Media releasePublished on 12 June 2024

New Xero research highlights end of financial year causes stress and mishaps amongst small businesses

Misplacing important documents and receipts was revealed as the most common mishap

Melbourne, 12 June 2024 Xero, the global small business platform, has released new research highlighting how Australian small businesses think and feel about the end of financial year (EOFY). The survey of more than 1000 small business owners and decision makers revealed 71% consider this time of year stressful, and 83% find one or more aspects overwhelming.

The top source of overwhelm during EOFY was found to be navigating tax compliance (33%). This was closely followed by gathering financial data (32%), the time investment required (30%), staying on top of receipts (28%), and balancing financial deadlines with day-to-day operations (26%).

Anthony Drury, Managing Director ANZ, Xero, said: “Our new research demonstrates that EOFY can be a difficult period for small businesses. It adds greater pressure on time, resources, and is compounded by the challenges they are facing in the current economic climate — from the rising cost of living, to a drop in small business labour productivity1. Our aim for this research is to highlight these common pain points around EOFY preparations, so we can provide practical tips for small businesses to use right now.”

More than half (56%) of small business owners confessed to making a mishap in their past EOFY preparations. The most common mishaps were misplacing important documents or receipts (32%), forgetting to claim a significant deduction (31%), entering incorrect figures that lead to tax errors (14%) and accidentally deleting crucial financial records (11%). When asked what the biggest EOFY misconceptions were, respondents selected ‘it’s just a one day event’ (47%), ‘it’s easy to prepare for’ (43%) and ‘it’s only about taxes and paperwork’ (42%).

Drury continues: “We always encourage small business owners to connect with their accountant or bookkeeper throughout the year to make EOFY preparations easier. EOFY highlights how important those relationships are as advisors can help to alleviate pressures, from managing records and financial statements to understanding tax compliance.”

“Complementing your accountant or bookkeeper’s advice with digital tools is an excellent way to automate repetitive tasks such as receipt capture, invoicing and bank reconciliation, and help manage the risk of errors. Xero’s research* shows how powerful digital adoption can be in terms of boosting productivity outcomes, as it allows small business owners to spend less time labouring on manual tasks and more time focusing on running their business.”

For more information and tips on how to help address the end of financial year preparations, visit Xero’s EOFY Resource Hub.

*Based on research revealed in Xero’s Small Business Insights (XSBI) Special report, Small Business Productivity: Trends, Implications, and Strategies (April 2024), which found that small business productivity declined in 2023 to AU$100.30/hour, around 9% lower than the most recent peak in November 2022 (AU$110.40/hour).

-ENDS-

Media Contact

Jess Brophy | Head of Communications, Australia | +61 431 268 549 | jess.brophy@xero.com

About Xero

Xero is a global small business platform with 4.2 million subscribers. Xero’s smart tools help small businesses and their advisors to manage core accounting functions like tax and bank reconciliation, and complete other important small business tasks like payroll and payments. Xero’s extensive ecosystem of connected apps and connections to banks and other financial institutions provide a range of solutions from within Xero’s open platform to help small businesses run their business and manage their finances more efficiently.

About the survey

All figures, unless otherwise stated, are from YouGov. Total sample size was 1,077 Australian adults, with 80% from NSW, VIC and QLD, who are small business owners and decision makers in businesses with fewer than 20 employees. Fieldwork was undertaken between 10th - 19th May 2024. The survey was carried out online.

Disclaimer

This media release includes and is in parts based on assumptions or estimates. It contains general information only and should not be taken as taxation, financial, investment or legal advice. Xero recommends that readers always obtain specific and detailed professional advice about any business decision. The insights in this release were created from the data that was available as at the date it was extracted. Data used was anonymised and aggregated to ensure individual businesses can not be identified.

For all media enquiries, please contact the Xero media team.

Start using Xero for free

Access Xero features for 30 days, then decide which plan best suits your business.

  • Included
    Safe and secure
  • Included
    Cancel any time
  • Included
    24/7 online support