Square has recently teamed up with PwC offshoot Airtax to offer time-poor sole-traders and individuals an easy and affordable way to submit Business Activity Statements (BAS) and income tax returns.
Airtax now integrates seamlessly with Square Point of Sale, allowing your Square transaction data to be imported instantly into the Airtax app. The Airtax app then auto-populates your tax submission and lodges it directly with the Australian Taxation Office (ATO).
Airtax not only makes tax time simple but is also a huge time saver, completing a BAS submission in just 10 minutes. Square sellers who integrate with Airtax will also be eligible to submit their first BAS free* — that’s right, we said free!
Keeping on top of your tax requirements is key for any business, especially this time of year. That’s why we’ve asked Airtax tax specialist, Nigel Stivala, to provide his top seven tips to help you win at tax time.
7 Ways to Win at Tax
1. Stay on top of your paperwork
Keep a tax diary
Enter details of expenses on the date they were incurred. Keep details about how you paid, receipts, amounts and purpose. Doing this makes it so much easier when it comes time to complete your tax return. As a Square seller your payment records are already stored in Square, so that bit is easy.
Keep your receipts organised
Keep receipts or invoices for business expenses. When it comes time to do your taxes, your receipts or invoices will break out the GST and net expense amount, making it easy to see what you can claim when you do your BAS and/or tax return.
Consider using expense management software designed for sole traders. If you don’t have many receipts it might be easier to store them straight in your BAS or tax return. Airtax allows you to upload photos of your receipts straight from your phone so they’re easily managed and ready for tax time.
Keep a separate bank account
Keep a separate business account for your business expenses. Come tax time, review your bank statement to see all your business expenses in one place. Keeping your bank statements separate from your personal bank account makes it easy to know what’s what. You should also consider putting aside a portion of your earnings every month to pay for your taxes. That way you’ll be prepared when your tax bill comes.
2. Use an online tax lodgement service
Airtax provides help and tips specifically for sole traders and sellers, offering guidance through making the right claims and giving peace of mind that tax returns are being lodged the right way. This import feature on Airtax reduces manual data entry by importing your data from Square, the ATO and other third parties, which means your tax return can be done in minutes. If you have multiple income sources, Airtax guides you through the process of inputting your different incomes for tax.
3. Lodge on time
Know your tax lodgement dates and avoid late filing penalties. If you are GST registered you’ll need to do a monthly or quarterly BAS. If you need to complete an income tax return you’ll need to do so annually. Don’t believe all the hype — there are loads of myths around the correct tax deadlines, so make sure you know what’s what. Airtax sends out reminder emails before your tax is due and helps you secure an extension on your deadlines if need be.
4. Don’t miss out
Hundreds of thousands of dollars of tax savings are lost every year because of unclaimed expenses. If you’ve paid for it, and it relates (entirely or in part) to business use, then make sure you claim it. These are some of the most underclaimed expenses, which you can claim on your tax return if you’ve incurred them for business purposes.
We know that Square sellers have all sorts of different claims, so go through everything and check whether or not they were business expenses. Home office, accounting fees, travel, tools and equipment, laundry, income protection and business software and hardware are just some of the things you can claim. Oh, and did we mention that you can claim your Square processing fees?
5. Understand the tax nuances for your profession
There are certain commonalities that apply to some professions, which means there are certain things you might be able to claim or things you need to know when it comes to your tax return. Read these guides written specifically for different professions to get clued up.
6. Claim your fuel
A lot of people don’t claim fuel, for no other reason than “it’s too hard basket.” Set yourself up with a system that works for you and is easy to manage. Fuel can be a significant expense, so it’s worth properly recording to make sure you’re not missing out. Find out about the different ways to track your fuel, then choose a method that suits you and get into the habit of tracking and claiming whatever you use for business.
7. Take a tax health check
It’s a good idea to talk through your tax affairs with a professional to find out what you’re doing right, what you’re doing wrong and where you’re missing out on claims. Tax is complicated, and you might have been doing the same thing for years, believing it to be correct.
Working with an accountant to take a health check every now and then will highlight anything you should be doing differently. The Airtax Business Assist service puts you in touch with a certified PwC accountant to review your tax affairs and set you up correctly. It usually takes less than 45 minutes, and in that time you’ll gain the peace of mind that you’re doing everything the right way and getting back what you’re entitled to.
So, what are you waiting for? If you’re a sole trader, investing a little time now will help you get set up and on top of things come tax season. Sign up for Airtax to get help connecting your Square account and sorting your tax needs now.
*As part of this partnership, eligible Square sellers who sign up with Airtax will receive their first BAS submission free of charge. Airtax’s current retail price for a BAS submission is $49, with a tax return costing $99.