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The ATO’s hit list: what you need to know before you do your tax return

Every year about this time, the tax office announces its compliance hotspots for the year ahead

So what is on the ATO’s list this year?

Well, essentially, it’s looking at two main areas: work-related expenses and claims by investment property owners.

Work-related deductions

Work-related claims have been increasing for some years so it’s no surprise that the ATO plans to look more closely here. This year it will focus on:

– Claims for work-related clothing, dry cleaning and laundry expenses. (For instance, the ATO has flagged that it will check taxpayers who take advantage of the exemption from keeping receipts for spending less than $150 on laundry expenses; it believes that too many people are claiming this without actually incurring the expense.)

– Deductions for home office use.

– Overtime meal claims.

– Union fees and subscriptions.

– Mobile phone and internet costs.

– Motor vehicle claims where taxpayers take advantage of the 66 cent per kilometre flat rate for journeys up to 5000km. (The ATO is concerned that too many taxpayers are automatically claiming the 5000km limit regardless of the actual amount of travel.)

The ATO will also take a closer look at the booming market in investments in cryptocurrencies such as Bitcoin. Increasing numbers of taxpayers are jumping on the bandwagon and the ATO believes that some of them are failing to declare the profits (and in some cases the losses) they are making on their investments.

Remember, investing in cryptocurrencies can give rise to capital gains tax on profits.

Share economy 

The ATO will also be looking closely at those working in the shared economy to ensure that income and expenses are correctly reported. Examples quoted by the ATO include services such as:

– Ride-sourcing – transporting passengers for a fare (such as Uber drivers).

– Renting out a room or house for accommodation. (Airbnb hosts are the obvious example.) The ATO is believed to be particularly concerned about taxpayers claiming the full CGT main residence exemption when part of their main residence has been rented out through Airbnb; the law prevents a full CGT exemption where part of a main residence has been used to earn income.

– Renting out parking spaces.

– Providing skilled services – web or trade services (Airtasker workers, for instance)

– Supplying equipment, tools, etc.

– Completing odd jobs, errands, deliveries, etc.

– Renting out equipment such as tools, musical instruments and sports equipment.

Property 

The other main focus this year is on people who claim deductions in relation to investment properties and holiday homes.

Over 1.8 million people – or about 8% of the population – own an investment property, according to ATO figures, so this is a large and growing area for it to examine:

– The ATO has announced it will pay close attention to excessive interest expense claims, such as where property owners have tried to claim borrowing costs on the family home as well as their rental property.

– It will also look at the incorrect apportionment of rental income and expenses between owners, such as where deductions on a jointly owned property are claimed by the owner with the higher taxable income, rather than jointly.

– It will look at holiday homes that are not genuinely available for rent. Rental property owners should only claim for the periods when the property is rented out or is genuinely available for rent. Periods of personal use can’t be claimed. This is particularly important for holiday homes, where the ATO regularly finds evidence of homeowners claiming deductions for their holiday pad on the grounds that it is being rented out, when in reality the only people using it are the owners, their family and friends, often rent-free.

– It will keep a close eye on incorrect claims for newly purchased rental properties. The costs to repair damage and defects existing at the time of purchase or the costs of renovation cannot be claimed immediately. Instead, these are deductible over a number of years. Expect to see the ATO checking such claims and pushing back against those that don’t stack up.

Don’t forget that the ATO has access to numerous sources of third-party data, including popular holiday rental sites such as Stayz and Airbnb, so it is relatively easy for it to establish whether a claim that a property was “available for rent” is correct.


Preventing bullying at work


Workforce Planning for SMEs

The truth is that if I slip into using “Corporate Talk” of workforce planning with some of my clients, they break into a cold sweat and think I’m about to make managing a team really hard. The reality is very different. Workforce Planning doesn’t have to be hard.

It is just as important in a smaller business as in a big business – possibly even more important. In a big business, you always have someone to cover a role and more than one person with the skills, but in an SME life isn’t always like that. So before your heart starts to pound and you feel queasy, let me explain what I mean by Workforce Planning.

In simple terms, it means ensuring you have the right people, with the right skills in your business to deliver your business plan or goals.

Most of us don’t deliver everything in our business ourselves, we employ a team to make it possible. Workforce Planning is about making sure you have the right combination of team and technology to achieve your goals and should take into account some or all of the following things:

Current and Future Workloads
An honest picture of what is happening in your business is essential to a workforce plan.

