By Casey Gabriel and Nina Gill

The past 12 months have flown by. With one of the most challenging years behind us, there is no time like the present to get your taxes in order! We know this can be an overwhelming task, so we have provided 5 key areas to help you get started.

#1 - Stock on Hand

Whether this is livestock or inventory, if you haven’t already completed your end of financial year (EOFY) count, we suggest you make this task a priority. So what do we need?

If you have livestock, we require how many stock you’ve purchased, the natural increase figure, how many stock you’ve sold, how many stock have died, how many you took for private use and, finally, how many you have on hand at 30 June.
If you have inventory, we’ll just require a dollar amount of stock on hand at 30 June. One of the important factors of having an accurate EOFY stock figure is so that you can compare prior year figures and highlight any major variances.

#2 - Plant and Equipment

Have you purchased a new car, tractor, trailer, or any other type of plant or equipment this year? Get the invoices and any finance documents together ready to send to your accountant. Did you know you can send these to your accountant or bookkeeper when you make the purchase? They will save them, so they are ready to go at tax time and you don’t have to think about it again!

#3 - Single Touch Payroll (STP)

Any business that has employees should have completed their finalisation report by 14 July 2022. This is important so your employees can access their information to complete their income tax return. Before you send off your finalised declaration, you will need to check your STP information is correct and reconciles with your data file. You can check out the videos on our website (under the Resources tab). These videos show you how to do this for Xero, MYOB AccountRight and WageEasy. Otherwise, please contact your bookkeeper or accountant if you require assistance with this step.

#4- Reconciliation of Bank Accounts

Reconciling your bank account means matching the bank balance in your data file to your bank statement to ensure you have no outstanding cheques, you’ve not missed any transactions and you have no duplications. This might seem like a big job to tackle when you think about going through each transaction on your bank statement, but if you break it down into sections it can be less overwhelming. Start with your bank accounts and petty cash. Certain accounting software can download your bank transactions to save you time!

It is also good practice to check your debtors, payroll liabilities, advanced income, and any other liabilities every quarter to make the end of financial year job even less stressful. If you do not do your own bookkeeping, ensure you send your bank statements up until 30 June to your bookkeeper or accountant as soon as possible.

#5 - Investments

Do you have a rental property or have you sold some shares in the last 12 months? This section is for you!

Renting through a real estate agent: we’ll need the end of financial year statement and any additional out of pocket expenses not included on the statement. This may be interest charged on loan accounts, council rates, water rates and some repairs and maintenance costs.
Renting out your property through Airbnb: we will require all your income and expenses in relation to renting the property out.
Purchased or sold a rental property in the past 12 months: we’ll require your settlement statements from both the purchase and sale.
Sold some shares: you’ll need to dig out any purchase and sale information you have. If you no longer have the statements, at a minimum we’ll require the date, the number of shares and if possible the dollar amount for both the purchase and sale.

Remember you can always send purchase and sale documents or anything else you think your accountant might need throughout the year when you receive it. Doing this helps in the efficiency of completing your tax!

Hopefully these 5 points will help get you started in wrapping up the financial year and to help you keep good records in the future. For more information about getting tax ready check out this page on our website - Getting Tax Ready

Performance Reviews and Pay Rises

Do you use the CPI to calculate?

By Thomas Warner

With the new financial year here, it is a time that we typically see performance reviews and pay rises occur. But let me ask you - what is the basis for your pay rise this year? Do you use a set increase, do you have levels that your staff move through, or do you use CPI increases?

As you may have seen in the media recently, the average CPI increase in the last 12 months has been significantly higher than in the last few years at 5.1%. So, if this has been the basis of your wage increases for this financial year – is this the figure you have used?

But first - what is CPI?

CPI stands for Consumer Price Index and is a measure of the average change over time in the price paid by households for a fixed basket of goods and services. This means that as the costs of goods increase, CPI increases. The main contributors to this recent increase are items such as the rise in fuel, utilities and basic household groceries.

Should businesses be using CPI as a basis for increasing wages?

There are many factors to consider when answering this question. The first being that if your employees fall under an award and you pay at award rates, the award itself will set a minimum increase to wages. If your employees do not fall under an award or if you pay above the award rates then it is up to you to decide what increases you offer to your staff.

If, as a business, you decide to use CPI for your annual wages increase you need to consider that without a corresponding sales price increase on the products or services you provide then this increase at whatever amount will eat into the profit of your business. In addition to potentially increasing your wages, you also have to consider that the superannuation guarantee for employees has just increased from 1 July 2022 from 10% to 10.5% and that this will continue to rise by half a percent for the next 3 years until it reaches 12%.

If you feel comfortable to be able to make those kinds of increases then there is no issue with using the CPI increase for your wages. All we would suggest is to step back and ensure you have considered the effects of your wages increases across the business and to your margins before locking anything in.

If this is something you would like assistance with, please get in contact with us on 08 9841 1200 or info@lincolns.com.au.

Apply Now: Regional Economic Development Grants

Applications are now open for the next round of the state governments Regional Economic Development Grants (RED Grants).

The grants are aimed at injecting additional funds into regional projects where they believe there will be a local economic benefit. Grants of up to $250,000 are available for individual projects that increase or sustain jobs, expand or diversify industry, develop skills or capability, increase business productivity, or attract new investment to the Great Southern Region.

If you would like to apply check out the website or get in touch with us. Applications close Wednesday, 24 August 2022.

5 Ways to Prepare this Tax Time