New financial year checklist: What to do in July as a small business owner

Published Monday 24 August 2026

Table of contents

• Why the first weeks of the new financial year matter
• Review and close out the previous financial year
• Understand the key FY27 regulatory changes
• Set up your books for FY27
• Create your FY27 business budget
• Update your business registrations and insurance
• Plan your tax strategy for FY27
• Set business goals and review your strategy
• Start FY27 with confidence using Xero
• FAQs on the new financial year

Key takeaways

• The first few weeks of July are your window to close out FY26, lodge your Q4 BAS, and confirm all super guarantee payments before deadlines hit.
• Payday Super starts 1 July 2026, replacing quarterly super with per-pay-period contributions and a seven-day payment rule that changes how you manage cash flow.
• Setting up your books, updating tax tables, and rolling over to FY27 early prevents compliance headaches and gives you clean data from day one.
• A forward-looking budget and clear business goals for FY27 turn the new financial year from a compliance exercise into a genuine growth opportunity.

Why the first weeks of the new financial year matter

The start of a new financial year isn't just a date on the calendar. It's the point where your compliance obligations reset, new rules kick in, and the decisions you make in July set the tone for the next 12 months.

For Australian small business owners, FY27 brings some of the biggest regulatory changes in years. Payday Super fundamentally changes how and when you pay superannuation. The super guarantee rate rises again. And if you don't close out FY26 properly, you'll carry unresolved issues into the new year.

This new financial year checklist for Australia walks you through everything you need to do in July, from reconciling your accounts and understanding the regulatory changes, to setting up your books and planning your budget for FY27. For more on wrapping up the outgoing financial year, start there first, then use this guide as your step-by-step plan for what comes next.

Review and close out the previous financial year

Before you can focus on what's ahead, you need to tie up loose ends from FY26. The tasks in this section have hard deadlines, so they should be at the top of your July to-do list.

Reconcile your accounts

Bank reconciliation is the foundation of accurate financial records. Your goal is to make sure every transaction in your accounting software matches your bank statements through 30 June 2026.

Here's what to work through:

• Match all transactions. Go through your bank feeds and clear any unreconciled items from the last financial year.
• Chase overdue invoices. Follow up on any outstanding payments from FY26 so they don't carry over as unresolved debts.
• Write off bad debts. If any invoices are genuinely uncollectable, write them off before you finalise your FY26 records.
• Review petty cash and expenses. Make sure all receipts and reimbursements are recorded and categorised correctly.

Getting reconciliation done early gives you a clean starting point for FY27 and makes your tax return preparation much simpler.

Finalise your BAS and tax obligations

Your Q4 BAS (Business Activity Statement) for April to June 2026 is due by 28 July 2026. If you lodge through a registered tax agent, you may have until 28 August 2026, but confirm this with your agent.

There are a few things to check before you lodge:

• GST thresholds: If your annual turnover is approaching or exceeding $75,000, you're required to register for GST. Review your turnover figures for FY26 to confirm your obligations.
• PAYG withholding: Make sure all employee tax withheld during Q4 is reported accurately.
• PAYG instalments: If you pay income tax in quarterly instalments, your Q4 instalment is also due by 28 July.
• Income tax return preparation: While your income tax return isn't due until later in the year, gathering your records now saves time and stress.

Super guarantee catch-up

The Q4 FY26 super guarantee payment is due by 28 July 2026. This is the last quarterly super obligation you'll have before Payday Super takes effect.

Make sure you've covered these essentials:

• Confirm Q4 contributions are paid. Super for April to June must reach your employees' funds by 28 July. Late payments attract the super guarantee charge (SGC), which includes the original amount, interest, and an administration fee.
• Note the new SG rate. The super guarantee rate increases to 12% from 1 July 2026. All pay runs from 1 July onward must use the updated rate.
• Plan for the transition. This is the last time you'll pay super on a quarterly cycle. From 1 July 2026, Payday Super requires you to pay with each pay run.

Understand the key FY27 regulatory changes

FY27 introduces several changes that affect how you run your business day to day. The biggest is Payday Super, but there are also updates to the instant asset write-off and measures from the 2026-27 Federal Budget worth noting.

