welcome to success - the growth edition

8/3/2019 Welcome To Success - the GROWTH edition

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welcome to

successthe GROWTH issue - spring 2011

tips to take the stress out of tax p4

5 ways to manage business growth p8

interest - whats in it for you? p12

presented by...


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Welcome to Success! Our Spring edition newsletter is packed full of hints, tipsand advice to help you get ahead in your finances, whether business orpersonal. But dont take our word for it - have a look for yourself!

Our new-look quarterly magazine is brought to you by High Street FinanceCentre. Just to bring you up to speed, High Street Finance Centre houses fourservices under one roof, all aimed at being a complete financial solution for youor your business. If you havent heard what those services are, theres a handyguide on page 3.

My personal favourite is the article on page 8 by my colleague Sarah-JoyPierce - its a great look at how growth can be used for good in small (ormedium business)!

I hope you enjoy this edition - we certainly enjoyed putting it together!

Allan JohnsonDirector, High Street Finance Centre

Welcome page 2

Meet the team page 3

4 tax tips for a growing business page 4

Selling your business? page 6

Have you lodged your tax return? page 7

5 hot tips to manage business growth page 8

Hearing a solution page 9

3 reasons the little guys lost out page 11

Its in your best interests... page 12

Do you know whos got you covered? page 13

The secret life of... page 14

Final Notes page 15


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More than just tax returns,specialising in all aspects of tax

accounting and compliance.

Business Developmentspecialists, helping out small

businesses with their planning, PR,people and performance.

Mortgage brokers andfinancial planning specialists,able to design a full wealth

creation strategy forpersonal finance.

Insurance Brokers, constantlystriving to find the best possibleinsurance deal thats just rightfor your individual situation.


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4 tax tipsfor aGROWINGbusinessW

hen your business is growing, there arealways problems of growth which ownersneed to manage. These can range from

HR problems to maintaining efficient production orupholding adequate cash flow. This juggling act al-lows your growing business to survive and thriveone problem you dont want to deal with is taxation.Here are some tips which will help growing business-es avoid tax problems.

1. Use the right structureThis is first on the list because it should be dealt withfirst.

Changing your business structure (especially after ithas been operating for a number of years!) is difficultand often expensive. The appropriate structure is in-fluenced by a number of factors, and requires care-ful consideration before the business commences. Inparticular, the taxation implications of different struc-tures can be significant and need to be addressed.

2. The ATO = not a bank!

It is very common for a growing business to needsignificant amounts of cash to fund the expandingoperation. Unfortunately, is it also common for suchbusiness to use funds which correctly belong to theATO to finance the growth. GST and income tax li-abilities are easy to forget, but the ATO has a verylong memory!

You need to allow for these payments in your over-all business planning, making sure that you are notforced to pay the ATOs excessive interest rates.

3. Use debt wisely

While on the subject of debt, you need to make surethat the type of debt you use matches the type ofinvestment you are making. For example, using cashowed to the ATO to fund the purchase of a motorvehicle will always create problems.

All tax office money aside, you need to ensure thatyou have long term finance for long term investments.

Also make sure that if you have a choice, you chooseto borrow for business purposes, and not for privatepurposes. Obviously, the interest on business loansis tax deductiblebut not for private loans.

4. Keep good records

Knowing the key numbers for your business is an im-portant element in the success of that business! Thisis even more important for a growing business. Theonly way to have reliable financial information is tokeep good records.

The same records will help you come out on top,should the ATO decide to audit your business.

So there you have it - a few quick tips to help dealwith the tax issues arising from growing a business.The team at Johnson & Tennent has helped manyyoung (and old) businesses, making them very well

qualified to handle these concerns.

Need more tips? Visit our brand-new website -www.jandt.com.au

You need to

ensure that youhave long termfinance forlong term

investments.


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Selling Your Business?

3ways to keep

in the bank!

The sale of a business is alwaysan important event in the life ofevery business owner. Years of

work have been invested in build-ing the business to its current

stage, so the sale representsthe results of all the hard work.

