Table of Contents: 1. Welcome 2. Refer a bookkeeping client 3. ATO due dates 4. End of Financial Year procedures 5. Super Guarantee rate 6. Taxable payments reporting building & construction industry 7. Fair Work Commission 8. The cloud 9. Changes by the Federal Government 10. Top 5 tips for avoiding tax scams 11. ATO moving businesses to lodge digitally Welcome Welcome to my newsletter which will discuss the latest news affecting small to medium businesses. I hope this financial year has been profitable for your business. As always, I appreciate your support as you continue to engage my bookkeeping services. If there is anything else I can assist you with, please do not hesitate to contact me. Refer a bookkeeping client Here s an easy way you can receive $250 for FREE towards your ongoing bookkeeping fees. Refer a regular bookkeeping client to me and receive a $250 credit. It s that easy and not complicated, no hidden terms or conditions. This offer is unlimited in number so if you are happy with the services we provide, then let other small businesses know what a high quality bookkeeping service you receive. ATO due dates BAS lodgement and payment dates: April June 2013 Hardcopy: 28 July 2013 Electronically: 11 August 2013 Monthly IAS lodgers: 21 July 2013 April June 2013 Superannuation Guarantee: 28 July 2013 Payment Summaries to employees: 14 July 2013 State Revenue Office payroll tax: 23 July 2013 One of the many mud crabs caught and eaten Jenny The Bookkeeper Page 1
End of Financial Year procedures The 30th June and end of the financial year are upon us once again. It s a great time for creating a budget and/or a cashflow forecast for 2013/14 as these will provide accurate financial management of your organisation. A budget details what you plan to do with your finances for the relevant period of time. This is usually over 12 months and focuses on profit. A budget also reflects the planned objectives of what the organisation is trying to achieve and is linked to the strategic and business plans. A budget is not used to monitor the amount of cash in the bank accounts. A cash flow forecast details when the actual receipts and payments are likely to occur. It is usually broken down into a month by month basis. Talk to us about your goals for the coming year & how we can work with you to help you achieve them. I suggest you purchase an End of Financial Year folder for 2012/13, which will contain all the information your Accountant requires. I will complete the folder for you as part of the end of year process and send the folder to either yourself or directly to your Accountant. These folders cost $85.00 plus GST. Place your orders for the folder before end June to ensure stock availability. Superannuation Guarantee Rate Employers have an obligation under the Superannuation Guarantee (Administration) Act 1992 to pay the superannuation guarantee charge (SGC). The SGC is calculated as 9 %( to 30June 2013) or 9.25% (from 1 July 2013) of the total salary & wages (OTE) paid by the employer to the employee. Ordinary Times Earnings (OTE) is earnings in respect of ordinary hours of work. IMPORTANT: Check your payroll programs and make sure they are changed to include the increase of superannuation guarantee (9.25%) before any payments are made in July 2013. Start reviewing your systems now. Check you have all the correct details for your employees such as; address, DOB, FBT information, RESC information. Impact on June & July 2013 Payroll 1. Consider paying the super before 30 June to get the tax deduction. 2. Check whether salary packages need to be re-engineered. 3. In order to get a tax deduction for the 30 June 2013 year the business must have PAID the superannuation out of their bank account into the superfund or at least the clearing house. 4. Check salary packages. Many employees are engaged on a salary package with a total amount which includes the SGC. 5. Review your employment agreements, industrial agreements, minimum wages and awards for direction whether the super increase can be adjusted within the current package or must be added to the package. Jenny The Bookkeeper Page 2
Employers are obliged to pay SG for their employees no later than 28 days after the end of the quarter to which payments relate. The late payment of SG can result in penalties and interest being imposed on the employer. SG is not payable for employees earning less than $450 per month and only employees aged under 18 who work at least 30 hours per week. Taxable payments reporting building & construction industry From 1 July 2012, businesses in the building and construction industry need to report the total payments they make to each contractor for building and construction services each year. You need to report these payments to the ATO on the Taxable payments annual report. Your Taxable payments annual report is due 21 July each year. The first Taxable payments annual report is due 21 July 2013 for payments made in the 2012-13 financial year. In this first year, if you lodge your activity statement quarterly, you can lodge by 28 July 2013. Fair Work Commission From 1 July 2013, the national minimum wage has increased by 2.6% to $16.37 per hour or $622.20 per week. The national minimum wage applies to employees who aren t covered by an award or an agreement. The Fair Work Commission will be issuing draft determinations and orders about how this decision affects each modern award. Updated information will be available by 1 July 2013. A coral trout I caught at Davis Reef Jenny The Bookkeeper Page 3