Payday Super: What it means for your business

Payday Super is the most significant change to superannuation obligations in years. From 1 July 2026, you must pay super at the same time as wages, rather than in quarterly lump sums.

Here's how it works in practice:

• The seven-day rule: You have seven business days from each pay day to make the super contribution to your employees' funds. For example, if you pay wages on a Friday, the super payment must arrive by the following Friday (excluding weekends and public holidays).
• Every pay run: If you pay employees weekly, you'll make weekly super contributions. Fortnightly pay runs mean fortnightly super. This replaces the old quarterly cycle entirely.
• Cash flow impact: Instead of saving up and paying a lump sum each quarter, you'll need to account for super as a regular outgoing alongside wages. For many small businesses, this means keeping a tighter grip on cash reserves.
• Working capital needs: Work out how much super you pay per pay period at the new 12% rate. Make sure your operating account can cover wages and super together without a shortfall.
• Penalties for late payment: The consequences of missing a super deadline haven't softened. Late payments attract the super guarantee charge. Check the ATO website for current penalty rates and calculation details.
• SBSCH transition: The Small Business Superannuation Clearing House will close as Payday Super is introduced. If you currently use the SBSCH to process super payments, you'll need to switch to a commercial clearing house or make payments directly to each employee's super fund. Check the ATO website for the latest closure timeline and start researching alternatives now.

Payday Super is a structural shift, not just a timing change. Building it into your payroll workflow now, rather than scrambling in late July, will save you stress and potential penalties.

Instant asset write-off changes

The instant asset write-off allows eligible small businesses to immediately deduct the cost of assets up to a set threshold, rather than depreciating them over time.

For FY27, the key details are:

• $20,000 threshold: Assets costing less than $20,000 (excluding GST if you're registered) can be written off immediately in the year they're first used or installed ready for use.
• Eligibility: Your business must have an aggregated turnover of less than $10 million.
• What qualifies: Equipment, tools, technology, vehicles (up to certain limits), and furniture are common examples. Each individual asset must cost less than the threshold. You can't split a larger purchase across multiple claims.
• Strategic timing: If you're planning a significant purchase, buying and installing the asset early in FY27 lets you claim the deduction in this year's return.

2026-27 Federal Budget changes

The May 2026 Federal Budget included several measures relevant to small businesses. Here are the ones worth noting for your FY27 planning:

• Working Australians Tax Offset: A $250 tax offset for individuals earning up to $150,000 takes effect from FY28 (2027-28). While it doesn't apply to FY27, it's worth factoring into longer-term planning for your personal tax position.
• PAYG instalment adjustments: The ATO is updating PAYG instalment amounts to better reflect current income levels. Check your instalment notices when they arrive to make sure they align with your expected FY27 income.
• Energy bill relief: Extended energy rebates for small businesses may reduce your operating costs. Check business.gov.au for the latest eligibility details and how to claim.

Set up your books for FY27

Once you've closed out FY26 and reviewed the regulatory changes, it's time to get your accounting system ready for the new year. A clean setup now means fewer corrections later.

Update your accounting software

Your software needs to reflect the new financial year's rates and reporting periods from day one.

Key tasks to complete:

• Roll over to the new financial year. Most cloud accounting platforms handle this automatically, but verify that your FY27 period is active and ready to record transactions.
• Update tax tables. The ATO releases updated PAYG withholding tax tables each year. Make sure your payroll system is using the FY27 tax tables so employee deductions are calculated correctly.
• Configure Payday Super. Set up your payroll to trigger super payments with each pay run, rather than accumulating them for quarterly payment.
• Set up new reporting periods. Create your monthly or quarterly reporting schedule for FY27 so you can track performance against your budget from July onward.

Review your chart of accounts

Your chart of accounts is the structure behind every financial report you produce. The start of a new year is the right time to clean it up.

A few things to check:

• Remove unused accounts. If you have expense or income categories you haven't used in 12 months or more, archive or delete them.
• Add new categories. If your business has added new revenue streams, products, or cost centres, create accounts for them now.
• Align with ATO requirements. Make sure your categories map cleanly to ATO reporting requirements, particularly for BAS and income tax.

