With the 2015 financial year gone and the new financial year just beginning, you’re likely in the middle of or are recovering from the stress caused by preparing / lodging your tax return. Keeping those receipts in a ‘safe place’ seemed like a good idea at the time, until you needed to collate them all together for your accountant. At the end of each tax year, you probably think you will try and become more organised for next tax year, however it is often easier said than done. We have put together 4 easy tips that we all agree will help you become more organised this tax year.
1. Create a record keeping system.
The key to staying organised is to devise a record keeping system that you and your employees have to follow. For example, you can define in your system the types of records that you have to keep (e.g. invoices, receipts, credit card statements), how long you should keep them (e.g. a minimum of five to seven years as required by the ATO), where you should keep them (e.g office filing cabinet, cloud storage), and how you should organise them.
Creating a system ensures that everyone is on the same page when it comes to managing financial records, and that these records can be accessed quickly and easily by those authorised to access them.
2. Use the ATO’s record keeping evaluation tool.
You’ll also be able to get more tips on how to keep your records organised with the help of the ATO’s record keeping evaluation tool. The tool, which you can access at https://www.ato.gov.au/Calculators-and-tools/Record-keeping-evaluation/, provides you with invaluable information on things such as records you have to keep and evaluating how well your business is keeping records.
It’s worth noting though that this is made for businesses, and as such it isn’t designed for super funds, non-profit organisations, or government agencies. Also, it only runs on Windows operating system (from Windows XP to Windows 8), so if you’re on a Mac or Linux, you may have to find another way to run the tool.
3. Make digital copies of your records.
The ATO requires businesses to keep records for a minimum of 5 years, however it does depend on your situation so it is best to speak to your accountant. It is a good idea to keep electronic copies of your financial records like receipts. Scanners are fairly cheap nowadays, so it’s a worthwhile investment to have one for your business. Also, keep backups of these scans on your computer, an external drive, or on cloud storage such as Google Drive or Dropbox.
4. Work closely with your accountant/bookkeeper.
It’s also important that you work closely with your accountant or bookkeeper. They will be able to provide you with valuable tips on how to stay organised and other ways to make dealing with the tax season easier on your end.
Overall, becoming more organised is all about creating a system that you and your employees will follow to help keep up to date with your financial records. Aside from that, it also helps to work with professionals who can give you advice on how to stay organised.
Written by Joe Del Borrello