advice Archives - RA Business Advisors

In today’s digital age, social media platforms like TikTok have become go-to sources for quick advice, including tax tips. Unfortunately, not all of this advice is accurate, and some of it can be downright misleading. For Australian small business owners, this misinformation can lead to costly mistakes. In this article, we will explore the dangers of relying on social media for tax advice and provide practical, accurate guidance for your business.

Why Social Media is Not a Reliable Source for Tax Advice

Social media platforms prioritize engagement over accuracy. Content creators on TikTok, YouTube, and Instagram are incentivized to produce content that goes viral, often sacrificing factual accuracy for attention. As a result, well-meaning business owners may follow incorrect tax advice without realizing the consequences.

Common Misleading Tax Advice on TikTok

Claiming Personal Expenses as Business Deductions: Some creators suggest that any personal expense can be written off as a business expense.
Incorrect GST Reporting Tips: Misleading advice on how to report GST can lead to underpayment or overpayment.
Exaggerating Deductible Expenses: Overstating what can be deducted as a business expense, which can trigger an audit.

Real Consequences for Small Businesses

Following inaccurate tax advice can have serious repercussions, including:

Penalties and Fines: The Australian Taxation Office (ATO) can impose penalties for incorrect tax filings.
Audits: ATO audits can be stressful and time-consuming, especially for small businesses without dedicated accounting teams.
Reputational Damage: Your business could suffer if stakeholders discover you have engaged in misleading tax practices.

How Small Business Owners Can Avoid Tax Mistakes

1. Consult with Qualified Professionals

Always seek advice from registered accountants and tax advisors who understand the latest ATO regulations and can offer tailored advice for your business.

2. Verify Information

If you see a tax tip online, cross-check it with reliable sources like the ATO website or speak to a professional before taking action.

3. Educate Your Team

Make sure your team understands the basics of accurate tax reporting to prevent costly errors.

How Our Firm Can Help

At RA Business Advisors, we specialize in providing reliable, accurate, and compliant tax advice to small and medium businesses across Australia. Our team of experienced accountants stays up-to-date with the latest ATO guidelines and can help you navigate complex tax issues without falling for misleading online advice.

Book a Consultation

If you have any questions about your business’s tax obligations, don’t hesitate to reach out. Contact us today to schedule a consultation and ensure your business is on the right track.

Conclusion

Don’t let TikTok or other social media platforms become your primary source of tax advice. The cost of following misleading information can be high, but with the right professional guidance, you can ensure your business remains compliant and successful.

Ready to take control of your business’s tax compliance? Contact us today.

EOFY is just around the corner, so business owners beware. If you haven’t gotten it done, there is still some time left! If you’re a start-up founder, then pay extra close attention as I guide you step by step into your first business EOFY.

Step 1. Get your ducks in a row

Getting your documents in order is absolutely crucial when that panic sticking EOFY rolls around. If you don’t know what your number looks like it’s hard to make a plan on what to do. As we keep telling you, we are XERO experts and we believe in most circumstances that is the best place to get your business numbers sorted. For a start-up, there may be more cost-effective options to get you going and we can guide you through that decision.

Step 2. Seek expert advice

Many problems arise when tax time comes around; the biggest one is lack of understanding. That’s why our taxperts (link) are well versed in all the laws regarding tax. We provide both taxation and business advice to arm you with all the knowledge you need. Penalties apply if your business isn’t compliant with legislation, so avoid unnecessary fees by talking to one of our advisors today!

Step 3. Claiming is the game

Small businesses that purchase new assets under $20,000 are eligible for a tax write-off to the full value of those purchases. Traditionally, you’d have to wait potentially say five years to realise this return but thankfully this upfront deduction has been extended. One catch: the assets must be purchased prior to EOFY and businesses cannot write-off expenditure that they are trying to also claim through an R&D tax incentive. Other deductions such as superannuation contributions (new rules this year) can also make a big difference to your tax bill.

Step 4. Be aware

Tax rule changes are as frequent as Christmas these days, no matter what they change every year. It’s critical that you stay up to date with these changes. Last year the tax rate for small companies dropped from 30% where it had been stuck for quite some time. This year the rate is 27.5% for businesses earning under $10 million and 30% for businesses earning more.

Step 5. Arm yourself

Before the technological age really took off, owning a small business was a living nightmare. Thankfully the ATO has kept up with the times by offering an endless supply of small business administration information. Or if you’re really a tech head, there’s an app for that. Check out the ATO website for information ranging from start-ups to large businesses. There is also a huge array of clever apps on the market that can help streamline your business and free up your time for the more important things in life.