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Tax tips: How the coronavirus can help you get a larger refund

Tax tips: How the coronavirus can help you get a larger refund

Source: https://thenewdaily.com.au/

The coronavirus pandemic has shifted the way we conduct our personal finances, and with June creeping up, tax time is no exception.

Strict social distancing measures have forced millions of Australians to work from home for the first time, throwing up a raft of new deductions.

Mozo.com.au consumer advocate Tom Godfrey told The New Daily sifting through records of expenses can help workers uncover surprising work-related costs to boost their tax refund.

So how has the coronavirus changed the way we conduct our taxes?

The New Daily tackles some key questions.

My employer asked me to work from home. What can I claim?

The ATO has two methods to claim working from home expenses, but choosing the right option depends on how much bookkeeping has been done during the lockdown.

For workers who are unable to apportion their expenses between work-related and private use, or haven’t kept records to substantiate claims, the ATO has introduced a ‘shortcut’ method to make things easier.

That method amounts to 80 cents per hour, and taxpayers should ensure the amount of hours logged matches hours agreed with their employer.

However, those who permanently work from home, or kept paperwork of internet and mobile usage and receipts for stationery and new office equipment, can calculate their actual expenses.

H&R Block’s director of tax communications Mark Chapman said this normally produces a larger tax refund, but workers can run into problems if their records are not up to scratch.

“Sitting down and working out the proportion of your electricity bills and other home expenses that are specifically work-related can be difficult and time-consuming,” Mr. Chapman told The New Daily.

My hours changed because of coronavirus. Can I claim tax back from the ATO?

Workers who lost jobs or had hours slashed by their employer may be eligible for a larger tax refund.

Prior to the outbreak, employers applied tax to their employees’ pay assuming they would be employed in the same capacity over the 2019-20 financial year.

If the number of hours dropped during the lockdown through reduced hours or joblessness, workers could be entitled to a larger refund.

“If your salary’s reduced, chances are your PAYG statement will show you have moved into another tax bracket, if the income lost is substantial enough,” finder.com.au managing editor Kate Browne told The New Daily. 

I’ve been receiving JobKeeper or JobSeeker. Does this affect my tax return?

Both the $1500-a-fortnight JobKeeper wage subsidy and fortnightly $1100 JobSeeker payments are part of a person’s taxable income and need to be reported to the ATO.

For Australians on JobKeeper, their employer should have already noted those payments on their PAYG summary.

And Australians on JobSeeker should receive an income statement from Centrelink outlining how much they have received, which needs to be lodged when filling out their tax return.

I own property but my rental income’s fallen. How am I affected?

Last year, the Australian Taxation Office singled out property investors for overzealous rent deductions, with roughly 90 percent of rent reduction claims containing an error.

And with the pandemic pushing down rents and driving up vacancy rates, the ATO told The New Daily it will be particularly vigilant this year.

Mr Chapman said landlords who retain tenants (regardless of the amount they pay) can claim expenses on loan interest and management fees, even if they incur a net rental loss.

According to the ATO, those property owners may claim the full amount of their expenses “against your rental and other income – such as salary, wages or business income.”

However, Mr Chapman sounded the alarm for property owners who now live in their rental properties.

“If you made your home your base in lockdown, you would not be able to claim deductions for that period, as it’s become a property for your own personal use,” Mr Chapman said.

What else can I do to maximise my refund?

Investors who sold non-performing shares or managed funds may be able to use a capital loss from those sales to reduce the amount of tax paid on capital gains.

And superannuation accounts can also help lower an overall tax bill.

“If you’re receiving a regular paycheck, making additional personal super contributions can allow [you] to claim tax deductions,” Mr. Godfrey said.

Australians can also make claims on:

  • Gifts or donations that have ‘deductible gift recipient’ status
  • Work-related expenses (such as courses, travel, and equipment) that were not covered by their employer
  • The cost of preparing their tax return.

What is MOSS? Calculating VAT when selling electronic services

Want some special guidance on how to treat VAT correctly for your automated electronic service supplying businesses? No wonder, you have landed at the right page. Here you’ll find some detailed tips from expert tax accountants Melbourne, after which you’ll gain a deep understanding of various dynamics of VAT.

What’s VAT?

VAT stands for Value Added Tax. It is a kind of tax that is levied on goods and services while selling and purchasing process. However, VAT is also called GST in Australia (GST-stands for Goods and Services Tax). Nearly all types of goods and services come under VAT.

Hence, if your business is also operational in the field of supplying or selling electronic services, then it will be influenced positively by the scheme ‘MOSS’ (Mini One Stop Shop).

What is MOSS?

If you run a business on a small scale in which you provide electronically supplied services across E.U. country, and the burden of VAT appears annoying, then MOSS is definitely for the people like you. Value Added Tax: Mini One Stop Shop after being brought in E.U. countries on 1 January 2015 enabled sellers just to pay VAT to HRMC because earlier registering VAT in every E.U. country was essential.

But what are Electronically supplied services? How to be eligible for MOSS?

If you want to be eligible for MOSS, your digital services must meet the requirements. According to E.U. law for MOSS, a business should be operational in sectors, such as- telecommunication, e-services or broadcasting and irrespective to other business must be supplied directly to consumers. For example, a business that sells-

  1. Hosting services
  2. Delivery of services related to websites (E.G. CMS Systems, Website Creators, Ready Templates)
  3. Downloading and updating computer programs
  4. Subscriptions to electronic magazines and paid contents
  5. Music, Digital Gambling, Films, and Games,
  6. Political, Entertainment, Cultural, Scientific, and Sports Broadcasts transmitted electronically
  7. E-Learning and other services, like Internet Courses, E-Books and Webinars, etc. are eligible to reap the benefits of MOSS.

Your electronic products business must be operational and supplying these services; otherwise, you can go with VAT- the general rule for taxation.

