![\"\"](\"https:\/\/content.easyweddings.com\/wp-content\/uploads\/2021\/11\/successful-marriage-2-700x467.jpg\" "\\"\\"")
<\/p>\n
1. Know where you stand on the GST threshold<\/h2>\n
The impact of \u2018COVID catch-up weddings\u2019 has generated a higher-than-usual financial year 2021\/22 income for many industry suppliers, after almost two years of significant reduction. This increase in revenue has the potential to bump businesses over the annual GST turnover threshold of $75,000<\/strong> this year \u2014 perhaps for the first time.<\/p>\n In Australia, businesses must register for GST if they reach the $75,000 turnover threshold<\/strong>, or if it looks likely they will exceed the threshold in the current financial year. Once the threshold has been reached, the business has 21 days to register for GST.<\/p>\n A good rule of thumb is to check if you are coming close to $6,250 in any given month<\/strong>. If you look like you are coming close to reaching that amount, and you expect it to continue for a few months, it is probably time to consider registering for GST.<\/p>\n For business with an annual turnover below<\/em> $75,000, registering for GST is optional.<\/strong> However, once the business is registered for GST, the GST amount must be included in the fees regardless of turnover. On the flip side, the business may cancel its GST registration if its annual turnover drops below the $75,000 threshold.<\/p>\n \u00a0<\/strong>2. Budget through the year<\/span><\/p>\n If you are registered for GST, Josh advised thinking about tax as an operational cost of doing business, as you would any of your other operational costs.<\/p>\n \u201cWe often see in the first couple of years of being a sole trader can come into quite a bit of trouble when it comes to cash flow management around their tax obligations because you\u2019ve shifted into an area where \u2013 instead of those funds being dealt with on your behalf by your employer,\u201d Josh said.<\/p>\n \u201cYou\u2019re getting all the revenue into your bank account upfront, and it\u2019s up to you now \u2014 as a business owner \u2014 to work out how you\u2019re going to deal with those obligations.\u201d<\/p>\n Small businesses can get ahead of the ATO before tax time by managing their cash flow throughout the year, Josh advised<\/p>\n “Putting aside 30% of your revenue is a really great way to make sure you’re covering your tax as you go,\u201d he said.<\/p>\n This might be moving the funds to a separate bank account or keeping a record of earnings and mentally setting the money aside. This ensures the funds are readily available when they are needed at tax time.<\/p>\n For example, as a sole trader, if your business earned $100,000<\/strong> over the financial year (with no deductions), you must be registered for GST. If you set aside 30% of revenue throughout the year, that $30,000<\/strong> will cover most of the following components:<\/p>\n Businesses can claim the expense of COVID tests as a deductible business expense, (so long as you can demonstrate the test was a requirement of your working activities \u2013 which is generally relatively easy to satisfy).<\/p>\n As travel is generally an essential part of many wedding businesses, claiming motor vehicle expenses per kilometre can be beneficial – provided a log book or record is maintained.<\/p>\n Asset write-off is another deduction available to small businesses during FY22.<\/p>\n Home office expenses may also be claimed for income earners who have worked from home during the financial year. The ATO introduced its Shortcut Method<\/a><\/strong> during COVID to allow expenses to be claimed with minimal record-keeping. Income earners can claim 80 cents for every hour worked at home for the 2020-21 and 2021-22 income years, to cover operating expenses.<\/p>\n\n
3. Understand what you can claim, and what you can\u2019t<\/h2>\n
![\"unrealistic](\"https:\/\/content.easyweddings.com\/wp-content\/uploads\/2022\/02\/iStock-619665366-700x464.jpg\" "\\"\\"")
<\/p>\n