Grants, loans, rebates and subsidies are available across a range of industries, business types and purposes, including for startups and indigenous businesses.

The Federal Government’s grant finder tool currently lists 557 different grants and programs for businesses, or search for support via the NSW Government’s grant finder.

Here are some financial supports that many NSW businesses are eligible for right now.

Toll relief rebate scheme

Eligible NSW motorists who spend more than $375 a year on tolls will receive a 40% rebate up to $750 a year.

Financial incentives for businesses to hire new staff

Wage subsidies ranging up to $10,000 may be available to businesses that hire eligible individuals into ongoing jobs.

Payroll tax rebate for employing apprentices and trainees

A payroll tax rebate is available for employers in NSW who employ apprentices and new entrant trainees. The rebate works as a payroll tax offset based on the wages you’ve paid to apprentices and new entrant trainees.

Fee-Free Traineeships NSW

The traineeships provide NSW businesses with access to fee-free traineeships when they employ a new trainee. Save up to $1,000 per trainee.

Free and confidential mental health coaching for small business owners

Developed by Beyond Blue to give small business owners support during challenging times. Coaches work side by side with business owners to overcome difficult issues and provide practical skills to help them manage stress.

Loans for Aboriginal and Torres Strait Islander owned small businesses

Loans are available for Indigenous owned small businesses to help them start, grow or restructure.

Energy Bill Relief

Eligible small businesses using less than 100 megawatt hours of electricity per year will receive $650 towards their electricity bills.

Eligible small business retail customers do not need to do anything as their retailer will apply the energy bill relief to their electricity account from 31 July 2023 in quarterly instalments.

Small businesses that are part of an embedded network (for example, located in a shopping centre) will be able to apply from October 2023.

The post Government grants and support for small business appeared first on Small Business Connections.

The post Tax cheats warned: what the ATO really knows about your finances appeared first on Small Business Connections.

The post Employee taxes: a small business guide appeared first on Small Business Connections.

“It is essential that small business owners and managers understand these changes,” Mr Billson said. “They should check their payroll and accounting systems have been updated and they should talk to trusted advisers like accountants and bookkeepers. It is important to get this right.

“With so many pressures on busy small business leaders as we near the end of the financial year it can be easy to overlook new and changing rules. However, there are significant changes that cannot be put aside.

“The end of the financial year is also a good time to not just have a stocktake but to take stock of the health of your business and yourself and to make use of the many helpful resources, tools and checklists available, including on our website www.asbfeo.gov.au.”

Below, is a list of just some of the changes. It is not a complete list and some changes that may affect a business are specific to industry sectors or states.

Instant asset write-off

The instant asset write-off threshold will be $20,000 on a per asset basis for 12 months from 1 July for eligible small businesses with a turnover up to $10 million.

It will replace the previous arrangement introduced during the COVID pandemic which expires on 30 June and provided a write-off of eligible assets costing up to $150,000 that were first used or installed ready for use between March 2020 and 30 June 2023.

From 1 July, assets valued at more than $20,000 (which cannot be immediately deducted) can be placed into the small business simplified depreciation pool and depreciated at 15% in the first income year and 30% each income year thereafter.

Small businesses have until 30 June to use the 20% tax deduction for investing in digital operations such as new equipment like technology, cloud-computing, eInvoicing or cyber security. The technology investment boost will apply to investments made between 29 March 2022 and 30 June 2023 but to be eligible the item must be first used or installed ready for use by 30 June. For more information; https://www.ato.gov.au/Business/Income-and-deductions-for-business/Deductions/Small-business-technology-investment-boost/?=Redirected_Technologyboost

A skills and training boost for training through a registered external training provider for new and existing employees applies between 29 March 2022 and 30 June 2024. For more information: https://www.ato.gov.au/Business/Income-and-deductions-for-business/Deductions/Small-business-skills-and-training-boost/

Small businesses may also be eligible for a range of tax deductions and concessions that are available before 30 June or from 1 July and should check with their trusted advisers or the Tax Office.   https://www.ato.gov.au/Business/Income-and-deductions-for-business/Deductions/

Small Business Energy Incentive

A tax incentive worth up to $20,000 will provide an additional 20% depreciation for eligible assets that support electrification and more efficient use of energy by small businesses.

The bonus will be provided to businesses with an annual turnover of less than $50 million and is aimed at helping them save on energy bills by making investments like electrifying their heating and cooling systems, upgrading to more efficient fridges and induction cooktops, and installing batteries and heat pumps.

Under the scheme, which is pending passage through Parliament, up to $100,000 of total spending will be eligible with the maximum bonus tax deduction being $20,000 per business. Eligible assets or upgrades will need to be first used or installed ready for use between 1 July 2023 and 30 June 2024.

