EOFY: Remember to Deduct Your Prepaid Expenses

The Cut-Off for Claiming Deductions is Looming

Dive deep into your claimable expenses and don’t forget all those smaller prepaid expenses like magazine subscriptions or domain name registrations – you can only claim all of these during the period in which they occurred.

WE’RE IN THE LAST QUARTER of the 2016/17 financial year, so now is the time to dive in deep and check you’ve included every single business expense — prepaid or otherwise — to ensure all your expenses are in order.

We’ve previously posted about writing off stock and inventory and the reports you’ll need to file your activity statements and tax returns: all of these you’ll learn how to run in our MYOB BAS Reporting and GST online training course or our Xero GST, Reporting and BAS training course.

Expenses reduce your taxable income

We all know this, but remember, they can only be claimed for the period in which they occurred. If you forget to claim a major business expense in the financial year that it occurred, you can’t make it up by claiming it the next year.

It’s really important you thoroughly check your credit cards and business accounts to make sure you’ve accounted for each expense. The final quarter of the financial year is also a good time to make any purchases for your business, because you can claim them straight away.

Prepaid expenses are often forgotten

Magazine or journal subscriptions, domain name registrations, business name registrations, car registrations, website fees, insurances — collectively they add up, but they’re also the easiest to forget.

These deductions are often prepaid and may not come up on your radar and may certainly not show up on your final quarter bank statements.

Make a list and check it twice

Over the next month or so, make a list of all of your expenses as you think of them. This makes it easy to spot them when you’re going through your bank and credit card statements and checking them against the expenses in your accounting software.

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Learn how to run the reports you’ll need for EOFY with our MYOB BAS Reporting and GST online training course or our Xero GST, Reporting and BAS training course.

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Steve Slisar

Steve Slisar has been training people how to use computers since 1994, opened a training centre in 1999 in Dee Why and by 2005 had 3 training centres and created over 35 individual courses that include Screen videos with audio commentary, training workbooks for those who prefer to read to learn, and exercise files that are used with the tasks in the workbooks so you get practical experience in the software you are trying to learn. Now the creator of 5 of the most popular online MYOB training courses in Australia.