As many business owners would agree, the start of the New Year is an incredibly busy time. For retailers, 50% of their sales may come from this period. Other service businesses can be equally overwhelmed. For others, the year end can be one of the slowest times of the year. Clients might be away, employees aren’t around to finish projects and the phones don’t ring. That makes this a perfect time to take care of some end-of-year tasks.
• Start working on your 2012 marketing plan. Review your best sources of leads and make a list of the people to contact. Include some key referral sources and compose emails to send in the first week back. You will want to be ready to increase your business as soon as customers have finished with their holidays.
• Create a contact database. Go through your piles of business cards and address books to find any old customers you may have dealt with. Purchase some software to organise your contacts and enter all your contacts in an up-to-date database for the New Year. Remember, the best source of a future customer is a past customer.
• Clean out your office. Clear off your desk and archive important documents and file away your tax receipts.
• Go shopping. With all of the Christmas deals around, the end-of-year a great time to make business purchases. Get that new computer you have wanted, update aging office equipment, upgrade software programs, stock up on office supplies and replace those broken desks that are falling apart.
• Do some mid-year tax planning. Call your accountant and discuss ways to reduce your tax liability. This year may be a particularly challenging one, so you will probably need professional help more than ever.
• Look for new networking opportunities. Check your local newspaper for businesses and community organisations, search for upcoming events to attend and make reservations for January. You will want to have a calendar full of potential business-building activities ready for the New Year.
• Redecorate your office. You may decide to paint the office during the slow holiday season or even just re-arrange furniture and clean off the conference room table buried under stacks of old mail. Working in a pleasant, inviting environment helps keep both you and your employees motivated and makes each day more enjoyable.
• Make a donation. As business owners, we make many contributions to our communities and nation; we create jobs and invent new products and services. But we also need to remember those who are less fortunate, especially in these challenging economic times. Check out the charities of your choice and make a donation.
Finally, enjoy time with family and friends and have a happy and healthy holiday season!
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The Tax Office has advised that it will conduct the data matching programs relating to motor vehicles; and credit and debit cards.
Motor vehicle data matching program
The Tax Office will request and collect details of individuals or businesses that have purchased or acquired a vehicle of any type valued at $10,000 or greater for the period 1 July 2010 to 30 June 2011 from the following motor vehicle registries:
- New South Wales — Roads and Traffic Authority, NSW
- Queensland — Queensland Transport
- Victoria — Vic Roads
- Tasmania — Department of Infrastructure, Energy and Resources
- South Australia — Department for Transport, Energy and Infrastructure (Transport SA)
- Western Australia — Department for Planning and Infrastructure
- Northern Territory — Northern Territory Department of Planning and Infrastructure (Transport Division), and
- Australian Capital Territory — ACT Road Transport Authority, Road User Services, Urban Services.
This acquired data will be electronically matched with certain sections of Tax Office data holdings to identify non-compliance with lodgment, payment and correct reporting obligations under taxation law. It is expected that records relating to approximately 2.7 million individuals will be matched.
Credit and debit card data matching program
The Tax Office will request and collect data relating to credit and debit card sales of entities within various industries for the period 1 July 2010 to 30 June 2011 from the following organisations:
- Commonwealth Bank of Australia
- St George Bank
- Westpac Banking Corporation
- Australia and New Zealand Banking Group Limited
- National Australia Bank Limited
- Bendigo and Adelaide Bank Limited
- Bank of Queensland Limited
- BWA Merchant Services Pty Ltd
- American Express Australia Ltd, and
- Diners Club Australia.
This acquired data will be electronically matched with certain sections of Tax Office data holdings to identify non-compliance with registration, reporting, lodgment and payment obligations under taxation law. It is expected that records relating to approximately 400,000 entities will be matched.
Source: Commonwealth of Australia Gazette No GN 49, 14 December 2011, p 3007–3008
For more information speak with Newcastle Accountants Leenane Templeton today on 02 4926 2300
Posted on 20 December '11, under Newcastle Accountant Tips. No Comments.