For many business owners thisrepresents the major superan-nuation asset which has been

accumulated over many yearswithout the support of em-ployer contributions. So itis important that we retain

as much of that capital aspossible to fund future lifestyle, whether or

not that includes retirement.

Fortunately, the government has recognised that thisis true and has put in place a number of measureswhich are aimed at allowing businesses to act assuperannuation assets. Generally these are goodnews stories for business owners, so its an area oftaxation that we enjoy advising in.

So what do you need to know? Keep reading, theconcessions are as follows:

1. Activate your assetsThe active asset concession allows the owner

of the asset to disregard 50% of the capital gainearned by selling the business asset. There are

some rules as to what constitutes an activeasset but the rules are not restrictive so most

business owners qualify for this concession.

The effect ofall of theseconcessions is thatoften, the business

owner payslittle or no

capital gains tax.

more money


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Haveyoulodgedyourtaxreturn?

2. Be inspired

to retireEven if the business owner is not retiring, the

retirement exemption concession is still avail-able. Again, there are some rules, but these main-ly apply to what you can do with the money (even if itneeds to go into a superannuation fund).

3. Keep it rollingA roll overconcession applies when the businessowner acquires a replacement business asset withintwo years of receiving the capital gain from the saleof a business. It is possible to offset the capital gain

against the cost of the replacement asset. This hasthe effect of deferring tax on the capital gain until thereplacement asset is sold.

Overall, the effect of all of these concessions is thatoften the business owner pays little or no capitalgains tax.

If you are thinking of selling your business anytime inthe next two years, we need to consider any actionsthat need to be taken now to make sure that the con-cessions are available to you when it happens. Call

Johnson & Tennent today on 4928 9244 to book yourappointment.

The deadline for tax returns for individuals is 31 October.If you use a registered tax agent (such as Johnson &Tennent), one of the benefits is that you can lodge laterthan 31 October but theres a catch you need to haveregistered as a client before 31 October.

Tips to make your return as hassle-free as possible:

Makesureyourreturnhasyourcorrectdateof

birth and current address Declareallyourincomeincludinginterestfrom

bank accounts, previous and current jobs, andoverseas income

Includedistributionsfromsourcessuchas trusts, investments and capital gains

GettherightdetailsrelatingtotheMedicare

levy/Medicare levy surcharge.

If you decide you cant go it alone and need some taxhelp, just give the team at Johnson & Tennent a call -well help however we can.


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5hoto mbusi

gro

At exceler8, were all about growing businesses.We know better than anyone that managingthe growth of a business isnt easy but we do

have five tips to help along the way

1Start with the right people.In a new business, especially a small business,the right people are everything. If you surround your-self with the right staff, your chances of success im-prove dramatically. Spending a little extra time andconsideration on recruitment and selection definitelypays off in the long run, when reliable staff membersare an asset to the business.

2Dont get trapped in expectations.This one is pretty self-explanatory if you expectfrom others what youd expect from yourself in termsof effort and committment, youll be disappointedevery time. We encountered this exact situation witha client recently, and had to explain there are only

about 5% of people that think like you do. The other95% will be in a completely different mindset!

3Have clear, concise systems.Systems are important to a business as mostsuccess comes from finding what works, and thenrepeating it. Think of McDonalds and their 32,000restaurants everything they do is systemised. Obvi-ously, your small business isnt quite on a McDonaldsscale (not just yet anyway!) but regardless, it can stillbenefit from systemisation.

4Set goals plan, plan, and plan!

This doesnt just apply to business! But in busi-ness, goals can help a business grow and movealong, by providing targets to aim towards. If youdont have goals, a sales month of $50,000 mightseem great. But if there was a goal of $150,000,the business has fallen quite short of the goal, andsomeone needs to take action.

5Always think of the customer!This should go without saying if youre not think-ing of the customer, theres something wrong. A busi-ness can have the best staff, the best products, orthe best-looking shop in the worldbut if nobody islooking after the customers, youre headed for dis-aster.

