The Biggest Tax Mistake Aussie Small Businesses Make

Rushing your tax return could cost you more than you think. CPA Australia is urging businesses and individuals alike not to rush into lodging their tax returns too early this year, as this can lead to errors, missed deductions, and the need for amendments later.

“Cost-of-living pressures could mean some people are eager to lodge their tax return as quickly as possible to access a refund,” says CPA Australia’s Tax Lead, Jenny Wong. “But it’s important to be patient, gather your evidence and claim everything you’re entitled to.”

Why Waiting Pays Off

Last year, over 3 million Australians lodged their tax returns by 23 July, but CPA Australia warns that lodging too early can backfire. Early lodgers often miss important pre-filled data from the ATO—such as income statements, interest, and dividend details—which could mean inaccurate returns and extra paperwork down the line.

“There’s a misconception that lodging early means you’ll receive your refund first,” Ms Wong explains. “It’s common for people who lodge early to have to amend their returns later anyway, so it’s best to wait. It’ll save you in the long run.”

Avoid the Copy-Paste Trap

For small businesses, it’s crucial to avoid falling into the “copy-paste” trap. As Ms Wong points out: “Some people go into autopilot when they do their tax returns. They cut and paste from last year’s return and fail to consider any changes to their circumstances.”

Have you bought new tools, software subscriptions, or paid for training this year? Have you travelled for business and not been reimbursed for meals or travel essentials? It’s time to review and claim what’s relevant to your current situation.

Tips for SMEs This Tax Time

Here are CPA Australia’s top tips for small businesses:

• Keep your receipts: Don’t let them gather dust—check emails, apps, and bank statements for evidence of purchases.

• Review work-from-home expenses: Internet, printing, and office supplies could all be deductible—just make sure it’s legitimate.

• Use the right method: The actual cost method may suit you better than the fixed rate if you’ve kept good records.

• Log your business use of vehicles: A logbook or diary can help justify your business travel claims.

• Consider purchasing essentials before 30 June: Tools, subscriptions, and other legitimate business expenses can be deducted in this tax year.

Professional Help is Worth It

For those with complex situations—such as rental properties or crypto assets—CPA Australia recommends seeking professional advice. Remember, the cost of tax advice itself is deductible.

As Ms Wong says: “Getting your tax return right is your responsibility. That means declaring all income and claiming the appropriate expenses. Don’t exaggerate your claims, but also don’t miss out on what you’re entitled to.”

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