Market & Technology Changes
Is there new technology change that will fundamentally affect how your business operates? Are there new products or competitors that you will need to adjust your business to compensate for?

Team Performance & Skills
Who are your employees (age, salary, skills) and what do you need in your business? Do you have what you need to be successful? Do your employees like working with you and how many employees leave your business in a year

Client Expectations
Are your clients or their expectations changing? What do you need to do to ensure the clients are satisfied with your work?

Once we have the answers to these questions we can start planning so your business is always ahead of the competition, with the right number of skilled people to have your clients singing your praises. This process will make sure that the focus is where it needs to be instead of playing catch-up after something has gone wrong.

The start of a new year can be a strange time in an SME. For some, it is the busiest time of year and for others, it is slow as we wait for people to make decisions in the post- Christmas lull. Regardless of what it is like for your business, it is a great opportunity to look with fresh eyes at what positions and skills are needed in your business for it to thrive.

If you would like help to Workforce Plan for your business call us now, or send us an email. We would love to support you through this important process.


Want The All-Stars Playing For Your Team?

Life is so much more rewarding and fun when you are working as part of a team that is successful and achieving the desired outcomes. Let’s face it; no one wants to be a failure. We all want to do well and be a part of something successful – that’s just human nature.

So why is it such a challenge to create high performing team at work?

When we are so busy doing all the things that need to be done, it can be hard to take the time to actually think about what it is you need from your team and then help them understand it.

There are five steps to create a high performing team:

1. Tell them why
Share your vision for your company, your clients, your dreams, your values. If the team doesn’t understand why they are working so hard they won’t share your passion or your commitment.

2. Tell them what
Be specific about what you need them to do and by when. Set the standards early and be consistent with the entire team and you will win their respect and the results will flow.

3. Tell them how they will know when they’ve done a good job
We all need to know what we are striving for, so set goals and targets. If possible break it into milestones that are achievable in reasonable timeframes.

4. Reward them when they do well
Celebrate successes. Small wins. Big wins. Let them know that you appreciate their efforts and find ways to thank them for it. It may be simply taking the time to say thank you personally those involved, or it may be something much more.

5. Be prepared to act if they don’t
And the most difficult point of all – be prepared to tell them if they are not meeting your expectations. If you don’t tell them, they may never know that you are disappointed and then they will never strive to improve.

Take some time out from running the business and work on the performance of the team. You’ll be amazed how much the team will reward you for it in return.

If you would like some tools to support your business and make your team performance easier, feel free to call us on 02 9907 6837 for an obligation free chat. Sometimes the simplest of suggestions from one of our experienced Consultants can have a huge impact.


When Cloning Is Not An Option?

Busy? No Crazy Busy

As you scan the to-do list, you realise that one of you is just not enough. Sometimes, when business is booming, rather than being able to kick back and relax, the trusted systems you’ve built start letting you down and the team start to grumble. You’re so busy that the idea of more business is as close to madness as you want to get.

For some business owners, there comes a time when you need to decide whether you want to grow your business or maintain it at its current size. It is potentially a huge decision that could change your business and your life forever.

How do you know when your business and you are really ready to grow?

How do you understand when your business and you are ready to grow?

7 Signs Your Business Is Ready To Grow

1. Growing to do list
That wonderful sense of satisfaction as you tick things off your to-do list is overshadowed by the pending sense of doom as you notice that it is growing longer each day. Making matters worse, when you prioritise the to-do list they are all coming up as High!

2. More opportunities than you can handle
Existing clients want more of you. New clients are seeking you out. Time to celebrate, right? But instead, their requests are added to the to-do list as a high priority and have to wait until you can get to them. Sometimes by the time you make it to them, they have already moved onto other suppliers. Instead of feeling upset, you feel relief.

3. Growing, Growing, GROWN
Yes, there are the normal busy periods in the year. But this is something altogether different. It doesn’t look like waning. The opportunities are there for the taking, if only you had the time.

Can’t take any more new clients on board? We can help with that.

4. Dropping the ball
Over time you’ve built systems and processes to make sure things run smoothly, however, there are cracks appearing in those systems now and it is taking longer than expected or those little errors are making it even more difficult.

