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Creating an office of problem solvers

Posted on March 30, 2017 by admin


One major key to success is the ability to problem solve. Knowing how to respond to and resolve issues that arise creates stronger, more effective businesses. Whilst employees ought be highly skilled in their given fields, one trait that is truly invaluable is that of problem solving. As an employer, there are tips you can follow to encourage and develop the problem-solving abilities of your staff: Trust your employees There is nothing more damaging than micromanaging when it comes to building efficient problem solvers. When employees feel trusted and valued, they are more likely to challenge themselves when seeking out new and effective ways to resolve an issue that has arisen. Set goals for your staff rather than giving them rigid instructions to follow; you will lesson your own workload and you will be amazed at what solutions they can come up with. Always look for hidden opportunities We often follow the mantra, ‘if it’s not broke don’t fix it’. A problem arising in one area is actually a great opportunity to refine and improve existing surrounding processes and strategies. By viewing a problem arising as an opportunity to develop and strengthen the business, solving the problem often become less […]


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Who is a ‘related party’ in an SMSF?

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Self-managed super funds (SMSFs) have a number of investment restrictions which apply to transactions conducted within the fund. One such restriction applies to transactions involving ‘related parties’ of the fund and ‘relatives of members.’ No one associated with the SMSF should obtain a present-day benefit from the fund’s investments. The fund needs to meet the ‘sole purpose test’ of providing death or retirement benefits to the SMSF members or their dependents. A breach to the investment restrictions may result in significant penalties, such as the disqualification of a trustee and even prosecution. The Tax Office considers a ‘related party’ as: all members of the fund associates of fund members, including: – relatives of each member – the business partners of each member – any spouse or child of those business partners – any company the member or their associates control or influence – any trust the member or their associates control standard employer-sponsors, which are employers who contribute to your super fund for the benefit of a member, under an arrangement between the employer and a trustee of the fund associates of standard employer-sponsors, which include business partners and companies or trusts the employer controls (either alone or with their […]


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ATO to report unpaid debts to credit agencies

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The Mid-Year Economic and Fiscal Outlook 2016-17 (MYEFO) announced that from 1 July 2017, the ATO will disclose tax debt information of businesses who have not effectively engaged with the ATO to credit reporting bureaus. The new measure is aimed at enhancing the integrity of the tax system and ensuring businesses who are not compliant do not gain an unfair competitive advantage over those businesses who are. The ATO will initially pass on unpaid debts from businesses with an Australian Business Number and with a tax debt of more than $10,000 which is at least 90 days overdue. In addition, the Government will provide $1.6 million to establish a Black Economy Taskforce to develop an innovative, whole-of-government policy response to this problem. Black economy activities disadvantage honest taxpayers, undermine the integrity of Australia’s tax and welfare systems and reduce the amount of revenue collected by governments.


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Offering employees non-cash benefits

Posted on March 24, 2017 by admin


Most small business owners would love to be able to offer their more valuable employees a pay rise. Increasing an employee’s pay is likely to reduce staff turnover, increase job satisfaction and boost productivity by raising motivation and commitment. Unfortunately, most small business owners are simply not in a position to offer their staff a larger pay packet. However, there are a number of non-cash benefits that you may care to consider as an alternative course of action for recognising and rewarding good work. These non-cash benefits may not have a dollar value. For example, allowing employees to work from home once a week or rearranging their working hours to better suit other commitments. Non-cash benefits may also have an identifiable dollar value, and in this case employers need to be aware of fringe benefits tax (FBT) before they decide to offer a non-cash benefit. Non-cash benefits that attract FBT include, but are not limited to, personal use of a company car, cheap or interest-free loans, and entertainment in the form of food and drinks. Typically, where an employee is provided with a fringe benefit, the cost of the benefit is deducted from their gross (before tax) pay and the […]


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Investing on arm’s length

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Running a self-managed super fund requires trustees to adhere to complex laws and follow a number of onerous rules. One of the most fundamental investment rules for SMSFs is that the trustees must transact on an arm’s length basis to ensure no conflict of interest arises. An arm’s length transaction requires trustees to conduct on a commercial basis as if there was no relationship between the parties. This means the purchase and sale price of fund assets should always reflect the true market value of the asset, and the income from the assets held by the fund should always reflect the true market rate of return. SMSF trustees must obtain independent valuations for assets which are not listed on a public market. Furthermore, if a SMSF sells an asset to a related party or member of the fund, the sale price must be at market value. Any non-arm’s length income is taxed at the highest marginal tax rate. The ATO considers non-arm’s length income as income which is derived from a scheme in which the parties were not dealing with each other at arm’s length and if it is more than the SMSF might have been expected to derive (if […]


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Preparing for the FBT year-end

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With the fringe benefits tax (FBT) year ending 31 March 2017, now is the time for business owners to get their FBT affairs sorted. When calculating FBT liability, employers must gross-up the taxable value of benefits provided to reflect the gross salary employees would need to earn at the highest marginal tax rate (including Medicare levy) to buy the benefits after paying tax. To calculate fringe benefits taxable amounts, employers must use two separate gross-up rates: Type 1: Higher gross-up rate is used where employers (or other benefit providers) are entitled to a GST credit for GST paid on benefits provided to an employee. The type 1 gross-up rate for year ending 31 March 2017 is 2.1463. Type 2: Lower gross-up rate is used where there is no entitlement to a GST credit. The type 2 gross-up rate for year ending 31 March 2017 is 1.9608. The FBT rate for the year ending 31 March 2017 is 49 per cent. Whether the benefits provided to the employee are type 1 or type 2, only the lower gross-up rate is used for reporting on employees’ payment summaries.


