Expecting a large company tax return? This is a great opportunity to re-invest in your business. Here are 5 ways you can use your return to deliver results.
As with any investment, the more you put into your small business, the greater the output will be. That’s why it’s important to think carefully about where you place your resources when it comes to running your company.
If you receive a company tax return this year, you’ll be faced with myriad opportunities on how to spend the money.
You can probably think of a hundred ways you’d like to use the extra cash. Yet, the reality is that making a wise decision now can reap you an immeasurable reward in the future.
Today, we’re looking at five smart ways that you can invest your company tax return back into your growing business. These options are easy to implement and provide a high ROI, helping you turn a little income into a big opportunity.
Ready to get started? Let’s go!
1. Reduce Your Debt
It might not be the most glamorous way to spend your company tax return, but it’s one of the most sensible: use it to help manage your debt.
It might come as no surprise that small businesses in Australia owe the Australian Tax Office (ATO) more than $13 million dollars.
If you’re part of this number, consider investing your return back into your business, using it to help lighten the financial load you’re juggling.
You might find it easiest to organise your debt by scale, from the lowest amount due to the highest. Then, you can begin to pay off the lowest balances first. Even just crossing one debt off your list, or significantly reducing it, can provide immediate relief.
Or, you may choose to tackle your debt based on which bills carry the highest interest rates. By paying these down up front, you’ll help ensure that any outstanding debt that’s left will carry a lower rate than you’re used to.
Regardless of the path you choose, this is an ideal way to make the most out of your return. It’s also one option that will leave a long-lasting, tangible impact even after the payments are complete.
2. Invest in Continuing Education
Another way to spend your company tax return is to invest it back into your most valuable asset — your workforce.
How do you do this? By providing your employees with opportunities to further their education, grow their skill sets, and add to their experience — and allowing yourself the same freedom.
The money you get back can be used to send yourself and those who work for you back to school to earn certifications, gain new abilities, and grow professionally. You can also apply it toward industry conferences, role-specific training, seminars, and more.
Industry research reveals that investing in employee development doesn’t just build stronger teams. It also creates loyalty, keeps teams engaged, and saves money in the long run by boosting employee competence.
3. Find Opportunities to Outsource
Is your customer service team pulling double duty in marketing? Are you, as the business owner, pulled in a million different directions as you try to balance administrative tasks with overseeing projects, finding new leads, and more?
Assigning more than one role to your employees might save money in the short-term. Yet, it can lead to dissatisfaction and reduced productivity over time. This can actually hinder your company’s performance and slow its progress.
This year, consider if you can use your company tax return to outsource any of these tasks, such as maintenance support or deliveries.
Doing so can alleviate overworked employees (yourself included) and help teams better focus on the jobs you hired them to do.
4. Upgrade Your Software and Systems
An industry survey reveals that 90 percent of customers would consider taking their business elsewhere if a company uses outdated technology.
More specifically, these customers want a tech-savvy experience when dealing with small businesses. In fact, 68% of customers believe modern technology (defined by most respondents as being less than five years old) is critical to small business success.
As such, if your business is currently using 10-year-old computers or an outdated phone system, chances are it’s time to upgrade.
For example, do your PCs still run on the 16-year-old Windows XP operating system, as more than 7% of the world’s computers do? If so, you may be able to use your company tax return to change this.
Take an audit of all the software and hardware your small business uses to keep operations afloat.
See if there are any weak spots that are holding you back from peak performance. Then, compare those to the amount of your tax return and see where you can make the most impact.
5. Add Perks and Lower Your Next Tax Bill
Did you know that in Australia, your small business could be eligible for a tax credit of up to $20,000 if you buy new equipment, software, or vehicles for your company to use?
The ATO offers initiatives such as these to encourage business owners to invest in their companies and employees.
Other tax-deductible purchases include company wardrobes, sun protection and other safety equipment, relocation expenses, subscription fees to industry journals, charitable donations, and more.
Choosing to implement any of these changes is a great way to take the money you’ve earned and re-invest it back into your small business. As you do so, you’ll not only save yourself some money in the future, you’ll also make your company stronger today.
Make the Most of Your Company Tax Return Today
Are you a small business owner in Sydney, Australia looking for advice as you navigate the journey to financial success? If so, we’d love to help.
We’re a professional accounting firm dedicated to helping our clients get the most out of every business investment.
From monthly accounting and tax plans to tailored advice designed to fit your needs, we provide it all. We’ll also take care of your bookkeeping for you, freeing you up to do what you do best.