How to Prevent The ATO From Cancelling Your ABN


ATO’s Intent To Cancel Inactive ABNs Program

The Australian Taxation Office (ATO) are currently undertaking a program of reviewing Australian Business Numbers (ABNs) to identify those that are potentially inactive and in need of cancellation.
The ATO may select an ABN for review and potential cancellation if:

  • that ABN has not reported business activity in a tax return;
  • there are no signs of business activity in other lodgements such as activity statements; or
  • there are no signs of business activity from other third-party information which the ATO has access to.

Are you a sole trader, partnership, or trust?

If yes, read carefully.

Did you declare business income for the last two years in your tax returns? If not, you might be at risk.

Or even worse you have forgotten to lodged business activity statements or income tax returns for more than two years?

The ABR checks are happening throughout 2018.

The solution is simple. Contact your bookkeeper to bring your BASes up-to-date and lodge your outstanding tax returns.

Consistent compliance with taxation office rules is a must.

Sole Trader Myth

Who knows how myths are created. In a lot of cases they are created with good intentions. As Samuel Jackson said: “Hell is paved with good intentions”.

Sometimes sole traders have not lodged forms with ATO because they think they don’t need to lodge if their income is below the tax-free threshold.

Tax-Free Threshold through the last two decades:

1991-2000 – $5,400
2000-2012 – $6,000
2012-now – $18,200
This myth is dangerous. It causes people to forget about their compliance obligations.

The truth is that regardless of the income, sole traders need to:

Lodge individual tax return, including the supplementary section.
Lodge business and professional items schedule for individuals.
Pay their IAS, and if Nil they must lodge a Nil.

Why inactive ABNs are not ideal

Inactive ABNs are, in most cases, an unwanted distraction for both advisors and the business owners. Some of the reasons for this include:

  1. If tax registrations are attached to the ABN (e.g., a GST registration), it can lead to activity statements being unnecessarily issued and penalties accruing if not lodged on time;
  2. The ABN will continue to appear as “active” on the Australian Business Register (ABR) if searched by the general public, which could be undesirable for various reasons;
  3. Emergency services and government agencies use information from the ABR during natural disasters to identify where financial disaster relief is needed to help businesses;
  4. The ABN may result in the client being misclassified in a certain way by the ATO (or other government departments), which could cause the business to be incorrectly selected for a compliance review of some kind;
  5. The ABN may trigger involvement in government surveys, such as those conducted by the Australian Bureau of Statistics (ABS) from time to time.

The impact of an ABN being cancelled on a legitimate business

Under the ATO’s ABN Intent to Cancel program, a legitimate and active business could see its ABN be the subject of review (and potentially cancelled) if it has fallen behind on the lodgement of tax returns and activity statements.

If an ABN is cancelled for a genuine business, the business owner is said to have no legal business and is thus held to be operating illegally. Among other things, this will cause problems for customers and suppliers who use the ABR to verify that they are dealing with a legitimate business (particularly at the commencement of a business relationship). If there is no ABN appearing on the register because it has been cancelled, then that customer or supplier may withhold 45% of any payments due to the business and may subsequently cease to deal with the business.

Moreover, customers will need a valid ABN on tax invoices to claim GST credits in relation to purchases made.

Considerations for the cancellation of an ABN

The reality is that some ABNs are no longer needed. In these cases, it is best to take a proactive approach to avoid later contact by the ATO.

If your client’s business is no longer operating, consideration should be given to the cancellation of the ABN. Likewise, if a business structure has changed – for example, a client’s business has changed from being a sole trader to a company – then the old structure’s ABN may need to be cancelled.

Before any action is taken to cancel an ABN, it is imperative to check with both the client and the tax agent. Sometimes an ABN will be in existence for reasons unbeknown to the BAS Agent (or, for that matter, the client). Indeed, it is not always the case that just because an ABN exists, a business in the usual sense of the word is being operated. The GST Act uses the notion of “enterprise” to determine GST registration requirements (and, in turn, the requirement to hold an ABN). Enterprise is a broader term than business and extends to commercial activities, charitable activities, religious and government activities, and non-profit activities.

