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Nov 29

Worried About Capital Gains Tax?

Posted by cassidy whipper on Tuesday, November 29, 2016

Capital Gain Vs Capital Loss

A Capital gain or capital loss on a property is the difference between what the asset cost you (cost base) and what you received when you disposed of the property.

 The cost base includes not only the purchase price of the property but also the associated fees such as stamp duty and legal costs.

A capital gain is the increase in an assets value over time. If you sell a property for a greater amount than the cost base then you will have made a capital gain.
On the other hand if the sale price is less than the original cost base then you have made a capital loss.

 

COST BASE – SALE PRICE / DISPOSABLE

 

 

Calculating Capital Gains Tax

To calculate Capital Gains Tax, the amount of capital gain is added to the amount of taxable income received from an investment property. This total amount of profit is then taxed at the marginal tax rate. However, if you have owned the property for longer than one year, only 50% of the capital gain will be added to your taxable income.

Not all property sales are subject to Capital Gains Tax. This tax doesn’t apply to the primary place of residence or family home. It’s also possible to rent out a primary place of residence for up to 6 years without paying Capital Gains Tax.

 

CAPITAL GAIN + TAXABLE INCOME RECEIVED FROM INVESTMENT PROPERTY TAXED AT MARGINAL TAX RATE

 

Top 3 tips to minimizing your capital gains tax payments owed

Although the Capital Gains Tax is fairly straightforward for property investors, there are a few ways to minimise payment owed;


1 – Maximise the original price/cost base of your property, be sure to include all legal fees stamp duty and any other incidental costs.

 

 2 – Hold the property for 12 months and you’re automatically entitled to a 50% tax discount on any capital gain you make when selling the property.

 

3- Move in right away. As your primary place of residence is exempt from CGT moving in for the first 6 months you immediately qualify your property as our primary place of residence. However if you originally rented the property out then moved in at a later date you are still entitled to a partial exemption.

Example/
Chris buys a property and rents it out straight away.

2 years later he moves in and lives in the residence for 6 years before selling the property and makes a capital gain of $200,000.00.

Chris only has to pay a CGT on the one quarter of that amount. Which is the 2 years the property was rented, out of the total 8 years he held the property for.

Therefore his total taxable income amount is only $50,000.00. Even better because he has held the property for more than 12 months he is able to reduce this by 50% leaving him with a total taxable income of only $25,000.00.

 

If you would like to know more about capital gains tax give us a call on 02 49291122 or request an information package by emailing admin@newvisionaccounting.com.au

Nov 14

Merry Tax-mas? - Keep the taxman jolly this Christmas!

Posted by cassidy whipper on Monday, November 14, 2016

Ho Ho Ho, The Christmas party season is fast approaching, and you know what that means? Parties and lots of them!
So let’s make sure you’re not waking up to regrets over that festive fiesta.

Our Top tips to keep the tax man and your (tax) hangover at bay.

  1. Thinking of throwing your team function off site? Example – function centre, restaurant or a hotel, the cost of providing the party would normally be treated as a Fringe benefits tax (FBT) payable by the employer.
    However! If the cost per team member is LESS THAN $300.00 AUD NO FBT will be payable. This is due to a little thing called minor benefits exemption. This exemption also applies if a partner or spouse comes to join in on the party fun.
  2. Speaking of minor benefits exemption, did you know it applies to each benefit provided?! That means if you’ve had a few too many rum balls and are feeling super generous and spend $290.00 AUD per person on the party AND THEN give a gift to each team member valued at a further $290.00 AUD, Both expenses are free of FBT!

  3. Hands off those Rum Balls! If you spend MORE THAN $300.00 AUD per person on the function, the whole lot will be subject to FBT, Not just the excess.

  4. Unfortunately the fat man in red won’t be giving free sleigh rides to and from the party’s festivities, so if your business plans to cover taxi fares they will count as part of the $300.00 AUD per person limit if the function is off-site. If the function is on your premises (see tip 5) fares will be exempt from FBT.