Understanding the Cloud There has been a lot of discussion about the cloud recently in the media. There are basically 3 common accounting software platforms: 1. Desktop accounting software The accounting program is installed on your local hard drive. Users usually pay once or annually for upgrades and updates occur at scheduled intervals with enhancements. 2. Hosted accounting software Software is run on a remote server and is published so it can be accessed via the internet. The data is backed up in a secure data centre, no software is installed and updates occur usually automatic. Users usually pay an annual or monthly fee for access. The software is usually accessible on any device. 3. Cloud accounting software No software installation is needed. The software is most commonly only accessible via a browser and updates could occur at any time as needed. The cloud is where you put all your data, files and software so you can access it from any computer or device anytime, anywhere. You use the internet to connect your device to the cloud. With cloud accounting, the business is purchasing the use of accounting software via an online service provider. There is no initial capital expenditure and it s all paid by a monthly fee. As it is accessed online, the software is Mac or PC compatible. There s unlimited data storage so the accounting information is not held on the internal network, it s outside the firewall. The only thing the organisation needs is an internet connection. Both MYOB and Reckon have released cloud accounting software, called AccountRight Live and Reckon One respectively. It is the need of the business which should dictate which platform you should choose. As always read any fine print and check if there are any hidden costs. One of the many grunters I caught near Crocodile Creek, south of Townsville Jenny The Bookkeeper Page 4
Changes by the Federal Government This is not an exhaustive list of all the changes by the Federal Government, just some highlights for you. On 13 April 2013, the Treasurer announced proposed reforms to introduce an annual cap on deductions for self-education expenses of $2,000 per person from 1 July 2014. On a personal tax front, the budget confirmed that the tax free threshold would not be increased to $19,400 from 1 July 2015. There is also the planned phasing out of the medical expenses tax offset. From 1 July 2014, the Medicare levy will increase from 1.5% to 2% to fund Disability Care. The instant write-off of most depreciating assets costing less than $6,500 continues for small businesses with turnovers less than $2 million. PAYG withholding tax tables for the following will be updated for 1 July 2013 onwards: Higher Education Loan Program (HELP) Student Financial Supplement Scheme (SFSS) employment termination payments (ETP) back payments, commissions, bonuses and similar payments seniors and pensioners return to work payments. All other tax tables will remain unchanged for 2013-14 financial year. Top 5 tips for avoiding tax scams 1. If you receive an email or phone call out of the blue claiming that you are entitled to a refund or grant, press delete or just hang up. Government agencies will never cold call to ask for you to pay fees to receive a refund. 2. Never send money or give personal details to people you don t know and trust. If you are unsure, verify by finding a phone number from an independent source and calling the agency to check. 3. Regularly check your credit card and bank statements to ensure that suspicious transactions are detected. 4. Protect personal information: shred all old letters containing personal information such as credit card applications and bank statements. 5. Be on guard online: if you receive an email that claims to be from the ATO with links or attachments, press delete. Be mindful about the information you disclose online and keep your computer security up to date with anti-virus and anti-spyware software and a good firewall. Jenny The Bookkeeper Page 5
ATO moving businesses to digital activity statements The ATO have started transitioning small-to-medium (SME) enterprises (with annual business income between $2 million and $250 million) from lodging paper activity statements to digital channels. Between now and 2014 the ATO will be contacting more businesses to promote and support their transition to digital channels. If you are still lodging your BAS statements via hardcopy, now is the time to swap across to lodging electronically and gain an additional 2 weeks to lodge and pay your BAS. Give me a call if you want to swap and I will walk you through the process required. As you can tell from the photos, the girls and I have been enjoying our time fishing and crabbing up in Townsville. Thank you for taking the time to read this newsletter and I look forward to continuing our business relationship together. If you would like any further information on any of the details mentioned above, please feel free to call me on 0413 264 994. All the girls fishing at Alligator Creek Jenny The Bookkeeper Page 6