Author: Adam_Admin

Employing A Talent Acquisition Strategy For Your Business’s Employment Needs

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It’s a daunting task, seeking someone who can fill a specific position that your business needs filled. It’s important that irrespective of how the economy is performing, the state of the workforce and what your business currently consists of, the employees that you hire are the best and most-talented people that you can get.

Though often we think of recruitment as a valid strategy of employment, it often seeks to fill gaps or vacancies that might be caused by staff turnover or insufficiency. This is still a valid strategy for businesses that need immediate solutions to staff/skill shortages.

However, hiring for your business shouldn’t just be about filling an immediate need – it’s about ensuring that your business attracts and retains talented employees for the long-term, to help your business grow to its full potential. A talent acquisition strategy should be put in place by your business to assist in addressing this issue.

Essentially, a talent acquisition strategy should be tailored to reflect and suit your business goals over the course of the next five years. It’s important to consider how the business is going to expand in the future, and what employees you need to join you in journeying towards that goal. Investing in the right talent now will pay off dividends for your business in the long term.

It’s all well and good to know what you need for your business in terms of talent – but how do you convince them to join you? Just as marketing campaigns are important for selling whatever your business produces, it’s important to consider how to market your business towards the talent you want to acquire.

There are plenty of ways to use data to strengthen your strategy, such as figuring out where your current top talent came from and using that information to focus your talent acquisition efforts on certain academic programs or professional networking sites. Data can also be used to refine job descriptions, career pages, emails and more, as it can eliminate in the application process any questions or phrasing that could be deterring qualified candidates.

Identifying where to find the majority of your top talent is an important step in the process of acquiring talent. It’s also important to ensure that you are utilising and expanding on our sourcing strategies when trying to find better talent.

Sometimes to recruit a skillset, you have to be a little adventurous in where to reach out to. Diversify your talent searching approach by looking outside of the usual LinkedIn profiles, and seeking out talent at specialised job boards, academic programs or networking events.

Above all, ensuring that your business has a reputation that draws potential talent is critical to engaging with those you want to acquire. Promoting aspects of your business that could draw in potential talent through multiple channels could be what convinces them to sign up with your business. Drawing attention to perks, the company culture and other work-life balance benefits or growth opportunities could be a way to highlight what sets you apart from the rest.

The Sharing Economy And Your Tax Return – How You Could Be Affected

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In Australia any income earned by a job may be considered to be taxable income. Those who receive their income via the sharing economy are no exception to the rule. In fact, there can be further complications that result from incorrect understandings of how the income tax and goods & services tax  may apply to those individuals.

The sharing economy is a socio-economic system built around sharing resources, often through a digital platform like a website or an app that others can purchase the right to use for a fee.

Popular sharing economy services and activities that could be subject to income tax include

  • Being a Driver for popular ride-sharing/ride-sourcing services and obtaining fares for those services
  • Renting out a room, whole house or a unit on a short term basis
  • Sharing assets (such as cars, parking spaces, storage space or personal belongings) through platforms such as Camplify, Car Next Door, Spacer, Toolmates or Quipmo.
  • Creative or professional services provided by individuals through online platforms to fill a need of others (also known as the gig economy)

Here are some of the things you need to bear in mind about the income and goods & services tax for these popular sharing economy services.

Ride-Sourcing/Ride-Sharing

If you’ve ever caught an Uber or gotten a Lyft, you’ve been on the passenger side of ride-sourcing. The income received from ride-sourcing is subject to goods and services tax (GST) and income tax is applied to it. All drivers on ride-sourcing platforms in Australia must have an Australian business number and be registered for GST.

GST requires:

  • An ABN
  • GST to be registered from the day that you start, regardless of how much you earn.
  • GST to be paid on the full fare.
  • Business activity statements (BAS) to be lodged monthly or quarterly.
  • To know how to issue a tax invoice (any fares over 82.50 must be provided one if asked).

Income tax needs to:

  • Include the income you earn in your income tax return
  • Only claim deductions related to transporting passengers for a fare, including apportioning expenses limited to the time you are providing a ride-sourcing service
  • Keep records of all your expenses and income.

Renting out all or part of your home

Renting out all or part of your residential house or unit through a digital platform can be an easy way to supplement your income, especially if you aren’t using the property at that particular time. If you do this, you:

  • Need to keep records of all income earned and declare it in your income tax return
  • Need to keep records of expenses you can claim as deductions
  • Do not need to pay GST on amounts of residential rent you earn.

