Business Tax Return Checklist for Small Businesses: What to Gather Before You Lodge

A business tax return checklist has three parts, and only one of them is documents. You need the year closed off properly — bank accounts reconciled, payroll agreed to what was reported, GST agreed to the BAS lodged. You need the source records for income, deductions, assets and vehicles. You also need to identify decisions that had to be made before 30 June, like a trust distribution resolution, which can’t be created retrospectively at lodgment time.

This article contains general information only and isn’t personal tax advice. Every business is different, so speak with a registered tax agent or accountant about your specific situation.

Start with the reconciliations, not the receipts

Missing documents aren’t usually what holds a tax return up. More often, it’s a set of books that hasn’t been properly reconciled.

Three reconciliations do most of the work:

1. Bank and credit card accounts reconciled to 30 June, with the closing balance in the software matching the closing balance on the statement. Not approximately — exactly.
2. Payroll reconciled to what was reported through STP, so gross wages, PAYG withholding and superannuation in the ledger agree to the year’s Single Touch Payroll reporting. Our STP guide covers what that reporting contains.
3. GST reconciled to the BAS you actually lodged, so the GST control accounts agree to the four quarterly (or twelve monthly) activity statements rather than to what the software thinks should have been lodged.

If any of these don’t agree, resolve the difference before collecting a single receipt. If the file hasn’t been reconciled first, you’ll often end up chasing the same documents twice.

The other pre-check is the suspense account — the one variously called “Suspense”, “Ask my accountant”, or “Uncategorised”. Anything sitting there at 30 June is an unmade decision, and every item in it will eventually come back as a question. If yours has a year of transactions in it, our catch-up bookkeeping guide is the more useful starting point than this checklist.

Income records

• Sales and revenue reports from your accounting software, for the full year to 30 June.
• Merchant and platform settlement reports — Square, Stripe, Shopify, Uber Eats, marketplace statements. These matter because the money that lands in your bank is net of fees, while the income you report is gross. The fee is a deduction, not a discount on income.
• Interest income on business accounts and term deposits.
• Government payments, grants and rebates, with documentation of what each one was for — treatment varies and can’t be assumed.
• Asset sale proceeds, including trade-ins, which are frequently netted against a new purchase and then reported as neither.
• Dividends, distributions and rental income received by the entity, with statements.
• Any income received in cash or in kind, including barter or contra arrangements.

When a ute is traded on a new one, the paperwork usually shows a single net figure to pay. For tax purposes there were two events: a disposal and an acquisition. The disposal also has consequences for the asset register. It’s something we regularly see missed, even in otherwise well-kept files.

Expense and deduction records

• Purchase invoices and receipts for operating expenses, ideally attached to the transaction in your accounting software rather than filed separately.
• Supplier statements for the major accounts, useful for catching invoices that were never entered.
• Loan and finance statements covering the full year, showing the interest and principal split — only the interest portion is deductible, and the principal is not an expense.
• Insurance policies, including any premium funding arrangements.
• Rent and outgoings for business premises.
• Subscriptions and software, which have a habit of accumulating on a personal card.
• Professional fees — legal, accounting, consulting. Some legal fees are capital rather than deductible, so keep the engagement letter, not just the invoice.
• Bad debts, with evidence they were written off before 30 June rather than merely doubtful.
• Interest and penalties charged by the ATO, which are treated differently from each other and need to be identified separately.

Assets, depreciation and the instant asset write-off

Start from the asset register and work outward. For the year, you need:

• Purchase invoices for every asset acquired, showing the date, the amount, and the GST.
• The date each asset was first used or installed ready for use — which is the test that matters, not the purchase or payment date.
• Details of assets sold, scrapped or traded in, including proceeds.
• Finance documentation for anything acquired under a lease, chattel mortgage or hire purchase, because the tax treatment follows the arrangement type.

The $20,000 instant asset write-off applies for the 2025–26 income year to businesses with aggregated annual turnover under $10 million, allowing an immediate deduction for the business portion of eligible assets costing less than $20,000, where the asset was first used or installed ready for use between 1 July 2025 and 30 June 2026. The limit applies per asset, so multiple assets can each be written off. Where an asset written off in an earlier year has been improved, the first improvement cost can also be immediately deducted if it was incurred in that window and is under the limit.

