Tag: small business

stopwatch countdown to deadline

Small business lodgement penalty amnesty deadline

Posted on | by Allan Hall

Clock ticking on small business lodgement penalty amnesty

Small businesses have until the end of December 2023 to get back on track with overdue forms via the small business lodgement penalty amnesty.

Late lodgement penalties will be remitted under the amnesty which ends on 31 December 2023 for small business income tax returns, fringe benefits tax (FBT) returns and business activity statements (BAS) originally due between 1 December 2019 and 28 February 2022.

More than 14,000 small businesses have taken advantage of the amnesty since it kicked off on 1 June 2023, with more than $48 million in failure to lodge (FTL) penalties remitted.

Directors who bring their company lodgements up to date can also have FTL penalties remitted if they rely on company lodgements to finalise their tax affairs. This applies to eligible lodgments made between 1 June and 31 December 2023.

The amnesty provides an opportunity for small businesses to re-engage with their tax affairs and get back on track with their lodgement obligations without penalties.

If a small business has ceased trading, they need to advise their registered tax professional or contact the ATO directly to seek assistance with finalising their tax obligations, which may include lodging overdue returns, cancelling their ABN and paying any amounts overdue.

While penalties will be remitted under the amnesty, if a business finds themselves with a tax debt after their overdue forms are lodged, they must pay in full to avoid further interest charges or check the ATO website to see if they are eligible for a payment plan.

CONTACT ALLAN HALL BUSINESS ADVISORS

cryptocurrency

GST and using or receiving digital currency

Posted on | by Allan Hall

What to do when you receive and use digital currency as payment for goods and services

Digital currency as payment for goods and services

Receiving or using digital currency to pay for goods and services in your GST-registered enterprise is the same as using money, but it is different to trading digital currency.

Receiving digital currency

If you make a taxable supply and you receive digital currency as payment, the GST amount for that payment included in your business activity statement must be in Australian dollars.

Your tax invoice must meet the normal tax invoice requirements and include either:

  • the GST payable in Australian dollars
  • sufficient information to work out the GST payable in Australian dollars.

Examples of sufficient information includes the:

  • price expressed in Australian dollars
  • value expressed in Australian dollars, or
  • conversion rate used by the supplier, or a statement, to work out the GST payable if it is not in Australian dollars.

Using digital currency

If you use digital currency to make a purchase for your GST-registered enterprise and claim a GST credit, the GST amount of the credit in your business activity statement must be in Australian dollars.

To work out your GST credits, your tax invoice will include either:

  • the GST amount in Australian dollars
  • sufficient information to determine the GST amount in Australian dollars.

How to convert digital currency

To work out the value of your digital currency for your business activity statement, you must use the exchange rate on the conversion day that applies to you.

Exchange rate

If the exchange rate is in Australian dollars, you may choose to use the exchange rate:

  • from a digital currency exchange or website, or
  • agreed on between the supplier and the recipient.

If the exchange rate is in a foreign currency, you must convert the amount expressed in foreign currency to Australian dollars.

Conversion day

The conversion day is the date you use to convert your digital currency into Australian dollars.

If you account for GST on a non-cash basis, your conversion day is determined by whichever happens first of either the:

  • day you receive any of the payment
  • transaction date or invoice date.

If you account for GST on a cash basis, your conversion day can be the transaction date, invoice date or the day you receive any of the payment.

CONTACT ALLAN HALL BUSINESS ADVISORS

Australian currency dollars and coins

Industry Growth Fund

Posted on | by Allan Hall

Industry Growth Program open for business

Supporting start-ups and innovative small-to-medium businesses to commercialise and grow their ideas.

Have a great idea but not sure how to turn it into a profitable product? The Australian Government’s new Industry Growth Program is here to help. As part of stage one of the program, start-ups and small-to-medium businesses can apply for expert advice to support getting their good ideas to market.

What do you get?

You will be connected to an Industry Growth Program Adviser who will provide tailored advice to support your commercialisation and/or growth project.

Once you have received this advice, you may also be able to apply for:

  • grants of $50,000 to $250,000 to support early-stage commercialisation projects
  • grants of $100,000 to $5 million for commercialisation and growth projects.

Industry Growth Program Grants will open in 2024.

Who is this for?

Innovative small and medium enterprises with commercialisation and/or growth projects in one or more of the National Reconstruction Fund priority areas.

LEARN MORE ABOUT THE INDUSTRY GROWTH FUND

What is the Industry Growth Program?

The Industry Growth program supports start-ups and innovative small-to-medium enterprises (SMEs) to undertake commercialisation or growth projects within the National Reconstruction Fund priority areas.

