3 tips for good record-keeping from the ATO
Make good record-keeping a habit
Record-keeping is a crucial part of any business. In addition to meeting your tax and superannuation obligations, having good records will give you a more accurate picture of your business to help you understand how you are doing, so you can spot potential problems sooner rather than later.
Here are 3 tips to make sure your record keeping is on point.
1. Don't miss a thing
Keep accurate records of all business transactions to support your claims and make it easier for you, or your registered tax or BAS agent. For example:
- all income (including cash, EFTPOS, credit or debit card, online sales and other payments you may receive)
- expenses (such as operating expenses, business travel expenses, and payments you make to employees and contractors including any cash wages)
- bank statements
- records of business purchases or use of business stock for personal purposes (to help you work out the business portion to claim as a deduction, and to account for the stock used)
2. Tailor a system to your business
Good record keeping doesn’t have to be hard; find a system that works for you. Get it right from the beginning to avoid making mistakes, but if you realise you have made a mistake you can still fix it. Here are some ways to make keeping records easy:
- keep records electronically (if possible)
- keep evidence of all transactions
- take pictures of your receipts to avoid faded records
- keep all business records including income, expenses and bank records
- keep your business records separate to your personal records
3. Use tools provided by the ATO
If you’re a sole trader with simple tax affairs, you can use the ATO app’s myDeductions tool to track your income and deductions throughout the year.
You can also use our Record-keeping evaluation tool to review your record-keeping practices from time to time and see if you're still on the right track.
- Read: Set up good record management systems
- Use: Financial policies and procedures management template
- Use: Cash flow forecasting template
Remember, without proper records you may not be able to claim what you're entitled to.
See Digital record-keeping for businesses for more information.