Month: December 2022

Starting A New Business In The New Year?

Posted on by Adam_Admin

The coming new year of 2023 may be bringing you a fresh start regarding your business adventures. You may even be looking to start your next adventure on your own terms.

Why not make the coming year your year to start a business?

Understandably, you may have concerns and trepidation about the process (particularly amidst current economic uncertainty). However, an excellent start to a business should consider strategising, planning and development.

Starting a successful business requires three things:

  • A good idea,
  • The right amount of capital you’ll need, and
  • Creativity.

However, with the challenges many businesses faced over the last few years, particularly those who were finding their feet and starting up, having just those three things to face 2023’s business environment might be a little daunting.

That’s why having a strategy in place for your business and a plan for its path in the future is of paramount importance.

Think Through Every Element Of Your Startup (From Top To Bottom)

An idea for your business is a great starting point, but articulating that idea to your investors with a solid foundation is even more critical.

Think about the questions that your investors might ask you about critical elements of your business, including your target audience, the competition in the field, your company’s goals and your potential marketing strategies, as well as potential questions investors might ask you about each of those aspects of your business.

Having solid answers in place will give your investors (and you) a better picture of the idea and your potential as a business innovator.

Draft A Business Plan 

Having a physical business plan that includes all the elements you brought forward to your investors or partners will help you as you move forward on your business trajectory, but also gives a map of your business goals.

Creating a business plan should be fairly easy as it is simply putting in writing what you have already discussed ahead of time with your investors.

You may also be able to speak with us about creating business plans at the beginning of your business and throughout your business’s lifetime.

Put Your Money Into The Resources You Need (Not The Ones You Want)

It might be tempting to shell out for the best and the flashiest equipment that your business could have a use for all at once, but it’s best to plan out your expenses. Determine your needs upfront and invest in them. Are you planning to have a physical space for your business, or can operations be conducted remotely? Putting the extra money into the critical resources and equipment that your business needs at the start may help you to produce a quality product and earmark your business

Don’t Skimp On The Marketing

Marketing is one of the most important business growth strategies but is often neglected or overlooked by new businesses. Use social media, create a website, set up a blog or create email campaigns to bring awareness to your business.

Hire An Accountant

An accountant is specially trained to manage your finances and keep them in good order.

While you might be able to keep track of your finances in the early stages of the business’s growth, we’re equipped to help when things start to pick up speed.

Start a conversation to find out how we can help your business today.

Advantages & Disadvantages Of Property Downsizing For Retirees

Posted on by Adam_Admin

Downsizing during retirement can help you reduce costs and put some more money in your pocket so that you feel more secure about your finances during retirement.

Downsizing by selling your property has advantages and disadvantages, which you should evaluate before making this decision.

Advantages

  • Increased cash flow: Downsizing should reduce your mortgage payments and free up extra money to invest or spend. This will give you more flexibility with your money in your retirement years.
  • Easier to maintain: A smaller house takes less effort and is easier to clean and maintain.  Approaching retirement, you may want to reduce the amount of time you have to spend cleaning your house so that you can participate in other activities.
  • More convenient: A new house will mean that you can choose a layout, fittings, locations and services that are more suited to your updated needs. While your old house might be close to schools, you may want to opt for a house that is closer to a recreational centre or the city centre (for accessibility to shops and services.
  • Lower insurance and utility bills: A smaller home generally costs less. Both in terms of insurance and also in terms of upkeep and maintenance (such as heating and cooling).

Disadvantages

  • Less space: A small house means that you have less storage for things. You might have to make some difficult decisions about letting go of your possessions. Alternatively, you could consider leasing a storage space – although this would cost extra money.
  • Less flexibility: There may be less privacy due to fewer or no guest rooms or less space for entertainment. If you regularly have many guests coming over, this might make downsizing unideal.
  • New neighbourhood: Getting comfortable in your new suburb might be difficult. You might have to check out your neighbourhood before and after moving into the new place.
  • Emotional connection: A family home is full of memories, and there is a strong connection with it. This can make it difficult to let go.

Eligibility 

From 1 July 2022, eligible individuals aged 60 years or older can choose to make a downsizer contribution into their superannuation of up to $300,000 per person ($600,000 per couple) from the proceeds of selling their home.

For downsizer contributions made before 1 July 2022, eligible individuals must still be aged 65 years or older at the time of making their contribution

On 3 August 2022, the Treasury Laws Amendment (2022 Measures No. 2) Bill 2022 was introduced into Parliament. In this, the Government has proposed that the downsizer eligibility age be further reduced to 55 years. This measure is not yet law.

Downsizing has financial benefits, but it does come with emotional costs and is a fairly significant decision to make. It may not be a solution for everyone, but it is one that you should consider carefully.

It is important to discuss the implications with your advisor and, perhaps also, your family members before determining how you will proceed.

FBT Liability During Natural Disasters & Emergencies

Posted on by Adam_Admin

Australians can experience a range of natural disasters, such as floods, bushfires, tropical cyclones, severe storms and even earthquakes. These events can cause devastation to communities and financial hardship for individuals and businesses.

While FBT may not be at the forefront of your mind when helping your employees after an emergency, it can result in potential exemptions depending on the assistance provided.

It is worthwhile to know what kinds of benefits you, as a business owner, can provide for different emergencies that will be excluded from FBT. Businesses that provide benefits to employees during an emergency situation are likely to have assistance costs be exempt from fringe benefits tax (FBT).

Exemptions will apply to benefits you provide to employees who are being impacted by or will be potentially impacted by:

  • A natural disaster such as a bushfire, flood or cyclone.
  • An accident such as a car accident.
  • A serious illness such as cancer.
  • An armed conflict such as a war.
  • A civil disturbance such as a riot.

The benefits you provide to your employees that can be exempt from FBT include health care, temporary repairs or emergency needs such as food supplies, clothing, accommodation, transport or household goods. These can be of great use to employees looking to get back on their feet.

Short-term benefits you provide to an employee, such as temporary repairs to damaged property due to a natural disaster, are exempt from FBT. However, long-term employee benefits after an emergency event will not be exempt, such as a replacement car, new house or ongoing renovations.

When providing health care, certain requirements must be followed. FBT exemptions only apply to health care provided:

  • For an employee of yours or from a related company.
  • On your premises or the premises of a related company
  • By a company doctor at an accident site.
  • At or near an employee’s worksite.

If you decide to pay for your employee’s ongoing medical or hospital bills, then the FBT exemption will not apply.

The benefits costs would be deductible to the employer but not assessable to the employee and will not appear as part of their salary and wages on their payment summary.

These benefits can be of use to not only the individual employees but to your business as well. Regarding FBT, exempt benefits can be a great way to lower the tax bill. They also provide a way to assist your employees during times of great hardship.

However, to ensure you’re maximising your FBT benefits potential, consult with a registered tax agent or adviser for the right information and assistance in handling these matters.