Union and non-Union MOSS

Union and Non-union are two schemes that come within MOSS:

 

  1. The Union scheme– if you are a taxable person working and have an establishment within the boundaries of the European Union (E.U.), while at the same time supplying goods and services to the Member States without any establishment.
  2. The non-Union scheme– If you are a taxable person operational in E.U. without any establishment.

For the non-Union and the Union MOSS scheme, the basic rules on the MOSS operational activities are almost similar. The only separate thing is the criteria where the company can sign up for MOSS.

Overview

As per tax accountants in Melbourne, the mini one-stop-shop (MOSS) scheme for VAT is however quite simple to understand. MOSS is quite helpful to trip down the burden on businesses and providing them relief from going through high VAT. Ultimately, the supply of broadcasting, telecommunications, and electronic services has become stress-free to some extent.

Direct to video: ‘the new normal’ for job interviews

Source: https://www.intheblack.com/

The novelty of the job interview via video doesn’t mean you shouldn’t be any less scrupulous in your preparation. Here’s how to get it right – and get the job.

Despite the economic slowdown driven by the COVID-19 crisis, hiring is still taking place, although social distancing rules and remote working requirements mean that job interviews are increasingly being done through computer screens rather than face-to-face.

“The technology for virtual interviews has been around for some time but prior to the COVID-19 crisis it was not used often, maybe 5 per cent of the time,” says Matthew Gribble CPA, regional managing director of recruiting firm Michael Page ANZ.

“That has changed radically. They are now the new normal and happen in 99 per cent of cases. And we expect that even after the crisis has passed many organisations will embrace the efficiency gains from using them, especially in the early stages of the assessment process.

“So, knowing how to handle a virtual interview is a skill that anyone looking to move up or move on will need.”

In many ways a virtual interview should be treated like a face-to-face interview: taken seriously, with research and preparation.

There are numerous platforms used for virtual interviews, and Gribble nominates Skype, Zoom, Microsoft Teams and Google Hangouts as the most popular. They are fairly easy to install and use but checking software compatibility and internet speed with the interviewer are important steps. There are useful tutorials on YouTube and most of the platforms provide guidance.

For first-timers a rehearsal with a friend in a remote location makes sense. This not only helps to identify any technical issues but can go a long way to ameliorate nervousness.

The overall goal is to be relaxed enough about the technology so you can focus on the substance of the interview itself.

Setting up the home environment for video interviews

If the interview is conducted from home, the interviewee should ensure that there is a quiet, controlled, indoor space, preferably backed by a blank wall.

Pay attention to lighting. Aim to have natural light behind your computer, or bounce lamp light off a nearby wall so your facial expressions can be clearly seen, as they would in a face-to-face conversation. Avoid having your back to a light or bright window.

There should be no interruptions from other adults, children, pets or neighbours. When speaking, look at the webcam on the computer and not the images of the interviewers. It is better to use a computer than a mobile phone but if a phone is the only option then it should be in a fixed position. A hand-held selfie-style image does not say competence and professionalism.

Attire should be the same as you would wear to a face-to-face interview, although it should be noted that stripes, bright colours and complex patterns do not work well on a screen.

Most platforms have an option that allows the interviewee to see themselves as they appear to the interviewers, and this should be checked before the interview.

Any supporting documents should be provided to the interviewers prior to the interview. Having a hard copy on hand can be useful. You do not want to have to exit the video platform to check documents that you have only in digital form.

A virtual interview provides fewer visual clues than a face-to-face interview so an interviewee should demonstrate their engagement with some extra nods and signs of agreement. A common problem with video platforms is that there is often a lag of a few seconds, and the interviewee should time their responses accordingly. The degree of lag can be established with a rehearsal and is not difficult to address once you are aware of it.

Paper for taking notes and a glass of water should also be on hand. Don’t forget to ensure that the connection is terminated before you relax at the end of the interview.

Interviewer obligations for video interviews

For interviewers, preparation is also essential to get the best out of the process. Most platforms allow for several interviewers to be involved on a split-screen basis. Familiarity with the technology is as important for interviewers as it is for interviewees.

Interviewers should realise that virtual interviews, like face-to-face interviews, are a two-way street, and that they and their company are being assessed as well as the interviewee.

“The chief issues typically come with coordinating the questions,” Gribble notes.

“A good briefing is important so that all interviewers are clear on the background of the candidate and their progress through the process so far, as well as the run of play and the questions to be asked.”

Prior to the interview, the interviewee should be informed about the length of the interview, the participants, and the general subjects for discussion. It might be also necessary to check any differences in time zones.

For both sides, virtual interviews are not difficult, but the special characteristics should be understood. Interviewees should realise that just because they are in their home environment does not mean they can be overly casual. Likewise, interviewers should acknowledge that they have obligations to ensure that the process is organised appropriately.

5 tips for virtual interviews

  1. Ensure software compatibility and internet speed
  2. A rehearsal allows for problems to be identified and addressed
  3. Find a controlled space free of distractions
  4. Use a fixed camera and not “selfie-style”
  5. In panel-style interviews, interviewers should ensure their co-ordination

Accountants to the rescue during COVID-19

Source: https://www.accountantsdaily.com.au/

While frontline health professionals have been saving the lives and health of Australians during the COVID-19 disruptions, accountants have been working flat out to save the businesses and livelihoods of their clients.

Major Government stimulus packages such as JobKeeper and the business cash flow boost payments have been critical in keeping many businesses operating, and these business owners have relied heavily on their accountants to understand the programs and lodge applications on their behalf.

For many accountants, this has created a major stream of new work, with new rules, conditions and eligibility requirements, and for some it has escalated their levels of stress.

“This has been a torrid time for many in the accounting profession and many are struggling with a tsunami of work which just came out of the blue,” says Paul Drum, General Manager of External Affairs at CPA Australia.

