Work: Everything You Need To Know About Tax!

everything you need to know about tax
As a small business owner, there are no shortage of financial details to keep straight. With limited staff and often no dedicated accounting department, it’s easy to get overwhelmed with the paperwork and not understand what your obligations are.

If you run a small business, you wouldn’t be the first one to get stressed and confused when it comes to sorting out these tax details each month. However, small business taxes do not have to be complicated. Thankfully, the Australian Taxation Office has made many improvements in simplifying the process of paying income taxes and calculating GST.

By getting yourself across these matters, you’ll be set to completing your taxes on time, with no stress – guaranteed.

Let’s look at what you need to know about taxation as a small business owner.

everything you need to know about tax

#1 – Work out your obligations to the ATO 

Based on the income tax assessment for your business, you will be provided with the specific monetary amount that your business owes the ATO. You will also be provided with a with a due date for this payment and a payment reference number. Tip: Sole traders can look at what their tax bill is through the ATO’s online portal.

If you run into cash flow problems and are unable to pay your tax bill, then you still need to fill out your tax returns on time. Inform the ATO about your situation and they will likely offer you options to proceed without being charged.

If you do not pay your outstanding tax bill to the ATO and do not file a tax return, then you will be charged interest on the amount you owe. The ATO will contact you about this and significantly, you will lose out on using future credits and refunds. You may even be contacted by a collection agency if you refuse to pay.

#2 – When to add GST?

The Australian goods and services tax (GST) is charged on most goods and services offered by businesses throughout the country. The standard rate is 10%, and as a business owner, you may need to incorporate this charge into your pricing.

You will need to register for paying GST if your business exceeds $75,000 or more in gross income (minus GST). Once you pass this threshold, you will have 21 days to submit a registration to the ATO. If you are starting out as a small business in Australia and you anticipate that you will surpass this threshold at some point in the year, then you can also pre-emptively register for GST to save time later on.

To register for GST in Australia, you will first need to apply for an Australian Business Number (ABN). Note, that if you fail to register for GST when you need to, then you may have to pay taxes on the items you have sold since the date that you were supposed to register. Keeping a close eye on your revenues each month will help you to avoid this situation.

#3 – Tariffs and excise taxes

Some items sold in Australia require tariffs or excise taxes to be added on to them. Examples of products that fall into this category are alcohol, tobacco and fuel. Producing or selling these items in Australia, or importing them to sell, requires payment of extra duties.

#5 – Consult with a tax professional

If you have more questions about the the nuances of taxation as it relates to your small business, then it is worthwhile to hire a tax professional to assist you. While the ATO has streamlined its services in recent years, you may take comfort from knowing that you have an expert on hand to assist you – at least when you’re just starting out.

MORE – 5 Awesome Money-Saving Tips Every Girl Should Know

MORE – 4 Useful Money-Saving Tips For Small Start-Ups

1 Comment

  • comebacks
    Reply comebacks Tuesday 18th October, 2011 at 7:09 pm

    I love tokyo fashion, this is no exception.

  • Leave a Reply

    Your email address will not be published.