The lead-up to EOFY can be both stressful and confusing. Understatement of the century, right? But things get even more stressful and more confusing when you are also juggling the financial complexities of running a business. A whopping seven in ten small business owners say EOFY is a stressful time for them, and more than half (55%) say it impacts their mental health and wellbeing, according to new research from Xero.
This year, it’s time to reclaim control of EOFY and put in place some smart — and simple — strategies that will prepare you for all eventualities.
Despite the huge diversity of industries that Australian small businesses operate in, there are a few common themes when it comes to EOFY challenges. According to the Xero research, trying to navigate tax compliance (33%) and gathering financial data (33%) are the biggest worries.
For Jasmine Strom, Senior Client Manager at Nexia Australia, she says her clients’ struggles are often more around a lack of understanding and trying to get everything done on time.
“I often find that our small business clients are concerned about how much tax they will pay for the year, as well as how much super they can contribute before year-end,” she says. “There are also questions around understanding what their profit is — and where the cash is going —- as well as how to best manage their year-end stock take.”
With Xero research finding that 89% of owners have experienced moments of doubt in the past 12 months, it’s no wonder so many are reaching out to financial experts to take some of the burden off their shoulders.
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So, what does the EOFY advice actually look like when a small business owner approaches an expert like Strom?
“One of the best things you can do for yourself as a sole trader or small business owner is to really understand the importance of tax planning,” she says. “Engage with your financial advisor prior to year-end so you give yourself enough time to action everything.
“Another easy task is to make sure your bank account is fully reconciled every week. Come June, that means you will be on top of your bank transactions and your advisory will have the most up-to-date information to assist with your tax planning.”
According to Xero’s research, some of the most common aspirations for small business owners in FY25 are to make their operations more profitable (61%) and either maintain or improve their happiness levels (48%). But a large percentage (89%) have one or more things holding them back, the biggest of which is economic uncertainty (53%).
The best way to alleviate these concerns is to get prepared for EOFY, so Strom has a few more hard-and-fast tips for what you can do:
Key dates to remember pre- and post-EOFY
18 June: Super must be processed by this date so there is enough time for the payments to be processed and allow the deduction within the 2024 financial year.
14 July: Single Touch Payroll (STP) finalisation is due.
22 July: Monthly BAS is due.
29 July: Quarter 4 BAS is due (if not lodging electronically).
26 August: Online BAS due (via a tax agent, BAS agent or electronic lodgment).
28 August: Taxable payments annual report (TPAR) due.
An unfortunate reality for business owners in Australia, according to the latest Xero research, is that the vast majority (86%) expect to encounter challenges in FY25, most commonly around being profitable (45%) and managing cash flow during lean periods (41%).
Strom says that while these concerns are valid, there are some steps you can take to set yourself up for a successful new financial year.
“There are some basic things like keeping track of your cash flow, preparing a FY25 budget and inputting it into Xero’s Budget Manager, as well as knowing exactly what you need to achieve income-wise to cover your expenses and your balance sheet outlays.”
But there are also other strategies that can help alleviate EOFY stress.
“Contact your finance broker and see if they can do a review of your current loans to ensure you are paying the lowest business interest rate,” Strom says. “This is also a good time to chat with your financial advisor about running a strategy session for the coming financial year.”
Importantly, Strom adds that an intuitive and user-friendly platform like Xero can make your life a whole lot easier at EOFY. As long as you keep your files up to date in the system, it will make your tax time much smoother.
“Xero has a lot of EOFY resources within the Xero learning channel, which will help small business owners who are approaching year-end for the first time. They have some fantastic checklists to work through to keep you on top of your obligations and due dates.
“There are also many Xero tools, features and connected apps that can be useful at year-end. From Xero Payroll and Superannuation Clearing, to connected bank feeds for all bank accounts and loans, to Hubdoc for ensuring all your bills are entered, to their Budget Manager and more.
“Speak to your advisor if in doubt and they will be able to guide you through the whole process.”
Read now: Take control of your cash flow with these simple tips
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