Communicating effectively with your remote team

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Communication is a huge part of business productivity, however, businesses who have made a recent shift from face-to-face work to working remotely can find it difficult to adapt and maintain effective communication. But just because you no longer see your staff face-to-face doesn’t mean that your communication has to suffer.

Have a communication plan

Whether it’s having a set schedule for work calls and virtual meetings, or requiring employees to provide reports or updates at certain times, having a clear communication plan can help keep your staff on track with their work and with each other. It’s a good idea to keep a record of this in writing by using tools such as shared calendars or reminders.

Utilise messaging tools

Messages are a great way to communicate with your staff and keep a written account of tasks and ideas. If your business relies on teamwork, then having group messaging chats are essential to keeping everyone on the same page, otherwise, miscommunication and confusion are huge risks. This will also give employees the opportunity to chat amongst each other in a group setting as they would normally do in the workplace, and can help them retain a positive work attitude through providing a sense of collegiality and normalcy.

Provide performance feedback

With everyone working remotely, it can be hard to monitor the performance and quality of your employees. Providing performance feedback fortnightly or monthly can help your employees continue to learn and improve, as well as keeping them productive knowing that their work will be reviewed.

Recognition

Providing a positive and encouraging comment in the office seems very natural and easy to do, but when it comes to remote workers, it is easy for employers and managers to forget about taking the time to show recognition for the work employees are doing. Just like anyone else, remote employees should receive adequate praise and recognition for the high-quality work they do; without it they are likely to become disengaged.

Common tax mistakes that businesses make

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Meeting tax obligations as a business owner can be stressful and potentially expensive if done wrong. Certain mistakes warrant severe action, so you can expect the ATO to take a closer look at them if you’ve failed to identify these errors before lodging tax returns for your business. Most mistakes made with regards to tax filing often revolve around poor administrative knowledge of tax laws. Ensure that you are aware of potential mistakes you could be making that might cost you your business.

Inconsistent declarations

The ATO gathers data from numerous businesses across a particular industry to create a benchmark showing a band of percentages within which businesses in that industry should typically fall under. Businesses that fall outside this band can expect delays and a closer look from the ATO inspecting reasons for inconsistencies within your business’ declarations. However, these can also be sources of mistakes from the ATO’s part as some inconsistencies can be very real – such as demographics or personal situations – that can cause variations in data. Ensure that you are declaring all your sales, and that any inconsistency can be justified to the ATO.

Poor bookkeeping

A majority of tax mistakes committed by small businesses revolve around poor bookkeeping. Businesses are required to maintain all financial transactions made – but forgetting to put the purchase through the register or taking money out of the register for personal use without replacement of the difference can show varying cash register tapes that can be problematic when filing your tax returns. You may be missing out on valuable tax credit claims by not keeping proper records of your financial transactions.

Employee payments

Businesses may assume that superannuation payments need not be made if they are employing subcontractors. This can be an expensive mistake, as if the worker has standard hours and is expected to work consistently for your business under your direction, they need to be treated as employees. Businesses may leave superannuation guarantee payments until the end when cash flow becomes restricted – but avoid late lodgements to prevent penalties from the ATO.

Common Mistakes Often Made By SMSF Trustees That You Can Avoid

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Involvement in an SMSF can put certain responsibilities in their trustees hands, and those who overlook important details or find themselves reported to the ATO for failing to fulfil those responsibilities may risk incurring financial, civil or criminal penalties.

As SMSFs often involve multiple members, the risk of non-compliance grows. You might be doing the right thing, but can you say the same thing about your fellow trustees?

That is why the role of the trustee should not be taken lightly as with greater control comes greater responsibility, should the administration of your SMSF go awry.

Make sure your retirement nest egg is protected by avoiding these common mistakes made by SMSF trustees.

Breaching The Sole Purpose Test

SMSFs must be maintained for the sole purpose of providing retirement benefits to your members (or for their dependents if a member dies before retirement). You will fail the test if a member gets any financial benefit through an investment, aside from increasing the return to your fund.