Stage 1 of the program allows SMEs to receive advice from industry experts on:

  • commercialisation and growth strategies
  • funding avenues
  • market testing
  • business models
  • building networks.

Stage 2 of the program will provide matched grant funding for SMEs who are operating in priority areas identified under National Reconstruction Fund.

How to apply

You can apply for expert advice (stage 1) now.

Applications for grant funding (stage 2) are expected to open in early 2024.

CONTACT ALLAN HALL BUSINESS ADVISORS

AHBA Xero Platinum Partners against AH office sign

Allan Hall attains Xero Platinum status

Posted on | by Allan Hall

Allan Hall Business Advisors is delighted to be formally recognised as Xero Platinum Partners

What does going Platinum mean for our clients?

Our primary goal is to build a successful accounting and business advisory firm that provides a high-quality, tailored service to business owners and individuals on Sydney’s Northern Beaches.

We didn’t set out with the goal of becoming a Platinum Partner but, looking back, becoming Platinum with Xero is something we’re really proud of. It’s recognition of our hard work and all that our team has done to help our clients and subsequently grow their businesses.

It’s also a great stepping-stone as we continue to work in collaboration with our Alliott Global Alliance colleagues worldwide to extend our capabilities beyond Sydney.

Being a Platinum Partner means a lot to our team.

Going Platinum boosts our capabilities in really unique ways. We’ve worked hard to achieve this goal, and the status shows our efforts have paid off.

As accountants, becoming a Xero Platinum Partner offers several benefits to our clients. Xero is a popular cloud-based accounting software platform, and achieving Platinum Partner status indicates a high level of expertise using the platform as part of our tech stack. Here are some of the benefits:

  • Expertise and Training: Platinum Partners have a deep understanding of Xero’s features and capabilities. We have undergone extensive training and certification, which means we can provide expert guidance and support to our clients.
  • Efficiency Improvements: Accountants who are Xero Platinum Partners are naturally more efficient in using and optimising the platform. This translates into skills we can pass on to our clients.
  • Enhanced Reporting: Platinum Partners can often provide more advanced reporting and analysis capabilities within Xero, helping our business clients gain better insights into their financial data.
  • Customised Solutions: Platinum Partners are better equipped to tailor Xero to the specific needs of our clients. We can create customised solutions and workflows that align with the unique requirements of different businesses.

At Allan Hall, we’re experts in Xero cloud accounting software that’s easy to love. Find out more about using Xero in your business here or drop us a line to get started.

CONTACT ALLAN HALL BUSINESS ADVISORS

Happy friends enjoying on terrace. Smiling man and women are celebrating together during sunset. They are wearing casuals in party

FBT treatment of work Christmas parties and gifts

Posted on | by Allan Hall

Fringe Benefits Tax — What business owners need to know this Christmas

As the festive season approaches, you are likely planning your end-of-year functions and perhaps even thinking about Christmas gifts for valued customers and employees for another year.

During this period, it’s important to understand and be mindful of the implications of Fringe Benefits Tax on gifts and parties, to ensure that your generosity doesn’t cause unwelcome tax consequences for your business.

To help, we have set out the following guidelines to assist you:

Fringe Benefits Tax at Christmas

Christmas Parties

If your business lodges an FBT return calculating entertainment using the 50/50 method, then 50% of the cost of your Christmas party will be subject to FBT.

If you do not lodge an FBT return using the 50/50 method then the cost of your Christmas party will be exempt from FBT provided one of the following applies:

  • The Christmas party is held on business premises on a working day for current employees only, OR
  • The Christmas party costs under $300 per head.

If your business entertains your employees frequently (more than 10 times per year) then your Christmas party may be subject to FBT regardless of the cost, so please discuss this with your Allan Hall advisor first.

Example

  1. A law firm holds its Christmas party for employees only on a Friday afternoon in the office garden complete with marquee, live band, premium alcohol and a delicious banquet cooked by a celebrity chef. The cost comes to $490 per head. This will be exempt from FBT.
  1. An electrical company holds its Christmas party at a local restaurant with food, drink and entertainment. Ten employees and their spouses are invited making a total of 20 people. The total cost comes to $5,000. As this equates to $250 per head it will be exempt from FBT.

Customer Gifts

Gifts to customers are tax deductible and not subject to Fringe Benefits Tax, provided they are a genuine gift e.g. a Christmas hamper or a bottle of wine.  If you choose to take a customer out for a Christmas drink instead, your portion of this may be subject to Fringe Benefits Tax.

