Month: July 2022

Business Automation: How Could You Benefit?

Posted on by Adam_Admin

With client needs and team capabilities constantly changing within the business world, we recommend you pause and reflect on your own critical business processes to see if you can spot opportunities for improving efficiency and reducing waste.

There’s no better time to do this than at the beginning of a new financial year.

Get your team together in a room or a Zoom meeting to brainstorm the processes or work that:

  • frustrates them,
  • has highly repetitive tasks, or
  • is time-consuming.

Then, you should examine how you might be able to automate these processes to improve your business’s productivity and output better.

Business automation can occur in order to improve external performance and experience of the business for your clients, OR it can be used to improve upon the internal processes of your business.

For example, communicating with your employees is one constant in your business. This is obviously important, but you know it could be improved. You don’t need to have as many meetings as you are now. You should be able to share feedback faster. So how can this be improved?

Automated business processes can be split into four basic types outlined below.

Basic Automation

Basic automation refers to the most straightforward jobs that need to be performed, like creating a centralized place to store a mix of related information. This can be automated through a project management tool that prioritises collaboration and communication to seamlessly pull together a patchwork of data into a single platform.

This tool should automatically organise all of this information to make it understandable and usable.

Process Automation

Process automation involves a dedicated network of software and apps used to document and manage your business processes, such as budgeting or project management.

Integration Automation

Integration automation allows machines and software to monitor and analyze how employees perform tasks and imitate them. You simply define the rules of operation.

An example would be your project management software integrated with your customer support software. A customer complaint comes through, but instead of waiting in an inbox for someone to process it, the integration automatically sends it as a task to the person assigned to handle them.

Artificial Intelligence (AI) Automation

Artificial Intelligence (AI) automation is when you combine AI with your integrated software tools for faster, smarter decision-making. The system can now make choices on your behalf with the data it’s presented (such as sample data).

Some general examples in which your business could benefit from automating key processes could include:

  • Email Automation – Automating your inbox can assist in automatically processing information from your email quickly and efficiently
  • Automated Business Application Integration – With businesses using more and more different applications, a lot of business processes can involve multiple business applications at the same time
  • Automated Order Entry – You can use business process automation to automate your database interaction processes without writing a line of code
  • Browser Automation – Even if a part of your process involves going to a website and clicking on fields or grabbing information, business process automation can make it faster and more efficient.

What Do You Need To Do To Make Your Business Compliant With Superannuation Requirements For Employees?

Posted on by Adam_Admin

It is your responsibility as an employer to set up your business to pay super into your eligible employees’ chosen super funds or their stapled super fund where no choice has been made.

If your employee hasn’t made a choice and doesn’t have a stapled super fund, you can contribute their super to your default super fund.

What you need to do:

  • Select your default super fund.
  • Offer employees a choice of super fund and keep records that show you’ve done this.
  • Request your employee’s stapled super fund details if they do not make a choice
  • Provide employees’ TFNs to their funds.
  • Set up your systems to pay super contributions electronically to the right fund.

If you pay extra super for an employee:

  • under a salary sacrifice agreement, you must set up the arrangement for the employees’ future earnings, document the arrangement and use a complying fund.
  • you must report the amounts being made to the employee’s fund.

Salary Sacrifice Agreements

To create an effective salary sacrifice arrangement, you must:

  • set up the arrangement for employees’ future earnings
  • document the arrangement
  • use a complying fund.
Set Up The Arrangement For Employees’ Future Earnings

The arrangement must be set up for your employee’s future earnings. It can’t include previously earned or accrued:

  • salary, wages or entitlements
  • annual or long service leave.
Document The Arrangement

You and your employee must prepare and sign a document that states the terms of the salary sacrifice arrangement. If you don’t have this documentation, it may be difficult to establish the facts of your arrangement.

Employees can renegotiate the arrangement at any time, within the terms of their employment contract or industrial agreement. If your employee has a renewable contract, you can renegotiate the salary sacrifice amount before the start of each renewal.

Use A Complying Fund

The salary sacrifice amount must be contributed to a complying fund for the period of the arrangement.

Contributions can’t be accessed until the employee satisfies a condition of release, such as reaching retirement age.

Report The Amounts

Reportable employer super contributions (RESC) are not included in your employee’s assessable income. They do not affect the way you calculate super contributions for your employees.

The following employer super contributions are reportable:

  • additional contributions as part of an employee’s individual salary package
  • additional contributions under a salary sacrifice arrangement
  • pre-tax amounts paid to an employee’s super fund at the employee’s direction, such as directing an annual bonus into super.

You must report extra contributions if:

  • your employee can influence the rate or amount of super you contribute for them; and
  • the contributions are in addition to the compulsory contributions you must make under
    • super guarantee
    • a collectively negotiated industrial agreement
    • the rules of a super fund
    • federal, state or territory law.

The extra contributions are reportable super contributions for employees unless you show that:

  • the extra contributions are made for administrative simplicity
  • a documented policy is in place that does not allow an employee to influence the contributions you make on their behalf.

The Tricks & Traps Of The Work-Related Expense

Posted on by Adam_Admin

Are you up to date and aware of what you can and can’t claim on your tax return this year? Brushing up on the three rules of work-related deductions can make tax time a lot easier.