What are your main struggles inbusiness, or what do you seegrowing local businesses strugglingwith? Share with us on Twitter@exceler8growth.

imageBiziorPhotography


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What

localbookstores?

to ourhappened


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If youre an avid reader (of both news and litera-ture) you may have noticed the demise of Angus& Robertson splash across the headlines in recent

months. The Borders-owned bookshop chain wentinto voluntary administration in February this year.But as our local Rockhampton Angus & Robertsonstores closed their doors, locals suddenly realised

Central Queensland was now without a dedicatedbookshop.

Weve heard many different stories about how thishappened. Any small, independent bookshops thatdid exist simply couldnt compete with the chain book-shops range and prices. Those that tried were bat-tling not only the buying power of chain bookshops,but the books section of department stores and theadded threat of online retailers.

Sadly, as Angus & Robertson shut up shop, CentralQueensland readers were left with only the smallbook sections of Big W, Kmart and the like or the

faceless world of online book retailing.

Why is this?1. The buying power and product offering of bigdepartment stores.Stores such as Big W and Target often include booksin their product offering but even if these booksarent selling as much as other items, it wont impacttheir bottom line. Compare this to smaller businessesonly selling books putting all their eggs in one bas-

ket, so to speak.2. Online retailers offer almost anything you canthink of and often at a lower price.Websites from eBay to booktopia.com.au have longbeen criticised for the demise of traditional bricks-and-mortar retailers. The reality is, the e-commercesector has a much lower barrier to entry any foolwith a computer can start their own store.

Costs are lower, and theres no need to pay rent. Inturn, the lack of overheads leads to lower prices. Ofcourse, as society becomes more technology-savvy,the idea of not having to leave your chair to do yourshopping becomes more and more attractive.

3. Avoiding GST Australia Post is making iteasier for online retailers to ship purchasesNow this may sound like an odd reason but Austral-ia Post has come under fire recently for streamlin-ing low-value packages through customs. Anythingworth less than $1000 (typically clothing, books,shoes or electronics) has a GST-free threshold, andcan enter the country quite easily. These GST-freepurchases also lower prices, making it difficult for in-dependent retailers to compete.

What can we do?Now that Central Queensland readers are book-store-less, the online solution seems to be the wayout. Our only caution is that readers should be care-ful about who they choose to buy from especiallywhen there is a choice between an Australian-basedonline store and an overseas one. If the differenceis only a few dollars, isnt it the right thing to supportAustralian businesses?

Wed love to hear what you think if youve lamentedthe loss of local bookstores or simply switched to on-line without a fuss? Talk to us on twitter@exceler8growth.

3 reasons the little guys lost out...


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Finance First

isGROWING!The team at Finance First have someexciting changes underway...

Our Mortgage Planning expert, John,

hasrecently added another feather to hiscap, and can now offer you expertfinancial planning advice to help payoff that mortgage in record time!

John received his Diploma inFinancial Planning early thismonth, and is now putting thefinal touches on his skills withthe help of WealthToday.

Financial planning is nowjust one more way thatHigh Street FinanceCentre can look afterour valued clients!

To book yourappointment,call John today on4926 0611.

Its in your best

INTERESTto get the right loan!

When you take out a loan, you are basicallybuying money. Money is a very simple com-modity, so you should be able to compare

the price of loans at a glance, in the same way youmight compare a litre of fuel. In reality, this rarelyhappens.

The financial industry has largely resisted efforts topublish the real interest rate on a loan and the aver-age borrower today is confounded by the thousandsof home loans on the market offered by hundreds oflenders.

This confusion, along with reduction in branch net-works and strong competition for home loans, hasin part been responsible for the mushrooming of themortgage broker industry. Virtually non-existent 15years ago, mortgage brokers now write at least 40percent of all loans in Australia.

In theory, the mortgage brokers job is to be familiarwith all the loans on the market so that when you en-list their services, they can find a loan that matches

your circumstances and offer the best deal for you.They can save you time and money, help explainloan documents, costs and disbursements and evennegotiate with the lender on your behalf.

But not all mortgage brokers are working for you.Mortgage brokers make their money by receivingcommissions from the lenders, which can affect theirimpartiality. Some have relationships with only a fewlenders, limiting access to loans. Others may onlyoffer the products of one bank. Others may simplysuggest to you the loan that pays them the highest

commission.