In the lead up to the end-of-year, employers should be thinking about the tax deductibility and fringe benefit tax implication of office Christmas parties. Many employers are caught out by failing to adequately understand the FBT impact of Christmas.
Here are some things employers need to be aware of when planning a Christmas party for their employees.
Christmas party costs are exempt from FBT provided that they:
• Are provided on a working day
• Are provided on your business premises
• Are for current employees only, not family members or partners of employees
If a spouse or associate of a current employee attends, these costs are not FBT exempt unless these costs satisfy what is known as the minor benefits exemption.
Many employers prefer to host Christmas parties off business premises. These will also be subject to FBT unless they satisfy the minor benefits exemption.
The minor benefits exemption has a $300 threshold per employee, which applies to each benefit provided. Benefits may include a gift given to each employee, provided that the cost for the party is less than $300 per employee.
A tax deduction for costs associated with the provision of Christmas parties for employees is allowable only to the extent that the cost is subject to FBT. If the cost is deemed to be FBT exempt, you cannot claim a tax deduction.
The application of the minor benefits exemption also implies that the costs associated with the party and the provision of gifts to employees is ‘infrequent and irregular’. This means that these kinds of benefits cannot be afforded to employees on a regular basis in order to be FBT exempt. Entertainment costs for clients are not subject to FBT and are therefore not tax deductible.
If this seems like a hassel for times of celebration, employers can choose to account for FBT. The 50/50 split method operates where 50% of all costs associated with entertainment, meals etc for employees, associates of employees, clients and suppliers are subject to FBT and this 50% is therefore tax deductible.
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It is that time of year again, the holiday period is just around the corner and the excitement of the work Christmas party is setting in. Ideas are being tossed around about locations and caterers and the Christmas spirit seems to be flowing through the office.
End-of-year celebrations are an excellent way for employers and staff to reflect on their achievements of the year and to develop their relationships with one another. However, it is also important for employers to consider the potential hazards which may arise and their legal obligations that stand when holding a work function.
An employer may be held liable for any injury which occurs at an event, as well as injuries of employees travelling to and from the venue.
Employers can also face the risk for any form of sexual or emotional harassment an employee becomes subject to. Areas such as drug and alcohol use, conduct, confidentiality and breach of company policies or procedures need to be given special caution.
All employees attending the party should be reminded of their responsibilities and expected standard of behaviour before the event. They should be informed that normal disciplinary procedures will apply for any form of misconduct that takes place. For serious matters formal action should be taken in the days following and not simply left to deal with in the New Year.
Employers should visit the Christmas party’s venue prior to the event and carry out a risk assessment to ensure that occupational health and safety requirements are met. This should be done bearing in mind that attendees may be under the influence of alcohol. Even small hazards like a wobbly chair could be potentially dangerous and worth eliminating.
Alcohol should be served responsibly and by qualified personnel, as required by the responsible service of alcohol regulations. It is a good idea for employers to organise safe travel arrangements for their employees, such a handing out cab charges or hiring a mini bus. This will ensure that drink driving-related incidents are avoided and employees can enjoy their night and return home safely.
If employees choose to continue partying and the after party is not arranged by your company, ensure this is made clear. Start and finish times should be clearly set out prior to the event. Employers should also be aware that actions such as placing a tab behind a bar at an after party, could give rise to liability for behaviour into the early hours of the morning.
Don’t Forget Your Team
If you are considering re-branding or re-positioning your organisation, one very important thing to remember is to ensure your team is kept totally in the loop. After all, you are relying on your staff to deliver for you.
So get their buy-in right up front and it will be so much easier to get the results you are hoping for. And, as we have previously mentioned, listen to those operating at the coal face – they may have some great ideas for actioning.
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Posted on 1 December '11, under business advice. No Comments.
