Keeping employees who are offered opportunities elsewhere

The best employees carry value that simply cannot be replaced by another. In today’s highly competitive market, employers should amend their plan for keeping talented employees who are offered new roles outside the business.

• Understand their motivation

Try to find out why the employee wants to leave your business by asking questions about their life and priorities. Their decision may be based on practical or personal reasons. Not knowing exactly what the issue is will make it much harder for an employer to counter the opportunity.

• Offer what they want

If an employee wants more money (and you’re willing to pay) offer them more money. If they would like more responsibilities, give them more responsibilities. Employers who are willing to exceed the employee’s offer from elsewhere should do so.

• Don’t become emotionally invested

Putting too much energy into keeping the employee can result in irritation or resentment later on. If you make your best offer, stick to it.

• Create performance incentives

The majority of employees who accept counter offers leave the business within six months. Make sure you create a performance incentive that will last, such as giving them a bonus after 12 months when they meet certain criteria.

When an employee decides to leave, employers should remain calm and wish them well. Remember that hiring a new employee as their replacement is an opportunity to bring fresh and innovative new ideas to the table.

Five ways to pay less FBT

Small businesses can achieve real dollar savings by efficiently managing and calculating the Fringe Benefits Tax on meals and entertainment. However, the challenge is often finding the best calculation. Many organisations struggle to identify which calculation method is best for them and, as a result, have to pay more FBT than necessary.

Here are five FBT strategies that may help small businesses get ahead:

1. Automate the expense management process
Automating the process allows a business to determine the lowest FBT liability automatically. It saves time, provides full visibility into expenses and enforces policies to optimise the expense management process.

2. Use clear, descriptive definitions for the expenses
Over-complicated definitions can confuse employees and impact on the quality of data (from a calculation and compliance perspective).

3. Train employees
Make sure employees understand the difference between the travelling and non-travelling employee status, as this impacts the FBT liability.

4. Use an employee master list
An employee master list simplifies the search for employee data and prevents the creation of multiple versions of the same attendees.

5. Review the RBT reporting annually
Don’t assume a specific calculation method will always equate to the lowest FBT liability. Make sure you are using the right method to avoid overpayments occurring.

ATO cracks down on high work-related deductions

The ATO is closely scrutinising employees who make abnormally high work-related expense claims.

The tax office is using advanced data and technology to identify and investigate claims that stand out from the usual. They are repeatedly targeting people who claim a tax deduction for using their computer, phone or other electronic devices to perform duties, transport bulky tools and equipment, or travel between work and home.

If an employee has to use their computer, phone or other electronic devices for work purposes, they cannot claim a private usage portion. They must ensure they claim the correct amount and have evidence to validate their claim.

Employees usually can’t claim a deduction for travel between home and work unless they are transporting bulky tools and equipment. But there are certain rules that they must comply too. While overnight work-related travel is deductible, the ATO provides a reasonable travel allowance each year to cover the expenses for meals, accommodation and other incidental costs.

The ATO has provided three characteristics to help employees qualify a work-related expense claim:

– the claim must relate to the job.

– employees must have spent the money themselves.

– employees must have a record to prove it.

Misconceptions surrounding property law

When a marriage or de facto relationship breaks down, the distribution of property is important for both parties. While some property settlements are reasonably straightforward, sometimes it can be difficult to determine the entitlements of each party.

A common mistaken belief is that a couple must be divorced to finalise their property with their estranged spouse. Both parties can conduct a property settlement as soon as they separate from one another.

Some individuals believe their inheritance is protected from the asset pool available for distribution. However, this issue is assessed on the circumstances of a particular case. The Courts will take into consideration:

– when the inheritance was received.

– the impact the inheritance has on the size of the asset pool.

– the length of the marriage or de facto relationship.

An inheritance received by a party prior to the relationship will be considered a contribution  to the asset pool. However, the impact of the inheritance may recede if the partner received contributions during the relationship.

An inheritance received after the separation may be exempt from the balance of the asset pool. The Court’s discretion usually relies on the distribution of the asset pool and the assets of both parties.

Revise your SMSF investment strategy

Self-managed super fund members should revise their strategy regularly to ensure it continues to reflect their circumstances and the fund’s investment objective. A self-managed super fund requires a clear, well-documented investment strategy to be successful. Characteristics of these SMSF investment strategies include:

– ability to pay benefits when members retire. A member must be able to maintain their standard of living when they leave the workforce.

– consider member needs and personal situations. The strategy takes on board the member’s age, their expected retirement date and identifies an appropriate investment option.

– liquidity of the fund assets. It is crucial for members to ensure they have sufficient cash to pay fund expenses.

