“Sure, I’d love to be spending more money than I need to be”…said no one ever. As a contractor, you’re your own boss, which also means you are head of finances too. End Of Financial Year (affectionately known as EOFY) can be a stressful time for small business owners, but the good news is, it doesn’t have to be.
As a small business owner we get it, not only are you juggling a million roles at once, but there’s also taxes, invoices and all that fun stuff to do. So, to take a bit of stress out of the equation, we’ve devised some quick tips on ways to save a few dollars here and there and to plan smarter for EOFY with your contractor business.
Start putting some money away for tax time
Nobody likes a unwanted surprise like a big old tax bill come June/ July, so it pays to be a bit cautious and set aside some funds for tax expenses. The exact amount you may need to pay, will be calculated from your earnings for that financial year.
Setting up a separate account to put your tax money away throughout the year, can help take the sting out of having to pay a large bill in one go. Who knows, you might surprise yourself and have some funds leftover to treat yourself with.
Have a chat to a financial professional
Chatting to a professional whether it be your accountant, tax agent or banker, is an investment in assisting with your contracting business and its financial path. These are people who know how the system works.
They might be able to give you some tips on what things you can claim at tax time, and practices you could do to improve your business and its overall financial position. EOFY is a great time to touch base and reassess any goals you may have for contracting business.
Invest in tools of trade for the long haul
If your contracting business requires the use of tools, it’s a good time to look at investing in high-quality ones that are going to stand the test of time. Forking out money to constantly repair or replace your tools will add up and can be an added expense your business doesn’t need.
Plus EOFY is a prime time for sales, so keep your eye out for deals that may save you a few dollars here and there.
Reduce your wasted materials
Take the time to assess how much wastage may be occurring when you’re working on jobs and how it could be reduced. This is going to also impact your outgoing costs when you need to order in materials for jobs.
This may involve a closer focus when it comes to project management, ensuring that you order the right amount of materials at the right time and if you require the assistance of sub-contractors, that you are scheduling them efficiently.
Invest in the assistance of technology
This is particularly important when it comes to financial side of things with the business. These days there are so many different types of integrated accounting systems that can work in with your other systems, saving you time and money.
There’s apps for invoicing or taking payments from customers on the go, all in the swipe of a button. Having a good system in place from the get-go, is going to assist, especially at tax time. The days of rummaging through shoe boxes for receipts is long gone!
Shop around
EOFY is a time to relook over some of your expenses and do some shopping around for a better deal. While you may be preparing your taxes, get out the details of your outgoings and start a research plan. Even if it only saves you a few dollars here and there, it all adds up.
Areas of your contracting business that you might want to shop around for include:
- Utilities
- Postage cost if your business requires a delivery service
- Business credit cards and loans
- Suppliers for stock
- Business insurance
Speaking of business insurance, when it comes to shopping around for business insurance options, save time and swing by BizCover. From Public Liability insurance* to Tool Cover* and Business Insurance*, we provide multiple quotes in the click of mouse, so you can get back to more interesting things like doing your taxes or running your contractor business.
Visit bizcover.co.nz and get insurance for contractor business without drama so you can get on with your day. If you’d prefer to pick up the phone and chat you can find us at 0800 249 268.
*This information is general only and does not take into account your objectives, financial situation or needs. It should not be relied upon as advice. As with any insurance, cover will be subject to the terms, conditions and exclusions contained in the policy wording. © 2023 BizCover Limited.