For example, a member’s personal use of a holiday house purchased by the fund, without making rental repayments, would breach the sole purpose test. The rules can become complex, which is why seeking professional advice may be wise. Trustees who breach the sole purpose test will lose their fund’s concessional tax treatment and could be liable for civil and criminal penalties.

Financial Assistance & Member Loans

Trustees can make the error of accessing their SMSF funds at will instead of following strict super laws. You cannot access your SMSF bank account to give financial assistance or loans to members or members’ relatives, improve your cash flow, repay debts or make personal investments. There have also been reports of withdrawals from SMSFs accidentally on mobile banking apps. Avoid ATO sanctions and keep your bank accounts separate to ensure no premature withdrawals are made from your SMSF account.

Failing To Lodge Paperwork On TIme

SMSF trustees must comply with demanding reporting and recordkeeping requirements. Your SMSF will have an annual audit. Failure to produce certain documents or make the deadline date will result in your SMSF being reported to the ATO. It is crucial to keep accurate records of all decisions and transactions should the ATO take an interest in your SMSF. A financial advisor may be helpful to take the stress out of keeping on top of your paperwork.

Not Planning For The Death Of Another Member

The death or illness of a member of your SMSF can have devastating effects on your retirement savings if you are not prepared. Dependency on one member to administer the SMSF can destabilise the fund if they pass away. Ensure that responsibilities are evenly distributed, if necessary, and that there is a clear understanding of the processes of the SMSF.

Go further than taking out life insurance policies and take the following precautions:

  • Educate all of the members on the basic rules and strategies of your SMSF
  • Employ an accessible financial advisor to answer any questions you may have about it, and to ensure that you remain compliant.
  • Allow access to passwords and account numbers for all members
  • Regularly review your binding death benefit nominations
  • Know the processes of your SMSF, and be aware of the responsibilities of the trustees.

Common GST Mistakes That You Might Be Making In Your IAS

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GST is an area that commonly has mistakes made in it – mistakes that can be costly and require additional measures to correct it if they aren’t caught in time.

Many small business owners continue to make errors when claiming GST credits in their GST returns or Business Activity Statements.

A vast majority of these errors are easily avoidable and often relate to the over-claiming of GST credits. Here are the top ten common GST mistakes that can be made (and what you might be encountering yourself).

  • Residential rental property: Incorrectly claiming GST credits on expenses relating to residential rental properties where the entity is registered for GST.
  •  Bank fees: Generally, annual fees, monthly fees and loan establishment fees are input-taxed, and therefore, there is no GST to claim. However, GST is charged on credit card merchants’ fees and can be claimed.
  • Private expenses: GST is not claimable on private expenses such as personal loans, director fees and drawings etc.
  •  Interest: Interest paid on loan or chattel mortgage repayments or credit card payments does not incur GST, and cannot be claimed.
  • The total cost of a business insurance policy: Insurance policies usually include stamp duty (which is GST-free), however, the rest of the policy is subject to GST. A GST credit cannot be claimed on the stamp duty portion of the policy as no GST is paid.
  • Government fees: GST is not charged on government fees i.e. council rates, land tax, ASIC filing fees, motor vehicle registration and water rates, and therefore, GST credits cannot be claimed.
  • GST-free purchases: Incorrectly claiming GST credits on purchases without GST, such as basic food items, exports and certain health services is a common mistake. Remember not all suppliers are registered for GST, so check the tax invoice before claiming a credit.
  • Entertainment expenses: Claiming the entire GST credits on entertainment expenses where the business has elected to use the 50/50 split method for fringe benefits tax is incorrect. Only 50 per cent of the GST credits can be claimed.
  • Wages and superannuation payments: Both wages and super do not attract GST and cannot be claimed. Wages are not an expense to be included in G11; they are to be reported in W1 in your BAS. Superannuation is not included in BAS.
  • Sole traders and partnerships: When claiming expenses that are used for both private and business use, you must apportion the expenditure to exclude private usage.

