By Gafar Fadl, General Manager SMB, Nearmap, and Tish Bhagwandeen, Intuit QuickBooks Trainer Writer Network
Navigating the end of the financial year (EOFY) can be a challenging yet rewarding time for small businesses in Australia.
For small business owners, EOFY is a crucial period and this year might be more challenging than the previous – with changes made to taxation laws, tax offsets and concessions, and not to mention, the Australian Taxation Office’s (ATO) Single Touch Payroll (STP).
The past year has been marked by economic uncertainties, inflationary pressures, and changing consumer behaviour. Understandably, small businesses are approaching the new financial year with cautious optimism. However, it shouldn’t deter them from considering investing in business and technology solutions that can improve financial health, profitability, and overall success in FY24.
To help small businesses make the most of this EOFY season, Intuit QuickBooks, together with location intelligence company Nearmap, is sharing the top tips on how to make informed decisions, from cash flow management to tax planning and technology investments.
- Evaluate and Optimise Cash Flow
EOFY presents an excellent opportunity to analyse cash flow and identify areas for improvement. Review cash flow statements and identify any patterns or trends that might have emerged over the past year – are there months with lower cash inflow than usual? Or clients with a habit of late paying that need attention?
Embrace technology platforms and consider using accounting software or cash flow forecasting tools, which provide better visibility into one’s financial situation, automate payments, and make informed decisions regarding expenditures, investments, and opportunities for growth. By understanding cash flow patterns, small businesses can proactively plan for any potential shortfalls or surpluses.
- Leverage the Small Business Technology Investment Boost
Technology isn’t only for big organisations, but in fact, works to the advantage of small businesses. Technologies like artificial intelligence (AI) can drive exponential returns for small businesses, improve business processes and increase competitiveness more so than large cooperations.
Explore available grants and funding programs designed to support SMBs in adopting technology solutions. Especially with the Federal government’s recently announced Small Business Technology Investment Boost, there has never been a better time to look at technology improvements for the business.
Whether it’s in marketing, sales or operations, investing in tools and software can streamline operations, enhance productivity, improve customer experience, and reduce costs.
For example, Nearmap estimates a construction company could potentially save up to $34,100 per worker annually if they use technology to conduct just two virtual site visits per day, each of which would require a one-hour travel time if done in person.
Such technological advancements can provide long-term benefits beyond the EOFY period.
- Embrace Automation and AI
Look for opportunities to automate repetitive tasks, such as invoicing, payroll, inventory and resource management, and even project site assessments using AI-powered software solutions. Small businesses can free up valuable time and resources to focus on strategic business initiatives and reduce the likelihood of costly human errors.
On top of that, these tools can provide valuable insights into financial data, environmental factors, customer behaviour, and market trends. Armed with insights, small businesses can make data-driven decisions, identify growth opportunities, and mitigate risks. AI chatbots and virtual assistants can also enhance customer service by providing instant support and reducing response times.
AI may seem intimidating, but many technology companies offer user-friendly platforms designed specifically for small businesses. Seeking guidance from experts and invest in training will maximise the benefits of automation and AI for small businesses.
- Reduce tax liability
The loss carry-back offset was fundamental in enabling businesses to claw back some of their prior taxes. That strategy helped free up some cash flow so businesses could continue to invest in growing their operations and bringing technology projects forward. With this coming to an end no doubt many businesses will feel the impact of the increased tax liability.
This is really where small business owners want to sit down with their accountant to do some tax planning to fully understand the implications on cash flow and potential tax liability while staying compliant with tax regulations.
- Prioritise Payroll Compliance
With the introduction of STP and increased scrutiny from the ATO, maintaining accurate and compliant payroll records has become more crucial than ever.
Consider adopting payroll software that integrate STP reporting with features like integrated super clearing portals and automated industry awards to streamline compliance processes and drive efficiencies. This can help small business owners manage complex payroll requirements and ensure adherence to industry standards while minimising the risk of non-compliance.
The EOFY doesn’t have to be a difficult time for small businesses. By optimising cash flow, leveraging government incentives, reducing liabilities and prioritising payroll compliance — businesses can gain greater confidence in investing back into their business and embracing new technologies like AI and automation.
Collaborating with your accountant and engaging technology partners that understand your small business will help you navigate what is a critical and often complex time of year in your calendar — so you can enter the new year not with cautious optimism, but confidence in the growth and prosperity of your business.
Please note: the advice provided is general in nature, and it is recommended that small businesses seek professional advice based on their individual circumstances.
Bylined by Gafar Fadl, General Manager SMB, Nearmap, and Tish Bhagwandeen, Intuit QuickBooks Trainer Writer Network