Staff Gifts

Gifts are a great way to show your employees how appreciative you are of their efforts whilst still attracting a tax deduction for your business. However, it’s important to understand that staff gifts over $300 will be subject to Fringe Benefits Tax.

Further, staff gifts under $300 should be eligible for the minor benefits exemption from Fringe Benefits Tax, but if they are recreational gifts (such as concert, cinema or sports tickets) then no income tax deduction or GST can be claimed.

Understanding the intricacies of Fringe Benefits Tax and the implications of FBT on your Christmas entertaining — gifts and parties — can be challenging. Many of our team offer skilled and highly experienced advice in all aspects of Fringe Benefits Tax, so please contact your Allan Hall Advisor for specific assistance before planning your Christmas functions and/or staff and customer gifts.

NOTE: If your business is a tax-exempt body or charity then a separate set of rules applies so please consult your Allan Hall Advisor.

CONTACT ALLAN HALL BUSINESS ADVISORS

team training session

Respect@Work Legislation

Posted on | by Allan Hall

Practical Steps for Small Businesses to comply with the new Respect@Work Legislation

As previously advised to our clients, a significant shift will occur in the Australian employment landscape on 13th December 2023. There are a number of legislative changes which employers are required to comply with under the Respect at Work reforms.

These amendments place a ‘positive duty’ on employers to take reasonable and proportionate measures to eliminate, as far as possible, unlawful sexual discrimination in their workplaces.

How to Comply – To comply with these laws, you need to take proactive steps and implement preventative actions against discrimination based on sex, harassment, hostile work environments and victimisation related to complaints or allegations.

Here are some practical steps for small businesses to prepare and comply with these changes:

1. Educate Your Team: The first step towards compliance is understanding the changes.

Educate and formally train your managers and employees about the updated legislation, emphasising the importance of respect, dignity, and equality in the workplace. This training should focus on ensuring everyone is aware of their rights and responsibilities and understands what is and isn’t appropriate workplace behaviour.

2. Review and Update Policies: Formalise your company expectations.

Review your existing workplace policies, especially those related to discrimination, harassment, or bullying. Ensure they align with the legislative changes. Take this opportunity to check that your Work Health and Safety policies place equal emphasis on psychosocial hazards as well as physical hazards, to ensure you comply with applicable Work Health and Safety legislation. Ensure your Compassionate Leave Policy specifies that employees and their partners can access miscarriage leave.

Once these changes are made, ensure you clearly communicate these changes to your employees. Having clear and legally compliant policies in place not only ensures compliance but also sets the tone for a respectful work environment.

3. Foster a Respectful Culture: Proactively promote a culture of respect, inclusivity and diversity.

Encourage open communication, active listening, and empathy among employees. Lead by example, demonstrating respectful behaviour at all levels. Demonstrate your positive steps to avoiding sexual harassment and sex-based incidents by clearly communicating what is and isn’t appropriate. If you have a client-facing business, ensure that your clients also act respectfully with your team members by communicating your expectations. By fostering a positive workplace culture, you create an environment where everyone feels valued and supported.

4. Seek Feedback: Give your team a chance to share their experiences.

Seek feedback from employees through anonymous surveys or focus groups to gauge their experiences within the work environment. Regularly review your workplace practices and culture to identify areas for improvement. Use this information to make necessary changes, ensuring your workplace remains respectful and inclusive.

5. Establish Reporting Procedures: Create effective reporting channels

Create clear and confidential reporting procedures for incidents of harassment, discrimination, or bullying. Ensure employees know how to report such incidents and that they can do so without fear of retaliation. Having a well-defined reporting process demonstrates your commitment to addressing workplace misconduct promptly and effectively.

6. Provide Ongoing Training and Support: Keep everyone up to date.

Equip your employees with the knowledge and skills to identify and address disrespectful behaviour. Offer regular and ongoing refresher training on topics such as conflict resolution and unconscious bias. Provide support such as confidential access to counselling services for employees who may have experienced harassment or discrimination.

7. Consult Experts: Don’t get caught short.

The legislation applies to every business, regardless of type, size and scope. If you would like assistance in actioning these steps, our HR Team is assisting many of our clients with tailoring the above steps to suit their business. The HR Team can provide guidance, training, advice and essential templates to assist you in meeting the minimum requirements for your business. If you are uncertain about how the new legislation applies to your business and what you need to do to comply, please contact Allan Hall HR at [email protected] or call us on 1300 675 393.

taxation & accounting

Business income: it’s not just cash

Posted on | by Allan Hall

Clothing, jewellery, gaming products, flights and crypto assets are just some of the things you might have to account for in your tax return as part of your business income.