Two common examples of undertakings where ABNs are required, despite arguably there not being a business in the usual sense of the word, are self-managed superannuation funds and commercial property ventures (including those where two or more parties are deriving income from a commercial property).In the case of genuine businesses that have ceased (such as through an outright cessation, sale or change of structure), it may still be the case that the ABN needs to be preserved for a reasonable period to deal with the finalisation of the business’ expenses.

Cancelling an ABN

The fastest way to update your ABN is online through the ABR. or contact us and we will help you sort it out

For businesses that have cancelled an ABN,  you will need to lodge an income tax return for the structure which held the ABN regardless of the result of the business. Even in the case of a sole trader, there is no tax-free threshold for sole traders with an ABN and they will need to report all business income greater than $1.

What to do if contacted by the ATO

If your ABN is identified for cancellation, the ATO may contact you and advise what actions you need to take to prevent them cancelling it. This may include lodging outstanding returns of activity statements showing business income.

The ATO have also introduced a new automated process which allows you or your BAS agent to confirm if the ABN is still required via a secure voice response system, so it is possible your contact from the ATO could be by this means.

If you are no longer in business and the ABN is no longer required, no action is needed apart from the attendance to any outstanding activity statement and tax return requirements.

Reactivation of a cancelled ABN

If your ABN is cancelled (voluntarily or otherwise) and you need it a later point in time, you can reapply to reactivate it via the ABR. If successful, this will bring back to life the former ABN as opposed to a new ABN being issued.

When reactivating a cancelled ABN, you can list your previous ABN on the application for a new ABN. Reactivating a cancelled ABN is free.

Bear in mind that reactivation of a former ABN is only possible if a business structure remains the same. If a business structure has changed, you will need to apply for a new ABN (for example, if your client was a sole trader but now operates through a company structure).

The ATO may conduct a manual review when you reactivate a cancelled ABN. Generally, this will be to determine eligibility and entitlement for an ABN. Eligibility depends upon whether you are carrying on an enterprise.

Maintaining accurate ABN details

Quite aside from the issue of cancelling unneeded ABNs, it is also best practice to ensure that accurate details of genuine ABNs are maintained on the ABR. It is common for ABN holders (or their agents) to forget to update their ABN details in the ABR when their circumstances or details change.

The ABR promotes the maintenance of accurate details on the register for three reasons:

  • ensuring the right people have the right permissions to act on behalf of a business;
  • enabling government agencies to have current information, for example, if emergency services need to contact businesses during natural disasters; and
  • ensuring businesses are ready for new government services when they become available.

Your ABN details will be most effective if you also list your own address and business details, not just your BAS agent’s address as your agent. This allows ABN holders to be located and contacted quickly with direct updates, critical information and financial support in times of emergency or natural disaster.

Details must be updated with the ABR within 28 days of becoming aware of changes. Once again, the fastest way to update your details is to contact us so we can update it online through the ABR’s Tax professional’s services.

We Love Setting Up Xero And Hubdoc Because We Love Equipping Business Owners With The Tools They Need To Thrive.

We can free up your time and get your bookkeeping off to a great start with our customised Xero Setup service.

After a discovery call with you, we will conduct a business analysis and design a customised Xero implementation plan. Once your Xero file is set up, we don’t just hand it over and say “good luck.” You get one-on-one Xero training sessions so you have the confidence to use Xero like a pro.

By the end of your Xero Setup, you and your new Xero bookkeeping system are ready to go!

Should you need it, we’re here to provide ongoing support, advice and training.

Getting Technical – Stapling Of Super Funds



The Your Super, Your Future Legislation Was Passed Into Law On 24 June. A Key Feature Is The New Superfund Stapling Rules Which Will Impact The Many Bookkeepers Who Handle A Client’s Payroll, Superannuation And The Setting Up Of New Employees In These Systems. This New Measure Commences In Just A Few Short Weeks On 1 November 2021! 

The New Rules Ensure That When A Worker Moves Jobs The Super Fund That They Used With Their Former Employer Will Be ‘Stapled’ Automatically To Them, To Protect Their Retirement Savings Being Drained By The Costs Of Unintended, Multiple Accounts.


