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Tuesday, 1 January 2013

Record keeping in the plastering industry

Poor record keeping by plastering businesses is a common issue identified during Tax Office audits. Of particular concern is the failure of taxpayers to correctly record and retain records of all sales.

The Tax Office has released a fact sheet that explains in detail how plasterers should record their income, including:
  • The use of pre-numbered invoice books;
  • The use of pre-numbered quote books;
  • Why a record of every sale and purchase should be made; and
  • How to complete summary records which will enable some individual records to be discarded.
Generally, taxpayers carrying on a business are required to keep records for a period of five years after the income year in which they lodge their tax return.
  • The fact sheet contains a table of poor and best practices and emphasises that the Tax Office will consider various sources of information to audit a business, including:
  • Whether a taxpayer’s personal lifestyle can be explained by family wages and drawings;
  • Information on loan applications, such as mortgages, to determine if they are consistent with lodged tax returns; and
  • Information from banks to determine if all deposits into a bank account can be explained.
The Tax Office has record keeping fact sheets for other industries including retail, wholesale, pubs and clubs and the primary production industry.

To access the Tax Office’s fact sheet for businesses in the plastering industry, click here.

Remember, failing to keep sufficient records of your business transactions may result in severe fines and penalties.