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Why Timing Matters: What Your Accountant Needs to Know (and When)

Let’s talk timing.

And let’s talk receipts.


Two things that can either save your business from stress or sink you into admin overload come tax time.


First, the timing…


Picture this: you’re in the car yard, ready to sign the dotted line, and you call your accountant and ask, “Should I buy this vehicle through the business?”


Here’s the truth: if you’re calling us while staring at the car, it’s probably too late to get the best advice.


We can absolutely help with tax implications — things like whether the vehicle should be purchased in your personal name or by the business, how it will affect your depreciation claims, GST credits, and running cost deductions.


But here’s the legal line:

As accountants, we can’t provide financial product advice — which includes recommending loan providers, interest rates, or what type of finance you should enter into. That kind of advice must come from a licensed financial advisor or broker.


What we can do is work with them (or you) to make sure the decision aligns with your tax position, cash flow, and business structure.


And we do our best work when the conversation happens before the paperwork is signed. So if you’re thinking about a major purchase — a vehicle, machinery, equipment or real estate — bring it up early. It gives us time to run the numbers and give you solid, strategic tax advice while there’s still room to move.



Here’s what you need to tell us early (and why):


🚗 Buying or Selling an Asset

We need:

  • A copy of the purchase or sale contract

  • A full tax invoice, showing whether GST was included

  • Details of any trade-in or deposit

  • If financed, the loan documents or chattel mortgage agreement


Why?

These affect depreciation, GST, capital gains, and how the asset shows on your balance sheet. If we get this info too late, we’re scrambling to adjust records at tax time.


🏦 Opening New Bank Accounts or Loans

We need:

  • Confirmation of the account purpose (business/personal)

  • Any loan contracts, including settlement dates and repayments

  • Details of any offset or redraw features


Why?

The ATO is matching bank data with reported income, and accounts linked to the business need to be reconciled properly. Missed interest expenses or double-counted deposits = red flags.


🔧 Major Repairs, Equipment, or Renovations

We need:

  • Invoices showing breakdowns of labour vs parts

  • Payment records

  • Clarification on capital vs repair for deductions


Why?

The tax treatment of repairs vs improvements can change your deductions by thousands.


🔄 Changing Your Business Structure

We need:

  • ASIC documents or trust deeds

  • Details of any asset transfers

  • Employee payroll transfer records


Why?

Getting this wrong can lead to double-taxation, incorrect reporting, and trouble with the ATO or Fair Work.


💳 Big Personal Transactions from Business Accounts

We need:

  • A note of what it was, and whether it’s a loan, drawing, or private expense

  • Proof if it was business-related but on a personal card


Why?

Clarity saves you from tax errors, ATO scrutiny, and confusion when reconciling later.


Now let’s talk receipts and recordkeeping…


This is no longer optional, casual, or "we’ll find it later." No matter how big or small the purchase — if you want to claim it, you need to prove it. This is one of the most common issues we see during audits, and it’s only becoming more critical as the ATO increases its data-matching capabilities.


The ATO requires businesses and individuals to keep receipts and supporting documents for five years from the date you lodge your tax return.


📣 The ATO has been VERY clear:

They are cracking down on dodgy deductions, over-claimed work-related expenses, and businesses who “guesstimate” their claims.


Here’s why:

  • The ATO can review and audit your return up to five years later.

  • If you amend a return, the five-year period restarts from the date of the amendment.

  • For depreciating assets (like vehicles or equipment), records must be kept for five years after the final claim — which may be well beyond the original purchase date.


This applies to:

  • Invoices and receipts for purchases

  • Proof of payment (bank statements, credit card slips)

  • Finance documents and loan agreements

  • Contracts for the sale or disposal of assets

  • Travel logs and vehicle use diaries (if applicable)

  • Logbooks for fuel use or home office claims


If you don’t have evidence, the ATO can disallow deductions, even if the expense was legitimate.



So here’s what you need to do — and keep:


✅ For all business-related expenses:

  • Keep a clear, legible tax invoice

  • Include date, supplier, ABN, description of goods, and GST amount

  • Note the reason for the purchase if not obvious


✅ For travel, vehicles, and fuel:

  • Keep a logbook if you use your car for work (you must renew it every 5 years)

  • Record litres, locations, and dates on fuel receipts

  • Include details of who travelled and for what purpose


✅ Where can you store this?

  • DEXT, Hubdoc, or Xero Files – scan and store receipts digitally

  • The ATO App also lets you track deductions on the go

  • Cloud drives like Google Drive or OneDrive (just ensure they’re labelled and backed up)

  • Old-school shoebox? We’ve seen it… but we don’t recommend it


Receipts and proof of purchase need to be kept for 5 years - the ATO 



Why all of this matters


When the ATO comes knocking — and they can and do — you need to have:

  • Records that match what you claimed

  • Proof that backs up your deductions

  • Clarity on what was business vs personal


If you don’t, you risk:

❌ Rejected deductions

❌ Backdated penalties

❌ Losing valuable write-offs that you were entitled to claim



Final thoughts from Me


We do our best work for you when we’re in the loop early, when we’ve got the right documents, and when your records give us a clear picture of your business.


So whether you're buying a new van, opening a savings account, or fixing the roof on your rental — tell us. We're not here to say no. We're here to help you make informed decisions that serve your future, not just your present.


Questions? Shoot us an email, give us a call, or bring it up at your next review meeting. We're here to help. Mel


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