Unintentional multiple accounts are created when a worker changes jobs and does not nominate a superannuation fund to the new employer under the super choice system. For background, under Australia’s compulsory superannuation system, employers must nominate a superannuation fund on behalf of their workers (default funds). Employers pay a worker’s compulsory contributions into their default fund if a worker does not choose their own fund. If you change jobs multiple times over your working life and do not nominate a superannuation fund, you could end up with multiple superannuation accounts, all charging their own fees and insurance premiums.

The latest data from the ATO indicates there are approximately six million multiple accounts held by 4.4 million people. Over one-third of multiple accounts are held by people aged 35 or younger. These multiple accounts collectively charge $450 million in fees per year. Eliminating these multiple accounts, through stapling, will eradicate these fees and, in turn, boost the retirement savings of affected individuals.

The New Rules

Under the new rules, effective 1 November, an employer can comply with the choice of fund rules by making contributions to the stapled fund of an employee who:

  • started their employment on or after 1 November 2021
  • has a stapled fund, and
  • has not chosen a fund to receive superannuation contributions.

Employers can continue to make contributions to their own default fund in compliance with the choice of fund rules if the employee does not have a stapled fund.

To support the new stapled fund rules, the amendments allow employers to request that the ATO identify any stapled fund held by an employee. This request must be made in the approved form (see later). Where a valid request is made, the ATO must notify the employer they can identify a stapled fund for the employee as soon as practicable.

Identifying The Stapled Fund

You’ll be able to request an employee’s stapled super fund from the ATO after the employer (or their BAS Agent or Tax Agent on their behalf) has submitted a Tax file number declaration or Single Touch Payroll pay event linking the employer to them. There is no limit to the number of requests you can make. To request a stapled super fund, employers, or their authorised representative such as their BAS Agent, need to:

  1. log into ATO online services.
  2. enter the employee’s details, including their:
    • TFN – an exemption code can be entered where an employee cannot provide their TFN, but this could result in processing delays
    • full name – including ‘other given name’ if known
    • date of birth
    • address (residential or postal), if TFN not given.

The ATO’s online system will use rules based on the regulations to work out and return a stapled super fund in response to a request.

You will receive the response on-screen. You should be notified of the result of the stapled super fund request within minutes.

ATO Compliance Approach

The new superannuation stapled fund rules will see the ATO adopt a gently-gently approach to employer compliance. The new guidelines are contained in SPR 2021/D1 – choice of fund – written guidelines for the reduction of an increase in an employer’s individual superannuation guarantee shortfall determination 2021.

A transitional period will apply from 1 November 2021 until 31 October 2022. During this time employers will, in the first instance, be provided with help and assistance to comply with the stapled fund requirements. The Commissioner will reduce any choice shortfall to nil where that shortfall arose due to an emloyer’s lack of knowledge of the stapled fund requirements (as opposed to an intentional disregard). This lenient transitional approach is confined to the stapled fund changes – not to existing superannuation choice rules. From 1 November 2022, the transitional approach will end. By that time, penalties may be applied on a stricter basis.

We love equipping Business owners with the tools they need to thrive.

We can free up your time and get your bookkeeping off to a great start , After a discovery call with you, we will conduct a business analysis and design a customised implementation plan. 
If you need any help, 
we’re here to provide ongoing support, advice and training. Our Payroll Angels will look after you.

Construction Industry


Why is Construction Accounting Different?

  • Construction is project driven. Construction workers are contractors who operate their business around projects with billing, production, or labor. The projects are scattered and occur on different sites and locations. Different sites often have wage differences, equipment, and transportation costs.
  • The length of contracts can vary and lag payment can be an issue here.
  • Costs need to be accurately tracked to each project.
  • Orders and plans can change abruptly and these changes need to be tracked diligently. Changes in the construction scope, design, site conditions, or even the project schedule have the ability to make or break the budget.

