COVID-19 stimulus

You could be eligible for a tax rebate or cash payment.

In response to the COVID-19 pandemic, the Australian Government has announced several initiatives to assist individuals and businesses through these trying times.

Whilst this is not an exhaustive list of the measures the Government is initiating, we will take you through some of the more relevant programs for our clients. It is also important to note that at time of publishing, these proposed measures are yet to be legislated so, we cannot guarantee these details are correct or final.

We will take you through each of the following changes so you know which incentives you may be eligible for.

 

For businesses, these are the new initiatives:

• Business Cashflow Assistance
  • For businesses with employees
  • For businesses with apprentices/trainees
• Instant Asset Write Off (IAWO) increase
• Backing Business Investment
• Other Business Support

 

For individuals, you could be eligible for:

• House Hold Stimulus payment

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Business Cashflow Assistance – boosting cashflow for employers

Facts:

• Eligible businesses could receive 50% of their employees’ withheld tax payments back.
• This would be received in the form of a credit on your Activity Statements (either monthly or quarterly) between March and June 2020.
• The maximum Activity Statement credit is $25,000 over this period.
• To be eligible, your annual turnover must be LESS than $50 million and have employees (sole traders may not qualify).
• If you do not meet the tax threshold for tax withheld, you would receive a credit of $2,000 on your activity statement over the period.

The aim of this assistance package is to support cashflow challenges faced by businesses; more specifically to allow businesses to retain their employees and continue to pay their wages.

For more information on the proposed Cashflow Assistance for employers, see this fact sheet from the ATO.

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Business Cashflow Assistance – supporting apprentices and trainees

Facts:

• Eligible businesses could apply to receive 50% of their apprentices/trainee’s wages back.
• This will be received as a reimbursement, accessible after an assessment.
• The maximum reimbursement amount is $21,000 per apprentice/trainee for their employment period between the claimable dates.
• The total claimable period is between January 1^st and 30^th September 2020. The apprentice/trainee must be with your business as of March 1^st, 2020 to qualify.
• To be eligible, you must have less than 20 full-time apprentices/trainees.

This assistance will assist small businesses in retaining their apprentices/trainee’s over difficult months ahead. If there is no opportunity to retain your apprentices/trainees, there is support in place to organise re-employment of those individuals.

For more information on the proposed Apprentice/Trainee Support assistance, see this fact sheet from the ATO.

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Instant Asset Write Off increase (IAWO)

Facts:

• Eligible businesses will be able to claim immediate deductions on their annual turnover for assets purchase for ~$150,000 or less (the cap for vehicle purchases could be limited to a maximum of $57,581)
• This IAWO increase is in effect from now until June 30^th, 2020 for assets first used or installed by the end date.
• This deduction will be claimable per asset (i.e. you can write off multiple assets at $150,000 each)
• To be eligible your business must have an annual turnover of less than $500 Million.
• This will result in a lower payable tax amount at the end of the 2019/2020 financial year.

This IAWO increase will back businesses to invest in the economy to help recover from the economic impact of COVID-19.

For more information on the proposed IAWO increase, see this fact sheet from the ATO.

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Backing Business Investments

Facts:

• Eligible businesses may be able to claim an extra depreciation deduction of 50% of an asset’s costs, on top of the standard 30% depreciation, in the first year.
• This will result in a tax benefit over the life of the asset, as well as provide better cash flow.
• This applies to assets purchased & first used/installed between now and June 30^th, 2021.
• To be eligible your business must have an annual turnover of less than $500 Million.

This accelerated depreciation deduction scheme will allow businesses to purchase equipment, support the economy, and lower taxes over the next financial year.

For more information on the proposed Backing Business Investments scheme, see this fact sheet from the ATO.

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Other business-related support

Along with the above-proposed measures, the ATO has also released a list of optional relief support,  available to certain businesses facing financial difficulties.

These support options include payment deferrals, GST cycle changes, and credits, Pay As You Go (PAYG) installment variations, and low-interest tax re-payment plans.

Of particular interest is the support offered to PAYG payers. If you pay quarterly PAYG installments, you can lodge a revised activity statement for the March 2020 quarter, to vary your installment payment and potentially claim a refund for payments already made.

For more information about PAYG variations and other relief support options for businesses, visit the ATO website here.

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House Hold Stimulus payments

Facts:

• Eligible individuals could receive a ONE-OFF payment of $750 (payment is per person, not per household).
• This would be received as an automatic deposit into your bank account.
• To be eligible, you must hold a certain concession card or receive a certain support payment (for a full list see here).
• You must hold an eligible concession or receive an eligible support payment as of March 12^th, 2020 to receive the one-off stimulus payment.
• This one-off stimulus payment will be paid automatically from March 31^st, 2020.
• If you are under 22 years of age and do not have employer leave entitlements, you may be eligible for the JobSeeker Payment.