  5. If you plan on having your party on a working day on your business’s premises food and drink costs are exempt from FBT if consumed by current employed team members. If partners & spouses are joining in on the party there may be an FBT liability unless the cost is covered by the minor benefits exemption. (explained Above, but for more info see https://www.ato.gov.au/General/Fringe-benefits-tax-(FBT)/FBT-exemptions-and-concessions/Minor-benefits-exemption/)

  6. Bah Humbug! If your Christmas shindig is exempt of FBT it is not tax deductible for income tax purposes. The business is also unable to claim goods and services tax credits for any of the costs incurred.

  7. Easy there Rudolph we forgot the clients! Holding a Christmas gathering for clients and contacts has its own set of rules – Luckily there are only two. Holding a bash for clients and contacts there is no FBT incurred but the costs are not income tax deductible.

  8. The rum balls have been forgotten and it’s on to the eggnog! Gift giving to clients and contacts is also FBT exempt and they generally ARE tax deductible and a GST credit can be claimed.

 

So there you have it! Your Christmas Party Planning survival guide! Save yourself the pre party headache and have a chat to your accountant to make sure you know where you stand tax wise before planning your party.

Jun 15

BAD reviews GOOD for Business?!

Posted by cassidy whipper on Wednesday, June 15, 2016

BAD Reviews GOOD for Business i hear you say?!

Yep. You heard it!

How can this be?
Before you get your knickers in a knot take a seat and keep reading...


Sure bad reviews can seem like a scary prospect but are they really?
How you respond publicly and handle these situations is what matters most!

Having a bad review isn’t necessarily a bad thing, although this can be unsettling for a business owner, it can provide valuable feedback that can actually give businesses an opportunity to improve.
Did you know that recent research into consumer behaviour shows that 9 in 10 consumers say they feel more positively about a business that has responded to a negative review in a positive way?

Why?
Well many reviews are community driven and this shows that reviews that occur organically are the ones consumers are more likely to trust. People generally know you can’t please 100 percent of consumers 100 percent of the time.

It is typical of business owners to focus on one bad review, but the truth is, potential consumers view the whole of a business’ reviews page which will usually include a decent ratio of positive and negative views and how the businesses have responded to those.


Personalisation
Take it from the ultra-smooth Barry White; They can’t get enough of your love babe...
Consumers love nothing more than feeling loved and cared about! That’s why it is so important to respond to all negative reviews promptly. Customers usually share feedback not to ‘name and shame’ but in the hope that it will help a business improve an offering, service or experience for future customers.

By replying to the review online and then communicating privately to help resolve a matter you have the opportunity to not only do business again with that customer but a lot of the times they will express their pleasure that they received a prompt response in relation to resolving an issue.

Good reviews – should you respond too?
YES YES YES!
Show people the love they have shown you. By taking the time to respond to a positive review it shows the reviewer that they are valued and appreciated by the business and also demonstrates to other viewers that the business takes customer service seriously.

 

See? Not so scary!


Jun 09

SuperStream - What you need to know

Posted by cassidy whipper on Thursday, June 09, 2016

As of the 1st of July 2016 all business will need to change the way they make contributions to superfunds.

So what does this mean?

 If you are an employer you will be better able to manage your super obligations by sending payments and employee data online which will reduce the amount of time and effort it takes to manage your business’s super responsibilities. It will also allow all Australia’s to track their super payments and to make sure businesses are upholding their super duties to their employees.

What do I need to do?
When it comes to paying contributions for your employees and sending the data electronically there is a few options.

To make things easier we have broken it down into 3 simple steps to get you SuperStream ready!

Select from the below which best suits your business and learn what you need to do to become compliant.


