Don’t pay tax on money you haven’t received yet.
This is applicable more so for service-based businesses where you’re primarily providing a service. You can choose to pay tax on what they call the receipts based method of your sales, rather than an accruals basis which is when you raise the invoice. So we’ve had tradies where they made $200,000 in profit on an invoice base, but they were owed $200,000 at the end of the year. So, really they made no profit from a cash perspective. We can take that off their income and they pay no tax there.