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Since its introduction, thousands of businesses have taken advantage of the (currently) generous instant asset write-off legislation. As the title above suggests (and you may already be aware), the deduction available for the asset is currently capped at $150,000, but there is currently no limit to the cost of the asset (see below for more on this).
Unfortunately, all things must end, and this piece of legislation is no different…
In May 2021 as part of the Federal Budget for 21-22, the government announced an extension of the InstantAsset Write Off to June 30, 2023. Despite the looming end to the opportunity to claim the write-off to the full value, there’s still time.
Temporary full expensing (TFE) allows businesses to deduct the full cost of eligible capital assets from their profits for the year, rather than depreciating the cost over several years. So in essence, you can deduct up to $150,000 per asset purchased in the financial year of which you are lodging.
Here are some of the specifics:
• The asset must be purchased and in use during the year in which you are claiming the deduction.
• Depreciating assets may include new business vehicles and equipment. For businesses with aggregated turnover of less than$50 million, the assets can be second-hand or new. Businesses with an aggregated turnover of up to $5 billion may also be eligible, but we strongly advise a discussion with the Attune team prior to purchase to ensure eligibility.
What assets are claimable?
In order to deduct an eligible asset you’ll also need to ensure there’s room in your taxable income to deduct from, you then should understand what assets are eligible for the Instant Asset Write Off… For example:
· fixtures and fittings (such as shop or cafe fit-outs)
· technology, such as laptops, computers, EFTPOS systems and securityequipment
· tools, plant and equipment
· office furniture
· motor vehicles such as utes, delivery vans and most cars(deductions for these are capped at a certain limit each financial year –$64,741 in 2022/23)
· motorbikes
· solar systems.
As you can see by this list, there are limits in some areas, most especially motor vehicles. Here are details of some of the exclusions:
· ‘Expensive’ cars (for the 2022/23 financial year, this means cars costing more than $64,741)
· Buildings and other assets that are eligible for capital works deductions
· Assets located overseas
· Some primary production assets (such as fencing and water facilities)that already have an existing instant write-off scheme in place
· Assets that are not used in a business.
And of course, you must be able to show that the asset is used as part of your business – this includes the percentage of business use if it is a motor vehicle. Generally, a log book will allow us to convert your kilometres into a business use and thus deductible percentage.
If you’ve identified a need in your business for a new asset, we suggest you contact the Attune team first so we can assess your situation against what is possible so we can guide you toward the best outcome.Essentially, we’ll go over your financial situation and discuss the asset in question before offering advice on a price cap and ultimately how much can be deducted.
For more about the Instant Asset Write Off and your eligibility, call Attune on 1300 866 113 or send us an email to start the conversation. And don’t delay, there’s not long left until the June 30 deadline arrives!
Outsourcing. It’s a big part of many successful businesses, but what can or could you outsource at a lower cost? Outsourcing done right, has the ability to create better value for your business or even add the expertise you need at a fraction of the cost of hiring in-house.
From C-suite execs to VAs and more, let’s take a look at some options that might surprise you, improve the running and bottom line of your business or simply reduce your workload so you can focus on more important tasks.
Reading reviews online or speaking with other business owners about their use of outsourcing can help guide you in making a decision to follow suit, but our main piece of advice is to simply make sure you’re undertaking the hire as part of your overall strategy. After all, following your business plan and growth strategy is ultimately what will keep you moving in the right direction.
Outsourcing is defined as this: obtaining (goods or a service) by contract from an outside supplier. The simplicity of meaning makes it easier to consider how it might work for you and to show that we’re not just talking about call centres…
There is literally thousands of options for outsourcing in today’s digital landscape with a quick google being enough to overwhelm you. With some careful research you might however be surprised at the kind of work you can hire for with your pick of personnel and their location.
There’s no doubt you’ve experienced a call or email exchange with someone working as an outsourced contractor in your daily life, but those calls or emails don’t always fit the cliché or stigma that often comes with outsourcing.
For example, let’s say you’ve started an online store and your business is young and growing. You’ve started it with most of the skills you need to continue building it, but you need some guidance from someone at the top level of such an operation. Well, you can find and contract a CEO with the specific experience you need at an agreed time and rate that fits your budget by outsourcing to someone like The Shared CEO.
Doing some digging reveals that The Shared CEO is run byJustin Hillberg, a man with decades of experience building online brands (some huge ones). After contacting The Shared CEO, it quickly becomes evident that you’re getting bespoke high-level help with their service. The beauty of the offering is that it doesn’t just come with a temporary CEO to offer real guidance, they also employ partners across related fields (including financial)that bolster what you can get from your time with them. It might seem out of the ordinary to outsource a key role like a CEO, but many businesses simply can’t afford that level of experience on their payroll and according to their team, the benefits of even a few hours a month can be enormous.
