How to take advantage of a world of opportunity? Insights from the 2013 CPA Congress

Last week I was fortunate to be able to attend the CPA Congress in Adelaide. There were amazing presenters from across Australia which provided for inspiration and thought about the Australian economy and the future for small business.

There were two particular presentations that challenged me as a business owner and business advisor to many small businesses.

Carolyn Creswell

Carolyn is the owner of Carman's Fine Foods, winner of Telstra Australian Business Woman of The Year, TV personality with Network Ten's Recipe to Riches, and a mother of 4 young children. I was fortunate enough to speak with her after the event and thanked her for being a positive role model for female business owners and entrepreneurs.

Carolyn's passion for great customer service is inspiring. During her presentation, she made the particularly relevant comment that business owners should 'find what your clients needs are and help them solve their problems, not yours'. So often we hear that the key to starting a business is to find something you are passionate about and do what you love. Yes, this is important, but the fundamental issue is that a small business is not about the owner, its about the customer or client and providing solutions to customers needs. It's the principle that if you "help enough other people get what they want, you will get what you want".

Deloitte - Digital Disruption - Short fuse, big bang

Every industry is facing 'digital disruption' (digital, being the internet). Deloitte have studied this disruption (and when it will occur) and the scale the internet disruption is expected to impact the different business industries (the Big Bang). For a small business owner, they have the choice to either ignore the impact internet is having on their industry or create opportunity from it.

The presenter made the interesting comment that most small business owners are still operating the same way they did 10 years ago, yet customers are NOT acting the same way they did 10 years ago. Customers socialise, interact, engage and make decisions extremely differently to the way they did 10 years ago. The presenter highlighted that business owners need to catch up to this asap or they are headed for the big bang. Think about your own business. What have you changed over the last 10 years? If you have a website, are you utilising this effectively? Is being social part of your strategy? Are you using the same old accounting software that you were using 10 years ago? Are you being disrupted or are you the disruptor?

At Flinders Accounting we have embraced our Flinders Connect program which assists small businesses to connect to cloud technology including accounting, CRM, inventory, point of sale, e-commerce and payroll solutions. Flinders Connect has given our small businesses the competitive edge to prosper, succeed and create opportunity from the digital disruption.

Check out Digital Disruption - Short fuse, big bang video below:

Not lodging your tax returns? You might be missing out!

I have seen a huge amount of new clients over the last couple of months that, for some reason or another, have got behind in their taxes. While I do not encourage this and there are serious penalties imposed by the ATO, there are great benefits for sorting out your tax.

1. Peace of mind

A client of mine said that they drove past my tax signs every day to work and everytime they did so, they remembered they had to do their taxes. After seeing me they were amazed at how quick and easy the process was. They no longer had the niggling reminder every time they drove past my sign to lodge their taxes! I also had one client worried that they wouldn't let him leave the airport because he hadn't done his taxes. Whatever you might be worrying about in relation to your taxes, one of our friendly and understanding Accountants are here to help you and deal directly with the ATO on your behalf.

2. Tax Refunds

A lot of clients that I see receive tax refunds. Just in the last week I have helped clients receive thousands of dollars back in refunds for every year of tax outstanding. This was a complete surprise to some of them and they certainly won't be late with their tax returns in future! Its important to note that this isn't the case all the time and its best to contact us to discuss your situation.

3. Other factors

Not having up-to date taxes can affect other extremely important areas. Often Centrelink won't pay certain benefits, like the child care rebate or family tax benefits, if you and your partner have not lodged your tax returns each year. Also, its important when applying for loans that your taxes are up to date as the lender generally requires this information.


Flinders Accounting can help:

I've helped clients from all over Australia with their tax. Email me at miriam@flindersaccounting.com to discuss your situation. I can generally access most of your payment summaries, bank account interest and some other forms of income from previous years within minutes.

Flinders Accounting offer a special fixed fee price to clients with outstanding tax returns.


 

31st October Tax Return Deadline - the Accountant extension!