5. Somebody has the grumps
Whether your team is just you or bigger, the team is complaining. There is too much to do and not enough time. Add to that your previously extremely happy customers are starting to make comments. Technology is not the silver bullet you

6. Technology is not the silver bullet you hoped
You are switched onto technology and use it to make things happen efficiently, but there are some things that apps and software just can’t do. You need another real human being on the team.

7. Revenue is looking good
There is enough cash to support the first few weeks of paying for someone until the increased revenue from their efforts hits your bank account.

Increased revenue is a clear sign that your business is ready to grow.

Growing

The idea of taking your business to the next level doesn’t have to feel so daunting and surprisingly it doesn’t always mean that you have to employ people in your own business.

Outsourcing
If there is a part of your business that you do not enjoy doing, procrastinate about or just don’t have the skills to do, consider outsourcing it. Most of us won’t think twice about seeking advice from a lawyer, but struggle on with doing our own book-keeping or marketing whether we are good at it or not. Nowadays, even soloist or micro businesses can take advantage of great outsourcing options.

Hiring a new team doesn’t mean commit to employing someone on a full-time basis straight away.

Hiring your own team
If when you sit down and do the planning, you decide that the best way to move forward is to hire into your own team, then keep your options open. You don’t have to employ someone on a full-time or part-time basis straight away. For those that suffer from a fear of commitment and want more flexibility, think about hiring a casual team.

We know there are a lot of choices to be made and it can be scary. We’ve done it ourselves and we’ll be happy to support you on the next stage of your exciting journey. Call us on 02 9907 6837 or drop us an email at info@impacthr.com.au for an initial consultation. 


Ready to Grow: Moving from Soloist to a Micro Business 

When you first dreamt of your business, was it always just you against the world? Was it the solo super business hero without his faithful sidekick or did your plan to include a team of people like Batman and Robin or the Avengers team to share to load, the dream and the success?

Thinking of moving from soloist to micro business? We’re here to help.

Those dreams can feel like the distant childhood imaginings once you’re locked in soloist mode. Don’t get me wrong, there are a lot of highly professional, highly profitable soloists around and not everyone wants to manage a team or expand their business through hiring people.


But what about you? Go back to your original daydream before you started down the business path that you are on. Was it just you or did it involve a team of people?

If you’re ready to grow and take the next step towards that goal, there are some steps to take. Those steps depend on your vision and time frames and are as unique as your business, but they all share the following three things.

Defining your business goals is key for the growth of your business.


1. Define your Business Goals
You need to be able to articulate your business goals and translate the ideas into a plan for the future. Spend some time thinking about what your ideal business looks like. So what if you are just one person right now. Even if your vision is a multinational empire you have to start somewhere.

2. Identify the Right Resources 

HR is not always about hiring people internally, it is about connecting you with the right external resources as well. Whether you need a marketing person you can trust to grow your client base, a financial wiz who can take the numbers on the page and unlock hidden value in your business, or a business coach identifying the right support is essential.

3. Be Accountable
Only when we are accountable to ourselves, our dreams become a reality. For many soloist who transitioned out of corporate life and are used to having someone there to encourage, problem solve and hold them accountable for delivering to their internal as well as external commitments, this can be challenging. But it doesn’t have to be. Share it with friends or family you don’t want to disappoint.

Start from identifying the right resources needed for your business.

4. Use Free Business Tools
There are a lot of great free tools out there to help with your day-to-day admin. From CRM software to Social Media management, you can easily download free software on your computer that will make your life easier in just a few clicks. And don’t forget First Aid compliance – download Alsco’s free ‘Beginner’s Guide To First Aid Workplace Compliance’ and make sure to keep your business safe.

If you need help to get started, call us for a confidential, obligation free chat. We know what it’s like and we can help you. Sometimes, just being able to talk to someone with no preconceived ideas about you or your business can really make a difference. Why we offer this? Because we’re passionate about helping small business and we believe that big companies can grow from Soloists.

Call us on 02 9907 6837 or drop us an email at info@impacthr.com.au


Family Friendly Doesn’t Mean Fiasco


Creating a family-friendly work environment used to have managers in a panic about sky-rocketing costs and worried about service levels, but it doesn’t have to be that way. Family-friendly can be a win-win situation in SMEs.

With the increasing rate of parents (both men and women) trying to balance family with work responsibilities and single parent families, companies have to embrace family-friendly practices to compete for the best employees.
How do you implement family-friendly practices without the pain?