In order to support lower-income Australians, pensioners, and income support recipients, this stimulus payment will be made to assist the increased demand on the economy.

For more information on the proposed House Hold Stimulus payment, see this see here from the ATO.

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  If you believe you qualify for any of these proposed initiatives summarised above and would like to know more information specific to your situation please contact us and we will be happy to help.

Again, it is also important to note that at the time of publishing, these proposed measures are yet to be legislated so we cannot guarantee they will be enacted according to these details.

There is talk of an additional stimulus package on the agenda and soon to be announced, however, this has not been confirmed at the time of posting this article. As this is passed and comes to fruition, we will update you. You can stay informed here.

Liability is limited by a scheme approved under Professional Standards Legislation.

First Home Loan Deposit Scheme

Purchasing your first home is a mix of making a daunting life decision and overwhelming excitement all at once. Even though you’re locking yourself in for a significant debt for the first time and you might be doubting your saving ability, there are many support systems in place to make the process of buying your first home easier.
The First Home Loan Deposit Scheme is a new initiative by the Australian Government and the National Housing Finances and Investment Corporation (NHIFC), where the Government will guarantee support for a percentage of your deposit.

Generally, you need to save a minimum of 20% of a home’s value as a deposit to avoid paying extra insurance and bank fees on your first home loan. Referred to as Lenders Mortgage Insurance, you’re basically paying the bank a fee to cover you for the amount you fall short on your deposit. With the new Deposit Scheme, the minimum deposit you’re required to pay, to avoid extra fees, is just 5%. If you can put forward 5% of your new home’s value, the Government and NHIFC will provide a guarantee to your bank for the remaining 15% (maximum).

This is not a cash payment or a deposit for your house, and there are no costs involved. What you get is support in the form of a guarantee from the Government to your bank, that you will be responsible for meeting all costs and repayments over the life of the loan. What’s even better, is this Scheme can be used in conjunction with other initiatives like the First Homeowners Grant (which exempts you from paying stamp duty on your first home).
As expected, there are rules for eligibility, which are outlined in great detail here. Some of them are:

• It must be your first home purchase
• You must be 18 years of age and an Australian Citizen
• You must be either single or in a de facto/married relationship
• You must earn under a certain amount ($125,000 for singles / combined $200,000 for couples)
• It must be your primary residence (investment properties are not covered)
• The property price must be under the price cap for its location (more information here).
• It must be a principle and interest loan

If you can tick off all of these criteria, then you are eligible to apply for a place in the scheme but be quick because there are limited places available in this financial year. The Deposit Scheme is only offered in partnership with certain lenders though, so it’s best to talk to your lending specialist to reserve your position in the Scheme before they run out. There will be more places released after July 2020.

Get in touch with Paul Duncan, Geelong’s Lending Specialist to talk about securing your place in the First Home Loan Deposit Scheme today. Contact us to make an appointment, or phone 03 5224 2366.

Information is intended to be of a general nature only and any advice has been prepared without taking into account any person’s particular objectives, financial situation or needs</em

New Year resolutions come in many shapes and sizes and range from the really challenging – I am going to get fit, healthy, drink less, lose weight – through to the less strenuous – stop watching reality TV, meditate more, read some good books, or take a break from Facebook.

For most of us, we are lucky if our New Year resolutions last more than a couple of weeks, at the most. Then, we fall back into our old ways. Sound familiar? This year, being a brand-new year and the start of the “20’s”, we would like to encourage you to spend some time to get your “super” sorted. While superannuation is about as exciting as spending a Saturday night sharpening lawn mower blades, or tidying the underwear drawer, there can be some real financial benefits in getting your super in order.

How do we get our super sorted out in the most painless way?

We all have super. And, for many people, we like our super so much we have multiple accounts! The problem is we lose track of those accounts and don’t really know what we have, where it is, or how much we have saved. The Australian Taxation Office (ATO) reports that as at 30 June 2019 there was almost $20.8 billion of lost and unclaimed super, spread over 2.8 million separate accounts. That’s a lot of money currently sitting with the ATO. Now, contrary to what you might think, the ATO is keen to reunite all that lost and unclaimed super with its rightful owners.

How did we lose our super in the first place?

Well, we move around a lot. We change address, we change jobs, and we forget to tell our super fund where they can find us. And, even when they try to get in touch by email, we probably tend to ignore those emails any way. Each time we change jobs, it can seem easier to get our new company to deposit super contributions into their “default” fund. As a result, we end up with multiple accounts with a variety of different super funds. After a while, if our super fund cannot find us, our super becomes “lost” and it is transferred to the ATO.

What can we do?

Most of us will now have a “My Gov” account. If you don’t have one, then it is time to get one. This is the way the government wants us to access government services like the ATO, Medicare, and Centrelink. Within your MyGov account, if you select the ATO service you will find an option called “super”. Within that “super” option, you can select “fund details”. Once there, it will show the details of each super account you have. You can even manage your funds from here, including the ability to combine all your super accounts into one if you wish. Doing so may help save on the fees for owning multiple super funds. However, before consolidating your super, make sure to check that you are not losing valuable benefits like insurance. Talk to a financial planner and have them check out the insurance you have or, at the very least, call up each super fund and ask then to let you have details of your insurances.

