Business Franchise Australia


The Business Franchise Owner’s Essential Checklist For EOFY 2024

With June 30th right around the corner, if you haven’t already gotten the ball rolling on your tax preparation, now is the time to do so. However, navigating business tax returns can be different for franchise owners compared to independent business owners. After all, franchisees have a unique array of expenses, including the purchase of marketing materials and other promotional collateral from their franchisors. 



To help, we’ll be sharing this streamlined tax time checklist for franchisees (based on this great EOFY checklist), designed to simplify the process of collating your tax documentation and ultimately filing your franchise tax return with all possible deductions made. 



Read on to equip yourself with a great game plan for EOFY 2024.


Finalise your payroll for FY24

The first thing you’ll want to do is finalise your payroll to ensure that your employees can also access their superannuation, PAYG (pay as you go withholding), and other necessary documentation in time for the October 31st deadline – if they’ll be self-lodging. This preliminary step is vital for simplifying your tax time process, as ensuring that your staff have the documentation they need will allow you as the business owner to turn your attention where it’s most needed: towards your financial statements. 



Review financial statements and performance reports

Upon reviewing and collating payroll records and gathering full documentation of salaries/wages across FY24, it’s time to call your business taxation agents to commence the process of calculating your company’s taxable income. Naturally, this is done by reviewing your quarterly statements across FY24 and calculating the gross profit reported over the fiscal year. 



Your total taxable income is also calculated by comparing your business’ full assessable income (including gross profit and other business income like government payments and gifts or prizes) against your total deductible expenses. Which brings us to item #3 below!



Prepare your business tax deductions

Now is the time to sift through your payment records and identify any expenses that you may be eligible to claim back as a business tax deduction. For franchisees, identifying deductible expenses can be a little bit tricky, mainly due to the fact that you may only have partial expenses in shared company assets like your franchisor’s website.



For most franchisees, however, the bulk of your tax deductions (outside of employee wages) will fall within these below categories:



Website and digital marketing expenses

Even if you don’t manage a website that’s specifically for your own franchise, any web management and digital marketing expenses that you’ve made with the intent of building your company revenue can be tax deductible. Be sure to work with your taxation agents to collate all records of these marketing expenses.



Travel and transport expenses

If you operate delivery services or provide mobile services, then your franchise business may be eligible to deduct these travel and transportation expenses. If your franchise operates from a fixed brick and mortar location and doesn’t use any travel for business purposes, you may still be eligible to deduct staff or employee transportation expenses – so long as you have necessary documentation to support the deduction.



Machinery and equipment expenses

For franchisees who’ve invested in specialised equipment like office computers, kitchen equipment, manufacturing machinery and other essential hardware and software for your business operations, all of these equipment expenses may also be tax deductible. Once again, work with your taxation agent to assess all machinery and equipment expenses made over FY24.



Business insurance premiums

Note that insurance premiums are only tax deductible for businesses if their cover is specifically for ‘revenue protection’ for your business. This distinction allows the ATO to segment personal insurance from business insurance policies. So long as you’re able to provide evidence that your insurance premiums are for business insurance policies that have been secured on behalf of your franchise, you will be able to deduct the value of premiums paid for these policies.



Lodge your business tax return

With your total taxable income and deductions now prepared, it’s finally time to complete your tax documentation and lodge your business tax return. Keep in mind that for self-lodgers the deadline to file your tax return is October 31st as per usual. However, franchisees who are working with a registered taxation agent typically have a deadline of February 28th. 



Even if you’re planning to lodge your tax return with the aid of a registered taxation specialist, it’s still wise to finalise your tax return as promptly as possible – just to avoid any FY25 documents from getting mixed up in your FY24 folders. Record-keeping is the key to enjoying easy and stress-free tax preparation.



Reassess your business insurance policies

EOFY is also a great time to actually complete a stocktake for your business. After all, franchises do tend to accrue a great variety of promotional materials, packaging, and other branded perishable and non-perishable products from their parent companies. If you believe that there is a surplus left over from FY24, EOFY can be an ideal opportunity for recording these surpluses and reporting them to your franchisor. It’s all about doing your due diligence as a franchisee in a company that you’ve effectively got your own stakes in.



And speaking of doing your due diligence, all business owners (including franchisees) are typically also advised to use the end of financial year period to evaluate their expenses – from their inventory and equipment and all the way through to their insurance. As business insurance is by nature designed to protect your enterprise from all the risks identified in your risk assessments, the last thing any franchisee wants is for their business insurance to actually be eating unnecessarily into their profits.



So take this EOFY period to evaluate your insurance policies and perhaps even shop around for better deals. That way, you can head into FY25 with reduced operational costs without having to sacrifice on your company’s insurance and other risk mitigation strategies.



Prepare record-keeping systems for FY25

Finally, the last item on all EOFY checklists has to be resetting your financial records for the next financial year. For most business owners, this will involve collating and archiving financial records from the previous financial year and establishing new files and folders for the year ahead. This is inclusive of both physical/hard-copy and electronic financial records for your business.



Preparing your record-keeping systems nice and early can help ensure your Q1 expenses and other documents are easily accessible and well-organised. This won’t just set you up for success for EOFY next year but also for your FBT deadline next year, which must be lodged before May 21st for self-lodgers, or June 25th for those working with a taxation agent.



With all these items ticked off, you should be on the tail end of a very successful and easy end of financial year period. Be sure to get your record-keeping systems in place now to ensure that FY25 also stays stress-free for your franchise business.