The instant asset write-off also isn’t automatic across every asset type — some assets are excluded from the simplified depreciation rules entirely, so an eligible business isn’t the same thing as an eligible asset.

Motor vehicle records

Vehicle claims are an area where record-keeping often becomes an issue. The claim is sometimes worked backwards from an estimate rather than supported by records kept during the year.

There are two methods, and the evidence is different for each:

For the 2026–27 income year, the cents per kilometre rate rises to 91 cents — a base rate of 89 cents plus a one-off 2 cent uplift — which is worth knowing when you’re deciding whether to start a logbook now.

Something we see across trades and mobile service businesses: the vehicle usage genuinely changed — a second van was bought, or the owner moved from quoting jobs to running the office — and the logbook from four years ago is still doing the work. The percentage it produces was accurate once. It isn’t describing this year.

Working from home and home-based business

If the business operates from home, keep records of the areas used and the basis of any claim. Two categories behave very differently:

• Running expenses — electricity, heating and cooling, cleaning, internet and phone — attributable to business use.
• Occupancy expenses — rent, mortgage interest, rates, insurance — which are only claimable in narrower circumstances, and where claiming can have capital gains tax consequences for the main residence exemption on the property later.

A claim that saves a few hundred dollars a year can affect the CGT position on a family home years later. Check the position before claiming occupancy expenses becomes a regular practice.

Payroll and superannuation

• STP finalisation completed for the year, so employees’ income statements are marked tax ready.
• A reconciliation of wages, PAYG withholding and super in the ledger to the STP reporting.
• Superannuation payment confirmations, showing the date each contribution was received by the fund.
• Records of any contractor payments where you’ve had to consider whether the person is genuinely a contractor — our contractor vs employee guide covers where that line sits.
• Taxable payments annual report (TPAR) details, if you’re in a reporting industry such as building and construction, cleaning, courier, IT or security services.

Since Payday Super took effect on 1 July 2026, the timing evidence matters more than it used to. Keep the confirmation showing when the fund received each contribution, not just when the payment left your account.

Stock, work in progress and debtors

• A stocktake at 30 June, with the valuation method used, for any business carrying trading stock.
• Work in progress for businesses billing on progress claims or milestones — the classic gap in construction and professional services, where work performed by 30 June hasn’t yet been invoiced.
• A debtors listing at 30 June, reviewed for amounts that are genuinely uncollectable rather than merely slow.
• A creditors listing at 30 June, so expenses incurred but unpaid are captured in the right year.

Progress claims can easily put income into the wrong financial year if the work and invoicing fall on opposite sides of 30 June. Our trades cash flow guide covers how variations and retentions move between periods from the cash-flow perspective.

Loans, drawings and Division 7A

• Loan agreements and statements for every loan into or out of the business, including from related parties.
• A summary of drawings and personal expenses paid through business accounts.
• Director and shareholder loan account movements for companies.

If you operate through a company and money has moved to a shareholder or an associate, Division 7A is on the checklist. Two mechanics to know:

• The loan needs to be on complying terms, with an interest rate at least equal to the benchmark interest rate for the income year — based on the RBA’s standard variable owner-occupier housing rate last published before the year started.
• Minimum yearly repayments must be made by 30 June of the year they’re due. A shortfall is treated as a Division 7A dividend in that year.

This is another 30 June item. It is easier to deal with a minimum yearly repayment when it is planned before year end than when the shortfall is found in November.

Trusts: the 30 June resolution

If the business runs through a discretionary trust, one important checklist item had to be completed before the year ended.

A trustee resolution is only effective for determining who is assessed on the trust’s net income if it makes one or more beneficiaries presently entitled to trust income by 30 June. A written record is essential where you want to stream capital gains or franked distributions to particular beneficiaries. Where no valid resolution is made, the trustee can end up assessed on the trust’s income at the top marginal rate.

