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BAS lodging and government funding eligibility

Posted on 2 April, 2020 by admin

As part of the second $66 billion support package in response to COVID-19 and its negative effects on the Australian economy, the Federal Government has expanded tax-free cash payments to small and medium businesses with a minimum payment of $20,000 and maximum of $100,000, up from the previous $2000 to $25,000 range. However, it is important to note that payments are only given to eligible businesses after they lodge their BAS (business activity statements) by the 28 July and 28 October 2020 due dates. The new enhanced scheme will be delivered in two phases: Employers are set to receive a first payment equal to 100% of their salary and wages withheld (a maximum of $50,000) when lodging their activity statements at quarterly due dates. An additional payment equal to the first payment made after businesses lodge their BAS by 28 July and 28 October 2020. Businesses will receive payments based on their BAS lodgement schedules. For example, a business that receives a payment for the period up until June 2020 will receive the same amount for the period up until September 2020 upon the lodgement of their BAS in two separate occasions. For monthly BAS lodgers, businesses will receive their […]

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New JobKeeper payments for employers

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The Federal Government introduced a third COVID-19 support package of $130 billion on 30 March 2020. The package includes additional support for businesses, including a new JobKeeper payment to help businesses retain employees. Businesses who have been affected by COVID-19 may be able to receive a Government subsidy to help them continue to pay their employees. To be eligible, employers must: Have more than a 30% reduction in their turnover for at least a month compared to last year if the business has an overall turnover of less than $1 billion. Have more than a 50% reduction in their turnover for at least a month compared to last year if the business has an overall turnover of $1 billion or higher. Not be subject to the Major Bank Levy. Have been in an employment relationship with eligible employees as at 1 March 2020. JobKeeper payments must only be made to eligible employees, which are employees who: Are under current employment with the employer. Were already employed by the employer on 1 March 2020. Are employed on a full-time or part-time basis, or are a long-term casual who has been employed on a regular basis for over 12 months as at […]

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Expert advice on early superannuation access as a result of COVID-19

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Under the coronavirus stimulus package released and revised by the Australian Federal Government on 22 March 2020, individuals in financial trouble due to the negative economic impacts of COVID-19 will be able to access their superannuation funds early. However, while the option is available, it is recommended that individuals only consider withdrawing from their super in the case of absolute emergencies and treat it as a last resort. With the new rules on superannuation, workers whose incomes are reduced by at least 20% due to the COVID-19 outbreak are allowed to take $10,000 out of their super for the 2019-20 financial year and another $10,000 for 2020-21. Individuals will also not need to pay tax on any withdrawn amounts and existing welfare payments will not be affected either. While the introduced early access to superannuation funds may be inviting for newly unemployed workers, it is important to consider whether the temporary relief is necessary and worth foregoing super funds available for long term investment. For example, even when accounting for Australia’s slowing economy in the coming years, $10,000 is predicted to be worth over $65,000 in another 30 years. Especially for younger workers who are less likely to have access […]

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Setting up your myGovID

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If you haven’t set up your myGovID yet, you need to do it before you can lodge your next business activity statement (BAS). AUSkey, including Manage ABN Connections, will be replaced by the ATO’s myGovID and Relationship Authorisation Manager (RAM) from 27 March 2020. After this change, you will no longer be able to access government online services through an AUSkey. Device AUSkeys will be replaced by new machine credentials. Business owners will need to set up a myGovID soon if they haven’t already done so and link it to RAM. Your myGovID is separate from your myGov account and will allow you to prove your identity online. RAM is an authorisation service that uses your myGovID to provide you with access. When linked with your myGovID, RAM will allow you to act on behalf of your business online. Desktop and browser-based versions of myGovID will not be supported as these devices are easily accessible. To set up your myGovID, you will need an email address (that you do not share with anyone else) and a smart device that uses iOS 10 or later on Apple devices, or Android 7.0 or later (not including devices that use Android Go operating […]

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Government increases cash flow support for businesses

Posted on 27 March, 2020 by admin

The Australian Government has increased support for businesses to manage cash flow challenges under the ongoing COVID-19 circumstances. The Boosting Cash Flow for Employers measure announced on 12 March 2020 will be increased to provide up to $100,000 for eligible small and medium-sized businesses. To be eligible employers must have been established prior to 12 March 2020 and have an aggregated annual turnover of less than $50 million and employ workers. The measure will provide employers with a payment equal to 100% of the tax withheld from wages and salaries. This is a rise from the original 50%, with maximum payments being increased from $25,000 to $50,000 and minimum payments being increased from $2,000 to $10,000. Employers will receive payments from 28 April 2020 from the ATO as automatic credit in the activity statement system upon lodging eligible upcoming activity statements. Eligible businesses will be provided with an additional payment during July – October 2020. The payment will be equal to the total amount received under the Boosting Cash Flow for Businesses scheme. For monthly and quarterly activity statement lodgers, these payments will be provided as automatic credit in the activity statement system for each lodgement up until October 2020. […]

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What to consider before taking out a business bank loan

