A new financial year should not begin with business as usual. It should begin with a clear new financial year business strategy.
Many businesses treat July as an administrative reset: close off the previous year, update payroll rates, prepare for BAS and move on. In the current economic environment, however, that approach is no longer enough.
Inflation continues to place pressure on businesses, with Australia’s CPI rising 4.0% in the 12 months to May 2026. Housing, food and transport remained among the largest contributors. The RBA also kept the cash rate at 4.35% in June, which means the cost of capital continues to influence business planning and investment decisions.
Businesses must also manage new payroll and super obligations, changing tax settings, higher compliance expectations and renewed global uncertainty.
On 13 July 2026, renewed conflict around the Strait of Hormuz pushed Brent crude prices higher. This development reminded businesses how quickly global shocks can affect fuel prices, freight costs, supplier expenses and consumer confidence.
Business leaders should therefore use the start of the financial year as a strategic reset, not simply as a compliance exercise.
A practical new financial year business strategy should address the following six areas.
Many businesses review revenue targets at the start of the financial year, but fewer check whether their pricing still reflects the true cost of delivery.
As wages, rent, software, insurance, finance, freight and supplier costs rise, margins can shrink even when revenue continues to grow.
The key question is not simply:
“Should we increase our prices?”
A better question is:
“Which products, services, projects and clients remain financially sustainable under our current cost base?”
Management should look beyond total revenue and review profitability by service, project or client. This may include labour costs, supplier increases, discounts, unbilled work, payment delays and the cost of rework or scope changes.
The right response may not be a broad price increase. It may involve revising service packages, reducing low-margin work, renegotiating supplier terms, tightening payment conditions or becoming more selective about the work the business accepts.
A strong pricing strategy helps the business protect margins, maintain service quality and focus resources where the greatest value is created
Business leaders should review payroll as one of their first priorities for the new financial year.
From the first full pay period starting on or after 1 July 2026, the National Minimum Wage increased to $1,004.90 per week, or $26.44 per hour.
Employers should also review award rates carefully because changes may affect roles and classifications differently. A general wage update does not automatically ensure that every employee receives the correct rate.
The larger structural change is Payday Super.
From 1 July 2026, employers must pay superannuation concurrently with wage cycles, rather than relying on the previous quarterly payment cycle
This change involves more than updating a payroll setting. It directly affects business cash flow.
Businesses that previously used quarterly super payment timing as part of their working capital cycle must now adjust their cash planning. Payday Super requires stronger payroll discipline, more accurate cash flow forecasting and less tolerance for weak internal processes.
At the start of the year, business leaders should ask:
Payroll errors compound quickly. A minor system mistake in July repeats across every pay cycle, quietly building into substantial back payments, penalties, and administrative chaos by year-end. Reviewing these settings early prevents small glitches from becoming expensive liabilities.
Many businesses review revenue targets at the start of the financial year, but fewer check whether their pricing still reflects the true cost of delivery.
As wages, rent, software, insurance, finance, freight and supplier costs rise, margins can shrink even when revenue continues to grow.
The key question is not simply:
“Should we increase our prices?”
A better question is:
“Which products, services, projects and clients remain financially sustainable under our current cost base?”
Management should look beyond total revenue and review profitability by service, project or client. This may include labour costs, supplier increases, discounts, unbilled work, payment delays and the cost of rework or scope changes.
The right response may not be a broad price increase. It may involve revising service packages, reducing low-margin work, renegotiating supplier terms, tightening payment conditions or becoming more selective about the work the business accepts.
A strong pricing strategy helps the business protect margins, maintain service quality and focus resources where the greatest value is created.
The 2026–27 Federal Budget proposed making the $20,000 instant asset write-off permanent for eligible small businesses with turnover below $10 million from 1 July 2026.
The measure can support businesses planning to invest in equipment, technology or other eligible assets by allowing an immediate deduction rather than spreading the deduction over several years.
