• Creating an anti-bullying workplace culture

    Posted on August 25th, 2016 admin No comments
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    Quite often, being too slow to name bullying behaviours that pose health and safety risks in the workplace can cost businesses millions of dollars each year through lost productivity.

    Workplace bullying is repeated unreasonable behaviour directed towards a staff member or a group of workers that puts their health and safety at risk. Instances of workplace bullying include deliberately intending to cause physical and psychological distress and includes behaviour that intimidates, offends, degrades or humiliates a victim.

    Here is a simple process businesses can implement to build an anti-bullying culture at work:

    • Always keep an eye out for bullying

    Bullying can be fairly easy to recognise. Forms of bullying include repeated harassment, exclusion and setting unreasonable expectations that a person is certain to fail. Recognise when staff are unhappy, quiet or unengaged with their work and whether there is a positive or toxic atmosphere in a workspace.

    • Recognise the patterns of bullying

    There is no mistaking bullying in action; the way people interact at work is a dead giveaway as to whether bullying is taking place. Examples of bullying patterns include one or several staff members converging on one or a minority of other staff members, snide comments slipped into conversations around the water cooler and the body language workers have to one another.

    • Speak up when you see bullying

    Bystanders of bullies are often reluctant to become involved when a bully is having a go at someone, but staying silent can be considered by many as simply accepting the practice as normal.

  • The importance of diversification in an SMSF

    Posted on August 25th, 2016 admin No comments
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    Self-managed super funds (SMSFs) that are not well diversified are quite risky investments since they aren’t as protected as they could be against shocks and volatility in the market.

    Diversification aims to maximise an individual’s return by investing in different asset classes that react differently to the same event. Although it does not guarantee avoiding a loss, diversification is an important component of reaching long-term financial goals while minimising risk.

    Diversification can control a super fund’s risk, as the better performing asset classes will help offset the others that aren’t performing very well. It also provides the super fund with the opportunity for long-term growth, as the portfolio is exposed to asset classes with strong growth potential.

    SMSF trustees that don’t have the appropriate blend of different asset classes in their fund risk their portfolio experiencing increased and unnecessary volatility. Well-diversified SMSFs include all the major asset classes including cash, fixed interest, shares and property.

    The first step to ensuring an SMSF is properly diversified is to consider the exposures the fund currently has to the major asset classes and assess how diversified the fund is. Trustees must then engage in the process of working out which asset classes the fund requires to be properly diversified.

    For many SMSFs, the idea is looking to invest in other asset classes that could help improve the fund’s diversification. These may include assets that have a negative or low correlation with one another.

    Those concerned about the diversification of their fund need to review their fund according to their investment strategy to assess whether it makes sense to increase diversification. However, it is important to work out any capital gains tax consequences before selling down any assets to buy investments to improve a fund’s diversification.

  • Short-term vs long-term financing

    Posted on August 17th, 2016 admin No comments
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    Maintaining healthy cash flow can be challenging; between ongoing expenses and bills, poor cash flow can severely impact your customers, staff and bottom line.

    Business owners need to understand the differences between short and long-term financing when developing a cash flow strategy.

    There are various sources of finance available and each source of finance is useful for different situations. Choosing the right source and mix of financing options is crucial for good cash flow, so it is important to first determine your needs and then match a financing option to meet those needs.

    Financing options are often classified into two categories based on time period: short-term and long-term. Below are the key differences:

    Short-term financing
    Short term financing (working capital financing) relates to the finance needs that arise to finance current assets – for a period of less than one year. Working capital is used in the business’ day-to-day trading operations. Short-term financing can help you to pay suppliers, increase inventory and cover expenses when you do not have sufficient cash on hand.

    Depending on your business’ requirements you might consider using one of the following options:

    Overdraft: extends your cash resources and protects your business’ credit rating.
    Line of credit: funding when you need it, to be paid back when you have surplus cash – offering flexibility, value and control.
    Business credit card: a convenient, fast payment method.

    Long-term financing
    Long-term financing options can help you invest in overall improvements to your business, for a period of more than 5 years. Capital expenditures, such as upgrading equipment, buying additional vehicles and renovating are funded using long-term sources of finance.

    Businesses can use one of the following options:
    Leasing: structuring a lease to match the useful life of the asset. This will help to preserve your cash and working capital for other uses.
    Term loans (from financial institutions, government and commercial banks): allows you to accurately forecast your monthly cash flow through regular monthly payments.

  • Tips to building credibility as a leader

    Posted on August 17th, 2016 admin No comments
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    Quite often, an employee’s level of satisfaction can be traced back to his or her leaders. Indeed, research shows that only 49 per cent of employees trust their senior managers.

    As all leaders should know, trust goes hand in hand with credibility. Credibility is something that all leaders must aspire to obtain, as it positions leaders as highly dependable sources of expertise and information.

