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Home > Blog > Considerations for Small Businesses Before the 30th of June: Navigating the End of the Financial Year

Considerations for Small Businesses Before the 30th of June: Navigating the End of the Financial Year

Date: 26 June 2024

The end of the financial year is fast approaching. We outline some areas of interest for small businesses.

Consider the following before 30 June;

Write-off bad debts

  • Your customer definitely not going to pay you? If all attempts have failed, the debt can be written off by 30 June. Ensure you document the bad debt on your debtor’s ledger or with a minute.

Obsolete plant & equipment

  • If your business has obsolete plant and equipment sitting on your depreciation schedule, instead of depreciating a small amount each year, scrap it and write it off before 30 June.

What’s changing on 1 July 2024?

Here’s a summary of the key changes coming into effect on 1 July 2024:

  • Tax cuts reduce personal income tax rates and change the thresholds.
  • Superannuation guarantee increases from 11% to 11.5% – check the impact on any salary package arrangements.
  • Superannuation caps increase from $27,500 to $30,000 for concessional super contributions and from $110,000 to $120,000 for non-concessional contributions.
  • Luxury car tax threshold increases to $91,387 for fuel-efficient vehicles and $80,567 for all others.
  • Car limit for depreciation increases to $69,674.
  • $300 energy relief credit for households comes into effect (credited automatically quarterly).

For business

  • $325 energy relief credit for small business commences (for small businesses that meet the relevant State or Territory definition of a ‘small customer’).
  • $20k instant asset write-off extended to 30 June 2025 (subject to the passage of legislation).

If you employ staff in your business

  • Please complete the ‘EOFY Finalisation’ process in your payroll software (MYOB, XERO, other) by 14/07/24 and lodge this information with the ATO. This replaces the previous process of hard copy handouts to employees of their Group Certificates.
  • Super guarantee contribution payments for the April to June 2024 quarter are due by 28/07/24.

Contractors & Subcontractors

  • Businesses in the relevant industries who make payments to contractors need to report these payments and lodge a Taxable Payments Annual Report (TPAR) by 28th August 2024.

ATO focus for 2024 income tax returns

  • There will be increased data matching for the sharing economy, meaning the ATO will have more information regarding your income from Airbnb, Uber, and other online hire platforms. It is recommended to have the right systems in place to record income and expenses and save tax receipts.
  • The difference between repairs & maintenance and capital improvements meanings; repairs & maintenance – expenses must relate directly to the wear and tear & capital works – is when you replace an entire asset with cost deduction spread over several years
  • Co-owned property – rental income and expenses must normally be claimed according to your legal interest in the property. Joint tenant owners must claim 50% of the expenses and income, and tenants in common according to their legal ownership percentage. It does not matter who actually paid for the expenses.

Should you have any areas for questions or concerns, don’t hesitate to contact our team.

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