How to Forecast and Assess Your Company Tax Position with a Simple Template

Check out the online course to learn how to forecast and assess your company tax position with a simple template

Access the course here

https://courses.morrisonabs.com.au/tax

Here are the 8 steps you need to go through. Once you have done this once, it will be quick and easy to update whenever you need to.

Step 1       Check Xero is accurate

                 In the bank reconciliation reports, check there are no outstanding payments or receipts that need to be cleared out

                 Check all reconciliations are up to date

2        Check whether your tax return is on an accruals or cash basis

                 Ask your accountant

                 Review prior year tax return and see if there are reconciliation items for debtors and creditors

3        Download profit and loss statement based on whether your tax return is on an accruals or cash basis

4        ‘Annualise’ the profit to calculate a full-year forecast

5        Add in year-end adjustments such as;

                 Depreciation

                 Hire purchase charges on car payments

                 Interest on loans

6        Add in tax return adjustments such as;

                 Entertainment

                 Increase or decrease in superannuation payable

                 Increase or decrease in other provisions (eg. annual leave)

7        Calculate forecast tax for the year

                 Tax at 27.5%

                      Take into account instalments paid during the year

8        Assess whether you have currently put aside enough tax