Whether you follow the economic theories of John Maynard Keynes, John Kenneth Galbraith or Nobel Laureate Friedrich Hayek; all were highly intelligent men and noted economists who knew about recessions, inflation, deflation, market forces and the role of interest rates and Governments, and disagreement; or the loudest talkers at the local barbecue, as a business person you would probably agree that nobody agrees on what is happening at the moment.
Left to right: Keynes, Galbraith, Hayek
Any cursory examination of Australian media tells us variously that interest rates will fall, remain the same or rise, that shares are undervalued, overvalued or should not be purchased at all. We do not have clear messages about where to invest money, or any idea of the future of the markets, shares, debt or property. Or where the world is heading. We would suggest that this is because historically we do not have any prior experiences to call on. In these days of email and immediacy, computers, social media etc we are comparing with times of faxes, telexes, telegrams and letters. The only constant is the human being who is in control, or not as the case may be.
So the reality is that no one knows at all what the future of economic markets holds because there are simply too many variables at work and the pace of change isn’t something that we have seen previously, so all the best intentions of the forecasters and commentators everywhere are by and large of little use.
So, for the business person, how can you develop strategies to continue operating a successful business? According to Christopher Laffey of Leenane Templeton, in this time of rapid change, of reduced loyalty, and uncertainty, anyone running or managing a business needs to develop at least five core strategies for continued success. They are:
- Totally understand your business, know where you want to go both short term (each quarter) and longer term (3 – 5 years). In all your decision making ensure that the assumptions on which you are basing decisions are correct and easily backed up by fact. Constantly review and re-evaluate.
- Have a clear communication strategy ensuring you communicate frequently with all your stakeholders and especially those who may be affected by any economic or market turmoil. Never assume that those close to you know what you are thinking.
- Focus your team on the future and how all the plans will be achieved. Be realistic and acknowledge the present but don’t concentrate on it – push past it and ensure the team is with you. Answer questions honestly.
- Ensure that all the people who are valued by the business team know they are valued and that they are part of the successful business in the future. Listen to their ideas for the future as well.
- Ensure you have trusted, qualified professional business advisors with whom you can talk freely and who understand where you want to be, who give you a clear understanding of the present and roadmaps of how to achieve your business future outcomes.
If you would like to speak with any of the qualified business professionals at Leenane Templeton Newcastle Chartered Accountants and Business Advisors. on 02 4926 2300
For anyone who runs a business, a finance health check should be a regular part of managing your ongoing business plan.
It should be done at least once a year, or when there is a major change of circumstances in the business which affects cash flow. One example of such a circumstance is the ongoing local and global credit crunch. Many other factors can also affect the financial position of your business – customers going overseas for their products, changes in technology or equipment or production processes. A finance review is all about establishing financial safety nets.
Careful consideration should be given as to how and where the finance should be sourced. As with investments, you should diversify your borrowings. No one lender should have all the loans. Often, when companies have financial problems, the lender ends up running your business.
It can be difficult for small to medium businesses to ‘shop around’ for the optimum finance arrangements, particularly as it is a time-consuming process. You should consult with your financial planner and finance broker to perform a finance health check.
In summary, these specialists will:
- Have their finger on the pulse of prevailing lending conditions and be able to access financial solutions from a broad range of lenders
- Act on your behalf in presenting your case to these financiers
- Utilise a range of financiers which will provide you with a series of good relationships rather than ‘one bad marriage’ and
- Ensure that companies get the right loan structures in place such as loan terms, flexibility, special conditions and the securities that you have to provide.
In the current environment credit can be difficult to obtain. More and more information is required by lenders even for existing customers. Small business owners who present a loan application to a lender run the risk of not presenting a complete, compelling business case and risk having the Bank decline the loan. These days, once a financier has formed a negative view of an application it is almost impossible to submit further information and change their mind.
