A new American Express survey has found that a lack of understanding exists among SME owners over what tax concessions they are able to access this financial year, which may lead to them paying too much tax.
The nationwide Amex survey of more than 1,000 small business owners found that just 13 per cent of those surveyed believed they were completely up to speed with the existing tax breaks for small businesses. The number was slightly higher (21 per cent) among those business owners that prepared their tax returns without the help of an accountant.
“It’s clear from the research that many small business owners may be missing out on concessions that may assist their business in the next financial year,” Jason Fryer, Head of Small Business Services at American Express, says. “Depending on the size and activity of the business, the value of these concessions could be quite substantive. Understanding what tax concessions are available is just as important as being familiar with reporting obligations.”
Taxation expert and author, Adrian Raftery adds that learning what can be claimed as a business tax concession does not need to take up a lot of time, but it could save business owners a significant amount of money.
“From my experience one of the most common questions I get asked from small business owners is, ‘Is there something that we are missing out on in our tax?’. This research supports my belief that there are thousands of Australian business owners out there who are paying too much tax simply because they are not aware of what rebates and concessions they are legitimately entitled to.”
The Amex survey found that as small business owners gear up for their end of financial year obligations, they cited several causes of stress related to tax reporting. Topping the list were:
- Keeping track of all receipts and invoices (43 per cent);
- Worrying about inaccurate reporting (41 per cent);
- The amount of time tax reporting taxes (35 per cent); and
- Getting tax reports in on time (31 per cent).
“End of financial year tax reporting is always going to be an arduous task but there are many ways it can be made easier: use software to help collate receipts and record transactions or use a business charge card to separate business and personal expenses and to provide GST compliant itemisation for ease of reporting,” Fryer explains.
“Even small measures can help make tax reporting more efficient, accurate and less stressful. I encourage all small business owners to stick to their resolution, stay more organised and seek the help of experts when they need it,” Raftery concludes.
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