Sharing Assets (Excluding Accommodation)

Assets that can be shared through a platform can include personal assets (e.g. bikes, caravans), storage or business spaces (e.g car parking spaces) or personal belongings like tools, equipment and clothes.

When renting out or hiring these (share) assets that you own or lease through a digital platform, you:

  • Need to declare all income you receive in your income tax return
  • Are entitled to claim certain expenses as income tax deductions
  • Need to keep records of the income you earn and of the expenses you can claim as deductions

Providing Services

Providing time, labour or skills (services) through a digital platform for a fee requires you to report income in your tax return. Deductions for expenses directly related to earning this income can be claimed, and records need to be kept to support these claims.

The following services that can be provided are considered to incur assessable income that needs to be reported in your tax return:

  • Delivering goods
  • Performing tasks and activities
  • Providing professional services

If the thought of trying to navigate your way through your tax return is a little daunting, consider speaking to us for assistance.

Outsourcing Models – How To Know What’s Right For You

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When a business cannot deal with the workload in house, a candidate or party outside of the business is often hired to assist in performing those services. This is called outsourcing, and it’s a practice that companies sometimes use to cut costs – especially if it’s easier to do this than to train up another employee.

The best model of outsourcing is one that meets the needs of the business. Clearly identifying those needs is a strategic step to take to ensure that the model chosen is the right one. There are four types of models when it comes to outsourcing.

Freelance

The freelance model of outsourcing assigns work to a freelance worker, which can be long-term, short-term, part-time or full-time. Jobs can be posted to freelance sites, freelancers can bid on them and you can select who you would like to work with. This model is a quick and easy way to get one-off projects completed that require special skills or obtain a little extra help during the busy season.

Pros: Cost-effective, quick and the skills needed for the job can be sourced

Cons: Overselling skills, difficult to brief, and jobs can be further outsourced by freelancers.

Project-Style Work

This model focuses on project-based work and involves outsourcing entire projects to a specialised outsourcing centre. Essentially all you have to do is provide the centre with the project requirements, and they will carry out the development work, project management and quality control through to the project’s completion.

Pros: Less work to be done by you, cost-effective in money and time, new staff aren’t needed and there is a fixed cost for the project.

Cons: May lack local knowledge if located overseas, time zone and language barriers can be difficult to overcome

Business Process Outsourcing

With the business process outsourcing model, a service provider sets up and operates an offshore office for you that they hand over when it is ready. Essentially, it’s contracting a business or organisation that hires another company to perform a process task required by the hirer for the business’ operational success. The provider has the facilities, setup, office environment and management required for global team members to work.

Pros: offers improved productivity, increased capacity, no need to worry about other sectors, inexpensive and an easy way to grow your team.

Cons: Large-scale BPOs can be more expensive to run and can be difficult to communicate needs and wants if the BPO doesn’t understand your industry or business.

Build-Operate-Transfer Model

This model is the model you want to employ if you’d like to build a separate office outside of your home country with more than 25 staff. To begin with, and much like a BPO, a provider ensures that there is a workspace and office equipment, and hires the employees. Rather than have the provider run the business for you, they then transfer the operation back to you.

Pros: Create work culture and environment among global team members, costs are less expensive than a BPO if there are more than 15 employees.

Cons: Can be expensive to set up, operating under foreign work ethics and work cultures can impact team management and requires time and effort to invest in the business in person.

Always consider what is best suited for your business, and confer with professional advisors before implementing a strategy regarding outsourcing

Super Co-Contributions Boost On Behalf of A Spouse

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Marriage and de facto relationships come with a number of perks – but did you know that if your partner earns less than you or is not currently working, you could contribute to their super fund savings?

Many households in Australia, either as a result of unemployment, maternity/paternity leave or by choice, have single-income households. As a result, the retirement savings held in super for one member of these households may not be increasing as exponentially fast as the working member. The good news is that when in a relationship, a spouse can boost their non-working partner’s super fund with their own contributions.

The best part? It could be a tax write-off for the working spouse.

Under Australian superannuation law, a spouse can be a legally married partner with whom you live or your de facto partner. That gives additional benefits to those in de facto relationships, who can choose (if one member of the relationship isn’t working or earns less) to boost their partner’s super fund. A spouse must also be younger than their preservation age or between 65 and their preservation age and not retired.

