In this guide, we’ll discuss how to report your business income and ways to claim deductions, and other yearly reports or returns you may have to file. Let’s start:
Income Tax Return Lodgment for Your Business
You are required to file a tax return if you run a business, even if your business has not earned any income. There’s no threshold for business income. Depending on your type of business entity, you will come to know what you need to report and how you file your annual tax return for your business.
Sole traders
If you run your business as a sole trader, you need to file a tax return, even if your income doesn’t reach the tax-free threshold. In your return, you need to report:
- Your business income
- Business deductions you can claim
- Other income, such as wages and salaries, rental income and dividends
- Any deductions you can claim as an individual.
You can also seek help from business accountants Melbourne to file a tax return accurately.
Partnerships and partners
As an individual partner, you need to report on your individual tax return:
- Your share of any partnership net income or loss
- Any other assessable income, such as wages and salaries, rental income, and dividends.
- The partnership doesn’t pay income tax on the income it earns. Instead, you and each of your partners pay tax on your share of the net partnership income you receive.
Trusts and beneficiaries
If you are the beneficiary of a trust, you need to report on your tax return:
- Any income you receive from the trust
- Any other assessable income, such as
- Dividends
- Rental income
- Salary and wages
Companies
If you run your business through a company, the company must lodge a company tax return. The company needs to report its tax offsets and credits, taxable income, PAYG instalments, and the tax amount it is subject to pay on that income or the refundable amount.
PAYG Withholding Annual Reports
You need to file a PAYG withholding report at the end of each financial year if your business withheld amounts from payments to non-residents, employees, businesses that don’t quote an ABN, and foreign residents.
FBT Return Lodgments
You are required to lodge a fringe benefits tax (FBT) if, for the FBT year (1 April to 31 March), you either:
- Have FBT payable on fringe benefits you offered to your employees
- Paid FBT instalments through your activity statements.
If you paid FBT instalments and are owed a refund, you will get your refund after lodging your return. For accurate FBT lodgment, you can reach out to a Melbourne accountant so that they can timely lodge your FBT without any penalties.
If you are registered for FBT but you are not required to lodge a return, you need to send Fringe benefits tax – notice of non-lodgment to the ATO to prevent them seeking a return from you at a later date. You need to send your notice by the time your return would normally be due.
GST Annual Return
If you qualify to file an annual GST return, you need to lodge and pay any amounts owing by the date mentioned on the front of the return. This date will be the same date your income tax return is due to be filed. If you don’t need to file an income tax return, the due date will be 28 February following the end of the annual tax period.
Business Activity Statement (BAS) Lodgment
If your business is registered for GST, you are required to file a business activity statement (BAS). Your BAS will help you lodge and pay your:
- Goods and services tax (GST)
- Pay As You Go (PAYG) instalments
- PAYG withholding tax
- Other taxes.
When you register for an Australian Business Number and GST, the ATO will automatically send you a BAS when it’s time to lodge. You can use an online method to lodge BAS or seek help from a registered tax or BAS agent.
Conclusion
The blog shares information on rules for reporting and paying returns for businesses. If you need help in reporting and paying returns, you can reach out to Reliable Melbourne Accountants.