Super Guarantee

The super guarantee (SG) rate will increase from 10.5% to 11% for all employees eligible to receive superannuation. Small business owners will need to use the new rate to calculate super on payments made to employees on or after 1 July, even if some or all of the pay period is for work done before 1 July. The SG rate is legislated to increase to 12% by 2025.

Employers are responsible for checking their payroll and accounting systems have been updated to ensure they correctly calculate their employee’s super guarantee entitlement. Payments must be received by the employee’s super fund by 28 July.

For more information: https://www.ato.gov.au/business/super-for-employers/paying-super-contributions/how-much-super-to-pay/

National Minimum Wage and Award Rate

The National Minimum Wage will increase to $882.80 per week, or $23.23 per hour.

Award rates of pay will increase by 5.75%.

Both changes are effective from the first full pay period starting on or after 1 July and more information is available on the Fair Work Ombudsman’s website: https://www.fairwork.gov.au/newsroom/news/awr-2023

Small businesses can Sign up to email updates from the Fair Work Ombudsman and can use its Pay and Conditions Tool and pay guides.

The Fair Work Commission has also made a decision to increase minimum wages by 15% for some employees working in aged care from 30 June. This is separate to the annual wage review. For more information: https://www.fairwork.gov.au/newsroom/news/15-per-cent-wage-increase-aged-care-sector

PAYG & GST uplift rate

The Australian Government will reduce the PAYG and GST uplift on quarterly payments from what would have been 12% to 6% for the 2023-24 income year in a move that should help assist cash flow for small businesses.

Single Touch Payroll

Employers are required to finalise employees’ Single Touch Payroll data by 14 July. The Tax Office advises small business owners to double check they are finalising STP data for the 2022-23 financial year.

It also says employers are required to report pay as you go (PAYG) withholding information every time they pay employees through Single Touch Payroll. From 1 July these amounts reported through STP will be used to pre-fill labels W1 and W2 in activity statements in ATO online services.

More information: https://www.ato.gov.au/Business/Single-Touch-Payroll/ATO-PAYG-withholding-pre-fill-for-activity-statements/

Paid Parental Leave scheme

The entitlement of 18 weeks’ paid parental leave pay will be combined with the Dad and Partner Pay entitlement of 2 weeks’ pay. This means partnered couples will be able to claim up to 20 weeks’ paid parental leave between them. Parents who are single at the time of their claim can access the full 20 weeks.

These changes affect employees whose baby is born or placed in their care on or after 1 July.

For more information: https://www.fairwork.gov.au/newsroom/news/changes-to-the-paid-parental-leave-scheme 2023

Temporary Skilled Migration Income Threshold

The Temporary Skilled Migration Income Threshold (TSMIT) will increase from $53,900 to $70,000. This applies to employers who wish to nominate workers for subclass 482, 186 and 187 visas and they must meet certain salary and employment condition requirements to ensure overseas workers are paid no less than an Australian worker doing the same work in the same location, known as the annual market salary rate (AMSR).

Other resources

A useful end of financial year checklist for small business is available at: https://business.gov.au/finance/yearly-financial-tasks/end-of-financial-year-checklist

The Tax Office provides a Tax Time Tool Kit to assist small business to prepare their tax returns, which includes a directory of links to find information, tools, calculators and other support and resources. It will be available in early July at www.ato.gov.au

The ATO also provides a cash flow coaching kit, which is available at: https://www.ato.gov.au/Tax-professionals/Support-and-communication/In-detail/Cash-Flow-Coaching-Kit/

Source: ASBFEO

Also read: Tax time tips for small business

The post 1 July important EOFY changes for small business appeared first on Small Business Connections.

The Australian Tax Office has highlighted a number of changes and processes that small businesses should be aware of:

• Temporary full expensing – Businesses can claim a deduction for the business portion of the cost of certain assets installed or improved on between 7.30pm AEDT on 6 October 2020 and 30 June 2023.
• Loss carry back – Eligible businesses may be able to claim a refundable tax offset if they made a tax loss in the 2019–20, 2020–21, 2021–22 or 2022–23 income years.
• Sharing economy reporting regime – If you earn income from sharing economy activities, make sure you understand your obligation to report this income as part of your tax return or activity statements.
• Lodgment Penalty Amnesty Program – Outstanding tax obligations originally due between 1 December 2019 and 28 February 2022 can be lodged without penalty until 31 December 2023.
• Late and unpaid super guarantee contributions – If you didn’t pay the correct amount of super contributions to all eligible employees or you have paid after the 28 April due date, you will need to lodge a Super Guarantee Charge.
• Debts on hold – View any debts on hold and offset transactions in the ATO online services.

