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Year-end guide and checklist - Business Owners

SOLVEDby QuickBooksQuickBooks Online77Updated 5 days ago

As the end of the year approaches, you will need to complete certain tasks in QuickBooks Online to close out the old year and prepare for the new one.

The following sections can help guide you through these year-end tasks to make the ending of one year and the beginning of another easier.

Tip: Looking for a walk-through guide of these steps? Our QuickBooks Online Digital Assistant can help. Get started now.

It's important to make sure that the correct month is selected for the start of your financial year to allow QuickBooks Online to clear accounting ledgers behind the scenes while you work on other year-end activities.

To confirm or change the first month of your financial year:

  1. Go to Settings ⚙.
  2. Select Account and Settings.
  3. Select Advanced.
  4. In the Accounting section, verify that the setting in the first month of the financial year field is correct, or select Edit ✎ to change the setting.
  5. Select Save.
  6. Select Done.

Your financial year is confirmed.

Once you have added the receipts and bills in QuickBooks, they’ll show up in the For Review tab where you can review, edit, and match the transactions.

For more info on adding your receipts and bills, read our Capture and catergorise expenses and bills article. This also includes Receipt Capture which extracts the data for you. 

At the end of the year, it's a good idea to make sure your client base has up-to-date account balances and that billing and payments are also up to date.

To check customer account balances:

  1. Go to Reports (Take me there).
  2. In the search bar, enter Accounts Receivable Ageing Summary or Accounts Receivable Ageing Detail and select the report you want to review. These reports are available in QuickBooks Online Essentials and Plus only.
  3. Review the report to identify customers with outstanding balances.

Here's some more information on how to run reports. 

Once you identify any outstanding balances, you can send statements to the customers.

To send a statement:

  1. Go to Sales, and select Customers (Take me there).
  2. Locate the customer you want to send a statement to.
  3. From the Action column drop-down menu, select Create statement.
  4. In the Create Statements window, select Print and Preview to print the statement, or select Save and send to create and preview an email to send with the statement to the customer.

Here's some more information regarding creating statements.

You'll also want to confirm that all deposits are cleared from the deposit queue. Any funds sitting in this queue will not be included in your current year's income.

Here's how you create a bank deposit.

The end of the year is a good time to take care of any outstanding bills you owe for the year, and address any outstanding credits, discounts, or products you're owed from your suppliers.

To review outstanding bills:

  1. Go to Reports (Take me there).
  2. On the search bar, enter Accounts Payable Ageing Summary or Accounts Payable Ageing Detail and select the report you want to review. These reports are available in QuickBooks Online Essentials and Plus only.
  3. Review the report to identify any outstanding bills to pay before the end of the year.

Once you identify any outstanding bills, you can clear them before the end of the year.

Here is some additional information on how to review bills.

It is good practice to match your QuickBooks Online data to your bank and credit card accounts to ensure that all transactions have been recorded correctly, and that your year-end reports display accurate financial data.

To reconcile your accounts:

  1. Select Settings ⚙️.
  2. Within the tools column Select Reconcile.
  3. Follow the prompts to match the transactions on your bank or credit card statement with the transactions on the Reconcile page.

For more detailed information about reconciling, see How to reconcile accounts or Year end: Tips for reconciling accounts for the entire year.

If your company is required by the Australian Taxation Office (ATO) to report payments to contractors or subcontractors, you will need to prepare a TPAR and lodge it with the ATO. 

What is TPAR?

If TPAR is not enabled for your file, learn how to turn on TPAR in QuickBooks Online.

Turn on TPAR for the supplier

First, you’ll need to make sure that relevant suppliers are flagged to be included in the TPAR. To add a supplier to the TPAR:

  1. Go to Expenses (Take me there) and select Suppliers (Take me there).
  2. Select the name of the Supplier, and select Edit.
  3. Select the checkbox Include this supplier in my annual TPAR.
  4. Select Save.

Run the TPAR report

  1. Go to Reports (Take me there).
  2. Under Manage Taxes, select Taxable Payments Annual Report.
  3. Ensure the Transaction Date/Report Period is correct and then select Run Report.