    Here are some suggestions new leaders can use to build their credibility:

    Engage in active listening
    When you’re responsible for managing people at work, tuning out of what they’re saying can be dangerous, as you risk missing important information like feedback or updates. If your staff also believe you’re not listening to them, they won’t confide in you in the future, which can prevent them from producing their best work.

    Actively listening isn’t an easy task at first, but can be learned with a few healthy habits. Keep distractions to a minimum or move the conversation away from computers or mobiles when colleagues are speaking to you.

    Get straight to the point
    With studies now showing that humans have shorter attention spans, as a leader, when you speak to your team, cut to the chase to ensure they remember all the important parts. While you’re keeping things brief, make sure your team knows that you’re also receptive to questions and feedback.

    Remain consistent
    An important thing for leaders to think about is consistency. When you are consistent with your staff, you gain credibility. Therefore, make sure you can do what you’ll say you do. Before making any promises, consider if you can take it on. Knowing when to say no can create a balanced sense of priority among your team.

  • A guide to salary sacrificing

    Posted on August 17th, 2016 admin No comments
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    Salary sacrificing (making before-tax super contributions) is a popular strategy for employees on middle-to-high incomes, as it can help increase a person’s superannuation balance while reducing the amount of income tax payable (up to 49 per cent including Medicare levy) on salary or wages.

    However, before embarking on a salary sacrifice arrangement, individuals should consider the tax implications involved to ensure they don’t lose out financially.

    Under a superannuation salary sacrifice arrangement, an employer can make additional super contributions when their employee arranges for some of their pre-tax salary to be paid into their super fund. The employee’s salary (for tax purposes) is then reduced while the additional contributions are treated as employer contributions. A salary sacrifice arrangement can only relate to future salary, not past earnings.

    Super contributions made under a salary sacrifice arrangement are treated as concessional contributions, and must be counted towards a person’s concessional contributions cap.

    For the 2016/2017, the concessional cap is $30,000 for those who are 48 years or younger on 30 June 2016 and $35,000 for those who are 49 years or older on 30 June 2016.

    Since salary sacrificing is a voluntary arrangement between an employee and employer, employers do not have to put such an arrangement in place. However, when an employer refuses to allow an employee to salary sacrifice super contributions, they must still pay compulsory Superannuation Guarantee (SG) contributions on the employee’s behalf.

    For the 2016/2017 year, employers must pay the equivalent of 9.5 per cent of an employee’s salary into a super fund under the SG laws.

    Under those same rules, an employer can cut an employee’s SG entitlements when they have reduced their taxable salary through a salary sacrificing arrangement. When an employer cuts an employee’s SG entitlements after they have entered a salary sacrifice arrangement, the employee’s total salary package is also cut, unless the employee has a written contract specifying a total amount.

  • Converting property into super

    Posted on August 17th, 2016 admin No comments
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    Individuals can minimise capital gains tax (CGT) when selling an investment property where proceeds are contributed to superannuation.

    Those who sell their property can contribute up to $500,000 as a non-concessional contribution into their superannuation, which means that no tax will be payable. Non-concessional contributions, or after-tax super contributions, are super contributions for which an individual hasn’t claimed a tax deduction.

    However, since selling an investment property is a type of capital gains tax event (unless it was acquired before 20 September 1985), sellers will need to calculate their capital costs to add to the purchase price to establish the property’s cost base. The sales price minus the cost base will form their taxable portion.

    Individuals who have owned the property for more than 12 months will receive a 50 per cent discount on the taxable portion. For properties owned in joint names, the taxable portion may again be cut in half. The remaining taxable portion is added to each owner’s taxable income for the financial year in which they exchanged contract.

    To further reduce CGT, individuals should consider their eligibility to contribute up to $35,000 as a concessional contribution to super, as this can help lower a person’s taxable income by $35,000 a year and reduce their potential capital gains tax liabilities.

    Individuals should keep in mind that proposed changes to Australia’s superannuation rules may affect this strategy since concessional contributions may decrease to only $25,000 a year.

    Tax
  • Making most out of your LinkedIn profile

    Posted on August 9th, 2016 admin No comments
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    LinkedIn is usually the most important social media platform for B2B marketing which can also be a valuable way to recruit and network. It is also a great educational resource, as small business owners and entrepreneurs can learn from interacting with other business owners.

    Like all social media sites, LinkedIn is a pretty crowded platform, so putting in a little extra effort to stand out can go a long way. Here are some tips for making the most out of LinkedIn:

    Get your photo right
    Your profile picture should be current, high-definition, and representative of your business persona. You should not use a photograph of you in a social situation if it does not accurately reflect what you do in the business world.

    Make sure your recommendations accurately depict your achievements
    Do not be shy about asking people for recommendations; that is what LinkedIn is there for. Similarly, going out of your way to give people deserved recommendations will help you to boost your network.