Helpful webinars

• Claiming small business tax deductions: This 60-minute session will help you know which deductions you can claim and when you can claim them. The session also covers what records you need to keep.
• Using your business money and assets: This 60-minute session will go through the options -and their requirements – so you can be sure you’re paying yourself correctly.

For more information, visit the ATO’s Supporting Your Small Business page.

The post Tax time tips for small business appeared first on Small Business Connections.

Most rewarding experience of running your business?

Perhaps Hnry’s greatest achievement to date is how we’re improving the productive capacity of Australia’s one-and-a-half million sole traders. A recent independent study conducted by Resolve Strategic demonstrated that sole traders are spending seven hours a week on tax and financial admin, going up to nine hours for healthcare workers and ten hours for tradies. They are also spending over $300 a month on tax and financial admin costs.

In the same study, Resolve Strategic was able to identify that sole traders using Hnry only spent two hours on tax and financial admin and only around $100 per month on costs, a drastic saving on both fronts.

What makes your business innovative compared to competitors?

Hnry is a completely innovative service with no real comparators around the world. Our innovation comes from the fact that we integrate three distinct modules – payments, accounting software and accounting. In and of themselves, these are three discrete multi-billion dollar industries that we house in one elegant solution, tailored to a specific customer segment.

Hnry combines all of these seamlessly and has designed them around the needs of a largely unserved segment: sole traders.

I think our innovation stands out for three reasons. Firstly, we are a service as a software. Unlike other tech startups that lead with their software in a traditional “software as a service” model, we consider Hnry a “service as a software”. With Hnry on your side, you have access to in-house tax experts so you never have to worry about tax and compliance again. The underlying software of Hnry makes it easier for independent earners to handle their financial obligations, while the people behind Hnry ensure that their needs are met and that they can be the best they can be at what they do.

Secondly, our proprietary automation stands out. Hnry uses cutting-edge automation to calculate, pay and file all tax obligations, before immediately passing on what the customer gets to keep. Not only have we automated and simplified tax payments, ensuring that everyone who uses Hnry is tax compliant, but we’ve also enabled people to focus on the things that matter most to them.

Lastly, we drive disruptive innovation from outside the industry. Hnry has not been created by the industry itself; like any great disruption, it comes from outside, from those that see a complacent and bloated industry ripe for change. While sustaining innovators make a better product and take customers away from the competition, such as Apple iPhone, disruptive innovators make a product accessible to a new market using technology to reduce costs and meet the needs of new customer segments. Disruptive innovation manifests through the business model of Hnry as we are using proprietary technology to revolutionise the market by providing a much more affordable solution for people that were not previously considered target customers of accountants or accounting software companies.

How has your innovative approach to business been beneficial to your customers?

Before Hnry, independent earners worldwide have been mostly ignored by other emerging and established solutions in favour of solving problems for the enterprise, or for the accountant. Hnry brings genuine value, time-saving and peace of mind for the individual, as well as removing the need for them to have to operate across multiple software or service providers.

The independently conducted Hnry sole trader pulse identified that by using Hnry customers saved seven hours a week. Hnry has been dubbed the individual’s ‘self-employment in a box’. With Hnry, our customers can use financial services such as sending unlimited quotes and invoices, accepting payments via different methods, having their tax rate automatically calculated by Hnry’s proprietary algorithm, having all their taxes including GST, Income Tax, Medicare Levy, Student Loans automatically paid to the ATO or IRD and much more.

By: Alyssa Herr, Editor

The post Overlooked sole traders can now save 10h a week on financial admin appeared first on Small Business Connections.

Laughter is a source of relief

The research also revealed that laughter can be the best medicine during stressful times, with nearly 96% agreeing with this sentiment for reasons including it makes them relax (56%), it is effective (48%), and it reminds them that everything “will be okay” (47%).

Moreover, almost all (98%) of Aussies who find completing their tax return difficult agreed that laughter can be the best medicine during stressful times. The main outlets for Aussies stressed out by tax time include relaxing through humour (66%), spending time with family and/or friends (51%), and enjoying a hobby (49%).

Of the Australians who disagreed that laughter was a good form of relief, 42% said they prefer other outlets and 4% would prefer to cry.

Aussies would rather avoid tax time

Only three in 10 (29%) Australians enjoy working on their tax returns. When asked to choose, the majority of the nation would prefer to participate in other activities over completing their tax return, including cleaning up dog poop (19%), making small talk with an unpleasant neighbour (18%), sitting in the middle seat on a long-haul flight (17%), and getting a filling at the dentist (16%).

