If you’re a tradie running your own gig, you already know the feeling. Work’s flat-out, money’s coming in, invoices are going out—but by the end of the month there’s nothing left in the bank. You’re not alone. In fact, poor cashflow management is one of the biggest reasons small trade businesses struggle or shut down. The good news is, it’s fixable. You don’t need to be an accountant—you just need a system.
This article will show you how to think differently about your money, structure your accounts properly, and create steady fuel to keep your business running smoothly.
Why Cashflow Matters More Than Profit
Let’s start with a myth: “If I’m profitable, my business is fine.”
Not necessarily.
Profit is what’s left over on paper after expenses.
Cashflow is what’s actually in your account to pay suppliers, wages, and tax.
You can be “profitable” but still broke if the timing of your payments and income don’t line up. A few unpaid invoices or a big tax bill can drain your tank fast.
Think of your business like your ute: cash is the fuel.
No fuel, no motion—no matter how shiny the vehicle looks.
Spending Money vs Fuel for the Business
Most tradies who go out on their own start with a simple bank account. All their job payments go in, and everything—fuel, materials, groceries, even Friday knock-offs—comes out of the same place. It feels convenient, but it’s chaos in disguise.
When you treat every dollar as “spending money,” you burn through the fuel your business needs to survive. Remember, part of every payment belongs to:
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The ATO (GST and income tax)
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Your suppliers and subcontractors
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Your vehicle and equipment costs
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Superannuation (for future you)
Until those are covered, the rest isn’t truly yours to spend.
The Three-Account System
The easiest way to take control is to split your finances into three simple bank accounts:
| Account | Purpose | Notes |
|---|---|---|
| Main Business Account | All income and business expenses flow through here. | Keep this purely for operational cashflow. |
| GST / Tax Account | Transfer a percentage of income into this every month to cover tax and BAS. | Treat it as untouchable until the ATO says otherwise. |
| Personal Account | Pay yourself a fixed “wage” from the business each week or fortnight. | Never mix personal spending with business costs. |
This structure mirrors the “Keep it Simple / Keep it Separate” principle in The Finance Shed’s CARE model.
Even if you’re a one-person business, it gives you discipline and visibility. You’ll instantly know what’s safe to spend and what isn’t.
How to Work Out What to Transfer
Every business is different, but here’s a rough starting point:
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30% to the GST/Tax Account (covers GST, income tax, and super)
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40–50% stays in the Business Account for materials, fuel, insurance, subscriptions, etc.
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20–30% to your Personal Account as your “wage”
If your accountant calculates your real tax rate or you’re GST-registered quarterly, tweak the numbers. The idea is to move money automatically, not by guesswork.
Most online banking apps let you set scheduled transfers—use them.
Track the Flow, Not Just the Balance
A healthy business isn’t about the biggest number on the screen—it’s about the movement of money.
Here’s a simple weekly rhythm:
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Friday: Send all invoices for the week.
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Monday: Reconcile payments received, chase late invoices.
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Tuesday: Transfer GST/tax share and your wage.
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Wednesday: Review upcoming supplier payments.
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Thursday: Check that next week’s jobs have deposits confirmed.
It’s a five-minute routine that keeps your finger on the pulse.
Use Cloud Bookkeeping (Ditch the Shoebox)
If you’re still dropping receipts into a glove box or spreadsheet, you’re flying blind.
Cloud systems like Xero, MYOB Business, or QuickBooks Online automatically sync with your bank account, track invoices, and show what’s overdue in real time.
Benefits for tradies:
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Snap a photo of each receipt—no more lost dockets.
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Instantly see who owes you money.
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Generates BAS and tax reports automatically.
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Lets lenders (or your broker) view verified income if you need finance.
Cloud bookkeeping isn’t expensive—basic plans start around $10–$20 a month.
It’s one of the best investments you can make in your business confidence.
Create a Cash Buffer (“Rainy-Day Fuel Tank”)
The smartest tradies keep a cushion for lean weeks, slow payers, or breakdowns.
Aim to hold 6–8 weeks of operating costs in reserve—enough to cover your mortgage and bills if work stops unexpectedly.
Label it “Tier 1 Capital” (banking jargon experts uses in CareBiz). Governments make banks keep it for safety; small businesses should too.
If saving that much sounds impossible, start with $1,000 and build from there. The habit matters more than the number.
Manage Debtors Like a Pro
Late payments are a silent killer. You can’t spend money that’s still sitting in someone else’s account.
Tips:
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Invoice immediately when the job’s done—don’t wait for Friday.
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Use clear payment terms (e.g. “7 days EOM”) on every invoice.
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Send friendly reminders the day after it’s due.
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Offer small early-payment discounts (1–2%) if it keeps cash moving.
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For chronic offenders, ask for 50% upfront on future jobs.
A customer who won’t respect your payment terms isn’t worth keeping.
Avoid the Quick-Cash Traps
When things get tight, it’s tempting to hit up a payday lender or borrow from family.
Both can backfire badly.