However, the tax outcome should remain only one part of the decision. Before making a purchase, business leaders should consider whether the investment will improve productivity, reduce manual work, increase capacity, strengthen reporting or deliver a clear commercial return. Business leaders should also consider the upfront cash requirement, implementation costs, staff training and ongoing fees.
Businesses investing in innovation should also consider whether their activities may qualify for the R&D Tax Incentive. Companies developing or improving products, processes, software or services may be eligible where the work involves qualifying experimental activities and appropriate supporting records are maintained.
Tailored Accounts supports R&D Tax Incentive claims through a structured professional process and purpose-built software that improves project management, documentation and claim preparation.
The strongest investment decisions balance commercial need, cash flow impact and available tax support. Tax incentives can improve the financial outcome of a worthwhile investment, but tax considerations should support business strategy rather than drive it.
The current year has already demonstrated how quickly global events can affect Australian businesses.
Conflict around the Strait of Hormuz reminds business leaders that energy prices, shipping routes, exchange rates and global market confidence can affect local businesses, even when those businesses do not trade internationally.
Higher fuel and transport costs can flow through to supplier prices. A weaker Australian dollar can increase the cost of imported products, equipment and software. Higher energy costs can affect direct business expenses as well as customer spending behaviour.
While predicting every global event is impossible, preparing for the financial consequences remains entirely within a business’s control.
The practical response is not panic. It is scenario planning.
Management should identify the small number of variables that could materially affect the business during the year.
For example:
What happens if supplier costs rise by 5% or 10%?
What happens if fuel or freight costs increase?
What happens if customers take longer to pay?
What happens if a major customer reduces spending?
The purpose of scenario planning is not to predict every possible risk. It helps management understand which risks matter most, what warning signs to monitor and what actions the business can take before the pressure becomes critical.
Potential responses may include building a larger cash reserve, securing alternative suppliers, reviewing contract terms, reducing dependence on one customer or adjusting pricing more frequently.
A resilient business does not avoid every disruption, but rather maintains enough financial visibility and operational flexibility to respond early.
Annual accounts alone do not give business leaders enough information to manage effectively. By the time problems appear at year-end, the opportunity to respond may have passed.
Directors, owners and management need timely reporting that shows:
cash position and forecast requirements;
revenue, profitability and margins;
debtor movements;
key cost increases;
tax, payroll and super obligations;
performance against budget; and
major risks for the next quarter.
The best reports are clear, consistent, and action-oriented, helping management understand what has changed, why it matters, and what decisions need to be made.
Regular financial reporting does more than record the past. It gives the business the visibility and insight needed to make better decisions for the future.
The new financial year is more than a time to tidy up the accounts. It is an opportunity to reset cash flow, payroll, pricing, tax, investment, risk and reporting.
In a year shaped by inflation, higher funding costs, new super obligations and global uncertainty, a clear business strategy helps leaders act early and make better financial decisions.
Tailored Accounts combines accounting, tax, reporting, payroll and CFO-level support to help businesses make better financial decisions throughout the year.
Speak with Tailored Accounts about building a practical financial plan for the year ahead.
If you invest in an Early Stage Innovation Company (ESIC), you may be eligible for the early stage investor tax offset.
This incentive encourages investment in innovative Australian start-ups. However, the rules are specific, and investors need to understand the benefit. Start-ups should also understand how it may affect capital raising and reporting.
For many employers, EOFY payroll appears straightforward. Complete the final pay run, finalise payroll through Single Touch Payroll (STP), and move on to the new financial year.
In reality, STP finalisation is often the final step of a much larger review process. Before employee income statements are marked as tax ready, businesses should ensure that payroll records, accounting records and ATO reporting all align correctly.
Behind every set of year-end financial reports sits a significant amount of reconciliation, review and compliance work. Payroll, superannuation, BAS, GST, bank reconciliations, debtor balances, creditor balances and year-end adjustments must all align accurately before businesses can finalise their books.
