Making safer workspaces

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As employees return to office spaces, there is a growing concern as to how employees can protect themselves at work. It is crucial that employers carefully plan their work spaces to minimise the risk of COVID transmissions. Consider the following essential ways you can adapt your workspace to protect your employees and customers during these risky times.

Physical distancing
One of the most essential recommendations employers should follow is making sure that there is at least 4 square metres of space per person. Consider making adjustments to the layout of your office space to allow workers to maintain a 1.5 metre distance from each other. These may include wall / floor markings and signage to keep workers aware of the distancing measures. It can be helpful to review tasks and events that require closer interaction, and map alternative ways to complete these tasks while still allowing social distancing to take place.

Close contact work
If the nature of the work your employees have to engage in requires close contact, then extra care needs to be taken to make sure that you minimise putting your employees at risk. Consider minimising the number of people within an area at any given time, and marking off certain areas of the workspace for essential employees only. Steps like staggering start and end times for shifts, encouraging employees to form teams with workers that need to work together, and moving each group to a different area of the office where they still have separate access to facilities can help minimise risk of COVID.

Sanitation facilities
It is important to train all employees on the hygiene practices that will be in place at your office space. Consider signage in washrooms on handwashing protocols, providing well-stocked bathroom facilities and providing hand sanitiser in appropriate locations such as entries and exits. Regularly empty waste bins and encourage ventilation by opening windows and adjusting air-conditioning units to stop them from recirculating the same air.

Cleaning the office space
It is recommended that workspaces be cleaned at least once a day, and commonly used spaces are disinfected as regularly as possible. If your business is more customer-oriented, it may be useful to clean and disinfect more frequently. Surfaces that are constantly touched, like door handles, phones, credit card machines, toilets and buttons should be disinfected as frequently as possible. Consider encouraging workers to disinfect their regularly used items like glasses and phones.

Personal protective equipment
Consider providing employees with PPE like masks, gloves and eye protection equipment to foster safer work conditions. It can be useful to consult with employees about the types of PPE they prefer, to ensure that their areas of concern are being addressed. If employees work in close proximity to each other or with customers where interaction time is longer, it can be useful to install screens or sneeze guards to shield workers from droplets. However, employers must remember that these screens also need to be cleaned and disinfected regularly.

Making NRAS claims

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The national rental affordability scheme (NRAS) started on 1 July 2008, encouraging large-scale investment in affordable housing. It offers tax and cash incentives to providers of new dwellings for 10 years, granted they are rented to low and moderate income households at 20% below market rates.

Though the NRAS is no longer taking new investments, property owners within the scheme will soon be receiving letters from the ATO to remind them of their claim requirements.

The two key elements of the NRAS are;

  • An Australian Government contribution in the form of a refundable tax offset or direct payment to the value of $8,394.10 per dwelling per year in 2018-19. The Australian Government contribution is 75% of the total annual incentive.
  • A state or territory contribution in the form of direct financial support or an in-kind contribution to the value of at least $2,798.03 per dwelling per year in 2018-19. The state or territory contribution is 25% of the total annual incentive.

Owners of NRAS rental property are eligible to claim a refundable tax offset if:

  • The Approved Participant has provided them with advice of their entitlement based on the certificate received from the Housing Secretary, and;
  • The claim is made in the year to which the certificate relates.

Deductions can be claimed for expenses incurred with a NRAS rental property, excluding the contribution amount received from the state or territory. The contribution amount is non-assessable, non-exempt (NANE) income for tax purposes.

Making employees feel valued

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Statistics have shown that employees who feel valued are more motivated to perform their best. But how can a business make employees feel valued so that they can encourage this behaviour?

Recognition

It can be as simple as letting employees know that they are valued. This can occur one-on-one or in group settings. Vocalising appreciation of an employee’s work, as well as giving raises and bonuses are effective methods.

Feedback

Giving employees positive feedback (more than negative feedback) is a great way not just to show appreciation, but also to foster an environment that allows constructive feedback as opposed to criticism.

