Firm Journal

Time wasters to avoid

Understanding what behaviours and factors which cause employees to waste time is important. Only when you understand why time is not being used efficiently can you implement strategies to overcome this.

Consider the following:

Technology
Technology helps us do things in a fraction of the time, it allows us to do things that are otherwise impossible to do from day to day. While it is extremely valuable, it is also one of the greatest distractions in the workplace. The amount of time employees spend checking their phones each day adds up and breaks down the flow of productivity. Another way technology becomes a time waster is when it isn’t working efficiently. Slow internet connection or slow software updates, failure to set up firewalls and virus protection can slow down an employee’s day drastically.

Lack of motivation
Employees who aren’t motivated are a big source of wasted time. Being motivated to get a task completed means you are going to complete it faster and to a higher quality. If employees aren’t motivated, they are likely to waste time procrastinating and doing anything other than the work they should be doing.

Failing to adapt
There could be ten processes to complete the one task, but only one of these will be the most efficient. Encourage staff to communicate about what the most efficient and beneficial process for completing tasks is and allow adequate time for training all staff how to use this process. Remember that even if staff know the faster process, if they don’t know how to complete this process, the work isn’t going to be completed any quicker.

Posted on 22 November '17 by , under business. No Comments.

SMSFs warned of risky retirement planning

The ATO is warning self-managed super fund (SMSF) trustees about the risks of some emerging retirement planning arrangements.

Retirees or SMSF trustees who are involved in any illegal arrangement, even by accident, may face severe penalties, risk losing their retirement savings, and potentially, their rights as a trustee to manage their own fund.

The Tax Office has released additional information through their Super Scheme Smart Program to help educate retirees and trustees of these complex tax avoidance schemes and arrangements.

Super Scheme Smart provides case studies and information packs to ensure taxpayers are informed about illegal arrangements including what warning signs to look for and where to go for help.

Many of the arrangements are cleverly designed to look legitimate, give a taxpayer a minimal or zero amount of tax or tax refund or concession, aim to give a present day tax benefit and involve a fair amount of paper shuffling.

Some arrangements may be structured in a way which appears to satisfy certain regulatory rules, however, these arrangements are often ‘too good to be true’ and are in fact illegal.

Among the ATO’s previous concerns about dividend stripping arrangements and contrived arrangements involving diversion of personal services income to an SMSF, there are some new arrangements on the Tax Office’s radar, including:
– Artificial arrangements involving SMSFs and related-party property development ventures.
– Arrangements where an individual or related entity grants a legal life interest over a commercial property to an SMSF. This results in the rental income from the property being diverted to the SMSF and taxed at lower rates whilst the individual or related entity retains legal ownership of the property.
– Arrangements where individuals (including SMSF members) deliberately exceed their non-concessional contributions cap to manipulate the taxable component and non-taxable component of their fund balance upon refund of the excess.

If you are concerned about your involvement with such arrangements, you can contact the Tax Office early to work towards a resolution.

Posted on 22 November '17 by , under super. No Comments.

ATO’s data matching programs

The Australian Tax Office (ATO) has sophisticated data matching programs in place to ensure individuals and businesses are complying with their obligations and to uphold the integrity of the tax system for the community at large.

The Tax Office uses data matching to pre-fill tax returns, ensure people and businesses are lodging tax returns and activity statements when required, correctly declaring their income and claiming offsets, and meeting their tax obligations.

It helps to detect dishonest individuals and businesses operating outside the tax system, detect fraud against the Commonwealth and to recover debt.

The following areas are currently under close scrutiny:

Credit and debit cards
The ATO obtains data from banks and financial institutions to identify the total credit and debit card payments received by Australian businesses.

Specialised payment systems
Data on electronic payments made through specialised payment systems to Australian businesses is analysed in conjunction with data collected through the credit and debit card data-matching program.

Business transactions through payment systems
Data is collected from organisations that process electronic payments for businesses in a report.

Online selling
Details of online sellers who sell goods and services to the value of $12,000 or more is attained. Data is obtained from online selling sites where the data owner or its subsidiary:
– Operates a business in Australia that is governed by Australian law.
– Provides an online marketplace for businesses and individuals to buy and sell goods and services.
– Tracks the activity of registered sellers.
– Has clients whose annual trading activity amounts to $12,000 or more.
– Has trading activity for the years in focus.