Our own version of outsourcing might also be worthwhile investigating for your business. Attune provide a unique Virtual CFO service, perfect for businesses seeking the expertise and financial insight of a CFO, without the permanent full-time employee price tag.
Attune’s Virtual CFO offers a qualified, experienced external financial specialist, who will assess cash flow and financial risk and identify opportunities for growth, guiding you towards reaching your business goals. We’re available when you require us and we strategically assist with maximising profitability and overseeing your business’ financial position. We offer the passion and commitment of a full-time CFO without the cost.
Perhaps it’s in the form of a Virtual Assistant who can take on the more routine tasks of your work day. One good example might be Remote CoWorker, a business offering dedicated VA professionals. They match your business with their staff and can tailor their time to suit your budget.You’ll get to meet (digitally) the person you’ll be dealing with directly and help ensure they’re suitably trained in the line of work you’re after.
The beauty of this arrangement is clearly in the saving of your time not to mention the ability to have someone on a contract that doesn’t require a full-time wage. Their list of clients is impressive enough, but the reviews reveal a trend of customers finding faster growth in their business through outsourcing.
The list doesn’t end there however… You might require customer support representatives, a phone answering service, an appointment manager, quality assurance or even a sales representative all of which you can find through any number of organisations.From Beepo to FusionBPO, the statistics of their reach and capability are almost staggering revealing the frequency of business using outsourcing services the world over.
The concept of outsourcing is great for so many businesses but each one will have their own story about how good or bad their experience is/was. If you’re considering outsourcing any part of your work, do your research on the people or business you’re engaging to make sure it’s the right fit.
If your business needs the experience of a CFO and you’d like to discuss our Virtual CFO service, we’d love to show you how it can be of benefit. Give the Attune team a call on 1300 866 113 or send us an email to start the conversation, you won’t regret it.
We’ve all got memories of February 14, whether they be from receiving nice cards and choccies in primary school to being scalded by your better half for forgetting it, but one thing doesn’t change… Valentine’s Day is big business.
In 2022, Aussies collectively spent somewhere between $415M and $500M on V-Day for their special someone. It seems an industry all its own with numbers like that. And, looking abroad the numbers only increase with American’s punching past the $1B mark in2022.
With all that in mind, (and the fact that it’s almost upon us) we thought it worth diving into Valentine’s Day with a look at its history through to how it has become such a big event for so many businesses.
There’s not really one source of truth when it comes to the original Valentine’s Day but, most historians say it’s roots either run through Christian or Roman history. There are even alternate versions of each story, so take the below with a grain of salted caramel ….
Some historians suggest that the Christian church placed St. Valentine’s feast day in February to “Christianise” the celebration of Lupercalia, a fertility festival (a pagan one), dedicated to Faunus, the Roman god of agriculture. It was an attempt to slowly remove the pagan beliefs and build the Christian fraternity. Many suggest this happened a long time after the ancient Roman’s version of the story however…
Legend has it that Emperor Claudius II executed two men (both named Valentine) onFebruary 14th in consecutive years of the 3rd century.Apparently one of the two Valentines was a priest who performed marriages in secret despite the fact that such things were outlawed for young men byClaudius who believed that single men made better soldiers. Once the weddings were discovered, Valentine was put to death. The tradition for love letters is said to have come from the note he wrote the night before his execution to his jailer's daughter, whom he had befriended, signing it "From Your Valentine."
As mentioned, Valentine’s Day has become big business with so many millions being spent in such a short period, and, we can point the finger at clever marketing over literal centuries as the reason...
In 1714 Charles II of Sweden began communicating with flowers, assigning messages to each type of flower. It’s suggested he was the first to assign love and romance to the red rose, setting the stage for the exchange of the rose on what we call Valentine’s Day today.
In 1822,Cadbury sold the first heart-shaped box of chocolates in England on Valentine’sDay, clearly seeing an opportunity to grab the market on a day that has by now been celebrated for hundreds of years.
In 1849 inMassachusetts, S.A Howland & Sons produced 12 sample Valentine’s Day cards hoping to make $200 on sales, but ends the sales trip with 25 times that amount, proving massive demand for such things on Valentine’s Day. One year later, the company featured the first ad for their cards in the famed local newspaper.