Communication

Keep open lines of communication with your employees, and let them know what the plans for the organisation are, when and if, possible. This improves transparency, and lets employees know that they are trusted members of the business.

Right level of challenge

Designate tasks which show trust in an employee’s capabilities. These tasks can build on employee’s skills and encourage growth and development in areas where needed.

Attending to employee’s and their needs is important in letting them know that they are valuable members. This will not only improve their morale, but in the end generate productivity.

Lower taxes for businesses and individuals

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The Budget seeks to promote tax reform and simplification in an effort to support business investment and help reduce the personal income tax burden.

Business

Businesses are encouraged to invest with the introduction of temporary full expensing. Businesses with turnover up to $5 billion will be able to deduct the full cost of eligible depreciable assets of any value in the first year they are used or installed ready for use, from now till end of June 2022. Costs of improvements to these eligible depreciable assets can also be deducted. Through the reduction of after-tax costs of eligible expenses, full expensing supports businesses that are investing and helping stimulate the economy. Eligible new or second-hand assets acquired under the enhanced $150,000 instant asset write-off by the end of this year will receive an additional 6 months (30th June 2021) to use or install those assets.

Temporary loss carry-back will provide businesses the opportunity to offset tax losses. Companies with a turnover of up to $5 billion will be able to offset tax losses against previous profits on which tax has been paid to generate a refund. Any losses incurred from 2019-20, 2020-21, 2021-22 may be carried back against profits made during, or after 2018-19. To receive this support, applications to receive a tax refund may be lodged during the 2020-21 or 2021-22 tax returns.

Measures have been taken to expand and modernise the tax treaty network. This involves eliminating double taxation in an effort to attract foreign workers, simplify taxing rights between Australia and other countries and boost foreign investment in Australia. The initiative reduces tax barriers to prioritise reinstating Australia’s treaties with important partners to relieve economic burden. The Research and Development Tax Incentive (R&DTI) will ensure businesses of every size are receiving the support they require in these areas.

Changes have been made to recordkeeping provision as the government maintains its efforts to cut down red tape. Businesses will no longer need complete prescribed records, instead they will be able to use existing corporate records to reduce the time and manpower spent on recordkeeping.

Individuals

Both low and middle income earners will also be receiving tax relief in the coming years. The government has brought forward their plans for tax cuts to make sure that families are keeping more of what they earn. Taxpayers will be receiving relief of up to $2.745 for singles and $5,490 for dual income families. The provision of a simpler tax system and lower taxes, which will be implemented in 3 stages, has increased the threshold of the 32.5% tax bracket from $90,000 to $120,000. Tax relief to individuals is expected to encourage spending and stimulate the economy.

Looking To Upscale Your Business? Here’s What You Need To Know…

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It’s a wonderful feeling when you have reached a point where your business is so successful that you need to upscale. Whether hiring more people or moving location, upscaling has its unique challenges. What can you do to ensure that you are hitting the ground running while upscaling?

Set Realistic And Actionable Goals

Businesses should set realistic and actionable small goals which they can work towards, rather than broad goals which provide no direction. Setting broad and unrealistic goals is demotivating and makes any progress made seem insignificant. Every person in the business should be given a target to meet over a reasonable timeline, contributing to achieving a larger goal.

Establish Standardised And Automated Processes

Small businesses can make the mistake of ‘doing things as they come’, but this means that as the business grows, adjusting to high-scale tasks is difficult. To avoid this, businesses should standardise all processes of work. Any individual placed into a role should be able to follow standardised procedures and yield a product that is of similar quality to the previous one. Investing money into automation tools is worthwhile for this procedure. This can include automating social media management, email, and customer relationships. Both of these will contribute to creating structures that support growth.

Identify Competitive Strengths And Weaknesses

Recognising the strengths and weaknesses of one’s business is essential. Strengths will allow businesses to hone in on their unique qualities, giving them a competitive advantage. Weaknesses will reveal which areas require growth so that changes can be made before upscaling takes place.

Network

Businesses should continue to develop relationships with service providers, sales channel partners, suppliers and customers. Keeping an open mind about partnerships or potential collaborations could open up different avenues of business growth.

