A national survey, jointly conducted by H&R Block and Officeworks, found that only one in 10 SMEs could correctly identify items that can be claimed as an instant write-off.
The upfront tax deduction for SMEs with an annual turnover of less than $10 million was due to expire on 30 June 2017 before being granted a one-year extension earlier this month.
The survey also revealed that up to 46 per cent of SMEs believed that their accountant was proactive in searching for additional tax breaks for their businesses.
Seven in 10 SMEs relied on a accountant or bookkeeper to compile their business tax return, with 22 per cent believing these advisers could do more for tax planning opportunities to help their businesses.
“A lot of small business owners relegate tax to the ‘too hard’ basket and take little interest in tax matters. However, being more proactive and spending time on understanding the opportunities and overcoming their pain points, will benefit their business in the long run,” said Mark Chapman, director of tax communications at H&R Block.
“When identifying tax breaks for our clients, it comes down to the businesses’ preparation and organisation throughout the year. The research found that 50 per cent of small business owners feel they weren’t prepared, so there’s a huge opportunity for improvement.”
In addition, the survey found that the most stressful aspects around end of financial year are paperwork (39 per cent), cash flow (37 per cent), time management (30 per cent), and employee administration (24 per cent).
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Jotham Lian is the editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.
Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.