“The reality is that many of the changes we have seen were foisted on accountants, and there have been consequences as they have come to terms with the new programs and also had to manage what were in many cases urgent client expectations.”

Not only have accountants been dealing with regular and quarterly BAS lodgments, 2019 income tax returns, self-managed superannuation fund administration and working with clients in the run-up to the end of the financial year, but clients have relied on their accountants to urgently apply for the new programs which are administered through the tax system.

“A lot of people would have missed out on the stimulus packages without the help of their accountant,” says Elinor Kasapidis, CPA Australia’s Tax Policy Adviser.

In addition to the quarterly lodgment of activity statements, accountants are now having to report monthly under the JobKeeper program for their clients and in many cases also for themselves.

As the economy has contracted and business cash flow has become critical, many clients have had trouble paying their invoices and this was impacting on revenues for accountants, while adding to their workload.

“Many accountants are also on JobKeeper and they are also working very long hours,” said Elinor Kasapidis.

“Some of this extra work is included in retainer arrangements with clients, but there is also pro bono work and reduced fees, because accountants are understanding that some clients just can’t pay invoices.”

While CPA Australia was not involved in the original design of the fiscal programs, it has recently been consulted by the Australian Taxation Office on the issue of lodgment and penalties.

The ATO did not adopt CPA Australia’s recommendations for longer deferrals, but Kasapidis welcomed the ATO decision to not apply late lodgment penalties for returns due in May and June if they were lodged by June 30.

The ATO has urged accountants and clients feeling “overwhelmed” by lodgment pressures to make contact.

“While the general interest charge will still be applicable, you can apply for remissions and we will take a reasonable approach in assessing your request,” ATO Deputy Commissioner Hoa Wood said in a statement on May 25.

Wood said the ATO recognised and appreciated the work of accountants to support their clients, and that “there have been additional pressures on the tax profession” during the COVID-19 crisis.

At CPA Australia, Paul Drum said he believed it was an “oversight” by the government and relevant agencies to introduce the new measures without discussing their design and implementation with the accountancy profession.

“There was just an expectation that accountants would manage all this, so I think it needed to be thought through a big better,” he said.

Many small businesses, he said, had gone ahead and lodged documents without the input of their accountants, often because they were in arrears with their accountancy fees.

This is likely to have resulted in a higher percentage of errors and inadmissible applications and ultimately more work both for the ATO and accountants.

So while accountants have been critical to helping their clients survive financially, it was inevitable that this increased pressure would take a toll on the mental health of some in the profession. Drum said CPA Australia’s message to these accountants is that “it is ok to not be ok” and that there are support resources available.

CPA Australia is offering a 90-minute webinar recording titled Mental Health at Work, which focuses on helping accountants recognise and support their clients, co-workers and staff who are experiencing mental health issues, in addition to looking after their own mental wellbeing.

There are also COVID-19 resource materials and a Mental Health Toolkit available to assist accountants on the CPA Australia website.

Lessons for the profession from the coronavirus

Source: https://www.accountingtoday.com/

While the coronavirus pandemic has accountants scrambling to safeguard their people and keep up with new client concerns and legislative updates, the crisis has also given the profession the opportunity to learn some crucial lessons that can only strengthen accountants’ roles in an uncertain future. We asked a collection of accounting’s thought leaders to share what knowledge they are seeing practitioners glean — and what they should be learning — from this unprecedented time.

Lesson 1: Truly essential

One of the most reassuring lessons from the pandemic is the invaluable role of accountants, especially amidst all this volatility, according to our panel of leaders in the profession.

“Many people believe a crisis is a test of character, but it’s not,” said Sarah Dobek, president and founder at Inovautus Consulting. “A crisis instead reveals the character and skills you already have. I think the biggest thing firms are learning is how well they were really doing on certain fronts. Firms are learning a lot about the resiliency of their partner group’s mindset and the soundness of their vision and strategy for growth.”

“I think the pandemic has made two things very clear related to firms,” said Erik Asgeirsson, president and CEO of CPA.com. “First, their services — in particular, their role as a trusted advisor — is highly relevant. Their clients are turning to them for critical business advice and support.”

“I believe CPAs and other accounting professionals have learned how invaluable they are to their clients and the community — something that has always been true but has been especially brought to light during the COVID-19 health and economic crisis,” said Ralph Thomas, CEO and executive director of the New Jersey Society of CPAs. “Our members have been tested in new ways, but they discovered the real value they bring to the table is helping clients navigate the unknown.”

Marc Rosenberg, president of The Rosenberg Associates, reports a similar takeaway, in “how much clients really appreciate their CPAs. Accountants have become lifesavers for their clients by helping them navigate the complexities of the government stimulus programs and generally providing advice, counsel, and solace on survival. This goodwill will play a huge role in firms’ recoveries.”

“The assistance with PPP and other stimulus solutions have given accountants the needed self-confidence boost to finally see themselves in this light,” said Angie Grissom, president of The Rainmaker Companies. “I have heard comments from clients like ‘My client will never see me in the same way again. He is grateful that I helped save his business.’”

Kim Austin, a business development manager for national accounts at Inuit, has heard similar feedback, including from one Intuit partner, Gabby Luoma of MOD Ventures: “A powerful quote from her message was, ‘Accountants are the first responders for small businesses through this.’ Firms are realizing that their clients need them, and are putting their trust in them to guide them through this.”

“We are needed now more than ever,” said Ron Baker, founder of the Verasage Institute. “We are not commodities, no matter what people mindlessly say. Just as the men and women in the medical and first-responder community are putting their very lives at risk to keep people physically healthy, CPAs will be needed to keep their customers financially healthy.”

“The other lesson that firms should be learning is how clients will truly value strategic insight,” said Todd Shapiro, president, and CEO of the Illinois CPA Society. “It was common for firms to be assisting a client in the preparation of their PPP application. Many firms proactively reached out to clients to advise them on alternatives to help their businesses survive and, eventually, thrive — all while not knowing if there would be compensation for their advice and assistance.”