Posted on 19 March, 2020 by admin

Many businesses, whether they are only just starting up or have been in the market for a number of years, will need a bank loan at one time or another. However, before you apply for a bank loan, it is important to think things through to ensure that you know if you should get one, if you are getting it at the right time and how you can make the most out of a loan. Here are some questions business owners should ask themselves before beginning their bank loan application: How likely is it that I qualify for the loan?If you believe that your business won’t qualify for a bank loan, then you will only hurt your credit rating if you apply for a loan you won’t get. Being rejected for a loan can also make it more difficult for a business to borrow in the future. Will the loan help the business grow?Instead of using the loan for aspects like routine operating expenses that don’t generate much revenue, owners should consider putting the borrowed money into parts of the business that will generate more revenue and help reduce future borrowing needs. How much do I need?Before making requests of […]

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Business loan vs business credit card

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Business loans and business credit cards are the most popular financing options, but there are key differences between the two that you should consider to help you make the right choice for your business. Business loanA business loan is a lump sum of money that you borrow. They can be a good option for your business if you require funding for a larger one-off purchase, such as buying new equipment or machinery, real estate, business acquisition, capital investment or refinancing existing debts. Business loans typically range from $5,000 to $50,000 and can be paid as a lump sum or through multiple set payments. Depending on your bank, you can generally make repayments in monthly or quarterly instalments that are tailored to you and your cash flow. To get your business loan approved, there is usually a strict approval process you must pass, which can include details such as your business’s financial position and a financial spending plan. In terms of extra costs, a business loan generally comes with signup fees and late repayment fees. The interest rate for a loan is often lower than a credit card and can be a monthly or annual rate, which typically ranges between 3-10% […]

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Investing in shares vs property in SMSFs

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Shares and property are two popular investment options for those with a self-managed super fund (SMSF). However, they both have very different attributes and choosing the one that will achieve the best outcome for an SMSF depends on your personal goals and situation. While the price of shares can vary drastically, property is a relatively stable asset, making it appealing to those who want more security and predictability. Property prices are also negotiable unlike shares, and you can generally borrow money at a lower rate for property purchases. It may seem hard to find the perfect investment property, but older and undercapitalised properties can be renovated for profit. However, returns from property rentals can be dented due to factors such as land tax, utilities and rates, maintenance and tenancy vacancies. Shares are more dynamic and volatile than property. One advantage is the accessibility of investing in shares, as you can enter the share market with a few thousand dollars – much less than what you need to invest in a property. Maintaining a portfolio of quality shares that pay tax-effective dividends may be a good way to fund retirement. With the right portfolio allocation, shares also have the potential to […]

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CGT exemptions have been scrapped. What does that mean for you?

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Are you an Australian living or working overseas with a family home in Australia? Or you know someone who is? If so, be sure to consider the impacts of the capital gains tax (CGT) on you from 30 June 2020. Since 1985, the exemption of Australian expatriates from the CGT tax has been available for homes which have never been rented out for more than six years at a time. However, following the scrapping of the CGT exemption under the A$581m federal government plan, Australians working overseas will have to sell their property before the 30th of June 2020 to avoid CGT and still be eligible for CGT main residence exemption. With the removal of CGT exemption past June 2020, Australian ex-pats who own property in Australia will be required to pay CGT dating all the way back to when they first bought the property. That is, if an ex-pat was to have bought their property in 1985, they would have to pay an accumulation of their tax owing in CGT from 1985 to 2020. The only way to avoid such hefty tax payments would be to sell your property on or before the 30th of June or to re-establish […]

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Tips for incorporating career mentoring into your business

Posted on 28 February, 2020 by admin

A career mentorship program involves partnerships between employees to develop professional skills and gain industry knowledge. Due to their requirement for a collaborative effort, career mentoring programs are often seen as powerful development tools for cultivating both leaders and employees within a business. Whether you are a small business owner or a multinational corporate leader, the implementation of a mentorship program will always be profitable for businesses as not only does it create a harmonious workplace culture, it also helps to attract and retain employees. As straight-forward as career mentoring sounds, there are a few key tips to keep in mind when building a mentorship program for your business: Make sure your mentoring program is clearly defined:To create a successful mentoring program, both mentors and mentees should have a concise understanding of their roles and what they would like to gain from the mentorship. By succinctly outlining the purpose of the mentoring program, mentors and mentees are more likely to keep organised and communicate respectfully with the guarantee of mutual rewards. There should also be short-term and long-term goals established for all parties involved, including the business. These goals could be the narrowing of particular skill gaps or creating a […]

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Using your tax return wisely

Posted on July 8, 2019 by admin

Getting your tax refund back is exciting, but as tempting as it is to splurge, consider other ways you can put that money to good use. It is easy to get caught treating your return as extra money when you shouldn’t see it any differently than your regular paycheck. Give the money a purpose by thinking about your personal financial situation and determining your needs.

Emergency fund:
An emergency fund can make all the difference if a difficult financial situation comes up, acting as a backup in the case of an emergency such as losing your job or medical costs. Building an emergency fund with enough money to cover at least three months worth of expenses is a good starting point. Make sure the money is added to a high-interest savings account to utilise compound interest. If you are contributing regularly to this fund, adding money from your tax return can boost it above schedule.

Make debt repayments:
With a bit more money at your disposal, now is the time to make repayments on debts you may have. Start with the higher interest debts and work down, your interest repayments will drop when you lower your outstanding balance. These debts can be things like credit cards, personal loans, outstanding bills or mortgage repayments.

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