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SMBs’ Market Confidence

nudge blog: Friday Finance

According to the Sensis business index (SBI), small and medium businesses (SMBs) have overall pessimistic perceptions of the Australian economy. The SBI, which has been tracking the confidence of SMBs since 1995, released findings in late May supporting the claim that SMBs owners believe the economy is slowing rather than growing.

When broken up into States, NSW fairs the best in terms of confidence whilst QLD, SA and WA were showing concerning signs. Regardless, all states on the whole perceived the current economic climate in a doubtful way.

Although overall confidence was low, one point of relief is that these rates had been shown to be relatively stable since last year’s results. These findings come as a results of SBI’s survey of approximately 1,000 SMB owners. A promising finding of the SBI is that 49% of SMB owners are feeling more confident for the coming year, with a manageable 22% being concerned for the coming year.

The general confidence in the upcoming year paired with a supportive 2015 budget for SMBs is a promising sign for the Australian economy.

The main concerns for those worried about the state of the Australian economy or the imminent year of business includes:

Aside from the more obvious concerns for SMB owners, there are additional concerns that many have failed to consider that impact on their perceptions and confidence in the current economic climate. These include excessive bureaucratic requirements for SMBs in the finance and insurance sector, competition in the wholesale sector, and the looming likelihood of growth in ever-present overhead expenses.

Such concerns, however, are being offset despite a soft last financial quarter. Last quarter SMB owners claimed to have a slightly easier time sourcing finance and as a result experienced increased success in doing so.

The results gained for the specific States regarding SMB owners’ overall confidence in the coming year were shown to greatly reflect their perceptions of the State government. For example, in NSW which had the highest confidence level out of all States, the perception is that the State government is supporting the building industry, reducing bureaucratic red tape, and investing money to stimulate the economy. On the other hand, in QLD where the most significant drop in confidence occurred, SMB owners failed to see how the State government understood the situation of SMBs. They were also concerned about increasing costs enforced by the State government.

The influence of government in the confidence of SMBs cannot be ignored. At a federal level, the recent release of the 2015 budget will surely stir some alterations to the confidence of SMBs. The budget is largely positively geared towards SMBs, with the intention of this being to increase confidence and stimulate spending and growth within the domestic market.

SMBs account for over 90% of Australian businesses, meaning their current state is greatly significant on the welfare of the overall Australian economy. The following 12 months for SMBs is sure to be of interest to many Australians.

The Winners and Losers of the 2015 Budget

Tax tips, tax, it expenses, startups, small business
A major winner of this year’s budget is small businesses. The government is hoping that these small businesses will take advantage of this and start investing in their businesses in order to generate future growth. From tax cuts to asset deductions, this is the time for small businesses to invest and take advantage of their current position. Below are some of the major budget announcements impacting small businesses.

Continue reading “The Winners and Losers of the 2015 Budget”

A Nudge as we head towards the end of the 2015 financial year

Tax tips, tax, it expenses, startups, small business
With the end of the financial year almost upon us, there are some questions the Nudge team would like you to think about with regard to your small business.

  1. Are you on top of your unpaid invoices? It’s important to review your unpaid invoices (debtors list) as small businesses can claim a deduction for old debts that are unrecoverable.
  1. Are you about to do your year-end invoices? Unless you are a sole trader operating on a cash basis, income is generally assessable when an invoice is issued. This means you might want to hold off invoicing clients until July so that it is taxable in the next financial year.
  1. Do you still have old equipment on the books? It’s important to review your list of assets as small businesses can claim a deduction for the remaining value of any asset that is no longer used.
  1. Have you organised a stocktake? If your business carries stock (for example if you are a retail business), then a stocktake is generally required before the end of the year. During your stocktake, identify unsaleable and damaged stock. If you pass this stock to charities, or gift it to organisations in need, the stock can be written-off and claimed as a tax deduction.
  1. Do you need to update some of your equipment? Small businesses can claim a deduction for the entire purchase price (up to $20,000), rather than having the deduction spread over several years. So purchasing new equipment now means you will receive a tax deduction this financial year.However, please note that the legislation confirming this new threshold of $20,000 has not yet been passed by Parliament. We will provide updates as information becomes available.
  1. Will you be paying your staff a bonus? If you are paying yourself or your staff a bonus you need to think about whether you pay it in this Financial Year (to June 30) or early next year. Paying the bonus this month, will mean you can claim a tax deduction for the payment this financial year.
  1. Are you paying dividends? If your small business is a company, you need to consider if the company will be paying a dividend this financial year or next. Declaring a dividend in July means you have an additional year to pay the tax on it.
  1. Do you owe your company money? Generally, if the director or shareholder owes the company money and there is no agreement in place, the loan must be repaid by the lodgement date of the Income Tax Return for that year. Ignoring these issues could result in an unfranked dividend paid to the shareholder (which means you will effectively be taxed twice, both in the company and in the shareholder’s tax return).
  1. Are you a trust distributing income? If your small business is trading through a trust, the trustee will need to determine which beneficiaries are receiving a distribution, what the proportion of the year-end income is and then prepare a minute resolving this. We will be chatting more about this to our clients with trust structures in the coming week.
  1. Have you considered paying June superannuation early? If you pay your staff super contributions after 30 June (even though payments are not due until 28 July), then you will not be able to claim the tax deduction until next financial year. You can only claim a deduction for superannuation when the payment is received by the superannuation fund, so get in early with these payments to ensure you receive the tax deduction this financial year.