Using a Financial Planner
Your financial planner can help you to work with a finance broker, establishing a strong professional relationship that can assist your financial health for the long term, as they gain a true understanding of your business and your needs. Your financial planner and broker can assist you with finance for a broad range of areas such as machinery, property, motor cars and more specialised finance tools. Essentially the broker becomes an active member of your team.
Speak with your financial planner about how to access a quality broker to assess and review not only your leasing facilities but all of your current business funding arrangements.
Source: Lonsdale Finance Choice, June 2011
Leenane Templeton has Newcastle financial planners and chartered accountants at hand to help with your finance needs.
Posted on 10 October '11, under Newcastle financial. No Comments.
…Whereas in Australia CEOs Worry About the Government
Whilst optimism about prospects for the Australian Company in the next 12 months amongst surveyed CEOs decreased significantly in the quarter to June 2011 (from 73% to 51%); optimistic prospects for the CEO’s organisation in the next 12 months remained similar (56% only dropping to 54%). Whilst CEOs are usually always positive about their organisations this still reads as a positive outcome.
The CEOs still consider that sourcing skilled staff is of their paramount concern, however the issue that has given them the most increasing concern is the government response to climate change issues which increased from 11% to 27%, followed by corporate regulation (13% to 24%). The CEOs scorecard for the Governments performance in managing the economy continues a significant downward trend to 3.3 out of 10 (from a high in February 2010 of 5.4).
Other concerns which have remained at similar levels include increasing competition and changes in customer demands.
For business solutions speak with Leenane Templeton Newcastle Chartered Accountants and Business Advisors call 02 4926 2300.
Posted on 21 September '11, under business advice. No Comments.
Worldwide Organisations CEOs Are Planning for Future Growth….
According to a recent global PricewaterhouseCoopers survey of almost two thousand CEOs, companies are moving beyond merely coping with the global financial crisis and are again planning for future growth. The survey found that companies are moving their focus more towards product development, longer term strategic planning and most are optimistic about prospects for the longer term. Whilst cost efficiency is still important, it is no longer perceived as the top priority. Companies are looking strategically for opportunities to best position themselves against their competition.
Innovation is expected to again come to the fore and many organisations will be undergoing significant change.
Speak to Leenane Templeton Newcastle Chartered Accountants for business and financial planning advice
Posted on 14 September '11, under business advice. No Comments.
Self-Managed Superannuation Fund (SMSF) For Your Retirement – Advice From Professionals
When considering setting up a self-managed superannuation fund (SMSF) ensure you use a broad-based professional services firm. A firm such as Leenane Templeton encompasses fully trained professionals (they are Chartered Accountants and Business Advisors as well as superannuation and investment advisors) to ensure you receive the best possible information and Self managed super funds advice that is best suited to your needs.
The key test for a professional is to provide impartial and unbiased advice and that is precisely what you receive at Leenane Templeton. Not only have the self managed super fund specialists cleared their various qualification hurdles and ensure ongoing professional development education; they understand that the lifeblood of a professional depends on the intellectual contributions through education, research, good administration and strong ethical standards to ensure the best possible self managed super funds and financial planning advice for their clients (even if it is advice the clients may not wish to hear).
For full information about our self managed super funds service please call our Newcastle Head office on 02 4926 2300 or visit the self managed super funds web site to review the advantages and disadvantages of self managed super funds. Also visit our Newcastle Financial planner website
Posted on 1 September '11, under Self Managed Super Funds. No Comments.
Does Your Newcastle Business Have An Innovative Use of Social Media?
According to the Business Spectator Accenture CEO Pulse Survey, June 2011, CEOs indicated that they are using social media to engage more directly with their customers (42%), to manage brand and reputation (41%) and to attract new talent to their organisation (37%).