In order to be able to claim a deduction for a work-related expense on your tax return, you must meet the following golden rules of the Australian Taxation Office (ATO).

  1. The money must have been spent by you and you were not reimbursed by your employer for it.
  2. The expenses must directly relate to earning your income.
  3. There must be a record to prove the expense (such as a receipt)

These need to be claimed in the Work-related expense section of your tax return.

If the expense was for both work and private purposes, you only claim a deduction for what was the work-related use. You cannot claim a deduction if your employer pays for or reimburses you for any of these costs.

These work-related expenses may include:

  • Motor vehicle expenses
  • Travel expenses
  • Clothing, laundry and dry-cleaning expenses
  • Self-education expenses

If the ATO believes that your employer may reimburse you for your expenses they may ask your employer directly.

You may be able to claim other work-related deductions for expenses you incur in the course of earning your income. These are claimable in your tax return as an ‘Other work-related expense’.

Common claims in this section of the tax return include:

  • Working from home expenses
  • COVID-19 test expenses
  • Phone, data and internet expenses
  • Tools, equipment and other assets
  • Union fees, subscriptions to associations and bargaining agents’ fees

When it comes to working from home expenses, you need to be careful of what you claim. To claim your working from home expenses you must:

  • be working from home to fulfil your employment duties, not just carrying out minimal tasks, such as occasionally checking emails or taking calls
  • incur additional expenses as a result of working from home.

You can claim a deduction for the additional running expenses you incur as a result of working from home.

Running expenses are expenses that relate to the use of facilities within your home and include:

  • electricity expenses for heating or cooling and lighting
  • the decline in value of office furniture and furnishings as well other items used for work – for example, a laptop
  • internet expenses
  • phone expenses.

You can’t claim a deduction for the following expenses if you’re an employee working at home. These include

  • coffee, tea, milk and other general household items, even if your employer may provide these at work
  • costs that relate to your children’s education such as equipment you buy – for example, iPads and desks, subscriptions for online learning
  • items your employer provides – for example, a laptop or a phone
  • any items where your employer pays for or reimburses you for the expense.

If your employer pays you an allowance to cover expenses, you can claim a deduction for the expense. However, you must include the allowance as income in your tax return.

You may also be able to claim a deduction for other expenses you incur that don’t relate to your work or income-producing activities. These are claimable in your tax return at the specific expense category (where available) or as an ‘Other deduction’.

Common claims in this section include expenses, such as

  • Cost of managing tax affairs
  • Gifts and donations
  • Interest, dividend and other investment income deductions
  • Income protection insurance

If you require assistance with ensuring that your individual income tax return is correctly lodged, a registered tax agent should be consulted (such as us). We’re equipped with the knowledge and tools to help you through this process.

Inflation, Your Business And How To Deal With The Upcoming Pressure.

Posted on by Adam_Admin

Understanding how and preparing your business for the impact of inflation is a critical element of business planning that now more than ever needs to be addressed.

Interest rates rising are putting a strain on businesses across the country, as the costs for running these businesses rise in turn. Further spikes in inflation could provide additional challenges for businesses and their owners who are struggling to prepare for them.

With interest rates forecast to increase exponentially over the next year, here are some methods you can employ to address the risk inflation may pose to you.

Improve Productivity And Efficiency

Now is the time to review processes and output and look at ways to improve or streamline your operations, such as automation of processes including business software.

This could include

  • Emails
  • Invoices
  • Shipping
  • Sales and marketing or
  • Purchase orders

Strategically Cutting Costs

Review your current service providers and contracts such as telecommunications and internet providers, commercial property leases and service contracts, and compare the current market. You may find that there are better deals or options that allow you to minimise costs without impacting your business’s performance and options overly much.

However, be mindful not to cut marketing spending or communications capabilities which could cost you business in the long term.

Revisit Your Banking And Financial Products Needs

Look beyond your short-term needs and make sure that the interest rate on your business loans is competitive and weigh the benefits of variable and fixed rates.

Develop A Pricing Strategy

Rather than a price increase, look at ways you can leverage or bundle your existing goods and services.

If you are selling products, understand that there is a link between your client relationship and your pricing. Pricing too high all of a sudden could impact how your business is viewed by customers, but pricing too low will be detrimental to your business.

It could be cheaper for your business to offer a discount on upfront or prompt payments, rather than maintain an overdraft that accrues higher interest rates.

Consider Your Supply Chain

Overseas markets are volatile at the moment, so consider reducing risks by finding a domestic supplier which could also slash the costs of freight and storage. Create backup supply chains to mitigate the risk of having a ‘singular’ supply chain that could be impacted by market disruptions.

Review Your Workforce

The labour market is competitive, and you want to keep talented staff. Consider offering flexible work arrangements, offering nine-day fortnights rather than pay increases, and looking for training and development opportunities, particularly those that are subsidised by the government.

If an employee is not providing value to the business (such as working in a redundant position or failing to meet work expectations that are reasonable to expect from them), it may be better for the business to let them go.

Are you concerned about how inflation could impact your business? Speaking with a trusted business adviser (such as your accountant) may assuage some of those concerns, as they can provide you with a formulated plan that targets your business’s year ahead.