 

Cash vs. Accrual Accounting – Which Method Do I Use?

Tax tips, tax, it expenses, startups, small business

When starting a business, deciding on which bookkeeping method is best suited to your business may be confusing. Two methods that you can use are cash vs. accrual accounting.

What is Cash Accounting?

Cash accounting tracks the actual money that is coming in and out of your business. If you receive an invoice, you do not record the cost until you have actually paid the invoice. This also applies when you send an invoice to a customer, you do not record the sale until you have received your payment. An example of this would be if you sent an invoice on Wednesday, but didn’t receive the payment until the following Monday, you then record the income against Monday’s date.

Continue reading “Cash vs. Accrual Accounting – Which Method Do I Use?”

#TaxTipTuesday: 2015 Budget Proposal for Small Businesses

Tax tips, tax, it expenses, bookkeeper, ato, startups, small business,

There were a few exciting incentives proposed for small business in the Federal Budget released on 12 May 2015.

The most significant proposal relates to the $20,000 tax break on the purchase of equipment. If you are a registered small business with an annual turnover of under $2 million, you can claim immediate tax deductions for purchases of $20,000 and under.

Assuming the legislation is passed, this scheme comes into effect retrospectively from 7:30pm on budget night (12 May 2015) and ends 30 June 2017.

We will keep you posted about when, or if, this proposed incentive becomes law.

#TaxTipTuesday: What Are The Small Business Concessions and When Can I Access Them?

Tax tips, tax, it expenses, bookkeeper, ato, startups, small business,

Most people agree there is very little government assistance provided to small businesses. There is however one significant concession the government provides, which relates to selling your small business.

The Capital Gains Tax (CGT) concessions provide options on how to reduce the Capital Gains Tax – sometimes to ‘nil’ – when or if you finally decide to sell.

Continue reading “#TaxTipTuesday: What Are The Small Business Concessions and When Can I Access Them?”

#TaxTipTuesday: What is Fringe Benefits Tax?

Tax tips, tax, fringe benefits tax, bookkeeper, ato, startups, small business,

What is a Fringe Benefit (FB)?

Fringe Benefits is a tax payable by you (as the employer/ small business owner) on benefits which you provide to your employees. Even though the benefit is received by your employees, it is you who bears the expense of the fringe benefits tax. This is different to employees’ salary and wages, where it is the employees who bears the cost of the tax through PAYG Withholding Tax.

Fringe Benefits do not include salary and wages or bonuses. They are generally non-cash benefits and can include the following:

  • Employee is provided a work car for use. However, the employee also uses this car for personal purposes (the personal component is subject to fringe benefits tax)
  • Holidays and entertainment
  • Payment of a non-work related expense incurred by an employee – e.g. school fees
  • and many others…

Continue reading “#TaxTipTuesday: What is Fringe Benefits Tax?”

Shark Tank – Why you need to Know your Numbers!

Know your numbers, business numbers, small businessA very important lesson was learnt on Sunday night’s episode of Shark Tank by a founder of Melbourne based startup WeTeachMe and that is, Know Your Numbers!

It is essential to track your numbers and know how your business is going, it is the best thing you can do for you business.

Why should I track my numbers?

  • Do you want to be able to raise funds for your business? If so, you need to know what your revenue is and how much is coming in and out of the business.
  • How can you keep yourself accountable if you aren’t actively measuring your performance? and further how can you be accountable to others (business partners)?
  • How are you able to grow your business and make investments if you don’t even know whether you have any money available?