Interestingly, almost half of the CEOs surveyed reported that they expect using social media to innovate their products and service offerings, through customer or other external input, to be very important in the future; however, less than a third indicated they are presently doing this. As 22% of the CEOs indicated they have a formal strategy or plan on how to leverage social media to add value to their business, and a further 34% indicated they are developing a strategy, perhaps they are waiting to attract that new talent to their organisation.
On their personal use of social media 63% of the CEOs indicated they personally used an Apple iPad, and since 31% indicated they do not use a smart tablet that means that of the CEOs surveyed who presently use a smart table, 90% use an Apple iPad.
Speak to Harlan at Newcastle Accountants Leenane Templeton to discuss your internet and social media strategies on 4926 2300. Also visit our Newcastle Financial website
Posted on 26 August '11, under business advice. No Comments.
The end of the financial year is approaching, and it is important to be prepared. This will ensure there aren’t any nasty surprises and as much cash as possible can be protected. Here are some tips to keep in mind:
1. Personal Expenses
Be careful and ensure that any claims or interest on borrowing for investment are separated from interest on borrowing of a personal nature.
2. Substantiate Your Claim
Keep all receipts to prove any deductions and be able to show why the expense was incurred to derive assessable income.
3. SMSFs And Property
Consider moving Business Real Property into a SMSF. This is a good way to free up some cash coming into tax time.
4. Renovations By Previous Owner
If the renovations are identifiable and itemized in a depreciation schedule, then it is possible to be eligible for a deduction for depreciation on the cost of improvements by a previous owner.
5. Capital Gains Tax
Ensure any capital gains on the sale of property are properly recorded. The ATO are keeping an eye out for any undisclosed capital gains from disposing of assets to invest in superannuation.
6. Fixtures And Fittings
If fixtures and fitting cost less than $300, it may be possible to claim a tax deduction.
7. Self-Education Expenses
Keep all receipts and documentation relating to self-education, such as seminars and investment related books and magazines, in order to qualify for tax deduction.
8. Use A Quantity Surveyor
There are benefits to having a depreciation schedule prepared by a qualified quantity surveyor. They could help gain a significant tax deduction for depreciation. The cost of employing such a surveyor is tax deductible and will help back up a capital allowance claim.
9. Pre-Pay Interest
Depending on the lender, it is possible to pre-pay interest to defer the payment of tax. This is dependant on possible future income, interest rates and cash flow impact.
10. Repairs To Property
Be aware that although the cost of initial repairs at the time of purchase is not deductible, expenses for repairs further down the track are. They must relate, however, to wear and tear or other damage incurred as a result of earning rental income.
11. Short Term Holdings
If a property has been renovated with the aim of selling it at a profit in the short term, the ATO may tax it as if it were a ‘profit making scheme’. If this occurs, it is not possible to take advantage of CGT concessions.
Speak with our Newcastle Financial Advisors for professional financial advice. This article is for guidance only, and professional advice should be obtained before acting on any advice herein. Neither the publisher Leenane Templeton nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication. See “Self managed super funds” website for further information. This article relates to Australia, NSW and does not take into account any legislative or other changes made after 1 April 2011.
Will It Improve?
Small business confidence has been declining since late 2009 according to figures gleaned by CoreData, an Australian research house that has been tracking small business confidence for the past few years. As John Maynard Keynes, and others since him, espoused in his theories of behavioural economics – the wealth of nations is not just a function of how much money is flowing around an economy, but rather the confidence and behaviour of the people in the nation.
According to Christopher Laffey of Leenane Templeton, Business Advisors in Newcastle NSW, “We know that small business is critical as a major driver of our economy, and that small business confidence is especially critical because it drives spending and importantly it drives borrowing. However, at the moment all the investment research and commentary indicates both spending and borrowing are at all time lows.”
These comments agree with those from CoreData when explaining their May 2011 findings, “one of the best indicators we have comes from the small business sector, which is by value almost half of the entire Australian economy and a fundamental driver of spending.”