Alas, the borrower is now like the old woman whoswallowed the fly and then has to swallow a spiderto catch the fly: it may have been diff icult calculatingthe cheapest interest rate, but it can be even moredifficult calculating the independence or honesty ofa broker.

Be certain of a good deal (in your best interests!)when you talk to John MacMaster at Finance First. Ifyoure not sure youre getting the best deal, callFinance First on 4926 0611.

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Having an insurance policy is one thing, but canyou claim on it if the need arises?At the time of claim for personal insurance (that isIncome Protection, Trauma or Total and PermanentDisability), you are usually sick and in no condition tobe asking an insurance company for money!

This is where an Insurance Adviser comes in handy.Make sure you know your Adviser, as they are thebest person to help with a claim. Often they will knowthe people at the insurance company, making claim-ing so much easier.

In my time as an insurance adviser, I have known in-surance companies to wrongly tell clients they do nothave a claim...and it wasnt until an adviser handledthe case that the claim was paid!

Being sick or injured is worry enough, we know youdont need the extra stress of making an insuranceclaim. This is when you need help with the claimingprocess, and a good adviser can make all the differ-ence.

If you do not know your adviser, dont have an ad-viser, or wish to change advisers, its a simple matterof asking another adviser to be your representative.

As you get to know your adviser, they can also reviewyour cover, make sure everything is up to date, andthey could even save you money on your premiums.Dont wait until something goes wrong - sit down withan insurance adviser today!

...do you know whos got you covered?

The importance of

knowing your


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What do you spend the mosttime on outside of work?

Physical exercise is a daily event. Im a health fanaticand exercise gives me a great relief from the stress ofmy daily work. Ive always been active when I was akid I used to play hockey.there has been no stage

of my life when I havent been active.

What is one thing that yourclients dont know about you?

Well, probably the fact that Im an aerobics instruc-tor! I started that when I was 45, and havent stoppedsince! I teach an average of seven classes per week,and I find that the discipline of having to be there toteach the class gives me no excuses!

What accomplishment areyou the most proud of?

I would have to say my daughters otherwise Ill getin trouble! However, Im also proud of the High StreetFinance Centre and what we are achieving here (ifyou dont know what that isgo back and read themagazine again!).

Whose biggest fan are you?

The American philosopher Jim Rohn sadly hepassed away last year. His prolific writings provide aneverending supply of inspiration and guidance.

If you could have one super-power what would it be?

The ability to freeze the passage of time but I wouldprobably then try to fit more into the frozen hour, soId still be pressed for time!

What is the funniest thingthats ever happened to you?

That would probably be when we were on a family

holiday in Yellowstone National Park in the middle ofwinter. We decided to walk up to a waterfall, acrossrocks that would normally have been merely wetbut because of the ambient temperature, were in factcovered in ice! We all ended up in ungainly poses,with at least one semi-minor injury! We made it, andwe had a lot of fun doing it!

Allan Johnson


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Here at HSFC we make it our mission to stay up-to-date with all the latest in social media. Chances are,if you like to Tweet, Facebook or LinkedIn (is that averb yet?)...youll see us around!

To make sure you dont miss out on any of the hints,tax tips or deals we pass on to our favourite follow-ers, connect with us today!! You can find us on...

@JandTaccounting

@exceler8growth

facebook.com/JandTaccounting

facebook.com/exceler8growth

Allan Johnson (Johnson & Tennent)

Sarah-Joy Pierce (exceler8)

John MacMaster (Finance First)

Even if youre not a fan of social media, check outJohnson & Tennents new-look website at

www.jandt.com.au and try our Live Chat!

antafreeeBook?

visit.www.jandt.com.auandenteryourdetails-itsthateasy!


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High Street Finance Centre84 High Street

Berserker, QLD 47014928 9320

[email protected] hours

8:30am - 5:00pm Monday to Friday(closed for lunch from 1pm - 2pm)

welcome to success - the growth edition

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