If you want to be a successful startup then these are the sorts of questions you should be able to answer straight away. Continue reading “Shark Tank – Why you need to Know your Numbers!”

TaxTipTuesday: I run my business from home. Can I claim my home office as a tax deduction

Tax tips, tax, business lunch, bookkeeper, ato, startups, small business,

This tax tip is based on our recent article in Startup Daily.

Nudge Accounting, home office, Startup daily, tax deduction

If you are operating your business from your home, there is a chance that you may be able to claim a tax deduction on some or even all of your home office expenses in your tax return. These expenses include rent, equipment, furniture and more.

There are a few questions that you need to answer first in order to determine whether you can claim rent and other home office expenses. Continue reading “TaxTipTuesday: I run my business from home. Can I claim my home office as a tax deduction”

TaxTipTuesday: I am having a lunch with a client. Is it tax deductible?

Tax tips, tax, business lunch, bookkeeper, ato, startups, small business,

A lot of confusion can occur amongst startups and whether or not they can claim their business lunches as a tax deduction. In order to help eliminate some of the confusion there are a few simple steps that you can follow in order to determine whether you these expenses are tax deductible or not.

The questions that you should ask yourself, are as follows;

  • Why is the food or drink being provided? What is the purpose of the food and drink being provided, if it happens to be a social setting than the chances are this is entertainment.
  • What food or drink is being provided? As your meal starts to take a more elaborate form, for example there is matching wines, its starts to take the form of entertainment.
  • When is the food or drink being provided? If a meal is provided during work hours than the chances of it being classed as entertainment are less likely. You do need to consider though whether or not it is social.
  • Where is the food or drink being provided? If you consume the meal on your premises than its not likely to be considered entertainment. However if you go to a restaurant it is difficult to say its not entertainment.

Continue reading “TaxTipTuesday: I am having a lunch with a client. Is it tax deductible?”

We Are E.S.T. 2012

Who WE Are

At Nudge, we do it all for your small business: bookkeeping, accounting and tax. we can also help you with tax advice, company setups, personal tax, monthly performance summaries and specialist advice for small business owners. All work is completed by Aussie Accountants so you’ll never have to worry about compliance again.

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OUR COMPANY

OUR COMPANY Quality

With the uprising of technology and the plethora of competition in the majority of industries, business owners tend to seek help and assistance in managing and tailoring their business to suit the era’s needs and expectations. The process of accounting provides reports that bring key financial indicators together. Understanding financial concepts and gearing clients to financial success is what we exceed at here at Nudge Accounting.Our expertise lingers throughout the field of online accounting and engulfs all financial cases. With years of extensive experience and a dedication for our clients success, we endeavour to evolve our existing methodologies, in order to transform into Australia’s leading online financial firm.

OUR COMPANY Commitment

A successful marriage between bookkeeping and accounting will contribute to the long-term financial success of any business. Nudge Accounting takes pride with their online bookkeeping and online accounting services that encompass all aspects and sectors of finance to ensure our clients receive the utmost finest service. Commitment is an attribute we stand for as client satisfaction is always key to evolution.Our reliability is second to none, as we ensure our clients are well organised and pursuit their financial tasks with accuracy and precision. Nudge Accounting propelled their excellence and with their dynamic team of online accounting professionals transcended competition and have cemented themselves as the leading online bookkeepers in Australia.

OUR COMPANY Success

Our software and technological client interface is meticulous and seldom do alternative online accounting companies acquire this quality of infrastructure. This is what portrays our excellence and gears Nudge Accounting towards success. We ensure client satisfaction, by going through all the details and explaining financial situations to our clients. Engaging the client is what makes us stand out!Online accounting software, combined with online accounting techniques is a much more effective procedure than filling out paperwork because half the work is already done for you! Nudge Accounting take pride in providing the utmost finest online accounting service across Australia, with a variety of small to medium businesses and accounting excellence, technology and Nudge go hand in hand, just like the glove fits the hand!

WE HELPING SMALL BUSINESSES

Nudge provide exceptional accounting service and support whilst remaining price competitive. All of our packages provide the same great features for your small business accounting needs, which includes:

  • Performance Management Reporting
  • Annual Tax Return Preparation and Lodgements
  • Annual Financial Statements
  • Financial Monthly Statements
  • QTR BAS Preparation and Lodgements
  • Monthly KPI's to Identify Improvement Areas
80
YEARS OF
EXPERIENCES
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UNDER MANAGEMENT
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TOTAL
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100
% SECURE
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