Ask For Help

As the financial operations within a construction company can get very complicated very quickly, sometimes it’s best to get a little assistance from someone who’s done it all before. Outsourcing a bookkeeper to keep and maintain your financial records is a great way to ensure every process is being performed accurately and meets legal obligations. If you do outsource, however, ensure that the bookkeeper you choose understands the complexity of construction bookkeeping and has experience in the field – as in, bookkeeping-wise.
In the case of small businesses, you may not have the budget to outsource. In this case, you may conflate the bookkeeping duties with the administrator’s role – this runs the risk of causing errors within your records as admin staff do not always have the required skill set for bookkeeping. Avoid losing track of your expenses by getting initially set up with an understanding in bookkeeping processes required for running a construction business by having a consultation with a bookkeeper, to learn the ropes. At Shoebox Books, we can provide small businesses with advice on maintaining their financial records, and if you need more help, you can retain a bookkeeper on an ongoing basis. It really depends on your needs.
The important thing is that if you’re struggling or losing track of your finances because your business is getting too busy (which is a good thing – well done you), then it’s important to get help with your bookkeeping. Invest in getting it done right so that you have one less thing to worry about.

Keep In The Loop

As a business owner, you most likely already do know the ins and outs of your business; however, as businesses grow and expand and get busier, owners sometimes take on a more managerial role and sometimes lose focus of smaller operations as they concentrate on the bigger picture. Changes in orders, contracts, and plans come often and quickly in construction and can sometimes mess up budgets and financial records – that’s why it’s important to stay on top of all of the jobs running in the background. A great step for ensuring you’ve got all your projects (if there’s more than one) in sight is by going digital.  Use a digital tracking system for projects and orders, and ensure that your project or site manager (if not yourself) keeps in regular communication with you and all workers. There are many great online platforms for project management; however, some can be more geared towards digital jobs. This website provides some resources to help you get started, if you’re looking for a good project management system.  Ultimately, to keep in the loop with all of your ongoing and upcoming projects, regular communication and meticulous organisation is key. Having a clear picture of what’s happening with each project allows you to keep track of material and labour costs day by day, allowing you to manage each budget better.
shoebox bookkeeping business essential

Keep a Digital Trail

On top of turning to the internet to help you manage projects and tasks needing to be done, consider going cloud-based for your financial reporting as well. This saves a lot of time and effort (and paper) down the track, especially during tax time. Going digital also helps with meeting financial obligations in the case of an audit; the ATO stipulates that businesses must keep all financial records for five years (some for longer depending on the nature of your business). Going digital can be as easy as utilising an online storage drive (like Google Drive, OneDrive, or Dropbox) and uploading your files. Microsoft and Google also allow you to use their office tools online so that all of your files automatically back up to the cloud. Everything is one place and you can access it from any device – making it easy for you to manage the financial side of your business. You can also take it one step further and get really into construction bookkeeping by investing in accounting software.

Using the Right Accounting Software

Accounting software – also referred to as bookkeeping software – provides a great virtual hub for all the little jobs necessary in business finance. You can manage payroll, invoices, and expenses, all in one place, and your data will be safe and secure online. We’ve previously talked about some of the most popular accounting platforms, which we shared in this article. For novice users of accounting software, Shoebox Books provides guidance on how to streamline your financial processes using the popular bookkeeping platforms Xero, MYOB, and Quickbooks. Get more info here.

Don’t Dig Yourself Into a Hole

Shoebox Books Bookkeeping specialises in solutions for tradies and construction businesses. The pricing is fixed, and our services are mobile, ensuring your BAS is lodged correctly and on time. To learn more about our services, get in touch with us by sending an enquiry today.

Improve your cash flow

Assess your company’s financial health to see if there are ways to improve cash flow. Can you charge clients a deposit or encourage payment up front to increase cash flow? Are there products you sell or services you provide that bring in revenue more quickly than others? Are there ways to save money that won’t hurt your business in the long run?

It can be tempting to eliminate staff, but when things are good you’ll just need to hire employees again. Doing so costs time and money. See if you can find small ways to save money that won’t negatively affect your business when it starts booming. Cutting overtime, for example, can save you money without losing staff.

Make sure you can account for every dollar your business spends. Don’t hide from creditors, communicate with them to find out if you can restructure your debt or extend your terms. Free up as much money as you can without setting yourself up for failure when things turn around.

