What SME Owners Should Be Doing Financially Before EOFY
For many business owners, the weeks leading up to 30 June become a rush of accounts, invoices, deductions and tax planning.
But EOFY financial planning for business owners should involve more than reducing this year's tax bill.
It's also an opportunity to review whether the wealth your business is generating is helping you achieve your longer-term personal goals.
For SME owners in Perth, here are some of the key financial conversations worth having well before the end of the financial year.
1. Meet With Your Accountant Before 30 June
Don't wait until after the financial year has finished to discuss planning opportunities.
Once 30 June passes, some options may no longer be available for that financial year.
Consider discussing:
expected business profit
tax liabilities
deductible expenditure
depreciation and asset purchases
business structure
dividends or distributions
cash-flow requirements
capital gains or losses.
The purpose isn't simply to minimise tax.
It's to make informed decisions before deadlines remove your options.
2. Review Your Superannuation Strategy
EOFY can be a useful time to review your superannuation contributions.
Contribution caps, eligibility requirements and timing rules apply, so don't assume a strategy that worked in a previous year remains appropriate.
Ask:
How much has already been contributed?
Do I have remaining contribution capacity?
Am I eligible to use unused concessional contribution amounts?
Does contributing additional money fit my cash-flow requirements?
Are contributions aligned with my longer-term retirement strategy?
Importantly, don't leave contributions until the final minute. Processing times can matter.
3. Review Personal Wealth Outside the Business
A profitable year doesn't automatically mean your personal balance sheet is improving.
Look at your complete position:
Business assets + super + investments + property + cash – liabilities.
Has your net wealth increased?
Is most of the growth still occurring inside your business?
Could you withstand a significant downturn in the business?
EOFY provides a natural opportunity to measure progress from one year to the next.
4. Review Business and Personal Debt
Not all debt has the same purpose or financial consequences.
Review:
home loans
investment loans
commercial property debt
business loans
equipment finance
credit facilities.
Your accountant and financial adviser can help you consider how cash should be allocated between debt reduction, investment, superannuation and business reinvestment.
5. Check Your Investment Portfolio
Investment portfolios shouldn't simply be established and forgotten.
Consider whether:
your asset allocation has changed
your portfolio remains aligned with your risk tolerance
you have become overly concentrated in one investment
your objectives or timeframe have changed
your investment strategy still complements the risk you're already taking through your business.
Business owners can already have significant exposure to one company: their own.
That makes diversification particularly worthy of consideration.
6. Review Your Protection Strategy
Your income may support your household.
Your leadership may also support the business.
Ask what would happen financially if illness, injury or death prevented you from working.
EOFY can be a useful reminder to review insurance, estate planning, business succession and emergency liquidity.
These issues aren't as exciting as investment returns, but they can be critical to protecting long-term wealth.
7. Look Ahead — Not Just Back
Most EOFY conversations focus on the year that has finished.
Successful planning also looks forward.
Ask yourself:
What do I want my financial position to look like by next EOFY?
Perhaps you want to:
increase super
build an investment portfolio
reduce your mortgage
purchase commercial property
prepare the business for sale
reduce working hours
increase your cash buffer
begin succession planning.
Set measurable targets and review them during the year.
EOFY Financial Planning for SME Owners in Perth
For SME owners in Subiaco and across Perth, EOFY is an opportunity to connect business performance with personal wealth creation.
Your accountant may help you understand your tax position and business numbers. Your financial adviser can help connect those outcomes with superannuation, investments, risk management and long-term financial objectives.
When these conversations happen together — and early enough — EOFY can become much more than a compliance deadline.
It becomes an annual checkpoint on your progress towards financial independence.
This article contains general information only. It does not take into account your objectives, financial situation or needs. Tax and financial strategies should be considered with appropriately qualified professionals based on your individual circumstances.