With only a day to go until the 31st October deadline to lodge your tax return I thought it was 'timely' to explain the Accountant extension. For anyone lodging their tax returns themselves, they have until the 31st October to lodge with the ATO. For anyone that is registered with a Tax Agent, they generally receive a later lodgement deadline until 15 May 2014! This is only available for people registered with a Tax Agent, that have no previous years tax outstanding and that have no other outstanding issues with the ATO.

If you do not think you will be able to lodge your tax return by the 31st October, than send us an email to admin@flindersaccounting.com and we can organise for you to be registered on our system and receive the later lodgement date.

Another important issue to note that is if you earnt less then the tax free threshold of $18,200 then you don't need to lodge a tax return if there was no tax withholding. However, you DO need to let the ATO know that you don't need to lodge a tax return. The Non-Lodgment Advice 2013 form can be found HERE.

If your earnt under $18,200 and your payment summary shows an amount in the tax withholding section, then its best to lodge a tax return as you will receive all this tax back. I offer a special $59 tax return fee for anyone that has income under the tax free threshold, so please feel free to book in an appointment if you are unsure what your tax obligations are.

Like our Facebook page facebook.com/BusinessBookkeepingPlus to keep up to date on the latest tax tips and advice or Follow @TheNumbers_Lady on Twitter.

email: admin@flindersaccounting.com
phone: 08 7001 1627

Understanding your HECS - HELP Debt and the recent repayment rate changes!

How does HELP/HECS work?
A person accumulates a Higher Education Loan Program (HELP) (previously referred to as HECS) loan when they undertake study and have not paid for the fees upfront. The Government expects this loan to be repaid when the taxpayer's Help Repayment Income (HRI) reaches over a threshold. The repayment rate depends on the income of the taxpayer for that Financial Year. 

When a taxpayer with a HELP debt gains employment they are required to tick a box on the TFN Declaration Form, which means that the employer will withhold extra money to meet the HELP repayment. The money withheld by the employer is paid to the ATO. When the taxpayer lodges their tax return, their HELP repayment amount is finalised as the repayment amount is based on the income declared on the tax return.

Whilst no real interest is charged, the HECS-HELP loans are indexed each year to the Consumer Price Index (CPI). (CPI is about 2-3%, so this is what is charged each year on the loan).

HELP debt TIPS:

• If you have a HELP loan than make sure you tick the box on your TFN declaration form. I saw a taxpayer last year who had a large tax bill when they earned over the income threshold, but did not tick the box. The employer had withheld enough tax, but not the extra amount required to repay the HELP.
• If you have received reportable fringe benefits then you will be required to contribute a portion of this to your HELP debt if it takes your income over the threshold. Be careful with this as I recently saw a client who had $25,000 in reportable fringe benefits. As his gross income was over $50,000 he was required to contribute extra repayments towards his HELP which he had not accounted for.

The new HELP repayment thresholds and rates for 2013-14 are as follows:

HELP repayment income (HRI*)	Repayment rate
Below $51,309	Nil
$51,309 - $57,153	4.0%
$57,154 - $62,997	4.5%
$62,998 - $66,308	5.0%
$66,309 - $71,277	5.5%
$71,278 - $77,194	6.0%
$77,195 - $81,256	6.5%
$81,257 - $89,421	7.0%
$89,422 - $95,287	7.5%
$95,288 and above	8.0%

Help Repayment Income includes:

• your taxable income;
• your total net investment loss (which includes net rental losses);
• your total reportable fringe benefits amounts;
• your reportable super contributions; and
• exempt foreign employment income.

If you are after the previous Financial Year HELP repayment thresholds and rates for 2013-13 click HERE.

Tax Time 2013! Individual Tax Return Checklist - Basic

 

This blog post contains a checklist for tax clients booked in to get their tax prepared by a CPA. If you don't have all of the documents, don't worry, we will be able to gather your relevant information from the ATO's database.

