As a sole trader or small business, if possible, it is best to put money aside throughout the year to help pay for your tax. Make sure you regularly set money aside, or are aware of future tax payments, so you are able to meet your tax responsibilities. A set routine for putting aside tax as you go is essential to avoid any tax-time panic.
Business goals! You know they’re a good idea, but there’s filing to be done, bills to chase and clients that won’t stop calling. I get that the everyday tasks of running a business can distract you from those big goals that make running a business worthwhile in the first place. So let’s do away with big, long term goals. Let’s just focus on this quarter and pare it back to manageable goals that you can achieve.
If you’ve been watching the news lately, you might have heard that the change in franking credit rules is going to break open the earth and swallow our retirees whole.
Or if you’re listening to the other side of politics, it won’t. So who’s right? Who’s wrong? What’s a franking credit? Let’s start with that. A franking credit is used by the Government to avoid you paying tax twice on dividends from shares. Say you invest in a company like Google. Hang on, this article is about paying tax :). Say you invest in a company like John’s Global Meat Pies. John’s Global Meat Pies pays you $700 in dividends after paying $300 in tax on that amount ($1000 in total).
The recent banking royal commission has highlighted some appalling behaviour on the part of the big banks.
Unfortunately, the recommendations don’t tackle some of the key structural issues that lead to their poor behaviour in the first place. For instance, a lack of separation between their banking and ‘financial product sales’ businesses, which turned ordinary banking customer service clerks into salespeople. Many bank boards also don’t have a mandatory employee representative who can raise issues of malpractice and do something about it from the top down. As a result, the banks have always chased profit at the expense of many individual costumers and as the heat dies down from the royal commission, that same tendency will re-emerge. We’ve had a serious enquiry into banking every 10 to 15 years within the sector since the deregulation of the 1980s because we never fully resolve these issues.
1. They don’t get you the highest possible tax return.
This is a big one for individuals and businesses. Everyone wants to pay the lowest amount of tax possible while sticking within the law. But when you sit with your accountant and they ask you the same stock standard tax questions and habitually punch your details into a computer before churning out your predicted tax bill and quoting you on their fee…. you’re often left doubting that they found every saving possible for you. They’re just doing the bare minimum. Make sure you partner with an accountant who probes you for information, asks follow up questions and gets the information out of you they need to optimise every element of your tax return in your favour. Our staff have deep, up-to-date tax knowledge and they work harder so you enjoy the best possible tax result each year.