Anticipate The Adjustment Pace.

No matter how prepared you feel, any change in an organisation will require a period of adjustment for the rest of your team. Give them time to recognise the need for change and accept this opportunity’s challenges. More importantly, they need time to understand their roles in the bigger picture of your organisation’s plans to scale and determine how they can make the most of their skill sets and add value to the company. Make sure to consider adjustment protocols and allocate a reasonable period for such adjustments in your scaling plans and process.

Outsourcing The Non-Essentials

As the business increases in stature, there will be a lot more little and frustrating tasks, meaning that you can’t focus on what’s important. Outsourcing components like payroll or marketing to companies with the professionals to do it effectively means that you can focus on upscaling the business.

Upscaling can be very stressful, but whether it’s making changes to your business’s technology or outsourcing things in the short term, to upscale a business means focusing on what is best for your business.

To get to this point, you’ve made a success of it, so it’s important not to lose your identity in the process. Upscaling your business is taking what’s great about your current operation and building it outwards.

If you are looking towards how your business can take itself to the next level, business planning for any eventualities can be of benefit. Consulting with a trusted adviser can be of great help when moving forward in your business’s upscaling endeavour.

Long term tax-effective Investments

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Determining where to invest requires multiple factors to be taken into consideration. One such factor may be tax efficiency. The tax charged on income from a tax-effective investment is less than the individual’s marginal tax rate.

Superannuation

The government provides incentives to save through Super, which make it one of the most tax-effective investments. Contributing to your super and salary sacrifice is only taxed at 15% if yearly income is under $250,000 (30% if over $250,000 which is still tax-effective). The maximum tax that can be charged on investment income in super is 15%, and 10% on capital gains. This is lower than marginal rates at which taxation occurs for most individuals.

Employees should ensure that contributions are not above $25,000, as this is the cap on concessional contributions. Additional tax needs to be paid on any amount claimed higher than the cap.

Insurance Bonds

Insurance companies offer insurance bonds as long term investment options. Earnings in an investment bond are taxed at 30% (Corporate tax rate), which makes them tax-effective for those whose marginal tax rate is above 30%. They are further tax-effective if one is looking to invest for over 10 years. This is because although withdrawals can be made during the 10 years, if no withdrawals are made, no further tax is payable.

The ATO warns against tax-driven schemes, which offer tax concessions for investing in certain assets that provide income in the future as these may be high risk or part of a scam. Investing in superannuation or insurance bonds are safe and reliable methods which don’t pose these concerns.

Lodging your business activity statement

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Businesses that are registered for GST are required to lodge a business activity statement (BAS). These assist in the reporting and payment of:

  • Goods and services tax (GST)
  • Pay as you go (PAYG) instalments
  • PAYG withholding tax
  • Other tax obligations

ATO will automatically send businesses who are registered for an ABN and GST a BAS when it is due for lodgement. 

Businesses are given various options to lodge their BAS:

  • Online services for individuals and sole traders – which may be accessed through myGov
  • Business Portal – which is a secure website created by the ATO to assist businesses in managing their tax online
  • SBR-enabled software – which allows access to lodgement from different financial, accounting and payroll software and can be integrated to industry-specific business software. 

Limiting tax deductions for holding vacant land

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On the 28 October 2019, The Treasury Laws Amendment (2019 Tax Integrity and Other Measures No.1) Bill 2019 received royal assent. The new tax law creates limitations for deductions related to the expenses of holding vacant land from 1 July 2019. This is likely to affect those who acquire land for investment purposes and begin developing for rental investment purposes.

The amendments will only apply to holdings on ‘vacant land’, meaning that it will not apply to any land that has a substantial and permanent structure in use or ready for use, or is a residential premise that is lawfully able to be occupied. Land is considered vacant if both of these are not true.

The changes will not apply to vacant land held by ‘excluded entities,’ which are:

  • Corporate tax entities.
  • Managed investment trusts.
  • Public unit trusts.
  • Superannuation plans other than self-managed superannuation funds (SMSFs).
  • Unit trusts or partnerships where all members are of the excluded entities listed above.

