Are You Prepared For The End Of The Financial Year?

22 March by Hope Etienne in Accounting

Are You Prepared For The End Of The Financial Year?

As the end of the financial year approaches on 31 March 2022, there are a few things to take a look at to ensure you are prepared. We’ve built a checklist of reminders to make sure that you don’t miss a step.

As a sole-trader or business owner, this can often be a stressful time of year, but you can help relieve some of this stress by ensuring that you have everything you need ready to go.

Here are some steps that are often missed out when it comes to preparing yourself for the end of the financial year:

Bad Debts

Compile a list of any unpaid invoices from customers that you consider unrecoverable.

Trading Stock

Complete a stock take on 31st March.

Work in Progress

Review any work in progress for jobs started but not complete as of 31st March.

Fixed Assets

Review your asset schedule and check for assets purchased, sold or written off during the year.

Accounts Receivable

Ensure you have billed your clients for all work that has been completed as of 31st March.

Accounts Payable

Check you have received all outstanding invoices for goods or services used by your business in the financial year.

Entertainment, Fines & Penalties and Legal Fees

Provide details of these expenses so your accountant can determine if they are deductible for income tax purposes.

You may also need to consider providing information for; home office expenses, motor vehicle expenses and company dividends (if any have been declared during the year).

If you have a rental property, have sold or are considering selling a property, you need to be aware of the changes to the interest limitation rules and bright line property rules respectively. These changes impact the amount of interest you can claim against your rental income and whether you are required to pay tax on the sale of a property. There are some exemptions so it’s best to talk to your accountant if you are unsure.

The end of the financial year isn’t most people’s cup of tea; there’s a lot to remember and it’s another item added to your already overfilled plate.

Once you have your end of year taxes complete, then it’s time to focus on your strategy for the year ahead and work towards those new goals you have set. Our business advisory team are ready to connect with you to assist you through the process of bringing those numbers on paper to life.

You can learn more about Lifetime Accounting and Business Advisory Services here.

If you aren't sure on where to start when preparing for the upcoming tax period, please reach out to Hope Etienne at 027 608 6526 or Hope.Etienne@lifetime.co.nz to arrange a chat with one of our team to point you in the right direction.

 

Disclaimer: This article has been prepared for the purpose of providing general information, without taking into consideration any particular investor’s objectives, financial situation or needs. Any opinions contained in it are held by the author as at the report date and are subject to change without notice.

 

 

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