Archive FY26 records

The ATO requires you to keep business records for at least five years from the date you lodge the relevant return. Archiving your FY26 records now keeps them accessible without cluttering your active workspace.

Key actions:

• Back up your financial data. Export or download a full copy of your FY26 records, including profit and loss, balance sheet, and all transaction data.
• Store securely. Use cloud storage with appropriate access controls, or keep a secure physical copy if required.
• Organise by category. Group records by type (invoices, receipts, bank statements, payroll records) so they're easy to retrieve if the ATO requests them.

Create your FY27 business budget

A budget isn't just a spreadsheet exercise. It's the tool that tells you whether your business is on track each month. Starting FY27 with a realistic budget gives you a benchmark to measure against all year.

Review last year's performance

Before setting new targets, look at how FY26 actually played out.

Key areas to assess:

• Revenue vs target: Did you hit your FY26 revenue goals? If not, what drove the gap: fewer customers, lower average sale value, or seasonal factors?
• Expense control: Identify where you overspent and where you came in under budget. Look for recurring costs that could be reduced or renegotiated.
• Profit margins: Calculate your net profit margin for FY26 and compare it to FY25. Small shifts in margins can signal bigger trends.

Set revenue and expense targets

With your FY26 review complete, set clear financial targets for FY27.

Practical tips for setting targets:

• Break targets into monthly or quarterly milestones. Annual goals are easier to track when you can check progress every month.
• Account for seasonal patterns. If your business has quieter or busier months, reflect that in your targets rather than spreading revenue evenly.
• Build in a buffer. Add a contingency of five to 10 per cent to your expense budget for unexpected costs. They always come up.
• Factor in new costs. Payday Super will change the timing (and potentially the admin costs) of your super payments. Include that in your payroll budget.

Cash flow planning

Cash flow is the lifeblood of a small business, and FY27 brings specific reasons to plan it carefully.

Focus on these areas:

• Forecast your first quarter. Map out expected income and expenses for July to September, including all tax and super obligations due in that period.
• Factor in Payday Super timing. With super now due per pay period rather than quarterly, your cash outflows will be more frequent. Model this into your weekly or fortnightly cash flow forecast.
• Identify potential gaps. If there's a point in Q1 where expenses are likely to exceed income (for example, BAS payment plus Payday Super plus supplier invoices), plan how you'll bridge it, whether through a business savings buffer, a line of credit, or adjusting payment terms.

Update your business registrations and insurance

July is a natural checkpoint for making sure your business details are current and your coverage matches your actual operations.

Check ABN and registration details

Your Australian Business Number (ABN) and other registrations should reflect your business as it operates today.

Quick checks to make:

• Verify your ABN details. Search the Australian Business Register to confirm your trading name, business structure, and GST registration are all correct.
• Review your business structure. If your business has grown, taken on partners, or changed how it operates, your current structure (sole trader, partnership, company, trust) may no longer be the best fit. Talk to your accountant about whether a restructure makes sense.
• Update contact details. Make sure the ATO and ASIC have your current address, phone number, and authorised contacts on file.

Review insurance coverage

Insurance is one of those things you set up and forget about, until you need it. The start of a new financial year is a good reminder to check your policies.

Areas to review:

• Public liability: Does your coverage still match your activities? If you've expanded into new services or locations, your policy may need updating.
• Professional indemnity: If you provide advice or professional services, make sure your indemnity insurance reflects your current client base and revenue.
• Workers' compensation: With wages and super obligations changing, confirm your workers' comp premiums are based on accurate wage estimates for FY27.
• Asset insurance: If you've purchased new equipment or assets (especially under the instant asset write-off), add them to your policy.

Plan your tax strategy for FY27

Tax planning isn't something you should leave until the end of the year. Getting your strategy in place now helps you make better decisions throughout FY27 and avoid surprises when lodgement deadlines arrive.

Key lodgement dates

Knowing your deadlines upfront prevents late fees and penalties. Here are the major dates for FY27:

• 28 July 2026: Q4 FY26 BAS and super guarantee due
• 28 October 2026: Q1 FY27 BAS due (July to September)
• 28 February 2027: Q2 FY27 BAS due (October to December)
• 28 April 2027: Q3 FY27 BAS due (January to March)
• 28 July 2027: Q4 FY27 BAS and super due
• 31 October 2026: Individual and sole trader income tax return due (if self-lodging)

If you use a registered tax agent, your lodgement dates may differ. Confirm your specific deadlines with your agent early in the year.