– identifies the likely returns from investments to manage the risks associated with the investments.

– Adequate diversification of investment to help with handling the risks and returns.

Five tips to manage difficult top-performing team members

One of the most challenging issues for an employer in the workplace is dealing with a difficult top-performing team member. Whether they are impatient, demanding, rude or a perfectionist, here are five tips to help you manage them.

1. Try to understand
Difficult people are often very frustrated, so sometimes it is best to listen and try to understand the reason behind their behaviour. Past experiences may have taught them to push their way through an organisation, and a manager may need to reset this approach. 

2. Ask if you can help
By asking someone how you can help, you are focusing your interaction on a particular activity. You might be able to share the responsibilities of an issue that needs solving.

3. Limit the subject
When interacting with a difficult team member, limit the topic of discussion to address one thing at a time. Provide them with different options, so they can be the one to decide on the solution.

4. Check if they are difficult with customers
Customers may tolerate the difficult person because competing companies may not offer the same products or services, or your company may offer something they value more than the frustration of dealing with a difficult person. If this is the case, it is only a matter of time before they find a suitable replacement company. If your difficult employee is difficult with customers as well, address their behaviour immediately.

5. Document and alert HR
If you do not see an improvement in behaviour, then you may need to take a more formal approach. Document the occasions where the person was difficult to work with and make them aware of this impact on your team. Keep HR aware of your counselling. You may need them to help with properly dismissing the difficult person if things don’t improve.

Finding the right balance

Finding the right balance between work and home life can sometimes be a tricky tightrope to walk across. Unfortunately for a number of workers, this balance isn’t level in their lives. Below are three simple changes workers may want to consider when seeking to regain the right balance in their life.

Prioritise your time
Set aside some time to determine your top five priorities and plan your schedule according to that. Make sure you learn how to manage your time in the most effective way possible so you don’t have to miss work deadlines, family outings or social gatherings.

Remove bad habits
Bad lifestyle habits can have serious repercussions on your goal of achieving the right life balance. Lack of sleep, a diet lacking in nutrition, bad exercise habits or engaging in time-wasting activities are all factors that contribute to an unbalanced lifestyle.

Don’t be afraid to ask for help
If you feel like you’re truly struggling, remember it’s never too late to ask for advice or support. Speak to your employer about the problem at work, or communicate with your partner about any family issues you are facing. If you don’t address the issue, it won’t go away.

Growing your business in the cloud

Cloud software is an easy way for businesses to manage their data and information. But with so many variations in the quality and structure of different providers, it’s important that businesses take the time to research and find the provider that is right for them.

A good first step for businesses is identifying the specific goals or objectives that could be achieved through the cloud. The cloud can offer many solutions, including CRM for sales management or portals for managing client support tasks.

Here are four tips to consider when using cloud software for your business:

1. Be clear on whether the service meets your specific requirements when looking for a provider.

2. Don’t rush into using your cloud service. Using a slow adoption principle allows a business to be flexible for the unexpected, and continue day-to-day business as usual.

3. Even after a cloud system is in place, a business should test it regularly to ensure the cloud platform accommodates their changing needs.

4. Conduct reviews every 6-12 months. This regularity will ensure the cloud platform is working to its full potential.

CGT on property in deceased estates

If you are appointed as an executor in a will, your responsibilities commence following the death of the will-maker. It is important for executors to consider the capital gains tax implications of a deceased estate when it is time to administer the estate property for its beneficiaries.

There is generally no CGT payable for the transfer of an asset from the deceased’s name to a beneficiary or the executor. However, the asset will become liable for CGT when it is sold by the beneficiary or an executor.

If the property was the deceased’s main residence, then the estate will have an exemption from paying CGT if it is sold within two years from the date of death. Spouses or beneficiaries can generally claim the main residence exemption when the deceased’s property becomes their main residence or when the property was purchased before tax on capital gains came into effect (on 20 September 1985).

If it is the beneficiary’s or executor’s intention not to sell the property within two years of the date of death, then they should obtain a valuation from a registered valuer. This will be used to calculate the capital gains payable when the property is eventually sold.

Building a business budget

Creating a budget for your business doesn’t necessarily mean watching every cent you spend. It is simply a list of expected income and expenses, which can then be used as a powerful tool to control finances.

Budgets can help businesses know and track where their money goes. Once businesses know this, they can make conscious decisions about prioritising their money.

Software can also help track how much money is being spent. Free apps can help businesses monitor their spending, and help ensure that they have covered all their likely expenses.

Setting goals is an important part of budget building, and should be set before any budget is created. This means the budget is based on past spending activity and factors in any foreseeable changes in the future.