“Our clients really need us in a crisis, and we have to have a lot of people on our team with the right advisory skills who are ready and able to handle client inquiries and provide solid advice or we risk not being able to help them all,” said Jennifer Wilson, co-founder, and partner of ConvergenceCoaching.

“Clients highly value their accountant as an advisor,” said Darren Root, co-founder and general manager at Rootwork and VP of market strategy at Right Networks.

Dawn Brolin, executive vice president of business development and compliance at Powerful Accounting powered by Out of the Box Technology, noted that clients and non-clients alike were waking up to the value of accountants. “People who typically file on their own realized they didn’t know what they were doing and were finally willing to pay for services due to the confusion around all of the rules,” she said. “The pandemic has taught me that you can never underestimate the importance of the accounting industry and its relevancy and its critical role in the economy.”

“I also think we have learned how to react and respond ‘on the fly,’” said Allan Koltin, CEO of Koltin Consulting Group. “When the CARES Act and/or PPP loan program came out, firms literally had hours to become the ‘resident expert.’”

Lesson 2: Move to advisory

The crisis has only crystallized the necessity for firms to embrace advisory services.

“Advisory really is the service that our clients value the most!” said Jim Bourke, managing director of advisory services at WithumSmith+Brown “During this time, if I can point to one area where our team members excelled, it was in guiding and advising our clients around their cash flow needs during this period of time. From dealing with clients with crushed revenue streams to those struggling to find a bank that was willing to process their SBA-PPP loan applications … now more than ever, we have learned it’s all about being that ‘trusted advisor.’”

“The opportunities for advisory services are huge right now,” agreed Jody Padar, vice president of strategy at Botkeeper. “There are so many services that we never dreamed of offering in ways we never thought of delivering them.”

“The biggest lesson I think firms should take away from this is that regardless of how their firm feels about ‘advisory services,’ their clients will be coming to them to advise them through tough times,” said Intuit’s Austin. “If a firm is not able to provide the type of help and guidance their clients need, they’ll be forced to look elsewhere for that assistance.”

And accountants must realize this demand will survive the crisis. “I think they should be learning to embrace change as a challenge to be better,” said Dobek. “We are seeing many firms take this approach and others that have yet to make that leap. I’ve heard a few comments around the move from compliance to an advisory, and some being happy they retained more compliance work. These firms are missing the bigger picture. The advisory work is what will help businesses and individuals make it through this pandemic.”

“Overall, the most important focus for firms should be realizing that this is a defining moment and time to deliver on the trusted advisor role with their clients,” said Asgeirsson. “Over the past two months, firms have been put in the center of advising their clients on how to manage the downturn and business relief. Over the coming weeks and months, they are going to support their clients on restart efforts and adjustments to their business model. This is a historic moment for the firms to help their clients. Clients will remember who helped them navigate through this time successfully.”

Lesson 3: ‘Remote work works!’

One of the most obvious opportunities to come out of the pandemic is the (long-awaited, for many) move to remote, flexible work. “The biggest lesson learned is that work-at-home can work,” said Randy Johnston, executive vice president of K2 Enterprises and CEO and founder of Network Management Group. “Stay-at-home orders forced everyone into this new work environment.”

Wilson agreed: “Remote work works! People are more productive than firm leaders imagined. Firm leaders realize they have to double down on technology to have maximum flexibility in the way they serve their clients.”

Hector Garcia, CEO of Quick Bookkeeping & Accounting, shared similar insight: “Embracing flexible work; not just ‘remote work,’ but different ways of being able to have team members work without interruption.”

“While firms have toyed with working remotely for several years, it has not been something that was widely done,” said August Aquila, CEO of Aquila Global Advisors. “The pandemic forced firms into doing it and they have found that it works. People who work remotely are more productive overall and have a better quality of life since they do not have to commute. Once the dust settles from the pandemic, remote workers will be the norm rather than the exception.”

“In as short as two days, many firms moved on-site engagements and critical administrative functions to 100 percent virtual environments,” said Kimberly Ellison-Taylor, executive director of finance thought leadership for the cloud business group at Oracle, and a past chair of the American Institute of CPAs. “Necessity is the mother of invention and this quote has never been more true. In a pre-COVID-19 environment, a completely virtual working environment would have taken many firms several more years, if ever, to implement.”

While the adjustment period is challenging, mastering new models can provide future benefits.

“Working from home was a difficult transition for some of our clients,” reported Jeff Phillips, CEO of Accountingfly. “But many firms have learned they can give staff this great gift of flexibility and still be highly productive.”

“Adaptation is not optional; it is essential for survival and firm leaders will see this as the new expectation,” said Grissom. “This includes the move to virtual workforces as necessary, the types of services offered, and the adoption and use of technology in their firms … The work-life blend is non-negotiable.”

Lesson 4: Embrace technology

Our panel emphasized technology’s vital role in a remote workforce, and in surviving post-pandemic.

“Difficult times magnify strengths as well as weaknesses. The efficient use of technology in a virtual environment is a primary lesson,” said Gale Crosley, president of Crosley+Co. “The tech world has been operating virtually for over 20 years. They’ve figured it out and we have only to peek over the fence for insight.”

“As time marches on and changes occur, so a firm should never put off for tomorrow what can be done today,” said David Bergstein, strategic account manager with the accountant and advisory group at Intuit. “Up until now, firms have been talking about taking advantage of technology, being virtual and collaborative, but were moving at a snail’s pace. Firms are now retooling at a record pace, trimming staff where they should have done it before, and utilizing technology that leads to digital movement of data and elimination of paper.”

“The pandemic has taught us the importance of true practice virtualization in that everyone needs to be able to work effectively from any place at any time,” said Roman Kepczyk, director of firm technology strategy at Right Networks.