One-third (32%) of Australians surveyed find it difficult to complete their tax returns. Men are more likely to struggle completing their tax return (37% compared to 28%) and be more stressed by the end of the financial year and tax submission process (37% compared to 27%).

The biggest barriers for those who find the tax return process challenging are a lack of knowledge and understanding of the correct process (51%), lack of motivation to complete it (39%), and lack of organisation (36%). The research shows a need for more financial literacy amongst women, as they are more likely to have a lack of knowledge and understanding of the correct process (62% vs 43%). They’re also more likely to not know where to start (29%) compared to men (11%).

Of the Australians who don’t find it difficult to complete their tax return, 39% said it is because their accountant or tax consultant does everything for them, 13% said they love tax, and 6% admitted to being in denial.

EOFY impact on Australian small businesses

The majority of Australians (62%) believe small business owners should have more support to help them through the end of financial year stress. These Aussies believe the initiatives that would most benefit small businesses during tax time include free business coaching (61%), free government advice (59%), subsidised access to accountants/bookkeepers (48%), and free access to mental health support (41%).

Making tax time less taxing

Australian consumers and small businesses can make tax time less taxing by working with trusted accountants and bookkeepers, according to Damien Greathead, Accountant & Advisor Lead at Intuit QuickBooks Australia.

“Aussie small businesses have had a tough few years and whether you’re a tradie, hairdresser or fast-paced startup, we know that tax time can add significant stress and mental load. We want to reduce the burden and stress of tax-time.”

“Working with an accountant or bookkeeper who uses tools like Intuit QuickBooks, or even using the tool yourself can help small business owners reduce stress and get time back in their day to focus on unwinding with some comedy, seeing friends and family or pursuing their hobbies,’” Greathead said.

Rachel Clements, Director of Psychological Services, Centre for Corporate Health said tax time can be an incredibly demanding period, often causing a great deal of stress.

“During this time, reaching out to a professional and your loved ones for emotional support is crucial. Sharing your worries with family and friends can provide solace, and discussing your concerns can offer valuable insights and help put things into perspective,” Clements said.

“Taking breaks and time to switch off and recharge is also important to tackle these often stressful times in the right mindset. If you find yourself excessively concerned about your stress levels, it is advisable to seek the guidance of a mental health professional. Consulting with an expert can assist you in navigating any underlying issues before they escalate into more significant problems.”

The post 31% Aussies find tax time one of the most stressful times of year appeared first on Small Business Connections.

Loss carry back scheme

On 6 October 2020, the Federal Government passed legislation to implement a temporary loss carry back scheme for some Australian companies, subject to eligibility. Through the scheme, eligible entities can choose to carry back losses to earlier years in which there were income tax liabilities. The offset effectively represents the tax the eligible entity would save if it were able to deduct the loss in the earlier year using the loss year tax rate. As it is a refundable offset, it may result in a cash refund, a reduced tax liability or a reduction of a debt owed to the ATO.

If you aren’t sure of your eligibility, the ATO has developed a loss carry back tax offset tool that can tell if your business is eligible and calculate the maximum amount you can choose to claim if eligible.

Temporary full expensing of assets

An immediate deduction for the purchase of business assets is allowed for eligible businesses with an aggregated turnover of under $5 billion. This means an immediate tax deduction can be claimed for:

• Business portion of new eligible depreciating assets
• Business portion of the cost of eligible second-hand assets, and
• Balance of the small business pool at the end of each income year in this period.

A limit on the allowable depreciation applies to passenger vehicles and this is currently $64,741 for the year ended 30 June 2023. If the motor vehicle purchased is more than $64,741, then only the first $64,741 can be claimed as a tax deduction.

This scheme applies to assets acquired between 6 October 2020 and 30 June 2023.

Writing off bad debts

Businesses should review their debtor’s ledger prior to 30 June 2023 and establish whether any of their customers’ debts are unrecoverable. If this is the case, the tax deductions can be claimed for the ‘write off’ of bad debts. GST adjustments can also be made for the write-off of bad debts in the June 2023 Business Activity Statement.

Review your June 2023 PAYG instalments

Review the need to pay your June 2023 Quarterly PAYG instalments. This is something you might want to talk to your advisor about. It the taxable income of your business has decreased from a prior year, then varying the instalment of tax or claiming credits for prior quarters’ tax may help with your cash flow.

We would recommend that you prepare a draft tax calculation to confirm the likely tax payable for the year prior to lodging a variation of the PAYG.