Small business owner confidence in the economy
“In part this can be explained by the fact that we have a Government that is meddling and yet decision free; in part it can be explained by the fact there have been some nasty natural disasters of late – but is a larger, more systemic fear lurking out there?
What if the confidence that has driven the Australian economy since the 1980’s has gone rather than just diminished? What if we are returning to a 1950’s style of capitalist economy – low risk, small investments, slow growth and large amounts of savings?”
According to CoreData, some of the signs are evident, and not just with small business owners, but with others in the nation. Their 2010 High Net Worth Individual (HNWI) survey showed that Australians with more than $1 million outside super and their house were not intending to borrow in the future and have been paying down debt as fast as possible.
The same survey showed that only 4% of small and medium business have plans to borrow in the next 12 months and that all new growth will come from cash flow.
“If the hypothesis is true,” says Christopher Laffey “and if there has been a fundamental switch in the behaviour of consumers and businesses alike then perhaps it needs to be recognised across both the investment community and government and acted upon.”
(HNWI research findings can be found at www.burning-pants.com/2010/02/jumping-ship)
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It appears that new Occupational Health and Safety changes may be introduced in New South Wales earlier than was expected, reports accountants Leenane Templeton.
Further details and the reasons for changes are illustrated in an article written by Peter Punch, a partner in the law firm Carroll and O’Dea which can be sourced via the following CCH link http://www.cch.com.au/au/News/ShowNews.aspx?ID=36216&Type=F&TopicIDNews=9&CategoryIDNews=20&u_i=5858
In addition to the commentary, many lawyers and employers believe the changes are a direct result of the successful appeal by Mr Graeme Kirk to the High Court of Australia (the Kirk case). http://www.austlii.edu.au/cgi-bin/sinodisp/au/cases/cth/HCA/2010/1.html?query=kirk
The ABC Law Report has commentary regarding the Kirk case and the NSW OHS legislation at http://www.abc.net.au/rn/lawreport/stories/2010/2846209.htm
Graeme Kirk was convicted by the Industrial Relations Commission of NSW of failing to provide a safe workplace under NSW OHS legislation following the death of his employee, an experienced farm manager who managed the Kirk hobby farm. The manager died in a work place accident when he used an inappropriate vehicle to transport materials and then drove down a steep slope.
In February 2010, the High Court unanimously quashed Mr Kirk’s convictions, with one High Court judge describing the prosecution as ‘absurd’.
The Kirk case was a significant blow for the WorkCover Authority of NSW, who were forced to review the way its criminal charges were pleaded. Rather than general and unspecific charges which were no longer acceptable, WorkCover had to specify what the employer (or culpable party) should have done to avoid the incident in the first place.
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Are You Up to Speed on Occupational Health and Safety?
Organisations are urged to ensure that are fully across the changes in occupational health and safety (OH&S) laws changes which are expected to be introduced in the latter half of 2011.
In an effort to harmonise Australia’s OH&S laws, Safe Work Australia has released Model Work Health and Safety Regulations for public comment by April 4, 2011 as well as an issues paper and draft model codes of practice.
With more than 500 pages, the regulations are certainly extensive and cover such areas as general workplace management, work participation, construction, plant and structures, hazardous chemicals and major hazard facilities..
There are subtle and not so subtle differences in requirements which will apply in each Australian state and territory, and in some cases certain organisations will be subject to more and detailed regulations, while in other cases less regulation.
According to James Simpson, a senior associate with legal firm Clayton Utz, the use of model codes of practice “will be interesting”, as they set a base line for compliance for matters such as managing risks, managing work facilities and the work environment as well as specific areas such as falls and hazardous chemicals.
Directors and management will need to ensure that their organisation assesses the impact of the regulations and codes of practice and implements appropriate systems to manage ongoing compliance.
Leenane Templeton Chartered Accountants also have specialists to help with you Financial Advice and a specialist team of Self Managed Super Fund Advisors
Posted on 3 May '11, under business advice. No Comments.