As much as the experts lauded the profession’s ability to go virtual, some identified new obstacles to overcome in the transition. “Interestingly, as the huge impact of the pandemic on personnel’s work lives and their sanity (partners and staff alike) have become apparent, one of the biggest issues emerging is people lamenting over the lack of interpersonal interaction,” said Rosenberg. “The very people who demanded more remote work time now crave more face-to face-time. This is especially problematic for younger staff, who need more attention and guidance than more experienced personnel.”

“First, firms had to shift to a remote work environment. Many were prepared; however, many were not,” said Shapiro. “The need for technology, especially cloud-based systems, became a game-changer, and those who were cloud-based transitioned more easily. However, the degree to which clients were comfortable with technology also had a huge impact on the success of shifting to a remote work environment.”

Going forward, many of the profession’s leaders expect these new work environments to endure, ushering in other changes. “One lesson that I believe we are about to learn is that we likely have too much office space,” said Bourke. “Our firm, like many, has large physical locations in major cities. Yes, we have embraced the ‘hoteling’ concept and have even deployed technologies to facilitate that process, but will our staff be willing to come back to the new reality of social distancing, face coverings, continual cleaning of the work environment, the temperature checks, the unknown contacts made by the staff that sat in the space before them?”

“One of the biggest lessons will be how to reconfigure space and implement the new office reopening standards for social distancing, safety, building entry (scanning for a fever), and cleanliness,” said Koltin.

“Virtual meetings, audits, advisory services, and consulting engagements are here to stay,” said L. Gary Boomer, visionary and strategist at Boomer Consulting.

“Firms should be looking to not only get their practices and clients securely through the COVID storm but also be prepared to take advantage of the new work economy afterward,” said Kepczyk. “We saw with the rushed transition to WFH that security was not made a priority, so firms are just now catching up on policies, training, and technical remediation which cloud/hosted providers natively had in place.”

These efforts can also serve as a blueprint for future change management. “Now it is time to lead change,” said Ellison-Taylor. “If we have learned from iconic businesses that either is no longer here or have been dramatically impacted, we know that new disruptors are sure to emerge in the post-pandemic environment.”

As Ed Kless, senior director of partner development and strategy at Sage, put it, one pervasive lesson is, “Change is not only possible but often necessary.”

Small businesses fail to seek cash-flow management help

Source: https://www.mybusiness.com.au/

Less than a sixth of small and medium businesses are engaging their accountants for assistance with cash-flow management despite its importance, says a non-bank lender.

According to a Scottish Pacific report, SME Growth Index, only 16.1 percent of SMEs are seeking cash-flow management advice from their accountants.

Scottish Pacific chief executive, Peter Langham told Accountants Daily the low percentage of SMEs seeking assistance with cash-flow management is usually down to SME owners being “time poor”.

“[Owners] wear many hats and in this economic climate, they have even more to do with increased urgency,” Mr. Langham said.

“Sometimes, they just have their heads down grinding away and don’t get time to think about asking for help.

“Those who are qualified to help, like accountants, need to reach out and offer help—and that isn’t sending emails, it’s picking up the phone and asking. If taking up something like debtor finance to relieve the pressure is an option, many business owners will be either too busy to seek it, or unsure of the benefits.”

Mr. Langham added that he believes the COVID-19 crisis should spur SMEs to seek cash-flow support more often.

“Previous SME Growth Index research found accountants are the trusted advisors that have the most positive business impact on SMEs,” he said.

“82.9 percent of small businesses who nominated accountants said they had helped the business, compared to 68.8 percent for family members, 58.8 percent for business colleagues, and 27.1 percent for friends.

“There is also a key role for accountants to play in providing information on how to access credit for their SME clients, reducing costs, preventing insolvency and improving cash flow and revenue.”

Accountants key to unlocking SME potential

According to Scottish Pacific, the role of accountants in the SME sector is showing signs of evolving beyond tax and end of financial year matters.

However, while those signs are positive for SMEs, Scottish Pacific believes that the role of accountants will need to continue to expand for the SME sector to “unlock its potential”.

The SME Growth Index found that more than 99 per cent of SMEs rely on accountants for “the traditional functions” of tax returns, annual accounts and financial records.

“Accountants are also very involved in SME owners’ personal tax affairs (64.4 per cent) and in helping with succession planning (56.6 per cent),” the report said.

“The Index results show there is room for improvement in how accountants are used by SMEs for value-add areas including advice on funding options (only 46.8 percent of SMEs turn to their accountant for this), business strategy and planning (31 percent), advice regarding selling business assets (17 percent), cash flow management (16.1 percent) and major acquisitions (14.3 percent).”

“A successful and thriving SME, we would suggest, is one that is likely to be using an external accountant not just for ‘number crunching’ and end of year tax, but for value-add business strategy and cash flow management assistance.”

MYOB has acquired payment processing provider Paycorp for $48 million

After showing interest in Paycorp, Australian Multinational Corporation, and a leading Accounting software company MYOB had announced a deal of $48million with Paycorp.

Resulting in, the accounting of MYOB income for the 2016 financial year- falls in line with the official statement that the total revenue of the company was boosted by 13 % to 3704 million dollars. Not only this, but the company also stated that the tax return in Melbourne benefit with $54 million has helped the company to cover previous year loss which was around $42.2 million.

Tim Reed, MYOB’s CEO, mentioned that MYOB’s acquisition gives the business “massive growth prospects” in the industry of payment services. He also mentioned that $700 million payment fees using ‘accounting software platforms’ have been estimated.

On the grounds of all such estimation, MYOB’s CEO- Tim Reed has also shared his view. In which he coined lines and discussed how it will lead to reducing the client’s administration time and cost. Apart from that, he also shared views about improved cash flow. He also said that their solutions would surely help small business operators.

