Accounting, Tax / Compliance

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The Financial Year Has Just Ticked Over… What Do I Need to Do to Finalise Last Year’s Results?

By Todd Coppin

22 July 2025

Well yes, another year ticks over – was it a good one? What could I have done better? What do I need to emulate for this year and next? All good questions, but to answer these we need to close off last year and finalise the numbers. It should be done efficiently and accurately.

Business

Business taxpayers need to get their electronic records in order. To the accountant or business advisor, this means attending to:

Year-end bank statements – The key here is to make sure these balances agree with the accounting system reports. If not, it can indicate some serious processing issues.

Confirm the individual Debtors/Aged Receivables Report – It’s important that the accounting system accurately reflects who owes you money and how much. If inaccurate, it could lead to double counting of income and higher taxes.

Confirm the individual Creditors/Aged Payables Report – It’s important that the accounting system accurately reflects what money you owe at year-end. If negative amounts exist or there are amounts in the 90+ days column, it normally means that payments have been applied to the wrong invoices, meaning some suppliers could be paid twice.

Taxes and lodgement – Ensure that all tax lodgements have occurred, including the lodgement of the June BAS (or at least the preparation of it). For most taxpayers, this is generally not due for payment until 25 August 2025.

Stock – If a business buys and sells stock, then it’s likely this is the biggest asset of the business. Counting it and valuing it is therefore important. It should be done on 30 June (or as close to as you can, then plus or minus any purchases or sales).

Assets – Anything in my book with a useful life of greater than a year can be classified as an asset. For materiality, I apply one of two thresholds: for a small business it should cost more than $300; for a larger business it should cost more than $1,000. Capturing the assets purchased allows for the right tax treatment and shows how much you’re investing in the business.

Hire purchase loans – Many businesses borrow money to acquire assets under a hire purchase arrangement. Ensure all the repayments are allocated to the one account.

Individuals

Individual taxpayers need to get their documents in order to ensure they know what money is theirs and what belongs with the tax office. Here’s what to do now that the year-end has passed:

Income

Confirm all of your income – this is easiest for the ATO to match, so it’s best that you be on the front foot and tell them what you have (rather than the other way around). The types of income are:

• Employment income – income statements from employers
• Interest income – from banks
• Dividend income – from companies you’re invested in (including your own, if applicable)
• Trust income – from trusts you receive a distribution from (including your own, if applicable)
• Foreign income – some taxpayers may have overseas assets and receive income
• Government income – this could include an age pension or money from the government while you study
• Superannuation receipts – generally only applicable to those aged 60 plus
• Business income – applicable only if you run a business in your own name
• Rental income – and rental expenses too, of course
• Capital gains – sometimes you sell an asset and most times it’s taxable (unless it’s your home)
• Other income – the common example in this category is income protection receipts (hopefully it’s not common to those reading, as it will likely mean you’re injured)

Expenses

There’s a broad net here that includes:

• Work-related expenses (WREs) – if you have any, then ask the question of your advisor. It’s better to ask to be certain.
• Investment deductions – for example, you may have borrowed to buy shares or have bank fees on a bank account that earns interest
• Donations – these must be made to a DGR (Deductible Gift Recipient). Before making the donation, make sure the receipt will have words to the effect: “This receipt is for a gift/donation made to [organisation name], ABN [insert ABN], which is a Deductible Gift Recipient (DGR)” or “This receipt is for a gift.”
• Cost of managing tax affairs – amounts paid to a registered tax agent are tax deductible

This all helps clear out and clean up the previous year financially. Hopefully you already have an idea of your tax position before now, and this process merely crystallises the final numbers (either payable or refundable). If payable… don’t be too disheartened – it can mean you’ve made a good profit in some areas and have had use of the government’s money for a short amount of time. I agree we don’t want to pay more than we legally have to, but I also see the balanced view that it’s the price we pay for living in a civilised society. If it’s a refund, then spend it wisely!

Todd Coppin