Step 1. – Choose one of the following:

Using a payroll System?
If you are using a payroll system you need to make sure it meets the superstream standard. You can do this by asking your system provider.  
To make things easier here is a register of payroll software and other providers that state if they are super stream ready. product register (PDF, 293KB)

Your Superfund –
Many large superfunds have online payment services that you are able to use that will allow you to be Superstream complaint. Some of these include – REST, MLC, BT Super etc… Check with your superfund to see if they have an online Superstream solution

Super Clearing House
A clearing house pays your employees super for you. You send a single payment to them along with your employee information and they do the rest ensuring you are superstream compliant.
The ATO also offers a small business super clearing house for small businesses that have 19 or less employees and must have an annual turnover of less than $2 million.
The registration link can be found here - https://www.ato.gov.au/business/super-for-employers/paying-super-contributions/small-business-superannuation-clearing-house/

 

Step 2. – Collect information from your employees:

SuperSteam requires you to collect some information from your existing employees (new employees who choose their superfund will be required to complete a standard choice form which will provide you with the required information.)

Once you have collected the following information from your existing employees you will need to enter it into your selected system as chosen above.

(Please note if you are an employer contributing to your own Self-managed superfund you do not need to collect any of the following information for these contributions.)

If you don’t already have it you will need to ask your existing employees for the following information:

  • Employee Tax file number
  • Their superfunds tax file number
  • Their funds unique superannuation identifier (USI)
    All funds have this. It’s publicly available on most funds websites. Some funds do have more than one USI so it is important that your employee knows which product they  are in. For example a fund may have the following super funds to choose from: Super/corporate, Select, Acumen, Pension these will ALL have difference USI numbers.

If your employee has a self-managed superfund (SMSF) you will need to request the following information from them:

  • Employee Tax file number
  • Fund ABN
  •  Fund Bank Account Details (BSB, Account Number, Account Name)
  • Their funds electronic service address


Step 3. – Start Using SuperStream:

For employers with 19 or less employees you should be ready to use SuperStream by the 30th of June 2016 deadline.
The ATO does however encourage you to use SuperStream earlier than this date so that you have time to time to adjust to the changes and start enjoying the benefits sooner.

Be sure that all information is correct and complete when making payments otherwise the payments are very likely to be rejected and you may not meet your super guarantee obligations by the due date.
Lastly it is a good decision to see how long a fund or clearing house will take to process payments. If it takes a few extra days for processing it is a good idea to pay in advance so you are still able to meet any deadlines.

So get started today and enjoy the benefits of Superstre

May 31

Webpage Must Haves!

Posted by cassidy whipper on Tuesday, May 31, 2016

Much like the art of producing a fantastic coffee there are some essential components to constructing a great website! You want your site to be the platform to showcase your brand. By creating engaging up to date content you will help to communicate effectively your unique selling point to viewers.

These are the 4 website ‘dos’ you need to be aware of!

Is your site mobile friendly?

Google has recently introduced an algorithm change that will penalize sites that are not mobile friendly when prospective clients search for your business via their mobile device.

When you take into consideration how many people search things via their phone it has the potential to have a significant impact on your business if you do not have this option for your page.

Making sure that your site is mobile friendly for users will give your site a boost on mobile searches.
If you are not sure take the google mobile friendly test below
https://www.google.com/webmasters/tools/mobile-friendly/

 

Consistency is key!

Is your content the same as every other accounting practice?
Did you know that you’re ‘about us’ page is usually the most highly viewed page on your site? This is because people want to know who you are, what your niche is and what you can offer them. Things such as positive imagery, Engaging headings and easy navigation can help to express who you are to potential clients.

 

Engage People

Engaging with clients and potential clients is not as hard as you think. Create a call to action via your webpages home page or alternatively create an email campaign to directly engage with people.
Ebooks are a fantastic way to interact and connect with people – People can download these in return for giving you their email address which can then help you to build your email campaign.

 

Communicate, Communicate, Communicate!

People are naturally inquisitive – They want to know what you are up to!
The easiest way to increase your lead generation is by up to date regular activity happening within your site. Blogs are an easy way to communicate with your clients and potential clients what you’re up to.
Start a social media campaign!
Facebook, Twitter, Instagram, LinkedIn are all great communication channels for you to utilize and expand your referral networks.

Apr 15

Why we love Delivery ( & you should too!)