On the other hand, John Caliguri, CEO of Paycorp, added his lines and mentioned their excitement on joining with MYOB. He stated that this opportunity would be delivering full payment solutions to more & more clients all across Australia, resulting in improved cash flow. Apart from that, John Caliguri also praised the performance of MYOB and marked them as a market leader that is helping businesses across Australia. And New Zealand with their effective online solutions.

MYOB’s through their ‘Connected Practice Strategy’ tried to refine small, medium business, broader accounting network with seamless connectivity. Everything was done with the intention to improve income streams.

Hence, the company with a $56 million investment in Research and Development has also anticipated investing 16% more from revenue.

With 27million dollars, the last acquisition of MYOB was Greentree, New Zealand (Developer of enterprise resource planning software). The acquisition was intended to enable MYOB to accelerate its holdings to the greater corporate market.

Simultaneously, Enterprise Solutions accounts for 14% of the company’s revenue, bringing in more than 7,000 clients. The division’s revenues moved up from 26-per cent to 52 million dollars over the last fiscal year. With MYOB contributions of 6.2 million that showed the company 15% growth.

However, with 1.2 million SME customers contributing to 63% of MYOB profits, SMEs remained the company’s massive base. Moreover, their Practice Solutions department used to provide the company with practice software for even more than 40,000 accountants, contributing to 23% of the revenues. Whereas their Enterprise Solutions department accounts for far more than 7,000 customers, producing 14% of the revenues.

Time To Think About EOFY Important Actions For 2020

No wonder, 2019-2020 has settled in our memories with unforgettable experiences. But with the end of this financial year, you need to review ‘what is your financial position right now.’ For instance, everyone is well-acquainted with how we are dealing with the global pandemic COVID-19 impact.

Hence, there’s nothing wrong with saying that this year will be identified as one of the most vexing years that ever had come in the life of any businessman. But, amid this problematic situation, you should get relief from tax exposure and audit risk by regulators. It is vital to take help related to the online tax return in Melbourne amid this hard time.

EOFY- an essential moment for businesses

The End of Financial year has always been one of the busiest and actionable times for business owners. EOFY is a great opportunity that advises all business owners to think more and create strategies in the New Year.

That’s why it is imperative to gain all the essential information that may help you tackle your EOFY.

We advise you on making the future a little less stressful and starting a new financial year with full dedication. We always strive to keep you up-to-date with the latest situations and online tax return possibilities in Melbourne.

What’s new that you should know

The release date of the 2020-federal budget has been delayed. Earlier it was assumed that we’d see it until 6 October 2020, but now it has been postponed. More information will be provided to you from time to time with advice on what changes are likely to impact you.

What can you claim if you are working from home?

During COVID-19 impact, you might have incurred loads of expenses, probably putting a burden on your shoulder. Hence, under special arrangements from 1st march to 30 June 2020, you can claim your expense.

The claim covers-

  • Incurred work-related expense
  • The employee hasn’t been reimbursed by an employer (for each hour you have worked, you can claim 80 cents for costs)
  • Electricity and gas
  • Cleaning expenses and Stationery
  • For office furniture declining value or repair
  • Phone and internet expenses
  • On the declining value of computers and devices, etc

Simultaneously, as per 80 cents, you can claim $470.40 that covers all these expenses if you have worked 84 days or 588 working hours. However, individual expenses can’t be requested separately.

Also, if more than one person is working from home in your family, then each individual has a right to claim 80 cents; on each hour, they have to spend on work while staying home.

On the other hand, if you are only temporally working from home due to COVID-19, then ATO (Australian Taxation Office) may not provide you claim for occupancy cost, rent, and mortgage interest payments.

What about a home-based business?

You can only claim occupancy and running expenses if your business is already home-based. At the same, if you operate under a company, you must have a rent-agreement for being eligible for claim as per ATO guidelines. You can seek a claim against rental expenses if you have an original rental contract. If you don’t have any original rental agreement, you aren’t eligible to claim your rental expense deduction.

Work-related – car expenses

You can also claim work-related car expenses from 1 July 2020 in between 62-72 cents per kilometer. All these will be evaluated by using the ‘cents per kilometer method’ that covers the claim for 5000 business kilometers per year per car.

Tax policies for Foreign income receivers

Do you receive foreign income? Then you must be aware of the tax policies with whole clarification. For instance,

Australian resident: As a resident of Australia, if you are receiving income from overseas, you’ll have to pay tax on income you earn. And for this, you contact us for an online tax return in Melbourne.

Foreign resident: If you aren’t a resident, then being a non-resident taxpayer, you will be taxed on Australian sourced income ( e.g., Australian rental income or generated revenue while working in Australia) starting at 32.5% on every dollar. No fixed-thresholds, and if you want an online tax return in Melbourne, you can contact us.

Temporary residents: If you are neither a foreign nor a resident of Australia, indeed you are only temporary residents for few months in Australia, then you’ll be nearly no taxed for your Australian sourced income or foreign-sourced income.

However, you’ll be taxed even if you are living outside of Australia for some time. Especially for those who have made an international investment, you’ll still be taxed for your earnings even if the cash stays outside Australia’s boundaries. As per Australian laws, you’ll always be recognized taxable whether foreign income is already taxed or not.

Rental properties, amid & after COVID-19.

COVID-19 doesn’t influence any sector. But apart from that, if you have rent out your commercial or residential properties, then only a few changes are made that come under tax policies.

  • In the situations of temporary reduced rent or if the tenant is unable to pay you rent, you can claim for that as per ATO.
  • But above from that, if the tenant pays rent, then you will be taxed for this income that you’ll have to mention in your online tax return, Melbourne.
  • Since the deferred interest rate is capitalized, so you can continue to claim the interest.

Moreover, if you are an Australian resident and you have a property in another country that generates rental income for you. Then you must recognize this rental income while filing an online tax return in Melbourne. However, during this, you’re also allowed to claim rental income expenses as per the conditions stated above.