If you received these or any other non-cash benefits instead of money for your goods or services, or as a tip or gift – you must record them as income at their market value.

This means you record the cash price that you would normally have to pay for those goods or services.

You may be able to reduce the assessable amount of a non-cash benefit you’ve received, by the amount you would have been able to claim as a deduction if you had purchased the item to be used in carrying on your business.

It’s important to report your regular forms of income

Such as:

  • cash and digital payments
  • vouchers or coupons
  • business investments
  • online and overseas business activities
  • services you provide using your personal effort and skills (personal services income)
  • the sharing economy, such as ride-sourcing
  • assessable government grants and payments
  • the value of trading stock you take for your own use
  • payments from insurance claims.

There are some payments that aren’t assessable income, so you don’t need to include them on your return, such as:

  • non-assessable non-exempt (NANE) government grants
  • bona fide gifts or inheritance
  • GST you’ve collected
  • money you’ve borrowed or contributed as the business owner.

Always keep accurate and complete records to prove the income you report and the expenses you claim as deductions.

Remember, registered tax professionals like Allan Hall in Brookvale can help and advise on your tax.

CONTACT ALLAN HALL BUSINESS ADVISORS

Parliament House

Support for Australian small business

Posted on | by Allan Hall

The Government has introduced the Treasury Laws Amendment (Support for Small Business and Charities and Other Measures) Bill 2023 (the Bill) into Parliament.

The Bill delivers measures announced in the 2022‑23 Budget to ease pressure and boost resilience for small businesses.

Schedule 1 to the Bill will implement a $20,000 instant asset write‑off for one year, as announced in the 2023‑24 Budget, to improve cash flow and reduce compliance costs for small businesses.

Small businesses with aggregated annual turnover of less than $10 million will be able to immediately deduct eligible assets costing less than $20,000, from 1 July 2023 until 30 June 2024.

The $20,000 threshold will apply on a per asset basis, so small businesses can instantly write off multiple assets.

This is targeted, responsible support, to help Australia’s small businesses continue to grow.

Schedule 2 to the Bill will introduce the Small Business Energy Incentive, a 2023‑24 Budget measure designed to help small and medium businesses electrify and save on their energy bills.

Up to 3.8 million small and medium businesses with aggregated annual turnover of less than $50 million will have access to a bonus 20 per cent deduction for eligible assets supporting electrification and more efficient use of energy.  

The new tax incentive applies from 1 July 2023 until 30 June 2024. Up to $100,000 of total expenditure will be eligible for the incentive, with the maximum bonus tax deduction being $20,000.

The new Small Business Energy Incentive builds on the Albanese Government’s measures to help small businesses become more energy efficient and ease pressure on their energy bills.

Small businesses are the engine room of Australia’s economy, which is why these new measures are so critical.

CONTACT ALLAN HALL BUSINESS ADVISORS

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NSW State Budget 2023-24

Posted on | by Allan Hall

The 2023-24 NSW State Budget has a strong focus on tightening tax compliance, as well as changes to a number of exemptions and duties:

  • Funding Revenue NSW to Target Tax Compliance
  • Land Tax – Closing the loophole for Principal Place of Residence Exemption
  • Landholder Duty – changes to threshold for acquiring a “significant interest” in a private trust
  • Fixed and nominal duty amounts increased

This year’s NSW State Budget does not explicitly mention specific measures targeted at small businesses. However, it does mention some broader economic and infrastructure initiatives that could indirectly benefit small businesses. These include:

  1. Toll Reform: Introducing a two-year toll cap and streamlining motorway pricing
  2. Infrastructure and Transport: Investments in infrastructure projects, including road upgrades and improved public transportation
  3. Energy Relief and Reform: Addressing high energy costs through rebates and energy market reforms
  4. Disaster Relief: Funds allocated for natural disaster support and recovery programs.

Measures for First Home Buyers

The State Budget includes an expansion to the First Home Buyers (FHBs) Assistance Scheme to support FHBs with a stamp duty exemption for purchases up to $800,000 and a concession for purchases between $800,000 and $1 million.

Five out of every six first home buyers will pay no stamp duty, or a concessional rate after the Government expanded stamp duty exemptions and concessions from 1 July 2023. According to preliminary figures, more than 1,000 FHBs purchasing in the $650,000 to $800,000 range have availed themselves of the full exemption from stamp duty in July under the scheme.

The measures announced in the 2023-24 NSW State Budget can have implications for the business environment in New South Wales, including those for small businesses and are outlined in the Treasury and Revenue Legislation Amendment Bill 2023 expected to be implemented from 1 February 2024, once the Bill has been passed by Parliament.

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