If you find that a mistake was made on a previous activity statement, the ATO says you are able to:

  • correct the error on a later activity statement if the mistake fits the definition of a “GST error” and certain conditions are met;
  • lodge an amendment – the time limit for amending GST credits is 4 years starting from the day after the taxpayer was required to lodge the activity statement for the relevant period, or
  • contact the ATO for advice.

If you find this process is too time-consuming or too difficult to complete yourself, the best way to ensure that you remain compliant and avoid making these mistakes is to contact a registered BAS agent for assistance.

Common Challenges Businesses Face (And Strategies To Face Them With)

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Starting and running a business is an exhilarating journey filled with opportunities for growth and success.

However, along the way, entrepreneurs inevitably encounter trials and tribulations that test their resilience and determination.

From economic downturns to unexpected setbacks, here are some common challenges businesses face and strategies for overcoming them:

Economic Uncertainty:

  • Economic downturns, market fluctuations, and global crises can significantly impact businesses of all sizes. During times of uncertainty, it’s crucial for businesses to reassess their strategies, streamline operations, and prioritise financial stability. Diversifying revenue streams, reducing unnecessary expenses, and maintaining open communication with stakeholders can help businesses weather economic storms.

Competition:

  • In today’s competitive business landscape, standing out from the crowd is essential for success. Businesses must continuously innovate, differentiate their offerings, and deliver exceptional customer value. Conducting thorough market research, understanding competitors’ strengths and weaknesses, and leveraging unique selling propositions are key strategies for staying ahead.

Cash Flow Management:

  • Cash flow challenges are a common concern for businesses, particularly startups and small enterprises. Poor cash flow management can lead to liquidity issues, missed opportunities, and even business failure. Implementing effective cash flow forecasting, establishing clear payment terms with customers and suppliers, and exploring financing options such as lines of credit or business loans can help businesses maintain healthy cash flow.

Talent Acquisition and Retention:

Recruiting and retaining top talent is critical for business growth and success. However, finding and keeping skilled employees engaged can be daunting.

Offering competitive salaries and benefits, providing opportunities for professional development and career advancement, and fostering a positive work culture are essential for attracting and retaining talent. Implementing robust recruitment and onboarding processes can help businesses identify and onboard the right candidates.

Technology Disruption:

Rapid advancements in technology have transformed industries and disrupted traditional business models. Businesses that fail to adapt to technological changes risk falling behind their competitors.

Embracing digital transformation, investing in innovative technologies, and leveraging data analytics to drive decision-making are essential for staying competitive in today’s digital age. Fostering a culture of innovation and agility within the organisation can help businesses adapt to evolving technological trends.

Regulatory Compliance:

Navigating complex regulatory requirements and compliance standards can pose significant challenges for businesses, particularly in highly regulated industries.

Failure to comply with regulations can result in fines, legal consequences, and damage to reputation. Establishing robust compliance processes, staying informed about relevant laws and regulations, and seeking professional guidance when needed are essential for ensuring regulatory compliance.

Customer Satisfaction:

Satisfying customers and building long-term relationships is crucial for business success. However, meeting customer expectations can be challenging, especially in today’s competitive marketplace.

Businesses must prioritise customer satisfaction, actively listen to feedback, and continuously improve products and services to meet evolving customer needs. Building strong customer relationships, delivering personalised experiences, and providing exceptional customer service are key strategies for fostering loyalty and driving business growth.

While businesses inevitably encounter trials and tribulations on their journey to success, with perseverance, resilience, and strategic planning, they can overcome these challenges and emerge stronger than ever.

Businesses can navigate obstacles and achieve their goals by addressing challenges proactively, staying agile and adaptable, and seeking support when needed. Remember, every challenge presents an opportunity for growth and learning, and with the right mindset and approach, businesses can turn adversity into an advantage.