Ultimately, if you’re planning an online tax return in Melbourne, then well-organized paperwork will surely make things much easier for you. In this way, you save your time as well as save money that’s essential for your business amid this global pandemic-COVID-19.

However, to sustain a good record with ATO and keep your business in shape, don’t forget-

  • Submit tax returns
  • Conduct a stocktake
  • Figure out your profit and losses
  • Completing income statements
  • Lodging reports for your PAYG, FTB, and GST

How to upskill when you’re self-isolating

Source: https://www.hays.com.au/

The ongoing COVID-19 outbreak has seen rapid and significant change sweep across the world of work, with organizations activating business continuity plans and transitioning their employees to remote working.

For a large proportion of us, then, our day-to-day working lives now look very different to just a few weeks ago. Added to this is the requirement to help your department or organization adapt to continue to serve its customers. You may, for example, have been pulled onto a taskforce or you might even be supporting other teams with responsibilities that are, strictly speaking, outside your normal remit. All of this is to be expected. After all, it’s at times like these that we all need to join together – remotely – to support our organization and each other in whatever way we can.

At the same time, many people have found themselves with more time on their hands and are wondering how they can spend this time productively.

Your own learning and development doesn’t need to take a pause

So, whether you have been asked to assist with work outside your usual remit or find yourself with more time to fill, upskilling makes sense as a strategy that will help you boost your sense of purpose, wellbeing, and self-esteem while learning valuable new skills to add to your CV.

It’s also well worth remembering that once this crisis is over, it’ll be those people who have taken steps to boost their skills who will come out the other side in the best position.

10 ways to boost your skills remotely

Naturally, upskilling when working remotely or self-isolating needs to be conducted digitally. Thankfully, there are many tools and platforms out there for you to choose from.

Here’s our advice on how to upskill remotely:

  1. Access any training and development resources that your employer offers. Your employer may have always given you the opportunity to take on certain forms of training, whether internally or through an external provider, but you may not have had the time to make the most of it. Employees who regularly undertake training and development are frequently higher-performing, more productive, more innovative, and more satisfied. They are also likely to stay with an organization for longer. Training therefore really is a ‘win-win’ for both employer and employee, with benefits lasting long beyond self-isolation. So, schedule some time in your calendar to access any resources that your employer has made available to you online.
  2. Read the top business books. Reading or listening to business books allows you to upskill from any location. The global research and advisory firm Gartner, for instance, provided this rundown of books that could enable you to become a better leader and more effective in the business in 2020. Harvard Business Review also recently opened up free access to its resources for working through coronavirus, which will help you both work and lead through this time.
  3. Listen to podcasts. Not only can you find podcasts on any topic, but they’re also almost always free. What’s more, they’re great to have on in the background while you’re at home. PlayerFM enables you to pick from podcasts on such subjects as software engineering, investing, and entrepreneurship. Meanwhile, Feedspot has come up with a list of career podcasts for 2020, of relevance to sectors including – but not limited to – nursing, aviation, and IT.
  4. Attend virtual events, conferences, and webinars. Switching previously physical, ‘real world’ events to the virtual sphere isn’t just a short-term means by which organizations and their people can continue to engage with each other and their customers. After all, even before the coronavirus outbreak, corporate videoconferencing platforms like Zoom were gaining traction. Others are now joining the fray, such as Hopin, which supports as many as 100,000 simultaneous participants. So, attending virtual events, conferences, and webinars could help you to adjust to a way of learning, networking, and collaborating that is likely to become a ‘new normal’ well beyond COVID-19.
  5. Keep in touch with your mentor virtually. As we have previously explained, a good mentor can change your career for the better, but you need to carefully nurture the relationship. That advice applies equally well at this time when you probably won’t be seeing them in person. Whether you’re keeping in touch with your mentor via video conferencing software or instead perhaps phone or email, the broad principles are the same. Show respect and gratitude to your mentor and discuss how their previous advice helped you, as well as what the two of you could focus on next to keep your development moving forward.
  6. Take an online course on a topic relevant to you. Udemy, for example, offers some 100,000 online courses covering such areas as business, design, marketing, IT, photography, and personal development, hosted by top instructors from around the world. LinkedIn Learning provides a similar service, with a one-month free trial. Or why not master Google Analytics with Google’s Analytics Academy? Intelligent data collection and analysis are likely to become more and more important for business success in the years ahead, so now could be a great time to find out more about the search engine’s measurement tools. You might also be tempted to brush up on your writing with The Open University’s free learning arm, OpenLearn. With other great sources of online courses including the likes of Codecademy for coding and Duolingo for learning a language, you’ve got no shortage of options for honing your skills at little or no expense while self-isolating.
  7. Try brain training apps. The fact is that we are all human, and therefore probably all prone to stress and anxiety at this time. Even if you aren’t necessarily reading all of the latest news updates or worrying about worst-case scenarios, you might be feeling under heightened pressure at work to do more in less time. Everyone is unique and is reacting to the situation differently. So, a brain training app that is specifically designed to help you control harmful emotions while improving brain sharpness and memory, such as ReliefLinkHappify or Lumosity, could be worth trying right now.
  8. Learn to use and master new technology. In much the same way as creativity is required even in non-creative jobs, even those in ‘non-tech’ roles still need some level of tech proficiency in today’s highly digital, interconnected world. It’s likely that this situation has already forced you to get to grips with remote working tools and technology that you may have never or rarely used before. So, why not use your time now to learn about the video conferencing, collaboration, and other platforms that you might not have been very familiar with, pre-coronavirus? With tech moving at a helter-skelter pace, it can be so easy to end up being left behind, so it’s worth acquiring skills now that will be indispensable for months and years to come.
  9. Learn how to work from home productively. There can be both good and bad things about working from home. You won’t be distracted by colleagues dropping by your desk to try to engage you in conversation. But on the other hand, they might pop up with demands on Skype, and with no one literally watching over your shoulder, you could easily find yourself wasting time browsing social media. Thankfully, some simple steps greatly help you to work more productively from home. Those include starting work early, structuring your day as if you are in the office, having a dedicated workspace that is separate from where you go to relax, and generally acting as if you are in the office. Use this time to learn what works for you when it comes to working from home as productively as possible.
  10. Get into the routine of upskilling when you’re in self-isolation. It’s important to establish a sense of routine when you’re self-isolating. So, you should try to incorporate your own learning and development as part of that routine. Try to put aside 30 minutes a day to help you self-improve in some way.