Download the TPAR report

Once the report is finalised, download the TPAR file to be lodged to the ATO. 

  1. Navigate to the top of the TPAR report.
  2. Select Download TPAR button.
  3. Once the TPAR is ready to download, select Download.

If there are missing transactions in the TPAR, make sure that you have enabled the transaction to be added to the TPAR. To check this:

  1. Find and select the relevant transaction.
  2. Under the Payee drop-down menu, ensure that Include the transaction in my annual TPAR is selected.
  3. Select Save.

If you've been using QuickBooks Payroll to lodge pay events to the ATO under Single Touch Payroll (STP), you'll have to lodge a Finalisation Event to send the final year-to-date figures to the ATO. 

To start this process:

  1. Go to Payroll.
  2. Select the Reports tab, then select Single Touch Payroll.
  3. Select Start Finalisation Process and follow the steps in the wizard to confirm YTD payroll data, Reportable Fringe Benefits amounts (RFB) and request client authority.

Important notes:

  • If employees have been paid on multiple pay schedules throughout the financial year, you DO NOT have to complete a finalisation event for each pay schedule of that employee. Only complete the finalisation event for the pay schedule the employee has mainly been using throughout the year.
  • If you need to make amendments to the payroll figures after lodging a Finalisation Event, you MUST create an amended Finalisation Event to update the ATO.

Here's more help on how to create, lodge and amend a Finalisation Event.

Your accountant has the expertise necessary to give you suggestions on data input, help with your year-end process, and forecast your company’s financial future.

If you haven't already done so, QuickBooks Online makes it easy to invite your accountant to collaborate with you, and to give them access to your QuickBooks Online account.

Once your accountant accepts the invitation, they have access to your accounts.

It's important to run year-end reports to review the information and identify any issues or discrepancies.

To run year-end reports:

  1. Go to Reports (Take me there).
  2. Locate and review the Profit and Loss report and the Balance Sheet, as well as any customised reports you or your accountant require.
  3. Make sure that the Profit for the Year figure matches the balance on the Profit and Loss report.

You and your accountant can review the information in these reports to identify any potential issues to resolve.

Your accountant can review a detailed view of how transactions or journals will affect the Profit and Loss or Balance Sheet depending on the account types, and can make changes to any item for appropriate display on reports.

To review detailed information:

  1. Ask your accountant to sign in to their account.
  2. Under Accountant Tools (the envelope icon), select Reclassify Transactions.

Your accountant can reclassify or move transactions multiple transactions at once.

If your Retained Earnings need to be divided among owners or partners, your accountant can assist you.

It's good practice to have previously set up an Owner's Equity and Draws ledger for any payments or withdrawals from the company during the year by the key people who founded the company.

To create journal entries:

  1. Select + New.
  2. Select Journal Entry.

For detailed information about journal entries, see How to create a journal entry.

If you have been recording your Mileage in QuickBooks Online then you can generate a Mileage report to review the mileage deductions

Learn more about mileage and how to extract the mileage data from the company.

If you’re a sole trader or an individual in a partnership, keep these guidelines in mind:

  • You can claim deductions for the business kilometres you've travelled on up to 3 vehicles, including motorbikes.
  • Your deductions stop once you reach 5,000km per vehicle. You can continue tracking your kilometres reaching the limit, but it won't give you any additional deductions.

For more information, visit the ATO’s website.

Taxes are typically prepared by a company's accountant.

When you send your accountant an invitation to your QuickBooks Online account, you give the accountant access to all the financial information they need to prepare and file taxes on your company's behalf, and to make any necessary changes.

Your accountant can use this information to prepare, or help you to prepare, any required year-end tax return.

Closing the books lets you control changes to transactions dated before the end of the financial year.

  1. Select Settings ⚙️.
  2. Select Account and Settings.
  3. Select Advanced.
  4. In the Accounting section, select the pencil (edit) icon to open the fields for editing.
  5. Select the Close the books checkbox.
  6. Enter a Closing Date and select a warning preference. You can also optionally enter and confirm a password that anyone who tries to make changes must enter.
  7. Select Save.
  8. Select Done.

For detailed steps to guide you through closing your books, see How to close the books.

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