ATO Releases New Blueprint: Reinventing the ATO

Yesterday, the Australian Tax Office released a blueprint containing information on a new unit for wealthy taxpayers, as well as a new design to guide future proceedings with taxpayers.

Entitled ‘Reinventing the ATO’, the blueprint outlines an exclusive unit to deal with wealthy individuals in Australia and at least one million privately owned businesses. The announcement of this new unit comes in response to the government being forced to defend exempting Australia’s biggest private companies from tax disclosure requirements.

Beginning in late April, the taxpayers who make over $1 billion or have $500 million in assets will be personally contacted by the ATO to discuss assessments of tax risks or issues. Other taxpayers in this segment who attract attention from the ATO, will also be provided with a report outlining any risk assessments or concerns.

For thousands of small businesses, the ability to pay all their employee super contributions at once to the Small Business Superannuation Clearing House will be possible by July, and there will also be enhancements made to the ATO’s small business newsroom.

The blueprint is available today on the ATO website, and contains information for both the community and ATO staff.

Mobile marketing

Mobile marketing is a very important facet of a business’s online presence. However, optimising websites for mobile access and promoting one’s business on location and review based mobile sites is something that often goes overlooked in a marketing plan. Here are a few tips to get your mobile marketing up and running:

Make sure that your website is responsive: A lot of business owners don’t realise that a great website with excellent functionality will not necessarily work on on a mobile phone or tablet. In order to be optimised for different sized screens, a website needs to be responsive.
Ensure that your business is easy to find using online maps: If Google and other search engines know where your business is and what you do, it will direct customers your way. You may also care to integrate a mapping application into your website.
Be present on review sites: Depending on your industry, online reviews can give you a significant marketing boost. For example, a restaurant that is active on reviews sites, has a lot of reviews, and a great average rating is likely to attract a lot of new customers.

Tips for cutting your tax bill

1. Put more into your mortgage offset account: Mortgage offset accounts are usually considered to be a mechanism for protecting yourself from interest rate rises. However, another advantage is that if you direct more money here and less to your savings account, you will save on tax earned on interest. With interest rates at record lows, this strategy may be particularly beneficial to some individuals.

2. Don’t forget about non-concessional super contributions: There is a lot of hype surrounding the massive tax benefits of concessional (before tax) superannuation contributions, but don’t forget about your non-concessional (after tax) options! By making after-tax contributions, you will save tax on the returns earned by your investments.

3. Discretionary family trusts: Family trusts allow you to direct the income earned towards lower income earners, thereby reducing the amount of tax you pay. If you are interested in starting a family trust, feel free to call our office to discuss your situation.

Superannuation and life insurance

A lot of Australians are unaware of the fact that they probably have life insurance provided by their superannuation fund. Due to economies of scale, you are most likely getting a very good deal on your cover, and as such it pays to be aware of a few things that can impact your life insurance.

1. SMSFs need to consider the life insurance needs of their members. However, this does not necessarily mean that the SMSF needs to provide the insurance. A lot of SMSF trustees choose to keep some of their super invested in public funds in order to take advantage of the cheap life insurance.

2. You need to specify who you would like to receive your life insurance payout in the event that you pass away (you need to do the same for your superannuation). It pays to be aware that life insurance payouts to non-dependents tend to attract a hefty tax bill, whereas payouts to dependents are typically tax-free.

3. You can also access income protection insurance in your SMSF. Income protection insurance is especially important for people who have families or large debts (i.e. a mortgage).

Choosing a bank account

Differentiating between bank accounts can be a tedious task, and many people will simply choose an institution that they are familiar with. There is, of course, a lot to be said for trusting your financial institution. Furthermore, you may be able to bundle your new account with existing ones to get a discount or some form of loyalty bonus.

However, you should always do your homework before settling with a banking product. Incrementally higher fees or lower interest rates can make a significant difference to your savings over time. Here are three things you should look when opening a new bank account:

1. Features: Look for things such as withdrawal fees, transaction fees, account fees, interest rates, minimum opening balance and minimum contributions. Some of these features may be more important to you than others. Think about what you want to get out of your bank account and the features that will give you the best results.