While this is a challenging time for all of us, we can use our time wisely and productively to upskill. This, in turn, will place you in the best possible position to advance your career in a post-COVID-19 world.

Employers’ frequently asked JobKeeper questions

Source: https://www.ato.gov.au/

General

Question: What’s the difference between JobKeeper and JobSeeker?

Answer: The JobKeeper scheme supports businesses to retain their employees by contributing to their salary and wages and is administered by the ATO. Eligible businesses are required to register with the ATO to receive these payments for their eligible employees.

JobSeeker payments are a form of income support available to eligible individuals and are administered by Services Australia. These payments are paid directly to the individuals and not to their employers.

Question: I pay my employee $1,400 per fortnight before tax, plus I contribute $133 super per fortnight to meet super guarantee obligations. Does this qualify for the minimum $1,500 payment?

Answer: No. The minimum $1,500 does not include the amount you contribute as super to meet your super guarantee obligations. However, it does include super contributions made under a salary sacrifice arrangement.

Question: Do I need to be registered for GST to qualify for JobKeeper?

Answer: No, you don’t need to be registered for GST, but there are other requirements. See Employers.

Question: I run a business but do not have employees. Am I eligible for JobKeeper payments?

Answer: Yes, you may be eligible for JobKeeper payments where certain conditions are satisfied. See Sole traders and other entities.

Question: Does an employer have to be assessed by the ATO as being eligible before any payments are made?

Answer: Eligibility for JobKeeper payments is a self-assessment process, with the ATO administering the payment. However, if a payment is made and we later determine that the entity was not entitled to that payment (or was entitled to a lesser amount) the entity will be required to repay the overpaid amount.

Question: What if my pay cycles do not correspond with JobKeeper fortnights? Do I have to change my pay cycles?

Answer: You are not required to change your pay cycles to correspond with JobKeeper fortnights. What is important is that you pay your employees at some time during the JobKeeper fortnight.

However, if you usually pay your employees less frequently the payment can be allocated between fortnights in a reasonable manner. For example, if you pay your employees on a monthly cycle, you will still be entitled to receive a JobKeeper payment if your employees received the monthly equivalent of $1,500 per fortnight.

Employee nomination notice

Question: Why do I need to get my employees to fill out the JobKeeper Employee Nomination Notice?

Answer: An employee can only nominate one employer for JobKeeper. The employee must agree to be nominated by you for JobKeeper. If the employee does not complete the nomination notice, you can’t claim JobKeeper for them.

Question: Will the ATO accept a digital self-generated employee nomination notice?

Answer: For practical reasons, an employer may choose to create their own digital employee nomination notice, but it must include key information. See Creating your own employee nomination notice.

Your employee’s signature is not required by the ATO but can be requested by you. Employees can submit their nomination notice to their employer through their internal business process (for example, a business’s HR portal) or their own form of communication channel (for example, an email).

Turnover

Question: Can businesses qualify for JobKeeper payments after April, for example, if my business experiences a downturn in the future?

Answer: Yes. If you do not satisfy the turnover test for the current month or quarter, you can still assess your eligibility at a later date. To qualify later, the turnover month can be May, June, July, August, or September 2020, provided the fortnight you are qualifying for has ended that month or an earlier month. If the turnover for a quarter is being used, it can be the quarter:

  • from 1 April 2020 to 30 June 2020
  • from 1 July 2020 to 30 September 2020, but only if first seeking to qualify for fortnights ending in July 2020 or later.

Once you satisfy the decline in a turnover test, you do not need to retest again.

Question: Do I have to show that it is COVID-19 that caused a decline in the turnover of my business?

Answer: No. It does not matter whether it is COVID-19 or the subsequent effect on the economy that has caused the drop in turnover, provided the turnover has fallen by the required percentage and you satisfy the other eligibility criteria.

Question: My business suffered a steep decline in turnover in March, but I’ve changed to a new business model and I may build the business up again soon. Does this mean I lose JobKeeper?

Answer: No. You only need to satisfy the decline in a turnover test once to be entitled to JobKeeper. For example, satisfying it for March 2020 (compared in March 2019) is sufficient, even if your business recovers to previous levels after this.

There are ongoing reporting obligations for current and projected GST turnover, but even where these show a recovery of turnover they don’t affect eligibility.

Question: What happens if my predicted fall in turnover happens to be incorrect, so that the fall ends up being less than the 30% or 50%?

Answer: This does not necessarily mean you are ineligible for JobKeeper.

Your projected GST turnover is a point-in-time test and needs to be a reasonable assessment of what was likely at the time you calculated the test. If, at a later stage, it eventuates that your actual turnover for your test period is greater than your prediction of your projected turnover, you do not lose access to JobKeeper. We will accept your assessment of these turnovers unless we have reason to believe that your calculation of your projected GST turnover was not reasonable.

If there is a significant difference between your projected turnover and what eventuates, we may need to assess whether your assessment was reasonable, so you need to keep good records of your calculations.

Integrity rules are in place to deny or reduce an entitlement to JobKeeper payments if schemes are contrived to ensure payment conditions are satisfied, such as temporarily reducing or deferring turnover. Exceeding your turnover predictions by itself does not trigger these integrity rules.

Our compliance focus will be particularly directed toward schemes where there has not been a genuine fall in turnover in substance, but arrangements are contrived to ensure the turnover test is satisfied.

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