New research commissioned by Intuit QuickBooks reveals that many Aussie SMEs stand to lose a potential $948 million in unclaimed expenses this EOFY due to what is called ‘Receipt Regret’, which means being unorganised with their receipt records throughout the year.
A total of 51 per cent of Aussie SME owners expressed regret of not being organised with their receipts, which has been attributed to the perceived laborious process of keeping records and being diligent in their tax records, something time-poor business owners without the right management systems already struggle with. And 19 per cent of SME decision-makers admit they feel anxious about doing their taxes this year, while 13 per cent are feeling overwhelmed. Only 36 per cent of SMEs feel prepared for tax season this year.
The research also noted that keeping accurate records of expenditure via receipts is proving to be difficult for SMEs, with 47 per cent admitting that their receipts have faded from the sun, while 42 per cent have misplaced or lost receipts during tax season. Almost a quarter of respondents, 24 per cent, said they have been unable to claim a business expense in the past due to paper receipts being illegible or damaged.
QuickBooks stress that, given the current cost-of-living crisis, every dollar counts and improving processes for already time-poor business owners has never been more important.
“For SMEs, using technology effectively to avoid receipt regret at tax time is more crucial than ever”, Damien Greathead, Accounting and Advisor Group Lead at Intuit Australia, said.
Additional time spent preparing for the end of financial year tax has also added stress for SMEs according to the report, with 23 per cent saying it affects their overall work-life balance. In detail, 25 per cent said they spend about 10 hours preparing for their tax return, while 13 per cent spend 15 hours or more. Surprisingly, 40 per cent reported taking on the task themselves by completing their tax return without the help of an expert advisor.
The research also showed that 33 per cent of the businesses surveyed want streamlined digital solutions (receipt management) and 29 per cent want more reliable storage methods to help improve efficiency at tax time.
“It’s concerning to hear that so many SMEs are experiencing this level of stress at tax time, because help is available,” Greathead said. “Small Businesses are the backbone of our economy, but so many small-business owners are time poor and burdened by admin tasks that impact their work life balance.
“Our advice to small businesses is, you don’t have to go it alone,” he added. “Working with an advisor in conjunction with reliable and affordable accounting software can make a huge difference to keeping on top of business admin and managing stress.”