2. Services: Services may include internet and telephone banking, an international call line or an overdraft facility. Choosing a bank account with services that are suited to your needs is likely to save you a significant amount of time (and possibly money) in the future.

3. Security: You should inquire about issues such as insurance and fraud protection before you make any commitments to a bank. It may seem like a remote possibility, but if something does ever go wrong you will be kicking yourself for not confirming your level of cover.

Improving business productivity

The easiest way to improve business productivity is to empower your staff to be more efficient and enthusiastic in their approach to work. If every staff member can make an improvement in their area, the overall output of your business will benefit. Here are our top tips for helping your staff to improve their performance:

1. Encourage planning: The more that people plan out their time and schedule tasks, the more likely they will be to identify opportunities for improving efficiency.

2. Schedule meetings at convenient times: If you are scheduling meeting that conflict with people’s workflow, you may actually be undermining their productivity. You should think about who really needs to be in each meeting, because valuable time can be wasted having staff members in meetings that are not relevant to their responsibilities.

3. Encourage exercise: Numerous studies have shown that people who are physically fit are better able to apply themselves in other areas of life. Regular exercise is also good for general mental health. Encourage your staff to get active by suggesting a ride to work day, or lunchtime walks.

Saving money on your energy bil

Energy bills are a significant expense for small businesses, so cutting back on your usage can be great for your bottom line. Improving your energy efficiency is also great for the environment, which presents an opportunity to connect with customers on an issue that is increasingly important to the public.

Here are our top tips for saving on your energy bills

– Buy energy efficient appliances
-Turn your appliances off at the wall (an estimated 10% of electricity bills is due to appliances that are in standby mode)
-Investigate solar panels and rainwater systems (there may be some government subsidies available to you)
-Discuss the need to reduce energy costs with your employees, encouraging them to be more mindful of their actions

Australia and Switzerland enter into tax information exchange

Switzerland and Australia have entered into an unprecedented agreement that will see the two countries automatically exchange tax information. The move is intended to prevent tax evasion through income earned and held in offshore bank accounts.

Tax avoidance has been increasingly prominent on the international agenda recently, and Switzerland is striving to shake its reputation as a haven for tax dodgers and criminal organisation. Swiss authorities have even gone so far as to criticise the James Bond film franchise for the unsavoury image it has cast on the alpine nation.

Authorities from both countries have indicated that they expect the information exchange to be in full swing by 2018. While this is the first time that Switzerland has entered into such an agreement, negotiations for similar arrangements are underway with a number of OECD countries.

The ABCs of SEO

Have you ever wondered why Google and other search engines will turn up some companies results over others? The answer is search engine optimisation or SEO.

To improve your SEO, you need to understand what it is that search engines are looking for in their algorithms. The problem is that these algorithms are a) not made public, and b) constantly changing. Despite this opacity, there are a couple of things you can do and be confident that you are improving your SEO.

1. Use root directories: Domain naming is important to the structural integrity of your site, so you are far better off using root directories (www.company.com/aboutus) than subdomains (www.aboutus.company.com).

2. Link it up: The more you link your sites to other sites, the more search engines will recognise your site as legitimate

3. Use keywords: This is especially important in your URLs

4. Optimise user experience: IF your site is hard to navigate, there is a good chance that search engines will recognise this and penalise you accordingly

Fund fees eating away at retirees’ cash

As interest rates plummet, retirees who are relying on interest from cash savings in their superannuation accounts may be losing out. The reason for this is that excessive fund fees can eat away at cash balances. Without decent returns from interest rates to offset these losses, the results for super funds can be grim.

Despite the fact that the Reserve Bank reporting that cash deposits in banks returned between 3.3%-3.7% in 2014, returns on cash deposits in super funds were hovering down at around 2.5%. For retirees, who so often elect to invest their super in cash for stability and a lower risk profile, this lower rate of returns can add up to significant losses.

You should always spend some time examining the fee structure of your superannuation fund and comparing it to similar funds. Do not be fooled by a fund that recently reported a year of high growth. To gain a comprehensive understanding of a fund’s performance, you should examine the returns from the past fifteen years, as there can easily be one-off flukes.