Payday loans carry extreme fees and stain your credit record—mainstream banks will often auto-decline future applications if they see them.
Family loans can strain relationships unless they’re properly documented. If the borrower defaults, it becomes a gift, not a loan, and can even cause tax complications.
If you need short-term cash, talk to a licensed broker who can source legitimate cashflow finance or invoice-funding options instead.
Price for Profit, Not Panic
Many tradies under-quote to stay “competitive” but end up burning out.
Here’s the truth: you can’t out-cheap everyone forever.
When you price too low, you steal from yourself—no buffer, no super, no growth.
Review your pricing annually. Include:
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Materials and supplier costs
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Vehicle maintenance and insurance
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Accounting, admin, software subscriptions
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Superannuation and tax provision
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A margin for reinvestment
Even a 10% price increase can transform your cash position without losing good clients.
Pay Off Non-Deductible Debt First
One of Experts “Cash Hacks” in CareBiz is simple but powerful:
“Pay off non-tax-deductible debt first.”
Every dollar that goes to your home loan or credit card comes from after-tax income.
If your tax rate’s 30%, you actually need to earn $142.86 to pay off $100 of personal debt.
By clearing that first, you free up real cash faster.
Review Every Subscription and Cost
Business accounts bleed quietly through forgotten direct debits—old software, memberships, or tool hire you no longer need.
Once a quarter, print out your transaction list and ask:
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Do I still use this?
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Does it earn or save me money?
Cancel the rest.
Small leaks sink big ships.
Build a Relationship with Your Accountant or Broker
Don’t wait for tax time. Your accountant and finance broker should be part of your pit crew.
They can:
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Tell you exactly how much to set aside for GST and PAYG.
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Identify legal deductions you’re missing.
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Help you prepare clean financials that make banks say “yes.”
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Advise on equipment or property loans structured correctly for your situation.
Think of them as trusted advisors, not paper-pushers.
Track Your Weekly Wins
Cash discipline feels tedious until you start seeing results.
Each week, record three simple metrics:
| Metric | Why It Matters |
|---|---|
| Cash on hand | Ensures you can meet next week’s bills. |
| Outstanding invoices | Highlights slow payers to chase. |
| Upcoming expenses | Avoids “surprise” costs that wreck budgets. |
Over time you’ll recognise patterns: quiet months, seasonal demand, which clients pay slowest. That knowledge gives you control—something most small operators never have.
Treat Tax as a Sign of Success
A lot of tradies see tax as a punishment. Expert flips it:
“You only pay tax if you make a profit.”
Avoiding tax through cash jobs might save a few bucks now but destroys long-term value.
When you under-report income:
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Your business valuation drops (buyers rely on declared profit).
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You can’t prove income for a home or vehicle loan.
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The ATO’s data-matching systems will likely catch you.
Do it right. Declare everything. Then work with your accountant to use legal deductions and super contributions to reduce tax the smart way.
Supercharge Your Cash Discipline with Small Wins
Start with achievable habits:
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Set a weekly transfer to your tax account.
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Review invoices every Monday.
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Spend 10 minutes a week reconciling receipts.
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Schedule quarterly check-ins with your accountant.
Within a month or two, you’ll notice the stress fade. Tradie Cashflow management isn’t about spreadsheets—it’s about rhythm and routine.
The Long Game: From Survival to Growth
Once you’ve stabilised your cashflow, you can finally plan ahead:
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Build a reserve fund for new tools or vehicles.
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Pre-pay expenses at EOFY for tax efficiency.
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Invest in training or hire help to free your time.
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Start contributing to super regularly.
This is how you shift from working for money to having money work for you.
When to Ask for Help
If your debts are mounting, suppliers are chasing you, or you’re constantly dipping into personal savings to keep afloat—don’t go it alone.
Reach out to:
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Your accountant or broker for financial restructuring advice.
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A licensed financial counsellor (through ASIC’s MoneySmart) for free guidance.
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The Finance Shed team for a tailored cashflow and lending review.
There’s no shame in asking for help; there’s only risk in waiting too long.
Quick Checklist: Are You Cashflow Fit?
- Separate business, tax, and personal accounts
- Transfer tax and super every month
- Track invoices weekly
- Keep 6–8 weeks’ buffer cash
- Review costs quarterly
- Use cloud bookkeeping
- Pay yourself a regular wage
- Declare all income
If you can tick most of these, you’re already ahead of 90% of sole-trader businesses in Australia.
The Takeaway
Cashflow doesn’t have to be complicated. You don’t need an MBA—you just need to treat your business like a business, not a bank account.
By separating your money, tracking the flow, protecting your buffer, and planning ahead, you’ll move from constant scramble to calm control.
When the next big tax bill lands or a slow month hits, you’ll have fuel in the tank—and the confidence to keep driving forward.
Need help getting finance-fit?
The Finance Shed works with Aussie tradies every day to set up cashflow systems, access smart finance options, and build long-term wealth. Contact us to book a free 15-minute chat and get your business back in the black.