There are two ways that someone can help their partner’s superannuation grow:

  • Making a Spouse Contribution to their super account
  • Arranging for Contribution Splitting (also known as Super Splitting)

Spouse superannuation contributions can now be made for spouses earning up to $40, 000 per year. If a spouse earns less than $37, 000, the maximum tax offset of $540 can be claimed when contributing a minimum of $3, 000 to their super. Anything contributed that is more than $3, 000 will not receive the spouse contribution tax offset.

This tax offset cannot be claimed if:

  • A spouse has exceeded their non-concessional contributions cap for the financial year.
  • Their super balance is $1.6 million (for 2020/21) or more on 30 June of the previous financial year in which the contribution was made.

Another way to inject funds into your spouse’s super is to choose to have some of your own super contributions put into their super account. This is fine as long as they have not reached their preservation age yet, or are between their preservation age and 65 years and not retired.

Super contributions can only be split in the financial year immediately after the year in which the contributions were made or in the same financial year as the contributions were made only if your entire benefit is being withdrawn before the end of that financial year as a rollover, transfer, lump sum or benefit.

There are two types of contributions that can be split:

  • Employer contributions – the most common form of super contributions to split
  • After-tax contributions – money that you voluntarily deposit into your super after tax.

Always discuss starting spousal co-contributions to super with your accountant or financial advisor for help and guidance prior to starting this process.

Interest On Your Home Loan Could Be Tax-Deductible

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It’s a simple, step-by-step process used by many Australians to increase their income. Borrow money from a financial institution, invest in a second property and pay off the loan with the profit accrued from the investment property (ie. rent from tenants).

But did you know that the interest on a home loan for the purchase of an investment property can be claimed as tax-deductible?

To clarify – claiming a tax deduction on the interest of a loan can only be used on the loan that was used to purchase the investment property. It also must be used to earn income, because a property that is solely residential isn’t eligible for any tax deductions (except in certain situations where the residence may be used to produce income, like home business or office).

Here are a few examples of when tax deduction claims on your property are not allowed:

  • If the secured property is being used for living as a primary residence, and no income is made from it.
  • Refinancing your investment loan for some other purpose (like buying another property).
  • Using the loan for private purchase, other than the purchase of a home.
  • If the investment property is a holiday home that is not rented out, then deductions cannot be claimed as it doesn’t generate rental income.

As an example, if borrowing against your main residence for the purpose of purchasing an investment property, then the interest on that loan is tax-deductible. Conversely, if the loan was against the investment property to buy a car for your personal use, then the interest from that loan will not be tax-deductible.

The only way that a tax deduction on a home loan’s interest is possible, is if there is a direct, unbroken relationship between the money borrowed and the purpose the money was used for. Any money that resulted from a home loan, for instance, should have been invested into a property.

If you happen to redraw (make extra repayments into your loan that reduce the loan balance) against an investment loan for personal use, the tax-deductible interest is watered down. This is because the new drawdown (transfer of money from a lending institution to a borrower) is deemed to not be for investment purposes.

It is important that any investment loans are quarantined from your personal funds to maximise tax deductions on interest. Though it may be tempting to pull additional funds from the loan for additional finances, it’s shooting yourself in the foot.

A better strategy (if there is only investment debt that has been incurred, and you wish to pay it off), is to place funds in an offset account (a bank account that is linked to your home loan) and then redraw those funds for your personal use. It’s also important to ensure that the offset account is a proper offset – a redraw that is disguised as an offset account can be a major drawback for investors looking to capitalise on their tax threshold.

If you or someone you know has recently purchased an investment property with a home loan, speak to your accountant or financial advisor to see how your tax return can benefit from it.

How Do We Make The Office Work More Productively, Post-Covid?

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There have been critical changes to the workplace over the past year. With many office-based employees forced to work remotely or from home during the pandemic, the adaptation of new technologies, systems of work, and overall business models has changed the office’s approach. 

Many office businesses may need to reevaluate their structure and model as employees return to the office.

