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Lodge your tax return with TMS FInancials

At TMS Financials, we simplify your sole trader tax return, ensuring you understand and meet your tax obligations with ease. As a registered tax agent, we guide you through the intricacies of the Goods and Services Tax, payroll tax, and help you claim all the deductions you’re entitled to, ultimately reducing your taxable income and ensuring you pay the correct amount of tax.

We recognise that your personal and business finances are intertwined. Managing your taxes as a sole trader involves maintaining precise records of your business income, expenses, and GST via your Business Activity Statements. Our team supports you in staying compliant with your tax duties, from vehicle costs to home office expenses, ensuring you make the most of every tax deduction available.

Partnering with TMS Financials means you receive dedicated support to effectively manage your tax situation, allowing you to focus more on growing your business. We assist in everything from establishing a business bank account to understanding your super obligations, preparing you for tax time and ensuring you lodge your tax returns accurately and on time.

How TMS Financials can help with your sole trader tax return

At TMS Financials, we understand the challenges you face with your sole trader tax return. We are committed to making the compliance process simple and free from stress.

Assessing your tax obligations

We initiate our process by closely reviewing your individual circumstances as a sole trader. This includes analysing the type of your business, your business income, expenses, and all financial activities relevant to your tax obligations. Our aim is to ensure you fully comply with the income tax laws, helping you effectively manage your taxable income and business deductions throughout the financial year. This thorough approach ensures you are well-prepared to lodge your tax return accurately and on time.

Lodging your sole tax return

Our team will guide you in preparing and lodging your tax return through the Australian Taxation Office (ATO) portal. We ensure everything is filed correctly to avoid any issues with compliance.

Tracking deadlines

We keep track of all important lodgement deadlines to ensure your trust tax return is lodged on time. This proactive approach helps avoid any late filing penalties and keeps your trust in good standing.

Maximising your tax deductions

Our experts will thoroughly review your business’s financial records. This helps ensure all relevant income and deductions are correctly reported, which is essential for accurate tax return preparation.
With TMS Financials, you can be confident that your business’s tax returns are in capable hands, allowing you to focus on managing the trust’s assets more effectively.

Lodge Your Sole Trader Tax Returns with TMS Financials

Our team at TMS Financials specialises in providing personalised tax solutions tailored to your unique situation. We can help you navigate through the complexities of tax planning, identify the most effective strategies for your situation, and ensure you maximise your tax savings.

We’re an Australian tax accounting firm with 30+ years of experience serving business owners and investors. Our reputation for reliability and exceptional client service is built on providing accurate financial advice and asset protection. We remain committed to serving our clients with integrity, professionalism, and quality, and have the expertise to help you succeed.

TMS Financials is online now

We are a Sydney based tax accounting firm servicing clients Australia wide online since 1993

Eng Sivieng

Principal of TMS Financials

We strive to build long-term relationships with our clients and to be a trusted advisor for all their financial needs.

Effective management of Sole Trader Tax Returns

Understanding your sole trader tax return is vital for the success of your business. Our team is dedicated to helping you understand and manage the complexities of sole trader taxes, ensuring compliance with all Australian Taxation Office (ATO) requirements. We’ll assist you in accurately recording your business income and maximising your tax deductions. Whether you’re new to business or have years of experience, we’ll ensure you’re well-versed in your tax duties, from lodging your tax returns to optimising your tax deductions for better cash flow.

Streamlining financial management for Sole Traders

Good financial management for sole traders is crucial, involving more than just meeting tax requirements; it ensures the transparency and health of your business finances. We are dedicated to helping you understand the impact of your business activities on your financial position and tax obligations. By offering straightforward guidance and practical advice, our goal is to enhance your business’s financial health, helping you make decisions that not only meet your business objectives but also comply with tax regulations.

Strategic Tax Planning for Sole Traders

Managing your sole trader business effectively requires thoughtful planning, particularly regarding taxation. Our method involves a detailed analysis of your business transactions to pinpoint opportunities for increased efficiency and adherence to tax laws. Whether you’re starting out or are an established entrepreneur, our aim is to streamline the tax return process for you. This allows you to concentrate on achieving your business goals while ensuring precise and timely compliance with tax regulations.

Sole Trader tax return due date

In Australia, the financial year for sole traders spans from 1 July to 30 June the following year. If you’re managing your own sole trader tax return, it must be submitted by 31 October, unless otherwise directed by the Australian Taxation Office (ATO). Using a registered tax agent can provide more flexibility; they will notify you of the specific due date applicable to you.

Understanding tax return penalties for Sole Traders

Failure to Lodge on Time penalty

If you don’t submit your tax return by the due date, the Australian Taxation Office (ATO) may apply a late lodgement penalty. This penalty is calculated at one penalty unit for every 28 days your return is overdue, capped at five penalty units. As of 1 July 2023, each penalty unit is priced at $313, which means the maximum penalty for late lodgement can reach up to $1,565. Essentially, you could face a $313 fee for every 28 days your return is delayed, with a total potential penalty of $1,565.

Interest on outstanding debt

In addition to late lodgement penalties, the ATO can charge interest on any tax debt that isn’t paid on time. The longer your tax remains unpaid, the greater the amount you might owe due to accruing interest charges.

Legal action

In severe cases, where tax debts are significantly overdue, the ATO may take legal action. This could potentially result in a maximum penalty of 12 months in prison. However, such actions are usually considered a last resort. The ATO generally provides ample opportunities for taxpayers to resolve their outstanding tax issues before proceeding to legal measures.

Registering for Goods and Services Tax (GST)

If your business expects a sales turnover of over $75,000 per year or if you wish to claim fuel tax credits, you must register for GST. To learn more about GST registration and how to claim GST credits, continue reading our article “Understanding Goods and Services Tax (GST) and Maximising GST Credits“.

Advantages of paying tax as a Sole Trader:

Tax-Free Threshold

As a sole trader, your business income is treated as personal income, allowing you to benefit from the tax-free threshold not available to companies, which pay tax from the first dollar earned.

Simplified Tax Lodgement

Sole traders need to lodge only one tax return, whereas a company, as a separate legal entity, must lodge both a company and a personal tax return for its owners, potentially leading to double taxation. This simplification can lead to lower accounting fees and overall tax payable.

Small Business Income Tax Offset

The government offers a tax offset of up to $1,000 annually for sole traders. This is calculated based on the proportion of your business net income to your total taxable income.

Cost and Management

Sole traders enjoy the lowest setup costs and the simplest management structure among all business forms, making it an attractive option for starting entrepreneurs.

Disadvantages of paying tax as a Sole Trader

However, there are drawbacks. Operating as a company or trust may offer better opportunities for asset protection and tax planning, providing more flexibility in how you manage and protect your business assets and income.

Disclaimer

The information provided in this article is for general guidance purposes only and should not be considered as personalised tax advice. It is recommended to consult with a qualified tax professional to assess your specific situation and determine the most suitable tax planning strategies for your needs.

Contact us today for a consultation.

Contact us today to learn more about how our accounting services can benefit your business. We look forward to hearing from you and helping you achieve financial success!

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