If you drive a car, I’ll tax the street,
If you try to sit, I’ll tax your seat.
If you get too cold I’ll tax the heat,
If you take a walk, I’ll tax your feet.Don’t ask me what I want it for
If you don’t want to pay some more
‘Cause I’m the taxman, yeah, I’m the taxmanThe Taxman by The Beatles
Funnily enough, I’m not scared of the taxman because of what ‘he’ can take away, because I don’t have anything to take away. I’m just irrationally scared of anything that requires me to be responsible with my finances. I’m pretty good at paying bills, but hopeless at keeping my business records. I think it’s because I know made a loss over the last two years, so I just don’t want to see the evidence piling up!
In fact, every time I get the orange tax return forms out my blood pressure soars. I’m claiming a similar reaction to ‘white coat syndrome’, when doctors make their patients so anxious their pulse races and throws off the blood pressure results!
I’m going to let you in on a secret. Last week when I was getting my tax stuff ready to see the accountant (for the first time ever) . . . . I cried. Like a baby! I was just so freaked out about having to be accountable for my income and expenditure. Silly isn’t it?
You may be wondering why I went to the accountant last week, before the end of the financial year. Well, it’s because I still haven’t lodged my tax for the last two years – yikes! Yep, I’m so scared of dealing with my finances that I just don’t do them.
I really don’t have any good reason to avoid it. None of my tax affairs are particularly complicated. In fact they’re really straight forward. Even though I cried before hand, the accountant was really lovely and just calmly went through everything. I didn’t even need to look at those horrible orange forms as he entered everything online.
He said I might get a fine for filing late, unless I had a good reason. I asked him if being terrified was a good reason. He didn’t think that would cut it.
It was quite empowering talking to the accountant. Things really don’t need to be so difficult (or scary). It all just numbers and categories and stuff. I left feeling a lot better about preparing my 2012 tax return, and I’ve already made an appointment to return in July. Also this year I should be in the black so that will be a nice change!
So, no longer the ostrich, I need to tackle my finances head on and start being more accountable and less scared of dealing with them. This is a crash test in the making!
I’d love to hear your tips on how you keep your financial records and track your receipts. Over the next week I’ll be looking at some different options and will set up my accounting systems for the next financial year.
I’m so brave ;)
Laney x
Good Lord – are there still paper returns? I’ve been using e-tax for at least a decade. No forms, no fuss…a lot of the info is even pre-filled for you (health fund rebate, bank interest, Centrelink payments, stuff like that).
I use a simple spreadsheet of my own devising for my business income and expenses. I’m slack about keeping it up to date, but try to get to it once a month. All receipts go in a folder until I enter them in my spreadsheet and then they’re filed in one of those expanding thingies. It’s not sophisticated, but it does the job – I’ve looked at commercial accounting software, but those are all way more complicated than what I need.
I’m about to go into end-of-year mode and madly finish off my books, chase down any missing receipts and get organised to lodge ASAP.
I sympathise on the panicked feelings – I don’t have those issues with tax, but if I ever have to deal with Centrelink again, it’ll be too soon. I used to break into a sweat every time I had to fill in one of their stupid forms, and ringing them gave me nightmares. O_O
Kek’s last post..In my dreams
Hi Kek, thanks reminding me about e-tax. I have used it before, must look into it again. I like the sound of all the pre-filled info, that’s the worst part, looking around for everything.
I have a very simple spreadsheet too (that I keep forgetting to use). Interesting what you say about most accounting software being too complicated – I only have very simple needs. Probably ok with the spreadsheet – as long as I remember to use it!
Having married an accountant, here are a couple of tips – don’t turn up with a shoebox full of receipts – it will cost you more for him or her to go through them, write or type them up in a list and note what they are for so the accountant can confirm whether they are deductible or not.
Also, do not be afraid of the taxman or ATO unless you are deliberately trying to avoid paying your taxes – the ATO is reasonable and understands people make errors, but they will come down hard on you if you are trying to cheat the system. If you are struggling to pay taxes you owe, ring them or your accountant, they will more often than not, let you pay off what you can reasonably afford. Don’t just ‘not pay’ – it will cost you more in the long run
It is always worth the money to get an accountant, and please pay them on time because they have a family to feed too!
One last thing, don’t get pissed off if your accountant tells you that you can’t claim something, give him or her a kiss on the cheek and thank them for saving your hide!
Ash K’s last post..The Last Milestones
Thanks Ash! I have absolutely nothing to be afraid of. I don’t owe tax, my stuff is really straight forward. I’m just a big baby! I liked going to the Accountant. Totally worth it!
I’m not sure if there will be a fine to pay for late taxes as long as you don’t actually owe any tax…..
I have an Excel spreadsheet that I “try” and add expenses into as I go. Doesn’t often happen that regularly (boo hiss). Many of my expenses are regular though – same amount each month – so I can find them easily. I also write in my diary (yes, that would be a paper one) any time that I use the car for business. Makes it very simple to then flick back through and see what the travel was for and the distance. As I am a country girl those km’s add up pretty quickly. I have actually been pretty switched on with keeping receipts for the kid’s education stuff – only to find out last week that I don’t need them and that the School bonus happens automatically!
I use an accountant but I email him my Excel spreadsheet – means that it costs me less as it is all colour coded and with totals. He just has to manipulate the figures into the right boxes on the return.
Good luck!
Alli @ Ducks on the Dam’s last post..Home and away
I gave an excel spreadsheet to my Accountant too. I need to divide it up into appropriate categories though.
Can’t wait to see your ideas for keeping financal records. I’m good at the tax part but SUCK at keeping everything organised. I’m that crazy girl who has a box of this here and a box over there! Hubby hates it
Beck @ The Rambling Mummy’s last post..Glasses
Hmmm, so far I’m trying to keep it simple. I think Evernote will definitely feature in my solution!
I agree with Ash K, a shoebox full of receipts can indeed be very overwhelming. What I do is to list down everything in organized columns. (Those I cannot decipher goes to a misc column…) The secret is consistency. It may just be a minute or two everyday, but it’ll be totally worth it. I prefer little steps than a giant leap at the end of the month. =)
Great advice – consistent little steps. I’m going to try and work it into my regular routine :)