So the checklist item at lodgment time is simply: produce the signed resolution, dated on or before 30 June, together with the trust deed. If it doesn’t exist, that’s a conversation to have immediately rather than at lodgment.

Concessions worth checking before you lodge

• Small business income tax offset — for sole traders, and for individuals with a share of net small business income from a partnership or trust, where aggregated turnover is under $5 million. The maximum is $1,000 per person per year across all small business income, and a net loss is treated as zero.
• Base rate entity status for companies. The 25% rate applies where aggregated turnover is under the threshold for the year and no more than 80% of assessable income is base rate entity passive income. Both tests, every year — it isn’t a status the company keeps.
• Simplified depreciation, including pooling, for eligible small businesses.
• Small business CGT concessions, if any business asset was sold during the year. These are valuable and conditional, and worth flagging early rather than at lodgment.
• Prior year losses carried forward, with the records substantiating how each was calculated.

What changes by business structure

The lodgment mechanics differ too — the channels, due dates and access requirements aren’t the same across structures. Our guide to how to lodge a business tax return walks through those.

What to keep afterwards, and for how long

Lodging isn’t the end of the record-keeping obligation.

Most tax and business records need to be kept for 5 years, starting from when you prepared or obtained the record, or completed the transaction it relates to — whichever is later. Some run longer: depreciating asset and CGT asset records generally need to be kept for as long as you hold the asset, plus another 5 years after disposal.

And employee time and wage records sit under a separate 7-year Fair Work requirement, so employee records can easily be discarded too early if everything is kept on the same five-year schedule. Our record-keeping guide sets out each retention period side by side.

Common gaps we see at lodgment

• Trade-ins recorded as a net purchase, so the disposal never reaches the asset register.
• Merchant fees netted off income, understating both revenue and deductions.
• A logbook that no longer reflects how the vehicle is used, kept in service because redoing it is a twelve-week commitment.
• Assets bought in late June but not installed ready for use, claimed in the wrong year.
• Personal expenses run through the business card and never separated out.
• A trust resolution signed in August, dated August.
• Prior year loss records not retained, leaving a carried-forward loss that can’t be substantiated when it’s finally used.

Quick recap: the checklist

• Reconcile bank accounts, payroll to STP, and GST to lodged BAS.
• Clear the suspense account before anything else.
• Income: sales reports, merchant settlements, interest, grants, asset sale proceeds, distributions.
• Expenses: invoices and receipts, supplier statements, loan statements with the interest split, insurance, professional fees.
• Assets: purchase invoices, first-use dates, disposals, finance documents.
• Vehicles: logbook or a real basis for kilometres claimed.
• Payroll: STP finalised, super payment confirmations, TPAR if applicable.
• Stock and WIP: 30 June stocktake, work in progress, debtors and creditors listings.
• Loans: related party loan agreements, Division 7A minimum yearly repayments made by 30 June.
• Trusts: signed resolution dated on or before 30 June, plus the deed.
• Concessions: small business income tax offset, base rate entity test, CGT concessions, carried-forward losses.
• After lodging: retain for 5 years, longer for assets, 7 years for employee records.

Getting help

If working through this list has surfaced more gaps than documents, the bookkeeping is the thing to fix first — the return is downstream of it. Our catch-up bookkeeping service covers bringing an overdue set of books back up to date, and our small business accounting and tax accountant pages cover preparation and lodgment.

If your file is current and you’d simply like the return prepared and lodged, the next step is our guide to how to lodge a business tax return, which covers the channels, due dates and what changes if you use a registered tax agent.

Official resources

• $20,000 instant asset write-off for 2025–26 — ATO
• Instant asset write-off for eligible businesses — ATO
• Cents per kilometre method — ATO
• Small business income tax offset — ATO
• Changes to company tax rates — ATO
• Tips to get your base rate entity status correct — ATO
• Trustee resolutions — ATO
• Division 7A loans — ATO
• Division 7A benchmark interest rate — ATO
• Overview of record-keeping rules for business — ATO
• Records you need to keep for longer than five years — ATO
• About Payday Super — ATO