Final thoughts

Chances are your business will go through tough times at least once. It’s important you take action to help get you through it, rather than crossing your fingers and hoping the difficulties pass.

The steps you take during these challenging periods will help you, but they can also help set you up for increased success in later years. 

Got a question? Please don’t hesitate to get in touch.

7 Business Strategies to help you Thrive in 2021


There’s no doubt that your inbox, phone and TV have been inundated with news regarding the current situation in the world. Mostly, this information is split into two categories; health and finance. These two topics are inseparable in the foreseeable future, which doesn’t seem that seeable, right now.

In a far-from-typical year, 2020 has literally changed our entire culture. These rapid and massive shifts make it all the more clear — business owners need to think about 2021.

To oversimplify, there are three (very) broad scenarios:

  • Situation improves:Treatments improve, people become less skittish and the economy shows real signs of life.
  • Things stay the same:Some states open, others remain a bit more shut down and the economy is a rollercoaster.
  • Situation gets worse:Economic and social measures revert to what they were closer to in the 2019.

No matter what the situation, 2021 likely comes with the need to prepare your finances and pivot your business practices.

Here are 7 tips to consider when planning the next 12-18 months.

1. Understand Your Business in 2021

Are there going to be more widespread lockdowns? Will current spending habits change back or continue? Is there any hope of normal within the next year?

The answer to all of these hypothetical questions is “no one knows.”

The unclear nature of 2021 makes understanding how the coming year plays out difficult (but not impossible). That said, there is one thing that is clear —An agile business, with a solid financial framework is far more likely to succeed in unknown economic territory.

Perhaps the most important tip is to better understand your own business. In fact, most of the following tips on this list are internal business considerations.

3 Ways to create Agility in your Business
Track metrics that matter:Up-to-date information means better decision making.

Use scalable solutions:Ensure outsourced services and software solutions are able to fit the needs of your business.
Communicate:With your customers, your staff, suppliers and your financial professional(s).

2. Create a Better Budget

You need a quality budget for any 2021 scenario. If things get better, you need to understand your cash flow in order to spend the right amount gaining new customers. It’s important to know the bare minimum you need to survive and how much cash you have for your operating expenses.

If you don’t do basic budgeting and bookkeeping, this is the year to start.

3 benefits of creating a budget
  • Gives insight into unnecessary spending
  • Knowing where the business stands gives confidence
  • Highlights any flexibility and opportunities

3. Adapt to New Business Practices

This “tip” is an entire article in waiting. There are so many new and innovative ways to run your business. Some were created due to necessity. Others were already around, but gained exposure in 2020.

Your business may stand to benefit from changing certain practices. Plus, other businesses you rely on (suppliers, service providers, etc.) have, in some cases, dramatically shifted how they do business. It helps to understand how these differences will affect your organization.

3 business practices that have changed in 2020
  • Remote work: If you’re a service-based business, it’s likely your team has worked from home (at least partially).
  • Online presence:Many businesses have shifted their focus to acquire clients and practice business online. Social advertising, content marketing and webinars have increased.
  • Niching down services:Some of the services you use may not be offered by your provider. Many are paring down in order to better serve a more niche client base.

Note:Again, your business may have to make these changes. But if not, it’s a good idea to check with the companies you use to see if their practices have changed.

4. Understand Sales Channels

With so many ways 2021 can play out, it’s more important than ever to test your customer acquisition strategies. One way to prep for any outcome is to fully understand the sales channels of your business (and industry).

Example scenario:An ecommerce business understands that Facebook ads perform better than Google ads. When sales drop, it’s better to reduce spend on Google while increasing FB ads buys. (A bonus tip is using your budget to determine how much money you have to spend to maximize FB ad profit.)

3 ways to improve sales channels
  • Figure out your current acquisition channels
  • Determine the lifetime value of customers acquired by each channel (or begin tracking this)
  • See where your competitors are spending their marketing dollars (i.e. content marketing and ads).

5. Track Key Metrics (in real time)

It’s easy to get off track when it comes to metrics. You can track too many items, the wrong items or get lagging metrics that don’t really give you the pulse of your business. Depending on your industry and market these metrics vary wildly. But there are several universal indicators to measure.