    Be vocal
    Write posts or start groups to talk about the things you are interested in. An active and presence is the best way for you to increase your exposure, and it is likely that you will learn something in the process.

  • Getting started with an SMSF

    Posted on August 9th, 2016 admin No comments
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    Starting a self-managed super fund (SMSF) may be a good idea for those after more control over investment choices and fund running costs.

    However, those considering an SMSF need to ask themselves some key questions such as:

    • if they can do a better job investing their super than the trustees of their existing super fund

    • if an SMSF will be cost-effective compared with large super fund options

    • if they are ready to take responsibility for the fund’s investment strategy

    An SMSF can have no more than four members. All members must be trustees of the SMSF or directors of the trustee company (if a corporate trustee is in place).

    Those who are an undischarged bankrupt or have been convicted of an offence involving dishonesty are considered disqualified persons. Such people cannot become an SMSF trustee.

    SMSFs are regulated by the ATO, so those in charge need to meet compliance obligations such as lodging annual returns, storing fund documents, preparing paperwork and signing an SMSF trustee declaration.

    Before trustees can arrange for their employer (or themselves) to make super contributions to the SMSF, the fund needs to be established. This includes:

    • drafting a trust deed

    • appointing trustees and admitting members

    • applying for the fund to be regulated by the Superannuation Industry (Supervision) Act 1993

    Those in charge will also need to draft an investment strategy and invest their super in accordance with that plan.

    Those wanting their employer’s superannuation guarantee contributions to be paid to the SMSF need to check if they have fund choice.

    Those who have fund choice must complete a standard choice form (SCF) outlining the SMSF’s details and give this to their employer.

    The SMSF must have an electronic service address (ESA) which enables it to receive an electronic contribution data message from an employer. SMSF members who are self-employed do not need an ESA.

    SMSF trustees also have to decide what happens to their super benefits from their previous super fund. Trustees can arrange to transfer those benefits to their SMSF via the ATO or arrange partial transfer using a form available from the previous fund. Before transferring existing super benefits, it is important to consider the implications the transfer may have on any life insurance cover from the previous fund.

  • ATO crackdown on work-related expenses

    Posted on August 9th, 2016 admin No comments
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    The ATO is currently targeting work-related expenses by taking a closer look at unusual deductions and claims that are higher than expected.

    The Tax Office will be looking for expense claims that are much higher than others who are in the same occupation and will be contacting employers to validate these claims.

    When claiming work-related expense deductions, taxpayers must ensure that the expense is related to their job; they were not reimbursed for the money spent and have a record to prove it.

    Here are some things to keep in mind when claiming deductions:

    Car expenses
    You can only claim a deduction if you use your own car in the course of performing your job as an employee. You cannot claim the cost of travel between home and work as it considered private.

    The ATO is focusing on the transportation of bulky tools as carrying unnecessary equipment is not a legitimate claim if equipment is already supplied.

    Self-education expenses
    You may be able to claim a deduction if your study is work-related or if you receive a taxable bonded scholarship. A deduction cannot be claimed if a course does not have a sufficient connection to your current employment.

    Internet and mobile phone expenses
    If you use your own mobile phone or internet for work purposes, you may be able to claim a deduction. If you also use them for personal use, you will need to apportion the percentage that reasonably relates to work use.

    Tax
  • Reinventing your business

    Posted on August 3rd, 2016 admin No comments
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    Small businesses should always be open to the idea of reinventing themselves to stay relevant to today’s customers and marketplace.

    Business owners who resist change and leave it too late to reinvent risk stumbling behind and at worst failing. Instead, businesses should focus on a proactive approach to growth for optimal business performance and success.

    Making a commitment to reinvention before the need is obvious does not come naturally; it requires planning. Here are a few ways to make sure your business does not get left behind:

    Continually forecast
    Industries are continually shifting – competitors are introducing new products, customer needs are ever-changing and technology is transforming the way business was traditionally performed. Forecasting changes is essential to be a competitive leader in your industry. High performing businesses exploit existing businesses that have not yet peaked and recognise untapped markets. High performers also understand that remaining competitive means some form of risk taking is necessary.

    Focus on strategy
    Strategic planning is imperative to make reinvention possible. Businesses need to detect shifts in their industry ideally before they happen. The best way to predict these shifts is to involve line managers, frontline employees, store managers etc into the strategy process, as they often pick up on insights business owners can easily miss. For a business to reinvent itself, it needs a permanent strategy which continually scans the market for unsolved problems and untapped customer needs.

    Invest in top talent
    Successful businesses need teams of talent to run and grow the business effectively. Business owners need not only hire the right type of candidate but they must strengthen and prepare individuals for the challenges that will arise when reinventing. Businesses need to invest time into developing their employees to enable them to succeed in their work. By first looking at what their employees are required to do day to day, business owners can assess what factors are fueling (or limiting) their success.

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