Hi,
I am sole trader with a new fashion retailer opening by end of this month.
My question is for the expenses of all the products that I bought/pre-ordered from our fashion wholesalers overseas.
I have a few questions relating to tax deductions and how to keep a great records of these expenses:
1.All of my payments are in AUD, and are made through remittance service providers ie. Wise.
2.The receipts I have from my wholesalers in different currencies depending on where I sourced my products from. They don't have the GST component but their receipts generally include:
- name of the supplier
- name of my business/myself
- amount of the purchase
- details and quantity of the products
- date of the purchase
3.I normally transfer a big amount of money i.e $AUD 2000-3000 each time to the immediate agent/ our my oversea bank account to to pay for my suppliers. Therefore, I don't have the exact transactions in my bank account to match the receipts I have from the suppliers. It means the date I made the payment is also not matched with the date of purchase.
For example, on 1st of May, I made a transfer of $2000 to my intermediate agent (this person will help to go to the wholesale market and make the payments on behalf of me to my oversea wholesalers). From 1st of May to 15th May, I have 3 receipts of purchases of $250, $300, $1550 (total of 2100), this means I still owe the wholesalers $100. On the 15th, I make another payment of $3000 to cover for that $100 and the remaining of $2900 is for my future purchases.
A very knowledgeable person in this forum has suggested me to ask my accountant to help open an Account in my General Ledger for these types of transaction. The fact that I still have money remained with my immediate agent or my oversea bank account by EOFY if not used to purchase more products. How can I make this whole thing less complicated?
4. As I'm launching this month, I've properly bought 10-15k worth of products/stocks from my oversea wholesalers. As there is only 1 month, I don't to expect to have any profit by EOFY - can I record all my expenses of as loss?
5.I read something about the closing and opening stocks - is that something I would need to keep an eye on and record? What is the best way to maintain this record?
6. As I still have my full-time job, so depending on how well my business runs, I may need some help. Am I able to pay someone (in particular, my partner or siblings) casually to help me with the packing and dispatching of my products if I'm a sole trader, not a company? This would work well in occasion when I need to go oversea to meet some of the manufacturers/wholesalers in person for long term business plans. @Bruce4Tax
Appreciate for all your help guys!
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