Why Your Accountant Should Be Talking to You Before May

For the majority of small business owners across Penrith and Western Sydney, the first real conversation about tax happens in May or June. By that point, the financial year is nearly over. The numbers are largely locked in, the options have narrowed, and the window for meaningful action has mostly closed.

The result is reactive decision-making — rushed purchases, last-minute super contributions, and a general sense of pressure that didn't need to exist.

This is a common pattern in small-business tax work. Effective tax planning is not something that begins after the financial year has closed; reviewing the position earlier gives a business more time to understand obligations, gather records and consider legitimate options before 30 June.

The Real Cost of Leaving It Until the End of the Year

When tax planning is deferred until May or June, business owners find themselves in a fundamentally reactive position. Time constraints create pressure, and pressure leads to poor decisions.

The most common consequences of late-stage planning include:

• Missed superannuation windows — contributions must be received by the fund before 30 June to count in this financial year, but the processing delays in late June create real risk.
• Rushed asset purchases — equipment bought purely to generate a deduction, without regard for business need or cash flow impact.
• No time for structural changes — if your business structure is inefficient, reviewing and changing it takes time that simply doesn't exist in June.
• PAYG underpayments catching up — if you haven't reviewed your instalments throughout the year, you may face a larger tax bill than anticipated.
• Stress — for many business owners, the end of the financial year is one of the most anxious periods of the year. Most of this anxiety is avoidable.

The businesses that wait until June are typically making decisions in two to three weeks that could and should have been made over two to three months. The quality of those decisions reflects that.

Why the February-to-April Window Is Different

By February, March and April, the financial picture is significantly clearer than it was at the start of the year. Trading patterns have stabilised, Christmas and January fluctuations have settled, and you have eight or nine months of data to work with.

This visibility is what makes planning possible. Without it, you are forecasting based on incomplete information. With it, you can make decisions with real confidence.

The key advantage of this window is time. Time to:

• Properly review your projected tax position
• Assess and vary PAYG instalments if needed
• Plan asset purchases that are commercially justified
• Structure superannuation contributions deliberately
• Consider whether your current business structure remains appropriate
• Review debtor management and cash reserves
• Make decisions calmly rather than urgently

Every one of these actions is more effective when it is given adequate thought and time. None of them are more effective when compressed into June.

What Your Accountant Should Be Discussing With You Before May

Your Projected Year-End Tax Position

The starting point for any meaningful tax conversation is a reliable estimate of your taxable income at 30 June. This requires up-to-date financials and a realistic view of what the remaining months look like. A good accountant will review your year-to-date profit and loss, factor in known upcoming income or expenses, and model out likely tax obligations.

This is not guesswork — it is informed forecasting that gives you a real foundation for every other decision.

PAYG Instalment Accuracy

If your income this year is substantially different from last year — higher or lower — your ATO-set PAYG instalments may be out of step with your actual liability. Overpaying ties up cash unnecessarily. Underpaying creates a surprise liability in June or July when you lodge your return.

A proactive accountant will review your current instalments against your projected income and advise whether a variation makes sense. This is a simple, low-cost adjustment that can have a meaningful impact on your cash position.

Superannuation Strategy

Superannuation is one of the most tax-effective tools available to Australian business owners, but it requires planning rather than reaction. Before May is the right time to review how much you have contributed this financial year, whether you have remaining concessional contribution cap, whether carry-forward provisions apply (allowing you to use unused cap from prior years), and whether any salary sacrifice or personal deductible contributions should be made before 30 June.

The tax saving from strategic super contributions can be significant, particularly for business owners with higher taxable income. But this planning must happen before June to be effective — contributions need to be processed and received by the fund before 30 June, which means leaving it until the final week creates unnecessary processing risk.

Asset Purchase Timing and Justification

If your business has been considering major capital purchases — vehicles, equipment, technology, fit-outs — the question of timing should be discussed well before June. The Instant Asset Write-Off provides an immediate deduction for eligible assets, but the asset must be installed and ready for use before 30 June to count in this financial year.

More importantly, your accountant should be helping you assess whether the purchase is commercially justified. A deduction that costs you $80,000 to generate a $30,000 tax saving is rarely a good decision if you do not actually need the asset. The conversation before May gives you time to think clearly, compare options, and make purchases that support your business — not just reduce your tax number.

Business Structure Review

If your business has grown, taken on significant assets, added employees, or changed in character over the past year or two, your current structure may no longer be optimal. Sole traders who have grown significantly may benefit from a company structure. Businesses with multiple assets may benefit from a trust arrangement for protection and flexibility.

Structure changes require legal and accounting work, ABN and registration changes, and careful transition planning. Starting this conversation in March or April means there is time to do it properly — either before or after year-end. Waiting until June eliminates most practical options.

Signs Your Accountant Is Not Being Proactive Enough

Not all accountants operate the same way. Many are primarily compliance-focused — they prepare your tax return accurately and lodge it on time, but they do not proactively initiate conversations about your strategy. This is a legitimate service, but it is not tax planning.

Signs that your current accounting relationship may not be working hard enough for your business:

• You have not heard from your accountant since your last return was lodged
• Tax planning conversations only happen in June
• Your accountant responds to your questions but does not ask any of their own
• You are not sure what tax you are likely to owe this year
• You have made significant financial decisions without consulting your accountant first

The standard for a good accounting relationship is higher than this. Your accountant should be a proactive adviser — someone who initiates contact, asks about your business, flags risks and opportunities, and helps you plan ahead.

How Proactive Planning Changes the Outcome

The businesses we work with who engage proactively before May consistently achieve better outcomes than those who do not. Not because they use aggressive or complex strategies, but because they make better-informed decisions, take action while they still have options, and approach the end of the financial year with clarity rather than anxiety.

Tax is a significant cost for most small businesses. A proactive, plan-first approach treats it as a manageable, foreseeable cost that can be legitimately reduced through good planning. A reactive, wait-and-see approach treats it as a surprise that arrives in June.

The businesses that build long-term wealth are overwhelmingly those in the first category.

What to Do Now

If you have not yet had a proactive tax conversation with your accountant this financial year, now is the time to start. Carmody Accounting works with Penrith and Western Sydney business owners who want to understand their position clearly before the year closes.

A review before May is not about complexity. It is about making sure you are using the time and options available to you — before they run out.

This article is general information only and does not constitute professional tax advice. Please consult a qualified accountant for advice specific to your situation.