While everyone loves a good EOFY sale and we eagerly look forward to a refund from the tax office, very few people actually enjoy getting their paperwork ready to complete their tax return. If you’ve got receipts in a shoebox and paperwork scattered all over your office, chances are you’d much prefer to have a root canal than think about the looming deadline. But it doesn’t have to be this way. So we’ve put together five ways to help make tax time easier.
1. Know your dates
This seems like such a simple statement. But do you actually know when your paperwork is due? Depending on your business structure, there are different dates for different lodgements (e.g. personal tax, company tax, BAS, superannuation contributions). One of the first steps towards taming tax time is being really clear on what needs to be submitted and when. Yes, you can put the dates in your online calendar. But they often sneak up on you without you realising. Instead, why not have an easy visual reminder of what’s coming up by using a simple wall calendar with different coloured dots, labels or tabs for each type of lodgement?
2. Filing that works
Everybody knows the key to tax time is filing different expenses away in different coloured folders, making sure your hard copy filing matches your electronic filing and scheduling weekly filing time so everything is in perfect date order. But does anyone actually have time for that? I think not. So what’s the best tax filing system for a busy person who likes to live a little? One you will use.
If you’re starting from nothing, begin with a simple folder and a set of pre-printed Jan-Dec dividers, and then file your paperwork at the end of each month. Your receipts can go into a labelled envelope and then be stored in a clear plastic wallet. This system can grow as your business does, and you’ll establish the good habits you need to keep it up to date. If you want something a little more detailed, you might want to think about creating your own customised tax binder.
Whatever system you choose, it will never relieve the stress at tax time if you haven’t made the effort to use it throughout the financial year. So make that small commitment once a month and your future self will thank you
3. Clear labels
Whether it’s your folder, receipt envelope or filing system, having everything clearly labelled makes things easier. You can be creative and colour-code them or you can keep it simple with black and white. Whatever design you choose, you’ll find the templates for the most popular labels here.
4. Storage solutions
Once everything is filed away and clearly labelled, give some thought to how you want to store your records on an ongoing basis. If you’re a small business that uses lever arch or other small folders, a bookshelf is all you need during the year. You can then transfer your records to an archive box or plastic storage for the time legally required (usually five years). If you’re a large company with lots of records, you want your filing system and storage system to work in tandem so you’re not double-handling or refiling records. As finding room for filing is always a problem in any office, a compact lateral filing system and cabinet is a good option. At the end of the financial year, when all your paperwork has been submitted, it’s simply a matter of loading them into archive boxes for onsite or secure offsite storage.
5. Get started
Now that you’re thinking seriously about tackling your taxes, it’s time to get started. And there’s no better time to start than the lead-up to the end of the financial year. That’s because most businesses can claim the costs of stationery and consumables as a tax deduction – including the brand new filing system you’re about to put in place. Our advice is to clear some time in your calendar to go through your office and find all the information you have – invoices, receipts, previous tax returns, important paperwork and documentation, etc. Gather it all together and assess the filing, labelling and storage you’ll need to get started. You can use the tips we’ve given you here to order what you need online and have it delivered to your door. Then it’s simply a matter of scheduling some time each week or month to keep on top of the filing and have you feeling happy and in control each tax time. Good luck.