Rightway - financial year

A fresh Financial Year - What does this mean for your business?

With the new financial year underway, RightWay Regional Accounting Manager Ashlea Stanford looks at steps you can take to streamline your accounting.

Hands up all who have already invoiced all work up to 31 March and have data from the 2020-21 financial year ready for your accountant? If that inspires some virtual feet-shuffling we completely understand.

We have so many customers who are busy working ‘on’ the business that they don’t have time to spend ‘in’ the business. This can mean that invoicing and gathering financial information is completed during ‘spare time’ or in a flurry just before it’s due. A frequent comment we hear from our trade customers is they’d like more time with family – and ploughing through invoices or doing payroll at 11.00pm isn’t healthy.

It’s also unnecessary, as there’s good trade-specific software which will do it for you. Most tradespeople have automated payroll systems now; if you don’t, then it makes sense to get one. The time it saves you should fully cover the costs.

For those still using paper invoices and paper diaries, it’s a good time to look at getting trade-focused job costing and management systems, such as Fergus or Tradify. These will automatically link with your accounting software and you can invoice customers immediately. Your accountant can provide you with guidance on the best software to suit your needs. Many accountancy firms, RightWay included, have a dedicated Bookkeeping and Payroll team. So, if you want further support, talk to your accountant about what admin they can take off your plate.

GST and Provisional Tax are due on 7 May 2021 and further tax payments on 28 August 2021 and 15 January 2022. If you’re facing challenges with paying, note that Inland Revenue is now providing more flexibility around payments – if you’re behind with GST or tax, you may be able to negotiate a repayment plan.

Accountants are also preparing to send out annual questionnaires to customers. They will need data, such as bank statements, loan statements, details of all money owed to your business, and what is payable, such as to electrical wholesalers and suppliers.

It's extremely important to be up-to-date on this, as well as with invoicing. Additionally, you must get your accounting software reconciled; in order to give you the best possible advice, your accountant needs to be looking at the current activity in your business rather than past data. This allows them to get a clear picture of the inner-workings of your business.

The minimum wage increased to $20 per hour on 1 April 2021 and the training minimum wage rate to $16 per hour. If you have an automated payroll system you should have been notified to update that. Be prepared that, with the increase, staff may be looking to negotiate pay rises. You can find out more about these increases here.

While most electrical firms will likely have been very busy, there is still some
COVID-19 related funding available. The IRD Small Business Loan is for businesses that have experienced a 30% decline in revenue. $10,000 can be provided, plus $1,800 per full time employee. This is interest-free and repayable over 2 years.

Moreover, there is the Regional Business Partner (RBPF) funding. Although the COVID-19 business advisory funding through RBPN has been fully allocated, there is still funding available to connect businesses with the right advice, people, and resources. RightWay is a registered service provider and can work with businesses on cash flow forecasting, business continuity, strategic planning, and human resources.

Each application is on a case by case basis, and a partner from the RBPN will conduct an interview with you on your business, your current needs, and evaluate your eligibility for funding.  A maximum of around $5,000 per business applies and the funding can be anywhere between $500 and $5,000.

To find out more and to register your business proceed to the RBPN website, or get in touch with us directly and we will take guide you through the application process.

If you would like further tips on managing your business, check out our free eBook, “10 tips for busy business owners”, here or get in touch with one of our team today – we're here to help!


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