The business of Valentine’s Day began to blowup between 1866 and the 1950s, with everything from conversational candies being born, then turned into hearts. The launch of the Hershey Chocolate company and their Hershey kisses, the beginning of American Greetings(specialising in cards). During the same period, Hallmark cards was founded and the first florist delivery service (then known as FTD) pioneered the enormous business of sending flowers to far-away loved ones.
From the 1950s until now, it’s a landslide ofValentine’s specific businesses popping up, while clever marketers began to use the holiday for businesses that aren’t specific to Valentine’s Day. Examples of such things will just about blow your mind …
Well, as with any business, understanding and identifying a market then fitting that market is the beginning. But, building a strategy to support such things is the real key to longevity and solid growth.
We’re not suggesting that building a business around one day of the year is best practice, but if you apply the same thinking as those who are incorporating Valentine’s Day into their model you might find your own niche to fit and dominate. After all, strategically growing a business is where the fun is right?
For us it’s examples like V-Day that make us think a little bit laterally. Thanks to the sheer volume of business that happens on Valentine’s Day around the world, we as accountants can’t help but look a little closer.
If you’re looking for tailored, strategic advice that fits your business and financial goals, speak with the Attune team today on 1300 866 113 or send us an email to start the conversation.
Whether you’re staying in the workforce longer to boost your superannuation, or making more, early contributions to your super, you’re likely to be aware of the “superannuation work test” that required you to prove you were employed before your super accepted contributions.
As of 1 July 2022, some changes were made to the work test, namely it was abolished if you’re 67 years or older. That said, there’s still some cause for caution as there is more to consider.
Let’s take a look at the changes while first covering what the work test(and the exemption) actually is…
Since the beginning of our super system, contributions have been tied to employment and income, meaning you needed to be working to make or receive contributions to your superannuation.
As part of that, you were required to prove you were gainfully employed before your fund would accept a contribution. This is referred to as the superannuation work test.
Back in 2004, the rules were changed for people under 65, abolishing the work test for that age group, but the rules remained for those between 65 and 75 years of age.
In 2020, regulations changed further, lifting the threshold to age 67 in recognition that many Aussies are staying at work longer. This meant you didn’t need to meet a work test requirement for making personal or non-concessional contributions if you were under 67.
Now, in 2022, the law was repealed for contributions made for those aged between 67 and 75 wanting to make non-concessional or salary-sacrifice contributions. It’s important to note that contributions here are still subject to contribution cap limits.
The main caveat is this: If you’re between 67and 75 and wish to make a personal contribution (for which you’d like to claim a tax deduction), you are still required to meet the requirements of the work test.
The key to these is that once you turn 67, you must be able to prove you are gainfully employed. Any younger, and you’re in the clear.
You must be gainfully employed. This is defined as working at least 40 hours of 30 consecutive days during the financial year in which you’re making contributions. There’s no rule around how the hours are structured, but they must be over 30 consecutive days.There is no maximum number of hours.
Interesting …
Super funds were previously the administers of the work test rules, requiring you to complete a declaration before they’d accept your contribution.Since July 2022, funds are no longer required to administer the work test at the time they accept the contribution, it now falls to the ATO to be responsible for checking you meet the work test. This will happen when you lodge your income tax return as part of the normal assessment.
More broadly, the ATO deem you gainfully employed if you’re employed or self-employed and getting paid for the work.Receiving payments for assisting family members (gardening, baby sitting etc),doesn’t meet the definition for those wondering. It also doesn’t allow for passive investment income through dividends or property investment to qualify under the work test.
On 1 July 2019 the government introduced an exemption from the work test for voluntary super contributions made in the first income year after you retire designed to allow recent retirees more time to get things in order while preparing for retirement.
To qualify for the exemption you must:
Remember though, since 1 July 2022 if you’re between 67 and 75, you no longer need to use the work test exemption to make or receive non-concessional or salary-sacrifice contributions.
You can contribute any amount up to your current concessional contributions cap for a particular financial year if you’re using the work test or work test exemption to make contributions for which you intend to claim a tax deduction.
As at 2022-2023, the annual general concessional contributions cap is $27,500, but you may be able to contribute more if you have unused concessional contributions caps from previous years. This is called a carry-forward contribution.
As with just about any matter involving superannuation (and indeed related taxation), whether it be a Self Managed Super Fund or not, the best advice is to get advice. Speak to the Attune Advisory superannuation experts as part of your planning. We’re hereto give you tailored, strategic advice that will remove the guesswork and put you in the best position for retirement possible for you. Give the team a call on 1300 866 113 or send us an email to start the conversation.
