Looking ahead to 2026
Running a business in Australia has never been more dynamic. Costs are shifting, customer expectations are higher, and the pressure to stay compliant with the ATO is always there. With 2026 just around the corner, now is the perfect time to tighten up your financial foundations so you’re not caught scrambling when the year kicks off.
Think of it like servicing a work ute before a long trip. You wouldn’t hit the road without checking the tyres, oil, and brakes. The same goes for your business, a bit of financial maintenance today can save a lot of breakdowns tomorrow.
Here are practical tips you can start putting into place now to prepare your business for a successful 2026.
1. Revisit your financial goals
Before crunching numbers, take a step back and ask: Where do I want the business to be in 12 months’ time?
- Do you want stronger profit margins?
- Are you planning to hire staff or invest in equipment?
- Is expansion into new markets on the cards?
Setting SMART goals (Specific, Measurable, Achievable, Relevant, Time-bound) helps bring clarity. For example, “Increase net profit by 10% by December 2026” gives you a tangible target to plan around.
Once goals are set, make sure they’re written down and broken into quarterly milestones. Reviewing progress every few months keeps you accountable and gives you the flexibility to adjust when needed.
2. Review your cash flow
Cash flow is often the biggest headache for business owners, especially with late-paying clients and rising costs. If you’re not already using cash flow forecasts, now’s the time to start.
Tools like Xero’s cash flow forecasting make it easier to predict what your bank balance will look like in the weeks and months ahead. Pair this with a cash buffer, ideally one month of operating expenses, so you’re protected against the unexpected.
A few smart steps to improve cash flow include:
- Invoicing clients promptly and following up on overdue accounts
- Negotiating better terms with suppliers
- Setting up automated reminders in your accounting software
- Reviewing subscriptions and cutting unused expenses
Cash flow forecasting isn’t just for large companies. Even small tradie businesses or local cafés benefit from knowing when the highs and lows will hit.
3. Build a budget that works in today’s climate
Budgets can feel restrictive, but they’re really about giving every dollar a job. A fresh budget for 2026 should reflect your current costs, including inflation, wage increases, and higher supplier pricing.
Start by reviewing your last six months of expenses. Categorise them into:
- Fixed costs (rent, insurance, wages)
- Variable costs (supplies, utilities, marketing)
- Growth investments (new hires, equipment, training)
Once everything’s mapped out, identify areas where costs are creeping up. A realistic budget is flexible, review it monthly and make small adjustments rather than waiting until year-end to find out you’ve overspent.
4. Tidy up your bookkeeping
Accurate records are the backbone of good financial management. If your bookkeeping is patchy, every other strategy will suffer.
By 2026, the ATO is expected to continue tightening compliance, especially around Single Touch Payroll (STP), GST, and BAS lodgements. Staying on top of your records now avoids the stress of last-minute fixes later.
Some habits to implement now:
- Reconcile your bank feeds in Xero weekly
- Keep digital receipts organised in folders or apps
- Track stock levels if you manage inventory
- Set aside time each fortnight for bookkeeping catch-up
If bookkeeping feels like a constant uphill battle, outsourcing may be the smartest move. Clean records make forecasting, reporting, and tax time much smoother.
5. Plan for tax well ahead of EOFY
Many business owners only start thinking about tax when June rolls around, but strategic tax planning should happen all year round. Reviewing your position early gives your business more room to manage cash flow, spread deductions, and avoid last-minute surprises.
Here’s how your business can stay proactive:
- Review your business structure: Make sure your setup, whether it’s a company, trust, or partnership, still aligns with your size, risk profile, and long-term goals.
- Consider prepaying key business expenses: Payments for rent, insurance, or subscriptions made before 30 June can often be deducted in the current financial year.
- Maintain accurate records of deductible costs: This includes business-related expenses like professional fees, equipment, and vehicle costs.
- Forecast and set aside for tax liabilities: Planning ahead ensures you have the cash flow to cover BAS, PAYG, and income tax without stress.
6. Review your margins and pricing
If you haven’t revisited your pricing model in over a year, chances are your margins are tighter than you think. Rising supplier costs, higher wages, and inflation all chip away at profits.
Conduct a margin analysis by looking at:
- Cost of goods sold (COGS)
- Labour costs
- Overheads
- Final selling price
If your margins are slipping, consider options like renegotiating supplier contracts, streamlining workflows, or adjusting your pricing. Many small businesses are hesitant to raise prices, but if costs are rising across the board, holding back may hurt your long-term viability.
7. Prepare for seasonal shifts
Plenty of Australian businesses see revenue fluctuate throughout the year — retail spikes at Christmas, hospitality slows in winter, and construction often depends on weather conditions.
Map out your seasonal highs and lows using past data. Then plan around them by:
- Building cash reserves in strong months
- Scheduling maintenance, training, or renovations in slower periods
- Adjusting staffing levels where possible
Forecasting with seasonality in mind helps you stay in control rather than being caught off guard.
8. Strengthen your reporting
It’s not enough to just have financial data, you need insights. Management reports in Xero or add-ons like Syft to turn numbers into meaningful information.
Reports worth reviewing regularly include:
- Profit and loss statements
- Balance sheets
- Aged receivables and payables
- Cash flow forecasts
- Job costing and project profitability
Clear reporting shows you not just what happened, but what’s likely to happen next. That forward-looking view is what helps you make smarter decisions for 2026.
9. Make compliance a non-negotiable
ATO audits may feel unlikely, but they’re more common than many business owners realise. Staying compliant avoids costly penalties and keeps your focus on growth instead of stress.
By 2026, expect continued scrutiny on:
- GST reporting
- Single Touch Payroll (STP) submissions
- Superannuation guarantee contributions
- Business activity statements (BAS)
Automating as much as possible in Xero reduces the chance of errors. Always double-check lodgement deadlines and consider working with a BAS or tax agent to keep everything above board.
10. Invest in financial education
The best investment you can make is understanding your own numbers. Whether it’s attending a workshop, listening to podcasts, or working closely with a bookkeeper or advisor, staying informed keeps you in control.
Set a goal to learn one new financial skill before 2026. It might be understanding cash flow ratios, diving into Xero forecasting tools, or brushing up on superannuation strategies. A little extra knowledge today can pay off in major savings tomorrow.
Taking the pressure off
Preparing your business for 2026 doesn’t mean overhauling everything at once. It’s about taking consistent, manageable steps: keeping your records clean, planning your taxes early, forecasting cash flow, and making sure you’re not just reacting but steering the ship.
At Accounts All Sorted, we help Australian businesses simplify their finances and gain confidence in their numbers. From bookkeeping and payroll to Xero advisory and compliance support, our goal is to make sure you can focus on running the business while we keep the financial side clear and under control.
If you’d like to step into 2026 with stronger systems, better forecasts, and more confidence in your decisions, get in touch with Accounts All Sorted today.
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