The blog shares the information to understand the record-keeping needs for businesses to meet your superannuation, tax and employer obligations. Being a business owner, it is important for your business to keep detailed records of all transactions in relation to your tax and superannuation affairs as you start, sell, run, close or change your business. Keeping and maintaining complete and accurate records for all your business transactions will help you handle the business and cash flow of your business. You can also opt for accounting services if you want to focus on your business rather than on business records and accounts.
Ensure you know the business record-keeping rules. In today’s blog, we’ll help you provide information on common business record-keeping rules and managing those records for your business. Let’s get started:
What are Common Business Record-Keeping Rules?
When it comes to business tax, you must have accurate and up-to-date records of all transactions. For this reason, the bank reconciliation process is extremely important. As a business owner, you are required to keep and maintain the records of all transactions related to your tax and superannuation affairs as you start, sell, change, run or close your business, specifically:
- Record of business’s income and expenses
- Any document that contains information regarding election, estimate, choice, or calculation you make for your business’s tax and superannuation affairs, including how the calculation was made
If you don’t know how to keep records regarding tax and superannuation, then you can take help from a tax agent Melbourne. To meet record-keeping needs and avoid errors, make sure you know what records are required for your business. Common information that needs to be recorded is:
- Purpose of transaction
- Amount, date and character and GST information for the transaction
- Connection between parties to the transactions
There are various accounting solution providers in Melbourne, and if you want to get rid of the burden of accounting solutions for your business, then you can take help from the best accounting firm in Melbourne from where you can take help from an accountant for your business.
Take a look at the following section to know five rules for record-keeping:
- First of all, you need to maintain all records relating to starting up, running, selling, changing or closing your business that are relevant to your tax and superannuation affairs.
- If your expenses are related to personal use and business use, ensure you have clear documents to showcase the business part.
- The appropriate information in your records shouldn’t be changed and should be recorded in a way that prevents the information from being modified.
- You have to restore your original data if your system of record-keeping changes over time.
- You need to keep and maintain records for five years.
- Basically, the five-year retention period for each record starts from when obtained the record, or completed transactions. However, in some conditions, according to the law, the start of the five-year retention period is different.
- In some situations, you have to keep records for over five years, including covering the review period for an assessment that utilises data from that record.
- You must keep all information about any routine procedures you have for ruining digital records.
- You need to show your records to the ATO if they ask for them.
- Ensure you maintain information relating to your record-keeping system so they can check whether it meets record-keeping requirements.
- Ensure that information on the records includes appropriate information to meet your tax, employer obligations and superannuation.
- If you record your data digitally
- Using an encryption system – give encryption keys and detail relating to how you can access the data when they ask. You need to ensure that the ATO can get and convert your data into a standard data format.
- To protect your record if you use passwords – give detailed information about how to access that record.
- Make sure your records are labelled, identifiable, or indexed as you record them. The legislative authority may have to extract it.
- Records must be in English or should be convertible into English.
These are five rules for business record-keeping. If you are not aware of these rules, then you can also take help from an accountant. If you haven’t hired an accountant yet, then you can search for ‘accountant near me’ to hire an accountant near your local area.
The blog is all about common business record-keeping rules and regulations. If you were not aware of these rules, then you can read all of the above rules for your business and keep yourself updated with these rules. Otherwise, it would be beneficial for your business to hire a professional and experienced accountant and for this, you can also contact Melbourne Accountants.