Here are a few ways that your office can update to help boost productivity and reassure employees during this process:

  • The physical workplace should prioritise collaboration with a communal, free-flowing workspace. This workspace allows employees to be transient and hybrid while still possessing the resources they need to work effectively in person.
  • Use remote work technologies for effective communication to facilitate and support teams collaborating and catalyse innovation. 
  • Place greater importance on portability, flexibility, ease-of-use integrated support for an entire ecosystem of software when it comes to IT.
  • Businesses should create more significant support for cloud software, data management and security measures.
  • Businesses should ensure that safety and sanitation measures are more visible, accountable and that the appropriate policies will be enacted.

Feedback from your employees can also be an invaluable resource in helping them readapt to working from the office productively. 

What You Can Negotiate For Your Employment Contract After 12 Months

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Before commencing employment at a business, organisation or under an individual, an employment contract must be agreed to by both employer and employee. This employment contract may have had additional revisions, agreements or negotiated terms set out in full at signing. Still, after the past year, there may be specific issues or conditions that you’d like to amend before continuing with your employment. 

One such condition that you can negotiate with your employer is working remotely. 

Under the Fair Work Act, if you have been in your current position for longer than 12 months (and it is feasible for you to carry out your work responsibilities), you can seek to negotiate flexible working conditions. The National Employment Standards set out additional conditions for employers and employees to negotiate contract conditions and agreement.

You can make this request if you:

  • Are the parent/responsible for the care of a child who is of school age or younger.
  • Have a disability
  • Are 55 or older
  • Are currently experiencing violence from a member of their family
  • Provide care or support to a member or their immediate family/household who requires care or support because they are experiencing violence from their family.

Other flexible working conditions that can be negotiated include:

  • Changes in the hours that you work (reduction in hours worked
  • Changes in the patterns of what you work (i.e. splitting shifts, job-sharing arrangements)
  • Changes to the locations from which you work (such as working from home/another location/remotely)

Employers are not obligated to agree to these requests if there is reasonable grounds to do so. An employer may refuse these requests for more flexible working arrangements if: 

  • It is too costly for the employer to accommodate them
  • There is no capacity to change the working arrangements of other employees to accommodate the new working arrangements requested by the employee
  • It is impractical to change working arrangements of other employees, recruit new employees or accommodate the new working arrangements requested by the employee.
  • It results in a significant reduction or loss of efficiency or productivity.
  • It would have a significantly negative impact on customer service.

Employers and employees should always discuss working arrangements and reach an agreement that balances both needs if possible. Always ensure that any agreements to conditions are noted in the amended contract and put in writing. Similarly, any refusals from employers must also be done in writing within 21 days of the proposed request. 

The Fair Work Commission is able to deal with disputes about reasonable grounds for denial but always discuss with your employer first whether there could be an alternative solution.

Simple Super Information For The Self-Employed

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If you’re self-employed, you aren’t required to pay yourself super guarantee payments. It is however a recommended way to save for your retirement, and making personal super contributions could be beneficial for you in the long run.

As a self-employed individual, you can make regular or lump-sum payments to your super, potentially claim a tax deduction on contributions, and may be able to save tax later on. 

If you’re looking to start paying contributions to a super fund you already have, always check that you can make those contributions to it if you are self-employed. Your fund will also need your tax file number (TFN) to accept those contributions. If you don’t provide your fund with your TFN: 

  • Your super contributions will be taxed an additional 34%
  • Any personal contributions that you try to include in your fund will not be accepted, which may mean you miss out on super co-contributions you’re eligible for.
  • It will be harder for you to keep track of your super. 

There are two ways to make contributions to your fund if you are self-employed, depending on how you pay yourself. If you receive a wage, you can set up a regular transfer into super from your before-tax income, or if you receive income from business revenue, you can transfer a lump sum when you have enough cash flow. 

Employers contribute at least 9.5% of their employee’s earnings to their super fund. As a self-employed person, bear in mind that there are limits to how much you can contribute each financial year. These are:

  • Up to $25, 000 in concessional contributions (from pre-tax income, which you can claim a deduction on).
  • Up to $100, 000 in non-concessional contributions (from your after-tax income or savings). 

You may also be eligible for co-contributions to your super from the government if you are considered low-income. Discussing your options for your super with an accountant or financial advisor is highly encouraged and will ensure that you don’t miss out on that potential capital growth.

Maximising Tax Returns On The “Side Hustle”

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If you or someone that you know began a side business (or “side hustle”) during the last financial year, you would have to meet the tax obligations that come with that business, along with the tax obligations of your primary business. 