 

GENERAL

·        Last Year’s Income Tax Return
 

·        Private Health Insurance Details

·        Spouse Income

·        Children’s details including D.O.B and Centrelink benefits

·        Records of sales and purchases of any shares, business or property

·        Out of pocket medical expenses if over $2,120

·        HELP & SFSS Balances

 
INCOME

·        PAYG Summaries

·        Pensions or Government payments/Allowances

·        Bank Interest

·        Dividend Statements

·        Rental Property Income

·        Business Income

·        Any  other Income

EXPENSES

·        Work-related expenses

o   Uniform

o   Mobile phone

o   Union fees

o   Memberships

o   Stationary

o   Seminars

o   Tools

o   Laptop

o   Internet

o   Home-office

·        Rental Property Expenses

o   Rates

o   Body corp fees

o   Agent fees

o   Loan interest

o   Repairs & maintenance

o   Travel

o   Water Rates

o   Depreciation schedule

o   Gardening & lawn mowing

·        Donations

·        Costs of managing last Tax Return

·        Travel & Motor Vehicle Expenses

·        Work-related Education Expenses

·        Investment Expenses

o   Bank fees, financial advisors fees, investment borrowings etc

MAKE SURE YOU TAKE YOUR BANK ACCOUNT DETAILS FOR YOUR TAX REFUND TO BE PAID INTO.

Please collect your receipts, tax invoices and documents for the above items and take them to your tax appointment.

 

 

Contact us today to book a tax appointment with a CPA.

 

Flinders Accounting

& Business Services

08 7001 1627

541 South Road Ashford

admin@flindersaccounting.com

 

 

 

FREE ATO webiners this week tor SMALL BUSINESS OWNERS!

The ATO is currently offering free Tax Webinars for small business, rental property owners and self managed super fund trustees.

The webinars are online, and you are able to participate over the internet, smart phone or tablet. Participants can also chat to the presenter and ask questions! Phone and tablet users can download a free app to join the ATO webinars (see the bottom of this email).

Below are details of Webinars being held this week (17th June - 21st June) for small business:

TB1 Tax basics for small business – an introduction

This webinar introduces you to the basic tax issues you need to consider if you are thinking about starting a business, such as business structures, tax registrations and record keeping.

 

Date	Time (AEST)	Webinar ID
Monday, 17 June 2013	Noon – 12.45pm	200956614

 
TB2 Tax basics for small business – income tax deductions

This webinar looks at the fundamental principles of income tax deductions that apply to all businesses. We will look at the tax treatment of different deductions, including depreciation of assets.

 

Date	Time (AEST)	Webinar ID
Monday, 17 June 2013	9.00am – 9.45am	281114086

 
TB3 Tax basics for small business – home-based business

This webinar provides you with information about claiming home-based expenses and understanding how capital gains tax may apply.

 

Date	Time (AEST)	Webinar ID
Tuesday, 18 June 2013	2.00pm – 2.45pm	374031622

 
TB4 Tax basics for small business – motor vehicle deductions

This webinar runs through the special rules when claiming deductions for motor vehicles, and provides practical examples of how to record and claim the expenses.

 

Date	Time (AEST)	Webinar ID
Tuesday, 18 June 2013	10.00am – 10.45am	672519326
Thursday, 20 June 2013	1.00pm – 1.45pm	444240854

 
TB5 Tax basics for small business – concessions for small business

This webinar will look at the concessions that are available for income tax, capital gains tax (CGT) and goods and services tax (GST).

 

Date	Time (AEST)	Webinar ID
Thursday, 20 June 2013	3.00pm – 3.45pm	465408526

 
How to register?
For easy online registration follow these steps:

1)                 Go to the website gotowebinar.com.au (copy this address into your web browser’s address bar)

2)                 Choose [Join a webinar] at the top of the web page

3)                  Copy the Webinar ID for your chosen webinar from the list above

4)                  Follow the registration steps

 

Webinar apps

To download the free app for your iPhone or iPad, Android phone or tablet:

·        Visit gotowebinar.com.au

·        Click on “Mobile apps” – on the left hand side menu.

 
The ATO has a fantastic FREE educational webinar program which is available at  ato.gov.au/seminars.They deliver webinars on a range of topics including a further eight Small business topics, Taxable payments reporting for people working in the construction industry, as well as webinars for Rental property owners and Trustees of SMSF. 