Ride-sourcing
Data is obtained from ride-sourcing facilitators operating in Australia and/or their financial institutions to identify ride-sourcing drivers. This information is used to notify drivers and help them understand their tax obligations.

Motor vehicle registries
The Tax Office acquires data from all the state and territory motor vehicle registering bodies to identify all motor vehicles sold, transferred or newly registered, where the transfer and/or market value is $10,000 or more.

Posted on 22 November '17 by , under tax. No Comments.

Getting customers to settle debts

Good credit management is an important business strategy to maintain cash flow and stable finances.

A cornerstone of managing credit is not only making sure an invoice gets paid, but gets paid on time. Before a debt recovery process commences (which may delay payment further and damage a relationship with a customer), it is worthwhile for businesses to put a few processes in place to avoid customer debt in the first place.

Prepare your customers
Making sure the customers understand their payment terms from the start is the first step in training them to keep track of outstanding invoices and payment due dates.

Keep detailed records
Businesses should keep all customer records such as payment term agreements, customer limits and outstanding sales to date.

Follow up regularly
Starting following up procedures once a payment becomes overdue will help speed up the process. It is also very important to know exactly who to speak to about payment matters, it may be different to the person you had been dealing with during the transaction process. Being consistent when following up debts will help businesses maintain good customer relationships.

Implement payment in full
Most businesses adopt this policy in regards to payment procedures. This way the customer has a full amount to pay by a concrete due date. Sometimes ‘making it easier’ for the customer by staggering payments and due dates can confuse and delay payments even further. If there are ongoing problems of overdue payments, businesses can consider mediation or debt collection services.

Upfront payments
For labour and time intensive work, some businesses ask for a part payment or deposit up front. This works as a way of showing that the customer is financially committed to the project. It also allows a business to better manage cash flow, knowing that there won’t be months at a time when there are no payments coming in because of works in progress.

Legal action is very expensive and should be considered as a last resort.

Posted on 15 November '17 by , under money. No Comments.

How to ensure your branding is consistent

Consistent branding is a big factor in your business’ marketing strategy – it can help build loyal customers, improve recognition and trustworthiness.

Businesses that adopt consistent branding techniques gain a competitive advantage by differentiating their products and services from other competitors in the market.

Staying consistent also helps to stay on track in delivering the brand promise to customers and clients through every single touch point.

Here are three ways to focus on delivering a consistent brand:

Similar tone and showcase personality
Whether your business is advertising via social media, TV advertisement or email campaign, the content should be similar in tone. Your marketing campaigns are a way to express your business’ personality and values, so make sure you deliver on this. Use similar language, adopt the voice to suit the type of marketing (i.e., conversational v formal) and stick to key messages for target audiences.

Design
Colours, images, fonts, logos and so on all communicate your business’ brand and identity. Creating a style guide is very useful for communicating your expectations to a graphic designer. If the designer is given a vague brief with no rules or guidelines then you cannot expect their designs to match your overall brand. Ideally, your website, logo, physical store and various marketing communications need to be aligned.

Staff training
Marketing communications can only go so far in proving your business is consistent. Customers and clients want to receive consistent service when they visit your store or office, call and email you. Invest in training your staff in customer service so customers can be guaranteed they will always have an enjoyable experience with your business.

Posted on 15 November '17 by , under business. No Comments.

SMSF annual return for pension phase trustees

Self-managed super fund (SMSF) trustees who are in pension phase must lodge their SMSF annual returns if they remain active, or choose to wind up the fund.

The ATO is warning SMSF trustees about their regulatory obligations and is paying close attention to those SMSFs that are not meeting their lodgment obligations.

Trustees must lodge a Self-managed superannuation fund annual return 2017 if it was a self-managed super fund on 30 June 2017, or a self-managed super fund that was wound up during 2016-17.

Super funds that are not SMSFs at the end of 2016-17 must use the fund income tax return 2017 and, where required, a separate super member contributions statement.