Maximise deductions early

The best time to plan your deductions is at the start of the financial year, not the end.

Strategies to consider:

• Plan asset purchases. If you need new equipment, tools, or technology, buying early in FY27 lets you claim the instant asset write-off in this year's return.
• Prepay deductible expenses. Some expenses, like insurance premiums or subscriptions, can be prepaid and claimed as a deduction in the year of payment. Check with your accountant to see what's eligible.
• Keep records from day one. Every business expense needs a receipt or record. Set up a system now so nothing falls through the cracks during the year.
• Review your vehicle logbook. If you claim motor vehicle expenses using the logbook method, check whether your logbook is still valid (they need to be updated every five years).

Set business goals and review your strategy

The new financial year is more than a compliance milestone. It's a chance to step back, assess where your business is, and decide where you want it to be in 12 months.

Start by reflecting on FY26. What worked well? Where did you fall short? Were there opportunities you missed or risks you didn't anticipate? Honest answers here will shape better goals for FY27.

When setting your FY27 goals, make them specific and measurable. "Grow revenue" is a direction, not a goal. "Increase revenue by 15% through three new client accounts by December 2026" gives you something concrete to work toward.

Break your annual goals into quarterly action plans. For example:

• Q1 (July to September): Focus on compliance setup, Payday Super transition, and locking in your budget.
• Q2 (October to December): Review performance against budget, chase outstanding invoices before the holiday period, and assess whether your pricing is keeping pace with costs.
• Q3 (January to March): Mid-year strategy check: are you on track for your annual goals? Adjust targets if needed.
• Q4 (April to June): Pre-EOFY planning, final asset purchases for write-offs, and preparing for FY28.

New financial year planning doesn't have to be complicated. A few hours of structured thinking in July can save you months of reactive decision-making later.

Start FY27 with confidence using Xero

Starting a new financial year means juggling compliance deadlines, regulatory changes, and business planning all at once. Xero brings it all together in one place, so you can focus on running your business rather than managing your books.

With Xero, you can:

• Automate bank reconciliation. Bank feeds pull your transactions in automatically, so reconciling your accounts takes minutes rather than hours.
• Stay on top of Payday Super. Xero's payroll features help you manage super contributions alongside each pay run, keeping you compliant with the new seven-day rule.
• Prepare and lodge BAS with confidence. Your GST, PAYG, and instalment data flows into your BAS automatically, reducing the risk of errors and missed deadlines.
• Track cash flow in real time. See where your money is going and forecast ahead, so Payday Super timing changes and other new costs don't catch you off guard.
• Get instant answers with JAX. Xero's AI financial superagent lets you ask questions about your business finances in plain language and get answers drawn from your live data.
• Pull bills and receipts in Hubdoc. Hubdoc captures your bills and receipts and feeds them into Xero automatically, so your records are always up to date.

Ready to simplify your new financial year? Get one month free and see how Xero can help you start FY27 on the right foot.

FAQs on the new financial year

Here are answers to some of the most common questions Australian small business owners have about the new financial year.

When does the Australian financial year start and end?

The Australian financial year runs from 1 July to 30 June. FY27 starts on 1 July 2026 and ends on 30 June 2027.

What is Payday Super and when does it start?

Payday Super requires employers to pay superannuation contributions at the same time as wages, within seven business days of each pay day. It takes effect from 1 July 2026.

What is the super guarantee rate for FY27?

The super guarantee rate is 12% from 1 July 2026. This applies to all ordinary time earnings paid from that date onward.

How long do I need to keep business records in Australia?

The ATO requires you to keep most business records for five years from the date you lodge the relevant tax return. Some records, like those related to capital gains, may need to be kept longer.

What are the key ATO lodgement dates for FY27?

The main quarterly BAS deadlines are 28 October 2026, 28 February 2027, 28 April 2027, and 28 July 2027. Individual and sole trader income tax returns are due by 31 October 2026 if you self-lodge. Dates may vary if you use a registered tax agent.