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Like our Facebook page facebook.com/BusinessBookkeepingPlus to keep up to date on the latest tax tips and advice or Follow @TheNumbers_Lady on Twitter.

 

ATO's targeting Sales and Marketing Managers and Construction Workers for 2013 tax time!

If your occupation is that of a Sales and Marketing Manager, Building Construction Project Manager and Supervisor or a Building Construction Labourer than prepare for your 2013 tax return to be closely examined by the ATO.

The ATO has recently sent out letters to taxpayers that fall within these occupations to warn them that they will be looking closely at work-related expenses claimed by these occupations in their 2013 tax return.

The letter reminds taxpayers to only claim work related expenses that they are entitled too and keep records to support these claims.

In particular they will be focusing on the following work-related expenses:

• telephone and internet expenses
• home office expenses
• travel between home and work where bulky tools and equipment required for work are not transported

If you are interested in more information about occupation specific work-related expenses check out the ATO's guide on the link HERE.

If you do fall within one of the 2013 target occupations, its definitely worth using a Registered Tax Agent for your 2013 Tax Return. A Tax Agent will be able to make sure that you are correctly claiming all work-related expenses you are entitled too. You will also be able to avoid the stress of dealing with the ATO if you are audited, with a higher probability of an audit for target occupations.

Like our Facebook page facebook.com/BusinessBookkeepingPlus to keep up to date on the latest tax tips and advice or Follow @TheNumbers_Lady on Twitter.

Watch your savings accounts! The government's trying to claim your hard earned money!

So some CRAZY laws were changed at the end of last year that meant the government could automatically take your savings from "inactive" bank accounts without your permission. Considering the purpose of a "savings" account this law is just absurd. These unclaimed money laws have recently come into affect, so check your bank accounts immediately to see if this has happened to you as its happened to me and some of my clients!

One of my clients were in complete shock this week when they received their bank statement. They had $1,000 sitting in a bank account which were there "rainy day" savings. They hadn't put any money in it for a few years and they hadn't taken any money out. However, the bank statement showed a balance of $1,000 at the start of May and a balance of $0 at the end of May. They couldn't work out where the money had gone as they hadn't touched it. So what had happened to the money? The government had taken it from their account. No letter from the government and no warning from their bank!

This also almost happened to myself. I have a small amount of money in a savings account, which was once again a "rainy day" savings. Fortunately, the bank called us to let us know that if there was no money in or out of a bank account for 3 years the government was now taking the money. We immediately transferred in a dollar. (Bank fees and interested earned are not considered to be money going in or out!)

These new unclaimed money laws were changed from 7 years down to 3 years in December 2012 . I can not believe how CRAZY this is. I encourage my clients to put away some savings for a rainy day and now their hard earned money is at risk from the government taking it.

Its also interesting to note that there has been very little government press out about these rules and educating people about the changes. We get bombarded with other rule changes to showcase what the government is doing, why not something like this?

TIPS TO MAKE SURE YOUR SAVINGS AREN'T CLAIMED BY THE GOVERNMENT:

• Check your bank accounts, even the long lost bank account that you opened when you were 5.
• Get in touch with your bank to make sure they have the your correct contact details.
• Consolidate your savings accounts and transfer in as little as 5 cents every 2 to 3 years.

So the good news is, if your money has been claimed by the government, you can get it back, but some part of me thinks the government is hoping a lot of people just don't bother. So if this happens to you, make sure you do!

For those interested in reading what ASIC has to say about the rule change click HERE

Has this happened to you? Did your bank let you know? Share your story....

Like our Facebook page facebook.com/BusinessBookkeepingPlus to keep up to date on the latest tax tips and advice or Follow @TheNumbers_Lady on Twitter.

Latest tax scam email: stealing YOUR tax details and lodging fake tax returns!!

Warning - if you receive any suspicious tax emails don't open up any attachments, report it to the ATO and delete it as per my instructions at the bottom of the blog post. 