While there are a number of legally required family-friendly work practices that every employer must provide (such as maternity leave), there is also an array of simple, cost neutral ideas that can be implemented effortlessly and with no negative impact on the business or your clients. It is these ideas that can really make the difference when employees are weighing whether or not they will look for another role or join your business in the first place.

Embracing family friendly can be really easy. Why not start by:

  • Allowing employees to start work earlier and leave earlier; or start work later and leave work later
  • Allowing employees to take a reduced lunch break so they can leave early every day or accumulate those short lunches to leave early one day a week (but remember no break at all, may be bad for concentration and even in the worst situation illegal.)
  • Considering a four-day week or a nine-day fortnight option where employees work the same hours but in a reduced number of days
  • Job sharing, where two or more employees share the same role. It is a great way to balance work and home and it also provides businesses with some built in holiday or resignation coverage
  • Implementing telecommuting opportunities in appropriate roles
  • Allowing parents to “bank” extra hours worked (without penalty rates paid) so they can utilise the account to attend to family needs.

Why not stop:

  • Automatically saying no to requests without first discussing how they could work in your business and teams
  • Resisting change out of fear that it may be too hard to implement or you can’t go back. Document any agreement you make with an employee as a “trial” for a specific period of time and give it an opportunity to work. If at the end of the trial, it hasn’t worked you can explain why the business can’t offer that flexibility going forward. Your employee is more likely to appreciate the attempt than if you just say “no”.

You can also put financial concerns to rest with the truth about family-friendly working environments. You don’t have to change the whole way you work to be family friendly, but it will change your business through its advantages.

Benefits of being family friendly environment include:

  • Increased employee engagement, and its demonstrated positive impact on your bottom line
  • Longer retention of current employees which increases customer satisfaction
  • More potential employees seeking to join your business, which decreases service interruptions
  • Reduced levels of employee absenteeism allowing improved scheduling and work completion

For more information on these or other family-friendly ideas, contact info@impacthr.com.au or call 02 9907 6837 for an obligation free chat. Impact HR are based on Sydney’s Northern Beaches.


The 5Ws of Impact HR

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The 5Ws of Impact HR
While working with my 6 year old daughter who was writing something for school, she reminded me that it is always helpful to go back to the 5Ws. We all know them: the Who, What, Where, When and Why you are doing something. With this re-learning fresh in my mind I decided to write the 5Ws of Impact HR. It is such an easy and concise way of thinking about your business.

Who?
Our small team of consultants generally have a corporate HR background, but a knack for applying HR in a pragmatic way so you and your team have a positive experience. To find out more about me personally, check out our website www.impacthr.com.au or find me on LinkedIn.

The other side of our “who” is our clients. This is generally small to medium sized business owners and managers who want to handle the people aspects of their business correctly. We also assist soloist who are ready to take the first steps in putting together a team. That team might be via outsourcing or hiring directly.

impactHR_logo

Impact HR

What?
Impact HR is a HR consulting and outsourcing business that focuses on small to medium sized businesses. We support you with all aspects of engaging people in your business.
Understanding that research shows in most SMEs, dealing with people related concerns and processes takes up 25% of a managers time, we work closely with SME owners and managers to give you more time to focus on your business while ensuring the compliance aspects of your business run like clockwork.

About Us

What is Impact HR

Where?
Impact HR helps clients across Australia, but we work with you in cost effective ways to ensure the best return for your investment. For some clients that means using technology like Skype to stay in close contact, for others we will visit your offices. Wherever you are located, we can find a way to support you that suits your needs and your budget.

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the 5w’s of impact hr

When?
As a small business ourselves, we get that there are times when you will need more help and times when you will not need us as much, if at all. Depending on your needs we can be your outsourced HR department so that you receive the time you need on an ongoing basis or for a one off project. One of the great things about working with us is that you there are no long lock-in contracts.

managing performance
WHY?

This is the biggie. The WHY? The motivation and passion behind our business.
Impact HR is passionate about your business and its people, performance and profitability. Why should large corporates have all the help and support! SMEs are such an important part of our economy and more people are employed in SME workplaces than in corporates. We know that while we have spent years studying HR, industrial legislation and set aside time to stay up to date that is not for everyone. You have your own passions and skills, which is why you have amazingly diverse businesses. We look forward to helping and supporting SME owners and managers achieve their business goals. It makes us feel good to share your successes.
So, can you embrace your inner child – what are your 5Ws?

impact hr grow our business

grow your business with impact hr