All income earned through a side business is taxable income. That means that every sale you make will count towards your taxable turnover (the total business income from your sales) and will need to be declared on your income tax return. Additionally, suppose your turnover exceeds or looks like it will exceed $75, 000. In that case, you’ll have to register for GST and incur the 10% tax that’ll be added onto all of your taxable sales, payable to the ATO every quarter.

If you have to spend money on purchases or expenses that relate to the side business, that spending can be deducted from the profits that you make. Essentially, you only need to pay tax on the difference between your income and your deductions. Here are a few things to keep in mind when claiming a deduction for your business. 

  • The expense that you are claiming has to have been incurred by the business. 
  • The expense must relate to the business and can’t be something like your weekly groceries (domestic or private in nature expenses are generally not eligible for claiming).
  • If an expense has been incurred that is partly private/domestic, and partly for business, that expense will need to be appropriately divided. This is especially useful if you run your side business from home and claim home office costs.
  • Always ensure that your records are being kept and that there is evidence that it was the business that spent the money. An invoice or a receipt is sufficient evidence in this case, but a bank or credit card statement may also be used.

Other deductible expenses can happen during the initial startup and structuring of the business. These deductions can include costs that occurred when seeking professional advice on structuring the business, researching the business’s viability or when developing a business plan. 

A few items you might be eligible to claim for your side business include:

  • If the business is being run from home, the business portions of bills like utility, phone or internet can be claimed.
  • Skilling up for the business or reskilling may be tax-deductible when it comes to the cost of courses, training, seminars or conferences (as long as it links to business income). 
  • Any prep work that occurred during the business startup before the business’ official start can be claimed by the business.

Always ensure that you claim all business expenses that could apply to your business.

Good record keeping will help track all income and potential deductions that come through via the side business, and employing a bookkeeper could be a means of ensuring that this happens correctly. Remember that accountants are always here to help you during tax return time as well.

Sexual Harassment and The Workplace

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In 2021, businesses have seen greater visibility surrounding the issue of sexual harassment within the workplace, particularly within the media and the public sphere. The impact of sexual harassment within the workplace is one that can have long-lasting ramifications on employees and employers alike. Sexual harassment is prohibited in any employment situation and relationship, with both men and women often experiencing acts of it in the workplace.

The health and safety of employees (mental, physical, and emotional) is the responsibility of the employer and must be protected accordingly. New Zealand currently has the Employment Relations Act 2000 and the Human Rights Act 1993 in place to protect people from sexual harassment. 

As an employer, you may be held responsible for acts of sexual harassment committed by your employees, known as “vicarious liability”. The Employment Relations Act specifically makes the act unlawful within the workplace, but can also make you, the employer, liable in any instance involving employees. The Human Rights Act makes employers liable if one of their employees subjects anyone to sexual harassment in the workplace. 

Businesses should have in place a sexual harassment policy to ensure that employees are aware of their position, and what is and is not acceptable behaviour, and how to report it if it is not. When writing a sexual harassment policy, it is important that you make it clear that sexual harassment will not be tolerated under any circumstances, and what your organisation’s commitment is in dealing with sexual harassment. 

Employers can also take the following steps to prevent sexual harassment:

  • Get high-level management support to implement a strategy to address sexual assault in the workplace. 
  • Write and implement a sexual harassment policy.
  • Provide information and training about sexual assault and awareness of it.
  • Ensure that employees are aware that complaints will be taken seriously and employees will face disciplinary action if they engage in inappropriate behaviour.

If sexual harassment does occur, the employer must take appropriate remedial action, with appropriate procedures on dealing with grievances and complaints once they are made. 

To respond to employees who report sexual harassment, employers should: 

  • Take all reports of sexual harassment seriously.
  • Act promptly, with set timelines, and deal with reports as soon as they come in.
  • Protected all of the people involved in the report from victimisation
  • Support the people involved, and make them aware of what support and representation are available to them. 
  • Maintain confidentiality, and ensure that all details of the matter are only known to those directly concerned and those involved in investigating. 
  • Ensure all actions and decisions are documented. 
  • Treat everyone involved fairly, with unbiased investigators and decisions made based on facts and evidence. 

Employees may also decide to seek help outside of the organisation and are legally entitled to do so. These organisations could include

  • The Human Rights Commission
  • MBIE’s Employment Mediation Services
  • Employment Relations Authority