How small businesses can navigate the end of the financial year

This year there are a range of changes including Income tax cuts, a rise in the minimum wage and increased superannuation payments.

It's a big responsibility owning and running a business and a lot of small business owners tend to get around to dealing with these sorts of obligations at 10pm after all their other big responsibilities are attended to.

It can be easy to overlook new and changing laws, but it is essential small business owners and managers understand what has changed because they are responsible for passing on the correct pay rises and tax cuts.

Don't just assume it will be done for you and software programs and systems will automatically make those changes. Pleasingly, that's usually the case, but it is wise to check payroll and accounting systems have been updated.

If needed, we encourage talking with trusted advisers like accountants and bookkeepers and government agencies such as the Tax Office and the Fair Work Ombudsman have extensive resources to help.

The turn of the financial year is also a good time to not just have a stocktake but to take stock of the health of your business and yourself and to make use of the many helpful resources, tools and checklists available, including on our website asbfeo.gov.au.

Unfortunately, nefarious characters also seek to take advantage at this time of year, so please be alert to scammers trying to trick small businesses either by impersonating official agencies such as the Tax Office or by offering unrealistic deals.

Below, are some of the changes. It is not a complete list and other changes that may affect a business are specific to industry sectors or states.

The national minimum wage has increased by 3.75 per cent to $915.90 per week, or $24.10 per hour. Minimum award wages have also increased by 3.75 per cent.

One of the best resources is the Fair Work Ombudsman's pay and conditions ool: calculate.fairwork.gov.au and it's pay guides.

The Fair Work Ombudsman also provides a support service than can give employers written advice to help make sure they meet all their employment obligations. It is especially useful for smaller employers that don't have a human resource department or industrial relations specialist on staff.

For more information, visit fairwork.gov.au.

The Australian government has changed income tax rates and thresholds, delivering an income tax cut to workers.

Small business employers should ensure they have the updated tax tables from the Tax Office and check their payroll software is up to date to withhold the correct amount of tax. Employers are responsible for getting this right. The new tax tables are available at ato.gov.au/tax-rates-and-codes/tax-tables-overview.

The super guarantee has increased from 11 per cent to 11.5 per cent for all employees eligible to receive superannuation. The guarantee rate is legislated to increase to 12 per cent this time next year.

Small business employers need to use the new rate to calculate super on payments made to employees and should be aware it can apply if some or all of the pay period is for work done before 1 July.

The Tax Office is also warning employers to ensure SG payments arrive on time, as processing times for payments made through a clearing house can take up to 10 days.

Super contributions are only considered paid when the super fund receives them, not the clearing house. Late payments may face a penalty.

More information: ato.gov.au/businesses-and-organisations/super-for-employers.

Employers are required to finalise employees' single touch payroll data by July 14.

This is an important obligation because it ensures employees have the right information they need so they can lodge their own income tax return.

Employers must include all employees they have paid in the 2023-24 financial year, even those who are no longer on staff.

More information: ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/single-touch-payroll.

The Australian government has announced the instant asset write-off threshold will be $20,000 on a per asset basis for 2024-25 for eligible small businesses with a turnover up to $10 million.

Not all expenses are deductible. Typically, a business can claim day-to-day operating expenses, purchases of products or services for the business and capital expenses.

The Tax Office says there are three golden rules:

The Tax Office also has on its website a useful end of financial year checklist for small business and a tax time tool kit to assist small business to prepare their tax returns, which includes a directory of links to find information, tools, calculators and other support and resources.

When it comes to providing a vehicle for a staff member, business owners should make sure they understand fringe benefit tax rules. Some vehicles, like eligible electric vehicles, may be exempt from FBT while others, such as a ute, could attract FBT: ato.gov.au/carFBT.

The Australian Securities and Investment Commission has increased fees for registering, renewing and reserving company and business names. There's a wide range of price changes available at ASIC website: asic.gov.au.

Having the government as a customer can be fantastic for a small business and changes to Commonwealth procurement rules offer the promise small businesses will have an increased opportunity to win a government contract.

The Australian government has boosted the target for sourcing from small- and medium-sized business for contracts below $20 million from 35 per cent to 40 per cent. While the target for contracts under $1 billion has risen from 20 per cent to 25 per cent.

The government has also increased the SME exemption threshold to $500,000 to make it easier for government to buy from SMEs. New rules for panels will also hopefully increase opportunities for small and First Nations' businesses.

A new Environmentally Sustainable Procurement Policy has also come into effect, meaning if a business supplies goods or services to the government, it will be required to substantiate environmental claims and demonstrate compliance with the policy.

More information is available at: dcceew.gov.au.

A range of further workplace changes take effect over the next two months and small businesses should be prepared for changes to casual employment and new minimum standards and protections for 'employee-like workers' in the gig economy.

There are also new laws around the right to disconnect, although for small businesses with fewer than 15 employees this change does not apply until August 26, 2025.

More details and timelines are available from the Fair Work Ombudsman at fairwork.gov.au.