Collaboration to grow business

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Businesses can gain a lot from collaboration, regardless of the industry they are in. The following are some reasons why businesses should care about collaboration.

Get inspired

As a business, it is important to build a routine and figure out day-to-day operations. However, this might mean that you stop trying different techniques which could be more efficient. Collaboration could give you a fresh perspective and encourage new ideas and methods you could apply at the workplace. 

Grow your network

Initiating collaboration will help you meet people who share common interests and goals. Building connections will benefit your business and could result in partnerships down the line. 

Educate yourself

Collaboration opens up opportunities to learn from those outside your immediate circle. This can provide you with valuable information that may be helpful for your business which is not otherwise accessible to you. 

Solve problems

Two heads are better than one. Therefore, with collaboration, you may be able to solve problems that were otherwise difficult to solve. This is because collaboration allows people with different expertise and backgrounds to contribute ideas. 

Closing the office for the holidays

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As the holiday season approaches, the workplace often gets more relaxed as things wrap up. However, closing the business for the holidays usually isn’t as simple as turning the lights off and heading home for a few weeks. There is often a lot of preparation and work that needs to be done before everyone leaves the office.

Notify staff:
Giving your staff at least two to four weeks notice of business closing dates will allow them to prepare for the shutdown and organise their workload appropriately. Having reminders through announcements, in-office calendars, emails or signs on notice boards will allow employees to ensure their work is done on time and organise personal events.

Notify other stakeholders:
Important stakeholders such as customers, suppliers or vendors should also be informed in advance of when the business is closed for the holidays to ensure that any services or needs are completed prior to shutdown. Customers can be notified through your business’s website, emails, signs around the business or letters and phone calls for close clients.

Update your security:
If your business has a security team or service, make sure that they are kept updated about your closing dates, as well as an emergency contact list with the owner and key employee details so they know who to contact in the event of a security issue, even when the business is closed. It is also a good idea to ensure that all cybersecurity software is up to date before you leave to prevent hackers and viruses from damaging your assets while you’re away.

Backup data:
Backing up your servers will reduce the risk of losing crucial business assets to hackers, viruses or software malfunction while you’re away. By making backups of your data through tools such as cloud storage or hard drives, you don’t have to worry about coming back to a corrupted system.

Change automated greetings:
If you have an automated answering service for business dealings, consider recording a message letting people know that your business has closed for the holidays. It is also a good idea to detail what dates you will return.

Turn off equipment:
Don’t forget to shut down any equipment that won’t be used throughout the holidays, such as lighting, copiers, computers and kitchen supplies. However, be aware of equipment that shouldn’t be turned off, such as fax machines, security systems, servers and backup systems, and refrigeration units.

Closing The Gap: Gender & Superannuation

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There exists a persistent and concerning gender gap in superannuation.

Women often find themselves disadvantaged compared to their male counterparts when building wealth for their golden years. Superannuation plays a crucial role in this narrative, whether via income, career breaks or even Australia’s retirement savings system.

Let us explore the factors contributing to the gender gap in superannuation and discuss actionable steps to empower women to bridge this divide and secure their financial futures.

Understanding The Gender Gap

  • Income Disparity: One of the primary drivers of the gender gap in superannuation is the income disparity between men and women. Women, on average, earn less than men across various industries and occupations, resulting in lower superannuation contributions throughout their working lives.
  • Career Interruptions: Women are more likely to experience career interruptions due to caregiving responsibilities, including raising children or caring for elderly relatives. These interruptions can lead to periods of reduced income and missed superannuation contributions, further widening the gender gap in retirement savings.
  • Part-Time Employment: Women are disproportionately represented in part-time and casual employment, often with lower wages and reduced access to employer-sponsored superannuation contributions.
  • Longer Life Expectancy: On average, women tend to live longer than men, requiring more significant retirement savings to support themselves throughout their extended retirement years. However, the gender gap in superannuation means that women may face greater financial insecurity in their later years.