Even if your fund does not have a tax liability, your SMSF must lodge an SMSF annual return.

Posted on 15 November '17 by , under super. No Comments.

Using the margin scheme for property sales

Those selling property as part of a business sale may be eligible for the margin scheme.

The margin scheme is a way of working out the GST you must pay on the property that you are selling as part of your business. The scheme is only applicable if the sale of a property is taxable.

The GST on property sales is generally equal to one-eleventh of the sale price. If the margin scheme is used, the GST is calculated on the difference between the sale price and your purchase price of the property (or the property’s value on 1 July 2000 if it was acquired before that date).

To meet the eligibility requirements you need to be registered for GST or required to be registered for GST.

Contact our office to check your eligibility for the margin scheme when selling property as the application of GST to property-related transactions can be quite complex.

Posted on 15 November '17 by , under tax. No Comments.

How to truly set your business apart from competitors

Making your business stand out can be difficult; especially if you are offering the same services as your competitors.

No matter how big or small, or what the financial status of your business may be, there is one strategy any business can adopt to set you apart: customer relationships. Building and placing value on the relationships you build with customers is free. The main focus of these relationships is to truly value the customer as a unique individual and not just view them as another sale or a number. When people feel their transaction with your business has been genuine, the whole morale and attitude within the business can change for the positive and drive up profit.

Consider the following benefits of developing strong customer relationships:

Creates brand loyalty
It is highly unlikely that a customer will return to your business for future services and sales if they unsatisfied with their initial transaction. If they are happy with their transaction with your business and they leave feeling genuinely looked after and positive, chances are they will be back.

Increase in referrals
Word of mouth is a strong tool for generating more business. If a customer is not happy with the service they provided, they are likely to go straight to social media and discuss their transaction, speaking negatively about your business. On the flip side, a satisfied customer is likely to speak highly of and recommend your business to friends, and even strangers on community social media pages. A referral from an existing or previous customer is often more trustworthy than a marketing campaign, so placing value on treating existing customers with the utmost professionalism and diligence can see the business grow and profits increase.

Cost-effective
Treating your customers well is a great marketing strategy. It is more cost effective to bring in more business through treating existing customers well (whilst making money) rather than splashing out on marketing campaigns that may or may not be as successful as you had hoped.

Posted on 10 November '17 by , under business. No Comments.

SMSFs: Stats

The Australian Tax Office (ATO) has released its June 2017 quarterly SMSF statistical report detailing key SMSF figures.

As of June 2017, the number of SMSFs increased to 596,516. The number of SMSF members in Australia is 1,124,453.

The estimated value of total Australian and overseas SMSF assets is $696.7 billion.

The number of annual wind-ups including both those initiated by trustees and those as a result of ATO compliance and cleansing activity was 1,419 as of June 2017. This is a significant decrease from 10,551 in June 2016.

The top five asset types held by SMSFs by value include listed shares (30 per cent or $212,210m), cash and term deposits (23 per cent or $159,686m), non-residential real property (11 per cent or $74,772m), unlisted trusts (10 per cent or $71,455m) and other managed investments (5 per cent or $37,695m).

Posted on 10 November '17 by , under super. No Comments.

Changes to GST on low-value imported goods

Australian goods and services tax (GST) will be implemented on sales of low-value goods imported into Australia by consumers as of 1 July 2018.

According to the ATO, business will have to register for GST, change GST on sales of low-value imported goods and lodge returns if they meet the $75,000 AUD registration threshold.

These business includes merchants who sell goods, electronic distribution platform operators or re-delivers. Customs duty and clearance charges will be changed to the importer at the border under existing process should goods be imported in a consignment over the value of $1,000 AUD.

Through the implementation of this new law, businesses will not:
– Charge GST on a sale where GST is to be charged at the border. This occurs when an item is worth over $1,000 AUD or is a tobacco product or alcoholic beverage.
– Need to charge GST where it is clear that multiple goods will be shipped in the one consignment coming to a value of over $1,000 AUD. In these instances, GST will be charged at the border instead.

The ATO will be holding a number of international engagements on the application of Australian GST to low-value, imported goods sales throughout November 2017.

Posted on 10 November '17 by , under tax. No Comments.