The law will also be inapplicable if:

  • Structures affected by natural disasters or similarly exceptional situation.
  • The land is in use or available for use in carrying on a business by the taxpayer or their affiliates, connected entities, spouse or child under 18.

The land is in use or available for use for business purposes under an arm’s length rental arrangement.

Life insurance through your super

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Over 70% of Australians have life insurance through their super fund. This acts as a financial safety net through your super if something unexpected happens. 

There are 3 main types of life insurance that super funds usually provide:  

  • Life cover: Also known as death cover, this type of insurance pays a lump sum or income stream to beneficiaries when you die or have a terminal illness.
  • TDP (total and permanent disability) insurance: If you become disabled or it is unlikely that you will be able to work again then this insurance will pay you a benefit.
  • Income protection insurance: Also known as salary continuance cover, pays a regular income for a specified period (length of time or up to a certain age) if you are unable to work due to temporary disability or illness.

Pros of life insurance through super

  • Cheaper premiums: Super fund buys insurance policies in bulk so it is cheaper for their customers
  • Easy to pay: Automatically deducted from super’s balance
  • Fewer health checks: Super funds accept default level of cover without health checks – particularly useful if you have a high-risk job or health conditions. But, remember that you should check the product disclosure statement (PDS) to see exclusions and treatment of pre-existing conditions. 
  • Increased cover: You have the flexibility to increase your cover above the default level but you may need to answer some questions about your medical history.
  • Tax-effective payments: Employer’s super contributions and salary sacrifice contributions are taxed at 15% which is lower than the marginal tax rate for most people. 

Cons of life insurance through super 

  • Ends at age 65 or 70: While outside of super, your cover will continue as long as you are paying premiums, but TDP and life insurance tend to end at 65 and 70 respectively. 
  • Limited cover: Since default insurance isn’t specific to your requirements, your cover might be lower than what you would receive outside of your super. 
  • Cover can end: In some cases, changing your super fund can cause your contributions to stop or your super account to become inactive – this will end your cover and you will end up with no insurance.
  • Reduces your super balance: Since premiums are deducted from your super balance, you will have fewer savings for retirement. 

Legal issues raised by social media

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Social media is an established part of our everyday lives, as well as a key platform for many businesses. The rise of social media creates a number of legal issues that business owners must be aware of when utilising platforms such as Facebook, Instagram and LinkedIn. Businesses should consider a proactive approach in implementing both preventative and reactive ways of mitigating potential risks.

Confidentiality:
Legal issues arise when confidential information is disclosed on social media. In accordance with privacy regulations, individuals must be notified when personal information is being collected and the disclosure of such information is prohibited unless it is for certain purposes. A current privacy policy, that is accessible to consumers, should clearly outline the business’ practices when it comes to the collection, use and disclosure of personal information on social media. To mitigate the risk of an unwanted privacy breach, you should constantly revisit the strength of your online security by updating software, creating strong passwords, and backing up data.

Misleading conduct:
Under the Australian Consumer Law (ACL), an individual acting in trade or commerce must not make any false or misleading statements about the goods or services that they are providing. The ACL applies this to advertising on social media platforms. Claims made on social media, as well as any comparisons with competitors, must be substantiated. The Australian Competition and Consumer Commission (ACCC) provides guidance to businesses to ensure their social media pages are not breaching the misleading conduct provisions of the ACL. Steps that businesses can take to minimise risk include constantly monitoring their social media pages and responding to or removing any misleading content.

Defamation:
Defamation occurs where content is published or broadcast that injures a third party’s reputation. Defamation on social media platforms can have far-reaching implications, as a slanderous comment can be distributed online instantaneously to numerous jurisdictions, causing severe damage to a person’s reputation. While there are defences on grounds such as the content being true or it is an honest opinion, a business may still potentially defame an individual or other organisation. Social media creates a further risk for defamation, as it could even occur by ‘liking’ or ‘sharing’ a defamatory comment made by someone else.