Your inward and outward cash flow is the lifeblood of your business. You need to make sure your business is likely to make money and will have enough cash available at the right time to pay its bills. In particular, you must be able to meet your tax obligations, including:.
GST – The GST you collect does not belong to you – you just collect it on our behalf. You must be able to pay this money (less any GST credits you are entitled to) to us by the due date of your monthly or quarterly activity statement, or your annual GST return, depending on your reporting cycle.

PAYG income tax instalments – most small businesses make quarterly payments to provide for the total amount of income tax they are liable to pay at the end of their income year. These payments are due when your activity statement is due. In your first year of operating a business, you will generally not have to pay quarterly PAYG instalments to provide for your income tax. Instead, you will have one income tax payment for the whole year at the end of the income year. So it’s important to make sure you have the money available for this one-off payment.
PAYG amounts withheld from employees’ wages – under PAYG withholding, you must withhold amounts from payments such as salary or wages to employees and payments to company directors. Most small businesses have to send these amounts to us each quarter with their activity statement. Remember, if you run your business through a company, you are probably an employee of the company.
Fringe benefits tax – if you have to pay fringe benefits tax, you may have to pay instalments on your quarterly activity statement.
Super – if you have employees, you will also have super payments (except in limited circumstances). You must make enough super contributions to a complying super fund or retirement savings account for your eligible employees each quarter. For more information, refer to Super – what employers need to know (NAT 71038).
The best way to make sure you have enough cash available to meet your tax and other obligations is to do a cash flow budget. The information in your cash flow budget will enable you to:
n see your likely cash position at any time
n identify any fluctuations that may lead to potential cash shortages
n plan for your tax payments
n plan for any major expenditure
n provide lenders with additional information.