Running a small business in New South Wales brings great rewards — and plenty of tax responsibilities. To help you stay compliant and minimise stress at tax time, we’ve prepared this step‑by‑step checklist for the 2024‑25 and 2025‑26 financial years. Follow these steps, and you’ll have confidence that your business is meeting its obligations while maximising deductions.
1. Make sure you have the right registrations
Apply for an ABN and business name
Before trading, your business needs an Australian Business Number (ABN). Without it, you can’t register for GST, lodge BAS or get certain tax concessions. If your annual turnover is likely to exceed $75 000, you must register for GST once you have an ABN. You can obtain an ABN through the Australian Business Register and register for GST at the same time.
When to register for GST
You must register for GST if your business turnover hits the $75 000 threshold or if you expect it to do so in your first year. Registration is also compulsory for ride‑sourcing and taxi operators, and non‑profit organisations when turnover exceeds $150 000. Once registered, you’ll need to lodge a business activity statement (BAS) and collect 10 per cent GST on most sales.
2. Understand and lodge your Business Activity Statements (BAS)
If you’re registered for GST, the Australian Taxation Office (ATO) will send you a BAS when it’s time to lodge. The BAS is used to report and pay several taxes, including:
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Goods and services tax (GST)
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Pay as you go (PAYG) instalments and PAYG withholding
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Other taxes
Lodging your BAS on time is crucial — it ensures you pay or receive the correct GST and PAYG amounts and avoids penalties. Most businesses lodge electronically, which can give you an extra two weeks to lodge and pay.
3. Plan for PAYG instalments
Pay as you go (PAYG) instalments are regular pre‑payments of tax on your business and investment income. Paying instalments throughout the year avoids a large tax bill when you lodge your return. In 2025–26, the instalments calculated using the “amount method” are increased by the GDP adjustment factor (currently 4 %). If your income varies, you can vary your instalments; review your cash flow regularly to avoid under‑ or over‑paying.
4. Keep up with superannuation obligations
As an employer, you must pay superannuation guarantee (SG) contributions for eligible employees at least quarterly. The SG rate increased to 12 per cent of ordinary time earnings from 1 July 2025. Ensure your payroll software uses the correct rate and that payments reach employees’ funds by the due dates; otherwise, you’ll incur the super guarantee charge.
5. Follow the rules for record keeping
Good record keeping isn’t optional — it’s a legal requirement. You must keep records of all transactions related to your tax, superannuation and registration affairs. The minimum information on each record should include:
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Date, amount and description (sale, purchase, wages, etc.) and any GST details
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Purpose of the transaction and the relationship between parties
The ATO’s five record‑keeping rules include keeping records for at least five years, ensuring they can’t be altered, and being able to produce them when requested. Accurate records help you monitor your business’s health, make sound decisions and avoid penalties.
6. Comply with payroll and reporting requirements
Single Touch Payroll (STP) requires you to report payroll information each time you pay employees. From 2024–25 onwards, you no longer need to issue payment summaries; instead, make a finalisation declaration by 14 July so your employees have their income statements. Check that your payroll software is STP‑enabled and up to date.
7. Common mistakes to avoid
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Failing to register for GST on time: Remember the $75 000 turnover threshold and register within 21 days once you exceed it
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Mixing personal and business finances: Use separate accounts to simplify BAS and tax reporting
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Not lodging BAS and PAYG instalments by the due dates: Late lodgement can attract penalties and interest
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Ignoring super guarantee rate changes: From July 2025, you must contribute 12 %
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Poor record keeping: Without detailed records, you may miss deductions or face ATO penalties
8. Additional considerations for NSW businesses
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Small business deductions: Keep receipts and invoices for deductions such as digital expenses, vehicle use and home‑based office costs.
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State payroll tax: If your payroll exceeds the NSW threshold, you may need to register for payroll tax. Check Revenue NSW for current thresholds and rates.
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Industry licences and permits: Some sectors (e.g. building, food) require additional licences. Ensure your registrations are current.
9. Let Carmody Accounting help
Navigating tax rules can be overwhelming. At Carmody Accounting, we listen, learn and act with purpose. Our Chartered Accountants help you:
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Choose the right business structure and registration
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Streamline BAS lodgements and PAYG instalments
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Update payroll systems for the 12 % super guarantee
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Implement cloud accounting to automate invoicing, receipts and record keeping
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Identify deductions and avoid common pitfalls