Tax Returns for Barristers.
With over 20 years of experience helping barristers manage their tax and accounting affairs, Causbrooks accountants have helped everyone from Senior Counsel through to readers starting out in their first year.
We understand how your personal and business finances are interconnected. As a barrister running your legal business via the sole trader business structure, managing taxes means keeping accurate records, from business income to business expenses, and recording and collecting GST through your quarterly Business Activity Statement lodgements.
Our experts can guide you in claiming the right deductions to reduce your taxable income, ensuring you pay the correct amount of tax on your business profits.
Sydney-Based Tax Accountants for Barristers
Working with us means you have the support to manage your taxes and accounting, freeing you up to focus on your business. From setting up a business bank account to understanding super obligations, we're here to ensure your business is prepared for tax time.
If you're currently lodging your own tax return, speak to us today about the advantages of lodging via a registered tax agent, such as deferring when you pay tax.
Let Causbrooks Help Manage your Tax Obligations.
At Causbrooks, we recognise the importance of managing your sole trader tax return obligations and the impact this has on your legal business. Our aim is to simplify the process for you, ensuring full compliance with the ATO.
As a barrister, it's vital that you keep up to date with your annual tax return lodgements to ensure your ability to continue to practice at the bar.
Everyone has to pay tax, but there's no need to pay more tax than you are required to. Our income tax specialists can help you understand all the tax deductions you're entitled to, and some you may not be currently taking advantage of. A tax agent can keep you up to date when the Federal government changes the tax thresholds and explain how such changes may impact your taxable income.
Understanding your Tax Requirements as a Sole Trader.
Unlike business owners who operate via a company structure, sole traders pay tax at the individual income rate. Ultimately, sole traders pay tax on business profits. To determine your business profit, you simply deduct any business expenses from the total income for the year. Put simply, the more deductable expenses you pay, the less your profits, the less you pay tax on.
Tax Deductions.
As a barrister running your business via the sole trader business structure, there are many business expenses that are tax deductible, such as: rental of floor chambers, payments to clerks, robing and court attire, subscriptions to the Bar Association and the Law Society, PI insurance, Superannuation contributions, journals, law books, and loose leafes. For a more comprehensive list, read our article Tax deductions for barristers here.
Don't forget, your accounting fees are also tax deductible!
Superannuation Tax Deductions.
Under current tax law, a self-employed barrister isn’t required to contribute to a superannuation fund, however, many barristers set up contribution strategies to have regular amounts set aside for their superannuation plan. The maximum concessional contribution per annum per person is currently $27,500. Should this be made to a complying superannuation fund, the taxpayer can gain a tax deduction.
Industry-based funds have been established to cater for specific members, including those who work in the legal profession.
A Self-Managed Superannuation Fund (SMSF) is a regulated fund that’s established to gain more flexibility around the investment criteria of the fund. SMSFs require more active engagement; everything from making investment decisions to ensuring all the legal, taxation, and administrative obligations of the fund are met
If you don't currently have an SMSF but want to speak to a specialist about setting one up, visit our page SMSF Set Up and book your complimentary consultation today.
Reviewing your Financial Records.
Our specialists review your business's financial records to confirm all information related to your business income, expenses, and deductions is accurate and complete, enabling a hassle-free tax return process.
Managing the Paperwork and Deadlines.
Our team will help in preparing your tax return and ensure it's lodged with the Australian Taxation Office (ATO) by the due date, helping you avoid any penalties for late submissions.
Lodge your Business Activity Statement.
A Business Activity Statement, otherwise known as a BAS, is a form used by businesses to report and pay their tax liabilities to the ATO. A BAS is used to report on the Goods and Services Tax (GST) amount that your business has collected on its sales minus any GST that you’ve paid on your purchases, with the net difference being what you are refunded or required to pay to the ATO.
Your Business Activity Statement can also include Pay As You Go (PAYG) withholding and instalments, and other kinds of tax. To learn more about PAYG withholding and instalments, see our article here, and to learn more about Business Activity Statements, read our article here.
