At the end of the 2025 financial year, small businesses face unique challenges and opportunities. This EOFY 2025 small business guide outlines practical steps to help you prepare for the new financial year. It is an ideal time to evaluate performance, streamline operations, manage tax obligations and plan for growth. Below are some key strategies to support your business through the EOFY period and beyond.
EOFY 2025 Small Business Guide: Claiming the Right Deductions
As an individual or a business owner, you may claim deductions for work- or business-related expenses. You must categorise expenses as either fixed or itemised and subtract them from your assessable income. You can only claim expenses that directly relate to earning your income and for which you have a record of purchase, such as a receipt.
Generally, deductions that may be available include:
- Office supplies and equipment
- Travel expenses
- Working from home expenses
- Education, training and seminars
- Memberships, accreditations, fees and commissions
It is important to research and consult with a professional when determining what deductions are applicable to you and your industry. The Australian Government, Australian Taxation Office (ATO) website provides outlines under respective industries. Lodging your deductions may occur from the new financial year until October of the same year.
EOFY 2025 Small Business Guide: Common Tax and Compliance Mistakes
- Not verifying if your tax agent is registered with the Tax Practitioners Board (TPB). You can check by searching the TBD register or at first instance looking for the registered tax practitioner symbol on their website that includes their individual registration ID.
- Not being wary of tax refund scams
- Not Seeking Professional Advice
- Not being aware of upcoming or existing tax legislative reform or updated regulations
EOFY 2025 Small Business Guide: Reviewing Your Business Structure
The end of the financial year provides an opportunity to assess whether your current business structure still suits your goals. You should consider:
- Considering incorporating or restructuring to support business growth or asset protection
- Assessing partnership relations
- Reviewing head documents (i.e shareholders agreements, deeds, employment contracts.)
- Reviewing how you are paying yourself (i.e salary vs dividends)
EOFY 2025 Small Business Guide: Asset Review and Stocktake Essentials
In the case that your business is obligated to manage an inventory you may consider EOFY as an opportunity to undertake the following:
- Updating current inventory and management systems
- Identifying what stock is slow-moving or obsolete
- Making decisions about stock clearance or write offs
- Removing any assets no longer in use
Planning Ahead
The below are strategies that you can do now to be best prepared for the end and upcoming new financial year:
Cash flow management
Essential to minimising tax issues and avoiding any surprises during tax season. By ensuring you have liquidity to pay estimated taxes (for freelancers, investors etc), remit payrolls on time to avoid penalties and interest from late or unpaid taxes. By monitoring and adjusting according to expenses you may estimate payments.
Profit and Loss statements
These statements provide an overview for your net income (the total that you are taxed on after deductions) that, if regularly reviewed, can assist with estimating tax payments to avoid penalties. Ultimately these types of documents help speed up lodgment preparation and reduce the risk of errors and omissions.
Reviewing Business performance
The above statements may help with reviewing the performance of your business. Profit and loss statements may be designed at your discretion to demonstrate monthly, quarterly or yearly growth or decline. With more detail they will show which products, services or employees are driving income and business net worth as well as revealing seasonal trends or inconsistent cash flow.
Drafting business goals
By setting distinct, attainable and measurable goals for your business builds motivation to grow along with the satisfaction of achievement. You may centre your goals around quantitative or qualitative growth that are relevant to the stage of your business (age, locations, number of employees etc.). You may build customisable goal setting worksheets or dashboard via third party platforms or through a professional that includes visual KPI boards, goal prompts and timeframes.
Budgeting
Having control over funds and being aware of your spending will avoid risks of falling short. This will allow you to allocate funds to the right priorities. Building a buffer for off-seasons or emergencies (as seen in the COVID-19 Pandemic) will help you schedule major expenses when you do have a stronger cash flow. Ultimately, budgeting helps small businesses manage unexpected bills, avoid penalties, and set aside income for development or restructuring. You should contact a professional to forecast liabilities and build assets after setting a budget.
Conclusion
As the End of Financial Year approaches, small businesses have a valuable opportunity to pause, reflect, and reset. From reviewing your financial statements and claiming all eligible deductions, to organizing your records and planning for the year ahead — taking proactive EOFY steps can save you money, reduce tax stress, and set your business up for success. EOFY isn’t just about closing the books; it’s about opening the door to smarter decisions, stronger cash flow, and clearer goals. With the right planning, tools, and professional support, you can finish the year strong and start the next one with confidence.
Jake McKinley notes that this article is written for the purpose of providing generalised information and not to provide specialised legal advice. If you require qualified legal advice on anything mentioned in this article, our experienced team of solicitors at Jake McKinley are here to help. Please get in touch with us on 02 9232 8033 today to make an enquiry.
Written by Brooke Nguyen, Law Graduate
