Recordkeeping and monitoring business cash flow

The ATO has stated that it has “no concerns” with business owners banking their business takings or other sales in private accounts, but that this may become an issue when this income isn’t reported.

Therefore, the ATO notes that a good way to avoid this problem is to establish a separate business bank account and only deposit sales and other business income into this account, as this can help with record keeping and monitoring the business’s cash flow.

The ATO uses many tools to identify income earned and to check if it matches income reported, and reminds taxpayers that business income includes all sales, whether they’re cash or electronic (for example, internet sales), and they must all be reported on the business’s tax return (as well as any earnings for services the business provides).

If you are unsure about what income you need to declare, feel free to contact Omnis Group’s team in West Perth on 08 9380 3555.