Let’s face facts; nobody enjoys paying their taxes. For most of the lower to middle class, there’s often a general feeling that those with more disposable income receive more tax perks than those who are not as financially well-off. In short, the rich get richer and the poor struggle to keep up with the growing costs of living.
There’s also the common public opinion that our tax dollars are not used particularly well in a best-case scenario, and are downright abused by the government in a worst-case.
That being said, Death and Taxes, are a part of life and anyone who wishes not to incur the wrath of the Australian Taxation Office is required to lodge a tax return on an annual basis. To individuals and businesses, this is where your choice of tax accountant is critical. Your tax accountant needs to know as much about you and your business as they possibly can because this information will allow them to create a tax return for you that has a greater chance of returning maximum value to you by way of a tax refund (if you’re on a PAYG scheme) or tax deductions if you’re a business owner.
Good accountants (such as the staff here at GNS Group) should provide the right advice for you regarding your finances and tax-related affairs. This is the case for both the individual and businesses, ranging from start-ups to large corporations.
Common areas of advice that your accountant should advise you on are:
- Correct advice around what you can / can’t claim on your tax return
- Helping you decide what sort of entity your business should be structured under (for business owners)
- Knowledge of your business habits and any deductions – such as home utilities – you might be eligible for
- Generating accurate profit and loss statements
- Projecting areas within your individual or business spending habits to identify possible savings
- Offering advice around hiring staff and the implications around PAYG protocol if you are a business owner
- Advice around the most appropriate superannuation strategy for you
- When and if to change your business structure to minimise your taxes
- Being proactive in their consultancy with you, they are the experts after all!
- Identifying what areas of your personal / professional life (such as computers, phones and vehicles) that can be depreciated to help bring your tax bill down
Your tax accountant is an invaluable tool that you should leverage in your business. Important business decisions such as leasing equipment, a new car or even migrating / purchasing new office space should always be completed with the input of your accountant since they will be the ones trying to maximise any offset costs you might be eligible for. Large cities, like Melbourne, with populations into the millions and tens of thousands of businesses operating within its municipalities is definitely not short financial advisors. And it can be a challenge to choose the right tax accountant. Melbourne is also quite a progressive city, which means there are many financial practitioners working from home officers as sole traders or who are straight out of university.
Whilst none of these facts are a bad thing, when choosing your tax accountant, the person who will be acting on your behalf to the Australian government, there are several key things to consider.
How large is the firm you are considering? Bigger does not always mean better, but a consistent staff in a permanent office space shows that the firm is stable, typically meaning they have a stable client base. This is a good indicator of their service offerings, since their clients are remaining with them over time.
Does the tax accountant you’re considering have experience in your industry or line of work? If they do they could potentially introduce you to new strategies that could save you money come tax time.