Capital Gains Tax (CGT)

Capital Gains Tax is triggered at the time a contract is signed and not when settlement occurs. If the asset has been held for less than 12 months, you may want to consider delaying the signing of the contract to take advantage of the CGT 50% general discount.

Other strategies

There are a number of other strategies that businesses can use as part of their year-end tax planning. These include:

• Writing off the value of obsolete trading stock before 30 June 2023 – or recognising the value of trading stock at either cost, market selling value or replacement value.
• Making cash repayments of Division 7A loans to companies before the financial year-end to avoid the need to declare dividends to shareholders.
• Paying employee superannuation by 30 June 2023 rather than by 28 July 2023, to claim a tax deduction.
• Making concessional superannuation contributions for business owners or additional salary sacrifice contributions up to the superannuation cap of $27,500.
• Using prior years unused concessional superannuation caps under the Concessional Catch-Up rules. This is subject to eligibility criteria which you should discuss with your advisor.
• Bringing forward and incurring any expenses before 30 June 2023.

From a governance perspective, it is also important for employers to ensure that their Single Touch Payroll is finalised, and all government revenue agencies (such as Payroll Tax) reconciliations have been completed and lodged.

Source: WilliamBuck

The post Tax planning strategies for small businesses appeared first on Small Business Connections.

The Australian Tax Office has increased the rate for claiming expenses under the fixed-rate method.

Those working from home or conducting a home business can now claim 67c per hour, up from 52c.  While not a large increase, home-based businesses are encouraged to review and apply the increase where they are using the fixed-rate method.

The revised fixed rate of 67c per working hour:

• covers running expenses including electricity, gas, stationery, computer consumables, internet and phone
• no longer requires an office or area of the home set aside exclusively for business
• allows the business to use a portion of the decline in value of depreciating assets and equipment, including their repairs and maintenance costs, to be claimed separately.

There are record keeping changes that must be made from 1 March 2023 in order to use the revised fixed-rate method for the 2022–23 income year.

Those who choose to use the revised fixed rate method need to keep a record of all hours worked from home for the entire income year (such as timesheets, roster or diary).

The post Home-based SMEs and those WFH can claim higher tax expenses this year appeared first on Small Business Connections.

CPA Australia Senior Manager Tax Policy Elinor Kasapidis says: “Millions of Australians need to know about new changes to work from home tax deductions. Before the pandemic about two million Australians claimed deductions for working from home expenses. Due to the pandemic this jumped to about five million people.

“Before the pandemic, taxpayers who worked from home could claim 52 cents an hour and required a dedicated work from home area. The revised method does not require you to have a separate office.

“When the nation went into lockdown the ATO introduced a shortcut method for work from home expenses. You could claim 80 cents for each hour worked from home and did not need an ongoing diary or calculations of running expenses.”

“The shortcut method that was used by millions of people over the last few years to make their deductions is no longer available.

“We’re glad the ATO has released guidance on this issue. Work from home arrangements affect millions of people and we have been waiting for this information.

“Some Australians will still be under the impression they can claim a work from home deduction in the same way as they did during the height of the pandemic. This will not be the case after March 1.

“Under the new fixed rate method, you can claim 67 cents per hour worked from home. You don’t need a separate office. The rate includes phone and internet expenses, as well as electricity and gas usage and stationery. Taxpayers will need to claim decline in value of work-related equipment such as office furniture separately.

“Australians will need to keep an ongoing diary for each day of the year they work from home from March onwards. A four-week diary representative of the year isn’t going to cut it. They also need to keep some records about their expenses incurred while working from home, such as copies of utility bills.

“Tax agents should let their clients know about these new arrangements as soon as possible so they aren’t left in the lurch at tax time.

“The ATO has a big job ahead to ensure Australians are aware of their obligations.”

Note: CPA Australia has been asking the government to legislate  a fixed rate method.

CPA Australia’s top four Rs to get your return right:

1. Record everything:

“Get your record keeping right this tax time. Keep a detailed diary throughout the year noting down when you worked from home. Hold on to documents relating to your home expenses, such as electricity and other utility bills.”

2. Retain receipts:

If you incur a cost when working from home, you should keep a receipt. This includes new office furniture and home office cleaning expenses.”

3. Be Realistic:

“Be realistic when submitting your tax return. The tax office is unlikely to accept a deduction for a packet of TimTams eaten in your coffee break at home. As much as your colleagues like to see your pot plants, the ATO won’t want to see claims made for office décor.”

4. Reach out:

“Seek advice when submitting your return and get help from a tax agent if you’re unsure. Reach out to a CPA who can help you understand your obligations and help you get your tax return right.”

The post WFH Tax changes to affect millions in 2023 appeared first on Small Business Connections.