Closing The Gap

  • Equal Pay: Addressing the root causes of the gender pay gap is essential for closing the superannuation gender gap. Employers must commit to paying women fairly for their work, regardless of gender, and take proactive steps to eliminate wage disparities within their organisations.
  • Flexible Work Arrangements: Providing flexible work arrangements, including remote work options and flexible hours, can help women balance their caregiving responsibilities while maintaining their careers and superannuation contributions.
  • Education and Awareness: Increasing financial literacy among women is crucial for empowering them to take control of their financial futures. Educational programs and resources focusing on superannuation planning, investment strategies, and retirement savings can help women make informed decisions about their finances.
  • Government Policies: Governments can implement policies and initiatives to close the gender gap in superannuation, such as increasing the superannuation guarantee rate, extending superannuation contributions to paid parental leave, and providing tax incentives for low-income earners to boost their superannuation savings.
  • Supportive Partnerships: Encouraging open and transparent conversations about finances within relationships can ensure that both partners are actively engaged in superannuation planning and retirement savings. Couples can work together to set joint financial goals and develop strategies to achieve them.

Closing the gender gap in superannuation is a multifaceted challenge that requires concerted efforts from individuals, employers, governments, and society.

By addressing income disparities, supporting women’s career progression, increasing financial literacy, implementing supportive policies, and fostering equitable partnerships, Australia can empower women to bridge the superannuation gender gap and achieve financial security in retirement.

Together, we can create a future where all women have the opportunity to retire with dignity and independence.

Closely held payees exemption to be extended

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Employers with 19 or fewer employees are temporarily exempt from reporting ‘closely held (related) payees’ through Single Touch Payroll enabled software. The exemption deadline has been extended from 1 July 2020 to 1 July 2021 as part of the ATO’s response to the COVID-19 situation.

A closely held payee is an individual directly related to the business, company or trust that pays them. Commonly, these are:

  • Family relatives of a family business.
  • Directors or shareholders if a company.
  • Beneficiaries of a trust.

The closely held payees exemption is automatically applied, and employers do not need to report them to the ATO.

Employers still have the option to report their closely held payees’ payroll information through Single Touch Payroll if they wish to. This can be done each time a payment is made, following the same process that applies for regular employees.

Employers will need to provide payment summaries to their closely held employees and a payment summary annual report to the ATO at the end of the financial year unless they:

  • report through Single Touch Payroll for their closely held employees, and
  • lodge their finalisation declaration by the due date.

Cleaning your business’ online presence

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Spring cleaning your business isn’t limited to its physical space, you should be cleaning your online presence too. Whilst it is best to be constantly monitoring your online activity, a regular assessment and clean up can be beneficial. Here are a few areas of your online presence you can renovate.

Content pruning:
Social media accounts and websites work best when constantly updated, however, this can create a backlog of content that could be hindering your SEO efforts. Content pruning is the process of running an audit of your website or social media account and removing or updating the low-value content. This can help you identify outdated pages, gaps in content and areas you have overworked.

Review security settings:
Online threats not only affect your business but can be passed onto website visitors too. You will need to check both the software you are using and the server operating systems are up-to-date to ensure all areas are covered. Consider also using a commercial service that will scan your website on a regular basis to check for malware and vulnerabilities. Even something simple like changing your password can make a difference. Once you’ve performed a security health check, update employees on any changes that may affect them. Employees need to be alert to the warning signs of an attack and the consequences that can result. Introducing cyber-security policies and procedures assist in educating and better preparing your staff.

Update:
When there is a significant change in a business, the last thing you would think about is updating your social media status. Some contact details or staffing information presented online may have become inaccurate and in need of an update. Remember to check internal links to social media if you change usernames or handles. This can also be a chance to change profile picture or cover photos that have been used for too long.

Search your name:
Searching your business’ name on Google or social media platforms can help reveal results that you weren’t aware of. This is a good way to find out what potential customers see when they search for you. If you find something you don’t like, then you can clean it up through the process the particular site offers.