So, I opened up my inbox to the following email this morning:

End of email

Even though the email appears to be sent from @ato.gov.au, it is a SCAM email. Keep your tax file number, date of birth, address, phone number and name confidential. DO NOT reply to this email with your details - the ATO would already have this on file and would never send an email like this. There is also no such thing as a 2013 subsidy benefit!!

Scammers try and steal your tax details so they can lodge fake tax returns under YOUR name and collect big tax refunds into bank accounts they control. Given that tax time is coming up soon, watch out for anything suspicious and keep your tax information confidential.

If you receive a suspicious looking email from the ATO click this link here to report it to the ATO. Once reported, delete the email and do not follow any of its instructions in the scam email.

If you are not sure about any correspondence you receive show it to a tax professional or call the ATO.

Remember - if the email is too good to be true, it's generally a scam!!

 

Like our Facebook page facebook.com/BusinessBookkeepingPlus to keep up to date on the latest tax tips and advice or Follow @TheNumbers_Lady on Twitter.

Common mistake by businesses for overtime payments! DISCLAIMER: Reading this blog may save your business THOUSANDS!!

I recently emailed my previous superannuation blog to one of my colleagues to review. He's a very skilled Industrial Agent and highlighted a common mistake that businesses make with overtime and superannuation.

So what is this mistake? Employers INCORRECTLY paying superannuation on employee's overtime. There is actually no superannuation payable on overtime!

The super guarantee, which is increasing from 9% to 12% over the next couple of years, is only paid on ordinary time earnings.

Ordinary time earnings include over-award payments, commissions, shift-loading, allowances and bonuses.

What most businesses don't realise is that payments for work performed outside an employee's ordinary hours of work (overtime) are not ordinary time earnings.

So if you're a business owner, and money is tight enough just trying to cope with the overtime rates of pay, double check your payroll to make sure you are paying superannuation correctly.

If you have overpaid on superannuation, then you are able to call up the super fund, explain the situation and they may be able to refund the amount overpaid. If you are a business that has been paying super on overtime than its probably a good time to review who you are getting tax and employment advice from.

If you're unsure whether you are paying superannuation correctly, I am able to do a complimentary payroll check for your business. Contact me by email or on Twitter if you're interested in taking up this offer. Email admin@flindersaccounting.com for your free superannuation review.

 

Part 1: Potential pay decrease from 1 July 2013 - Understanding Your Superannuation Series!

Super, Super, Super - that's all that seems to be in the media right now. So I have decided to do a small series educating people on what changes are actually happening with superannuation and how they affect you.

Employers currently pay 9% of ordinary times earnings to an employee's superannuation fund, this is referred to as the 'ESG' - Employer Superannuation Guarantee. This will transition to 12% of wages over the next 6 years, starting from 1 July 2013 to 1 July 2019. The increasing increments are below. 


Increasing the superannuation guarantee rate from 9 to 12%

Year	Rate (%)
2013-14	9.25
2014-15	9.5
2015-16	10
2016-17	10.5
2017-18	11
2018-19	11.5
2019-20	12

The key issue that affects employees and employers about this change is who will pay for this increase in super. Employers using a base wage plus superannuation may expect to have to pay the superannuation increases. But, those employees on a remuneration package including super will have to  pay the difference, which means a decrease in take home pay.

Here's an example of the difference in how your wage package will change with the 12% increase:

Super at 9%

Employee 1 - Base wage of $80,000 plus super (currently 9% - $7,200) - Gross Wage: $80,000 (before tax)

Employee 2 - Remuneration package of $87,200 including super - Gross Wage $80,000

Super at 12%

Employee 1 - Base wage of $80,000 plus super (now 12% - $9,600) - Gross Wage: $80,000

Employee 2 - Remuneration package of $87,200 including super - Gross Wage: $77,600

For Employee 1, the employer is paying the 3% super increase. But, for Employee 2, the employee is paying the 3% super increase with a resulting $2,400 decrease in their pay.

Whilst the super increase will be felt in small increments, its important for employers and employees to understand what's happening and communicate between each other.

For a review of how the changes affect your businesses payroll or your wage, please contact us.