Everything You Need to Know About EOFY: Key Dates and Deadlines
EOFY stands for “end of financial year” and is a very important time to review financial records and obligations, especially for small businesses.
Most importantly, it’s also an opportunity for businesses to claim any tax deductions and depreciation items to maximise tax benefits. In order to leverage your business expenses for tax purposes effectively, make sure you are familiar with all the benefits available to you and what the relevant deadlines for submission are.
It can be beneficial to meet with your accountant early, so they can help you get the most out of your tax benefits. Especially since these benefits change all the time.
But what is happening when? To help you stay on top of all the key dates and deadlines, here is everything you need to know about EOFY:
When is the EOFY in Australia?
The financial year in Australia goes from the 1st of July to the 30th of June of the following year. Therefore the end of financial year (EOFY) is on the 30th of June every year.
Employer Obligations
As a business owner you must provide payment summaries to your employees by the 14th of July at the latest. These will be sent directly to the ATO and will also be available to your employees via their MyGov.
Tax Return Lodgement
For your personal tax return, provided you are lodging it yourself, you have until the 31st of October to do so. If you are using a registered tax agent, you may have a later deadline. Usually until March of the following year.
Superannuation Contributions
If you want to claim a tax deduction for personal superannuation contributions, they must be made before June 30th. You will also need to allow a few business days for the funds to be processed by your superannuation fund. So, it’s best to make the transfer in mid June at the very latest. You can then lodge a Notice of Intent to Claim with your Superannuation provider.
They will send you a confirmation and deduct 15% tax on your personal contribution. This is a valid strategy to reduce your taxable income and pay less tax overall.
Tax Concessions for Small Business Entities
If you are a small business entity (turnover less than $10 million), you may be eligible for certain tax concessions, such as the instant asset write-off.
Be sure to review these with your accountant well before the end of the financial year. So you can make all the relevant claims and reduce your taxable income effectively.
Capital Gains Tax
If you have sold any assets during the financial year, you may be liable for Capital Gains Tax (CGT). It’s important to review your CGT obligations before the end of the financial year. If in doubt, make sure to ask your tax specialist for help.
PAYG Instalments
If you are required to pay PAYG instalments, the amount for the financial year is calculated based on your previous year’s tax return. These instalments are due quarterly throughout the year.
Depreciation
If you are claiming depreciation on assets, be sure to review and update their values before the end of the financial year. Your accountant can help you determine how much you can depreciate on your assets and for how long.
These are some of the key dates and deadlines for EOFY. For specific information about your own financial situation, it’s always best to speak with a qualified accountant or financial adviser.
Finally, the EOFY is a key moment for small business owners to make the most of any tax benefits.These benefits can help reduce your taxable income. Less money paid in tax can mean more money invested in your business!
Below are 6 strategies to help you reduce your taxable income before the EOFY:
It is important to note that you should always seek the advice of a tax professional to determine what deductions and tax reduction strategies are appropriate for your specific situation.
- Contribute to a superannuation fund: Contributions made to a superannuation fund are generally tax-deductible, up to certain limits. This can help reduce your taxable income.
- Claim work-related expenses: If you incur expenses related to your work, you may be able to claim them as deductions on your tax return. Examples of work-related expenses include uniforms, tools, and training courses.
- Make charitable donations: Donations made to registered charities can be tax-deductible. So consider making donations to your favourite charities to reduce your taxable income.
- Utilise government incentives: There are a number of government incentives available that can help reduce your taxable income. For example, if you earn less than a certain amount, you may be eligible for the low-income tax offset.
- Take advantage of deductions for investment properties: If you own an investment property, you may be able to claim deductions for expenses such as interest on your loan, council rates, and repairs and maintenance.
- Consider investing in relevant business equipment: If you need anything for your business consider buying it before the 30th of June EOFY deadline. Any big purchases in the pipeline, which can help reduce your taxable income. Plus you can also add these to the list of business expenses for depreciation. If you have a list of items you would like to buy, but are worried about your cash flow, you could consider a business loan, if your business meets the requirements.
