How to Avoid ATO Audit Headaches: A Guide for Small Business Owners
If you’re a small business owner in Australia, the word “audit” might send a shiver down your spine. And fair enough. The Australian Taxation Office (ATO) has stepped up its enforcement game for FY25, and audits will be more frequent, especially for businesses that fall outside the lines.

The good news? You can stay off the ATO’s radar and take the stress out of financial admin with a little help from Thriday.
Let’s unpack what the ATO is focusing on right now, what could trigger an audit, and how Thriday helps you keep things squeaky clean.
Why the ATO is turning up the heat
The ATO’s current mission is clear: crack down on non-compliant buinesses. Just 1% of debtors are responsible for a whopping $11 billion in unpaid tax. The ATO is going hard on this group—with powers like garnishee notices, director penalty notices, and even wind-up action being used against businesses that refuse to engage.
But it’s not just about the big offenders. The ATO uses data analytics and benchmarking to scan for anomalies across all small businesses. That means even a small inconsistency could raise a red flag.
What could trigger an audit?
The ATO keeps a close eye on certain behaviours that often lead to deeper investigations. Here are some key triggers to watch out for:
- Unusual claims or deductions – If your expenses are way outside the norm for your industry, expect questions.
- High cash transactions – Hospitality and retail businesses, take note. If you're dealing with a lot of cash, the ATO will want to see meticulous records.
- Consistent losses – A few bad years are fine, but if you’re always in the red, they might wonder if your business is actually a hobby.
- Inconsistent income vs lifestyle – Reporting low income but living large? The ATO can and will cross-check.
- Big GST or tax refund claims – Especially if they don’t line up with your income or expense records.
Record-keeping: Your first line of defence
Staying audit-ready means keeping solid records. You’re legally required to hang onto key business documentation for at least five years, including:
- Invoices and receipts for income and expenses
- Any calculations or estimates used in your tax affairs
- Notes on decisions, like how you calculated GST or PAYG
- Documentation showing the business purpose behind each transaction
But here's the thing. Keeping track of all that manually is a nightmare.
How Thriday keeps you audit-ready (without the admin headache)
This is where Thriday shines. With built-in bank accounts, AI-powered automation, and real-time tracking, Thriday takes care of the heavy lifting. Here's how it protects you from audit stress:
✅ Automated record-keeping
Every transaction that flows through your Thriday account is automatically categorised, logged, and ready to go. That means receipts, income, and tax data are neatly stored and fully audit-compliant—without you lifting a finger.
✅ No dodgy bank feeds
Thriday doesn’t rely on unreliable third-party bank feeds. With integrated transaction accounts and Visa Debit cards, everything is tracked at the source.
✅ Real-time tax calculations
Whether it's GST, income tax or PAYG, Thriday calculates it automatically based on your live data. So you’re never guessing or scrambling last-minute.
✅ Easy access to financial reports
If the ATO ever comes knocking, you’ve got everything you need in one place—profit and loss, balance sheet, cash flow reports—you name it.

Want extra peace of mind?
If you’re in a high-risk industry or just want extra cover, tax audit insurance can help cover the cost of accounting professionals during an audit. But with Thriday doing the heavy lifting on record-keeping and compliance, you’ll already be in a strong position to handle anything the ATO throws your way.
Final word: Be proactive, not panicked
An audit doesn’t have to be a nightmare. With the right systems in place, it's just another check-up. Thriday helps you stay organised, compliant, and confident - no spreadsheets, no late-night panics, no stress.
So if you want to save time, sleep better, and keep the ATO happy, give Thriday a go. It’s everything you need to manage your finances—and avoid any audit headaches - automatically.
DISCLAIMER: Team Thrive Pty Ltd ABN 15 637 676 496 (Thriday) is an authorised representative (No.1297601) of Regional Australia Bank ABN 21 087 650 360 AFSL 241167 (Regional Australia Bank). Regional Australia Bank is the issuer of the transaction account and debit card available through Thriday. Any information provided by Thriday is general in nature and does not take into account your personal situation. You should consider whether Thriday is appropriate for you. Team Thrive No 2 Pty Ltd ABN 26 677 263 606 (Thriday Accounting) is a Registered Tax Agent (No.26262416).