3 key metrics to track in your business
  • HR numbers:Obviously tracking payroll is a good idea, but you should also know how much profit per employee you have. Tracking people analytics by connecting payroll with your accounting provides much greater visibility. Doing so helps with staffing decisions (both positive and negative).
  • Sales/revenue:This is one top line number you should always know. How are you compared to the previous week/month/quarter?
  • Cash flow:If cash flow from one month to the next gets low, you may have an accounts receivable issue. Too much and you’re likely not utilizing money properly.

6. Use a Financial Forecast Forecasts differ from budgets.

Budgets keep you in line with your current spending. Forecasts help you predict various outcomes (kind of like our 3 scenarios). The better and more flexible your forecasts are, the more you can plan for any 2021 that may come.

A true forecast should look ahead two to five years, with assumptions based on your business model and growth plans. A financial forecast is a great task for a fractional CFO, and can be a major driver for a growth-minded business.

3 Benfits Of a Financial Forecast

An accurate forecast allows you to budget better for the coming year.
A flexible model provides better scenario planning and how you would have to change in order to deal with each possibility.
Seeing how much cash flow you’ll have shows realistic growth opportunities vs thinking too small or having “pie in the sky” goals.

7. Solidify Operations

Even if your business tends to thrive in adverse situations, it’s a good idea to check for any ripple effect. For example, an ecommerce store relying on foreign distribution. Inventory shortages are a big deal for a business who expects to sell more products over the next year.

No matter what, someone in your business ecosystem will significantly change in 2021.

3 operational details to secure

Supply chain management:Get on the phone (or in an email) with all vital areas of your supply chain. See what their outlook is, renegotiate if possible and understand if they’re ready for your needs in the coming months.
Staff level and focus:Make sure roles are clearly defined, procedures are understood and be as honest as possible about the outlook for the company.
Tech and services:Take a look at every program, tool and service you pay to use. One common problem is underutilization. Learn about all of the features and services provided to make sure you’re getting the most value.

We love equipping Business owners with the tools they need to thrive.

2021 comes with uncertainty. A nimble and agile approach better prepares your business for survival and success. And after you prepare, it’s necessary to keep tabs on each aspect of your business as often as possible.

Get your finances in order, track the most vital business metrics (in real-time) and change your approach to deal with changes and trends you see in the market. Do that, and you’ll do more than survive next year — you will thrive.

We can free up your time and get your bookkeeping off to a great start , After a discovery call with you, we will conduct a business analysis and design a customised implementation plan. so you have the financial daat about your business to make startegic decisioons. 

Should you need it, we’re here to provide ongoing support, advice and training.

How to go from a sole trader to company in Xero


Deciding on the structure of the business is a vital decision which should not be taken in haste. It has a plethora of implications as it determines the amount of tax to be paid, asset protection, accountability of the owner, paperwork for the organisation and much more. Entrepreneurs in Melbourne usually start off as sole traders because they are getting into a business for the first time and have a small set-up that can be managed single handedly.

The owner starts operating as a sole trader and takes on the complete legal responsibility of the organisation. It means that the owner cannot share the debts and losses with anyone else. Since it is the most cost-effective structure in Australia, most first-time business owners begin their journey with this.

Over the course of a few years as the work expands and the organisation starts generating amplified revenue, after all, you’re good at what you do.

So you make the decision to transition to a company structure. Before you make any formal changes, it’s important to know if a company structure is the right structure for your evolving business.  One item on your action list is converting Xero across – and what happens next is important to get right.

Difference between a sole trader and a company

Sole traders and companies have different legal, tax and reporting obligations. Find out the differences to help you decide which business structure best suits your business needs.

As far as the ATO is concerned – even if you’re trading under the same name, you as a sole trader’ and you as a company’ are completely independent and unrelated entities. It’s important you know your reporting, legal and tax obligations for your business structure.

Ongoing Company Compliance

As a company, you’ll need to comply with additional reporting obligations. Company obligations include:

  •  record keeping
  • lodgement of financial records
  • company registrations and fee payments
  • notification of changes to company details, including updating ABN details on the Australian Business Register (ABR).