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Social media etiquette

Posted on March 15, 2017 by admin


There is no denying that social media is fast becoming the most powerful way for businesses to communicate with their existing and potential customers. Although it has become a new approach to communication, businesses should always remember to treat their customers as if they were dealing with them face-to-face. Here are some important rules to remember when using social media for business:Fill out details Fill out the profile information completely, providing the name of the business, a way to make contact and some information on what services and products the business offers. This will assure the customer that the businesses profile is legitimate. It is important to have an appropriate profile picture such as the company logo so that clients are able to easily identify with the brand. It is not a good idea to have the same profile for both business and personal use. Creating separate accounts will keep clients separated from friends and ensure that the business maintains a professional image. Use manners It may seem simple, however treating clients with respect online can go a long way. Things as simple as saying ‘please’ and ‘thank you’ can give a positive image of the business. It doesn’t matter […]


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Tips for successful networking

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Whether you are looking to make new contacts in your industry or searching for your dream job; networking is essential to forming new relationships and expanding your connections. Here are three ways to improve your networking skills: Listen Networking is all about building relationships. One of the best ways to establish a connection faster is to simply listen to the other person with no interruptions. Listening helps to understand the other person’s concerns and identify opportunities where you can offer them value. Ask for an introduction Ask friends and acquaintances for introductions to people they know or people who you would like to meet. Being introduced through someone else can help ease nerves and take the pressure off approaching a stranger. Prepare questions Preparing a few ice-breaker questions can help to get the conversation going and avoid small talk. If you are attending a networking event, do some research ahead of the event about the people who will be there and formulate your questions around their interests, knowledge etc. Having a list of well-prepared questions also helps to increase your confidence and demonstrate your enthusiasm.


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Transitional CGT relief for SMSFs

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Self-managed super funds can access Capital Gains Tax (CGT) relief to provide temporary relief from certain capital gains that might arise as a result of individuals complying with the transfer balance cap, and Transition to Retirement Income Stream (TRIS) reforms, commencing on 1 July 2017. The transitional CGT relief is designed to preserve the income tax exemption for certain, accrued capital gains which would have been exempt, if the underlying CGT assets had been disposed of before the changed treatment of TRIS’s and before a member transfers to comply with the transfer balance cap starting. CGT relief is available for certain CGT assets held by a complying SMSF at all times between the start of 9 November 2016, to ‘just before’ 1 July 2017. However, the CGT assets eligible for the relief depends on whether they stopped being segregated current pension assets during this period, or whether the fund continued using the proportionate method for the 2016-17 income year. Trustees need to be aware that CGT relief is not automatic – it must be chosen by a trustee for a CGT asset. SMSF trustees will need to review their fund’s circumstances and determine if CGT relief is available and appropriate. […]


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Easier GST reporting for food retailers

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Many small food retailers buy and sell products that are both taxable and GST-free. Depending on the point-of-sale equipment used, identifying and recording these sales can be difficult for business owners. The ATO has introduced a series of simplified accounting methods (SAMs) to make it easier to account for GST and work out the amount of GST that is liable at the end of each tax period. There are five SAMs to choose from. The SAM you choose will depend on your business’ turnover, the nature of your business and the nature of your point-of-sale equipment (except for the purchases snapshot method). These methods help you work out the information you need to correctly complete the GST section of your activity statement. However, they can only be applied to sales and purchases of trading stock. Here is a summary of the five SAMs you can choose from: Business norms Turnover threshold: SAM turnover of $2 million or less.How you estimate your GST-free sales and/or purchases: You apply the standard percentages to your sales and purchases. Stock purchases Turnover threshold: SAM turnover of $2 million or less.How you estimate your GST-free sales and/or purchases: You take a sample of purchases and […]


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How does the super guarantee charge work?

September 20, 2017

Employers who do not pay the minimum amount of super guarantee for their employee(s) by the due date may have to pay the super guarantee charge (SGC).

The charge is made up of super guarantee shortfall amounts including any choice liability calculated on your employee’s salary or wages, interest on those amounts (currently 10 per cent) and an administration fee ($20 per employee, per quarter).

Employers must report and rectify the missing payment by lodging an SGC statement by the due date and paying the SGC to the ATO. Employers may be able to use a late payment to reduce the amount of SGC, however, they must still lodge an SGC statement and pay the balance of the SGC to the ATO.

The ATO prioritises the collection of unpaid SGC debts. If an employee reports an employer for unpaid super, the ATO will investigate on their behalf.

Employers must lodge their SGC statement and pay the charge by the due date.

Quarter Period Due date
1 1 July – 30 September 28 November
2 1 October – 31 December 28 February
3 1 January – 31 March 28 May
4 1 April – 30 June 28 August

If a due date falls on a weekend or public holiday, the payment can be made the next working day.

Once the statement has been lodged and the SGC is paid, the ATO will transfer the super guarantee shortfall amount and any interest to the employee’s chosen super fund.