Posted by cassidy whipper on Friday, April 15, 2016

Who doesn’t love delivery? I can go to lunch with friends, pop out for a swim and watch that new film everyone has been raving about all while my groceries have been done and delivered (my cold goods are even on ice!), my swimming pools water has been tested and the chemicals have been dropped off, even my overweight Labrador has been groomed and his pills and 40kg feed bag await me at home. This would usually take me a good full day but instead I ordered from my phone, paid and was out living the good life.

People love convenience but not all businesses offer it. But WHY NOT?!
If you are a business owner and you offer a product or a service why aren’t you offering to deliver? It is a very simple concept that will benefit sales immensely if marketed and distributed correctly.

Customer Demand-
Give people what they want. There has been a huge surge for e-commerce businesses located in Australia who are supplying various gadgets and services to consumers all around the world.
So what do they want? They want ease of access but also want to feel secure. They want a tracking number, email or text where they can see their goods have been delivered. They also want to know up front delivery costs.  A great initiative for people to buy more is to offer free postage over a certain amount, this not only allows you to acquire that extra sale but also leaves the customer feeling satisfied that they are getting something for ‘free’.

Starting small –
Logistical challenges are one of the biggest failure factors when it comes to delivery in business. Offering local delivery and or an extra service will give you a taste of the logistics you will need to handle a larger volume and broader region.

Track your sales -
Once you have taken the leap and are offering a range of delivery options and services it will pay to track the regions you are delivering to. By expanding your businesses stores and or warehouses to these regions it will cut delivery costs and allow you to make money outside of your local area. A good suggestion is going by state.

Healthy Competition –
Have you ever heard the saying ‘same same but different?’ and no you aren’t reading it off another cheap Bali tee shirt.. You are going to have competition. No matter what business you are in. But it’s how you do things that will keep customers coming back for more. What sets you aside from other business’s doing the same or a similar service to you? Can you change the way you do something to improve it? Delivery is one of those things it can also be HOW you deliver, a text or phone call for an estimated drop off time or when it’s on your doorstep is a simple strategical improvement!

 

What’s Next? -
Increasing turnover and growing your business brand would be the ultimate goal to achieve by offering delivery, but it also opens up a whole new world full of opportunity’s to include extras in your products or services. For example gift wrapping, next day delivery and maintenance.
Not all of these examples will be relevant for your business so find what works for you, Trial and Error is a part of life but by doing extensive research and having a set goal in mind you can achieve it.

For more information about how we can help you achieve your business goals contact us on 02 4929112202 49291122 or at admin@newvisionaccounting.com.au

Jan 25

Why you Need Xero!

Posted by cassidy whipper on Monday, January 25, 2016

Move over MYOB there’s a new little blue guy in town.

Xero is everywhere! And there’s no escaping – so why try to? Xero is AMAZING!
As human beings we shy away from change. We are reluctant to try new things and are quick to point out limitations.

We have heard all the excuses why people shouldn’t change over for example -

It will take more time for me to learn a new program which won’t make anything faster.
 
Our Answer – We offer training to all of our clients and are there to step them through every step of the way! Have a question? Ask! We love to help!

The internet can be a dangerous place – is it safe?

Our answer – Yes it is safe! Protecting data is fundamental to everything Xero does. Which is why they have invested in industry-leading infrastructure and are constantly striving to ensure your data is always secure!

 

So How Can Xero help you?

Xero allows you and your accountant to access your accounts anywhere anytime – this means if you have an issue which needs fixing we can see the problem first hand and fix it for you!

Do you allocate your transactions quarterly? – Allocate your transactions online – it will cut your book-keeping time in half! – We can show you how!

Perfect for tradies! Have you just completed a job? Don’t wait until your back in the office send the invoice now! Xero is mobile compatible meaning you are able to create invoices anytime anywhere so you can get paid sooner!

Hate filing those receipts? Don’t! Take a photo of the receipt on your mobile and create a claims expense! – We can show you how.

Want to know what you’re spending your hard earned cash on? Add your receipt and allocate it in Xero the minute you spend your money from your business account. Everything is instantly there – meaning you don’t have to reconcile later!

Want to know more about how we can help you change your life by shifting to Xero?

Contact us for an obligation free chat today!