Lodge your Tax Return
We prepare financial statements and tax returns for sole traders, and can take care of everything from bookkeeping all the way through to lodging your tax return. If you have a separate business such as a farm, and you operate that business via a company strcture, we can prepare and lodge a company tax return for you as well.
Lodge your returns with Causbrooks
At Causbrooks, we re dedicated to helping businesses with their taxation and accounting needs. If you d like to discuss
your own situation, please complete the form below.
Our team of dedicated accountants is committed to providing the best possible experience for our clients, and we
believe that our combination of longevity and experience in the industry and our commitment to embrace innovation
and change make us uniquely qualified to do so.
Sole Trader Tax Return Due Date.
For sole traders in Australia, the financial year runs from 1 July to 30 June. If you're handling your own sole trader tax return, you'll need to submit it by 31 October, unless the Australian Taxation Office (ATO) advises otherwise.
Engaging a registered tax agent can offer flexibility, as they'll inform you of your specific due date.
Tax Return Penalties to Avoid.
For sole traders in Australia, the financial year runs from 1 July to 30 June. If you're handling your own sole trader tax return, you'll
need to submit it by 31 October, unless the Australian Taxation Office (ATO) advises otherwise.
Engaging a registered tax agent can offer flexibility, as they'll inform you of your specific due date.
Failure to Lodge on Time Penalty.
If your tax return isn't submitted by the due date, the ATO might impose a late lodgement penalty. This penalty is calculated at the rate of one penalty unit for each 28-day period that your return remains overdue, with a cap at 5 penalty units. As of 1 July 2023, each penalty unit is valued at $313, making the maximum penalty for late lodgement $1,565. In simpler terms, you could be facing a $313 charge for every 28 days your return is late, up to a total of $1,565.
Interest on Outstanding Debt.
Besides the penalties for late lodgement, the ATO may also levy interest on any tax debt that remains unpaid. This means the longer your taxes remain unsettled, the more you may end up owing due to the accumulation of interest charges.
Legal Action.
In extreme cases where tax debts are ignored for an extended period, legal action may be pursued by the ATO. This could potentially lead to a maximum sentence of 12 months in prison. However, such measures are considered a last resort. The ATO aims to provide ample opportunity for individuals to clear their overdue tax lodgements before escalating to legal proceedings.
If you expect your sales turnover to exceed $75,000 per year or wish to claim fuel tax credits for your business, you will also need to register for Goods and Services Tax (GST). To learn more about GST and in particular, how to claim a GST credit, read our article "Claiming GST Credits" here.
Lodge your Tax Return with Causbrooks Today.
Readers Guide: Setting up your Business.
Read our guide on what you need to do to set up your sole trader business and ensure compliance with the ATO's tax laws. We walk you through everything from applying for your Sole Trader entity's individual Tax File Number and Australian Business Number through to what software to use for tracking your business expenses and how to budget for your first tax bill. Use the link here to get our Readers Guide Ebook.
Tax Optimisation Strategies for Barristers.
Read our white paper on the various strategies barristers can use to optimise their taxes. Around half of Australian taxpayers are already using legal tax planning methods to their advantage, strategies such as negative gearing their residential properties or salary sacrificing super contributions.
There are many strategies that might help you reduce your tax liability, however, we have put together a special white paper just for barristers. If you want to do more than simply claim deductions to reduce assessable income, read our complimentary white paper today.
Disclaimer.
Any advice contained in this document is general advice only and does not take into consideration the reader’s personal circumstances. Any reference to the reader’s actual circumstances is coincidental. To avoid making a decision not appropriate to you, the content should not be relied upon or act as a substitute for receiving financial advice suitable to your circumstances.
Contact us today for a consultation.
Contact us today to learn more about how our accounting services can benefit your business. We look forward to hearing from you and helping you achieve financial success!