You can find more detail about company officeholder’s legal responsibilities on the ASIC website.

What not to do

Lately at Aview Bookkeeping, we’ve come across a few cases of how not to change over to a company in Xero. What people have done is simply change the ABN to the new registered company, change the dropdown in Xero for organisation type to Company’, and away they go. It’s simple, right?

The Problem With This Approach – Is That The Transition From A Sole Trader To A Company Is Rarely So Clean.

Typically, activity continues in the sole trader account for some time after the changeover. Whether it’s customers paying the wrong account, or suppliers debiting it. Add to this the fact that the context is wrong – the trading history of you as a sole trader isn’t related to your performance as a company.

So what is best practice for managing this transition in Xero?

The best approach to take is the simplest. Set up a new Xero account for the company, and over time change over from one to the other. We’ve put together a quick checklist for making the change from sole trader to a company

  1. Create a new Xero account as at the incorporation date of the company
  2. Set up new bank accounts under the company, and get the feeds up and running
  3. Let your clients and suppliers know that the company details have changed
  4. Clear your balance sheet as a sole trader. Talk to your accountant and find out the best way to manage any assets still held by you as a sole trader (such as money in your bank accounts) and also any liabilities (such as loans). For instance – money in your sole trader account might be treated as funds introduced to your company
  5. Continue lodging any Business Activity Statements for both you as a sole trader and you as a company for as long as there is activity in those entities during the reporting periods
  6. Close down the sole trader bank accounts – exporting out any CSVs or bank statements
  7. Downgrade the sole trader account to a ledger (you can upgrade it again if you ever need to access the financials – such as at year end)
By doing it this way – there is a clear distinction between you as a sole trader, and the company. Both can still have activity during the changeover period without it becoming unnecessarily messy – and it ensures that the process of moving from a sole trader to a company is as smooth and easy as possible.

We love setting up Xero because we love equipping entrepreneurs with the tools they need to thrive.

We can free up your time and get your bookkeeping off to a great start with our customised Xero Setup service.

After a discovery call with you, we will conduct a business analysis and design a customised Xero implementation plan. Once your Xero file is set up, we don’t just hand it over and say “good luck.” You get one-on-one Xero training sessions so you have the confidence to use Xero like a pro.

By the end of your Xero Setup, you and your new Xero bookkeeping system are ready to go!

Should you need it, we’re here to provide ongoing support, advice and training. 

What is Hubdoc and How Can Businesses Benefit From It?


Hubdoc, a Xero-owned company, helps you spend less time chasing financial documents, and more time running your business. Since being acquired by Xero, Hubdoc continues to evolve into a feature-rich platform for Xero users to capitalise on.

Hubdoc Features:

  • Auto-fetches bank statements, bills, and receipts from over 700 financial institutions, utilities, telecom providers, and online vendors
  •  Supports real-time document capture via desktop, email, and mobile (the Hubdoc App is available as a free download on the Apple App Store or Google Play Store
  • Extracts key data from documents (vendor name, date, and total amount) using Optical Character Recognition (OCR)
  • Automatically creates folders and sorts documents by their vendor name after they’ve been fetched or uploaded
  • Integrates with Xero for reconciliation and audit-proofing
  • Organised and verified data: Hubdoc provides accountants and their clients with confidence that their financial documents are organized, secure, and always available. All data is “verified” with the source document, stored and easily searchable on any device.

How does Hubdoc Affect You and Your Business?

With Hubdoc, bookkeeping is easy. You don’t have to chase documents at the end of the month, quarter, or year. All your financial documents are securely stored and managed from one place, giving your business peace of mind.

We Love Setting Up Xero and Hubdoc Because We Love Equipping Business owners With The Tools They Need To Thrive.

We can free up your time and get your bookkeeping off to a great start with our customised Xero Setup service.

After a discovery call with you, we will conduct a business analysis and design a customised Xero implementation plan. Once your Xero file is set up, we don’t just hand it over and say “good luck.” You get one-on-one Xero training sessions so you have the confidence to use Xero like a pro.

By the end of your Xero Setup, you and your new Xero bookkeeping system are ready to go!

Should you need it, we’re here to provide ongoing support, advice and training.