Set up a tax filing system to keep all your paperwork in one spot. This way you’ll save yourself money, time and stress searching for important documents and tax-related papers.
One of our Personal Organisers revealed the must-haves to create an effective tax filing system at home or at work.
1. Create a tax folder
Own a business? For businesses filing quarterly BAS statements, we recommend 4 identical folders, one for each quarter, so that you can continue filing paperwork for the current quarter and send off your completed folder to the bookkeeper/accountant.
2. Label dividers to suit your lifestyle
If you’re not sure where to start, sort paperwork into its relevant financial year, then by category and subcategories. Unless your circumstances change, it’s likely these categories will be very similar from one year to the next, so you can reuse these dividers the following year too.
Labels could include:
• Pay slips
• PAYG statement
• Invoices (for small businesses etc.)
• Interest earned
• Property including all income & expenses
• Shares including dividend statements
• Term deposits etc.
3. Bank statements
• Use coloured pens to annotate any expenses claimed
4. Tax related expenses
• Accountant fees
• Costs associated with managing tax affairs
5. Private Health Insurance Statement
• Health related expenses (if these exceed the safety net)
6. Professional Memberships/Union Fees
• Meeting fees
• Conference expenses
7. (Home) Office Expenses
• Equipment purchases
8. Work-related vehicle expenses
• Purchase/Lease/Interest payments
• Car washes
• Log book
These are just a guide – adjust yours to suit your unique lifestyle.
3. Sort paperwork as it arrives
Give yourself a head start and sort paperwork into this folder as you receive it. This way, when the new financial year arrives, you know exactly where everything is and you’ve avoided unnecessary double handling.
4. Keep a checklist
Keep a checklist at the front of your tax folder so you can readily identify what documents you have and what is still missing. You could also record the totals for each category on this list to make your appointment with your accountant simple and efficient.
5. Store completed Tax Returns
Store completed Tax Returns in an A3 Storage Box along with your Diary for that year. Only keep these for as long as required by law – usually five years for most individuals, for companies, you’ll need to gain advice on this. Once that time is up, securely shred and discard those documents. If you have a lot of paper work, you may prefer to use an individual A3 Storage Box for each year or an Archive Storage Box.