How much lost super do you think the ATO might be holding for you?

Superannuation is going to become more important as we age. Living a life that is solely supported by the age pension is not going to deliver the lifestyle that many aspire to for their retirement. Now is the time to take control of your super and start to make some progress in adding to your eventual retirement nest-egg.

Take control of your Super this year. Talk to our Financial Planners to get started – contact us here.

HG Financial Services – Corporate Authorised Representative 401592 of Alliance Wealth Pty Ltd  ABN: 93 161 647 007 AFSL: 449221

The information provided is general advice only has not taken into account your financial circumstances, needs or objectives. This publication should be viewed as an additional resource, not as your sole source of information. Where you are considering the acquisition, or possible acquisition, of a particular financial product, you should obtain a Product Disclosure for the relevant product before you make any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. It is imperative that you seek advice from a registered professional financial adviser before making any investment decisions.

The idea of purchasing a property is daunting enough whether it is your first home or another addition to your investment portfolio. Add in the idea of the mountain of paperwork that goes along with obtaining a home loan and it may seem impossible!

The paperwork lenders require can be significant, and it’s important to provide the correct documentation and completed checklists. Sending your home loan application with missing or incorrect documents can result in your loan application going back and forth without result or even derail the application altogether.

After evaluating the risk involved with repaying a loan, lenders will decide whether or not your application will move forward. While requirements may vary from lender to lender, there are some key criteria commonly used to assess the risk of a client.  

Income

The first and foremost area your lender will look into is how much you earn, as well as how stable your earnings are. They want to make sure you can consistently make repayments to your loan and are maintaining continuous employment. Bank statements, payslips, group certificates, and tax returns are among the documents required to give evidence of your income.

 

Savings

Although the overall number in your bank account is taken into consideration, lenders look at whether you are capable of saving over the long term. A bank account statement showing regular deposits is an example of a required document. In the lead-up to applying for a home loan, think twice about buying your daily coffee or eating out multiple times a week. Instead, deposit this money into your savings account. It is not uncommon for applications to be rejected if a savings history is deemed not to be genuine, for example, if the majority of savings have been given as a gift.

 

Other income/assets

To better determine your financial situation, lenders want to see proof of your assets and liabilities, including savings, shareholdings, and motor vehicles or an additional form of income. The Hrkac Group team can advise you on the specific paperwork requirements, as each lender can differ.

 

Credit

In order to determine that you have been able to make any previous credit card repayments and bill payments, lenders will look at copies of credit card and personal loan statements. Keep in mind that it’s not only just your credit card, home loan, or personal loan repayments they’ll look at, but also any mobile phone and utility bills.

Buying a home is a big step in everyone’s lives and there are certainly many hoops to jump through along the way. The team of Mortgage Brokers at The Hrkac Group aims to make the process of gathering all the necessary paperwork and applying for a home loan as simple and stress-free as possible.

Call us today to arrange an appointment.

Although speaking about mental health is becoming more accepted in society, unfortunately, the issue of mental health encompasses a complex and often ‘taboo’ subject within the workplace.

The trust clients hold in their accountants is a relationship unlike many others. With 9 out of 10 clients trusting their accountant beyond compliance and more than half of small business operators stating that running their own business has led to feelings of anxiety and depression, largely caused by financial and cash flow concerns, the accounting profession is evolving into a lot more than reconciliation, profit, and loss. Trusted advice does not always have to be all about the numbers, more so a realisation that sometimes it’s more about listening to the person sitting in front of you and what you can do to help them.

With the term ‘accidental counsellors’ being used around accounting firms more frequently, a typical day as an accountant can entail wearing a large array of hats. We may find ourselves dealing with a client-facing bankruptcy, someone going through a messy divorce, a small business owner struggling to support themselves and their family, or someone fighting to get on top of a mountain of debt.

As accountants, we are often working with people and businesses who are experiencing some level of stress about their finances, and we must be careful to ensure we don’t carry and absorb too much of the stress ourselves. This occupational hazard is a natural reaction as there is always a sense of genuine care toward our clients.

We must be conscious about how taking on other people’s stresses and issues can make an impact on our mental health. In Australia, nearly a third of accountants suffer from mental health issues, with more than half admitting depression and anxiety leaves them dreading going to work. We are all guilty of taking our work home with us during particularly busy and demanding times but, having a good work, life balance and feeling comfortable in the workplace is essential to maintaining positive mental health.

Cultivating an environment in which both employees and colleagues feel safe to talk about their mental health and the issues their clients or themselves are facing is vital to maintaining a supportive and collaborative working environment. To tackle the stigma, The Hrkac Group, along with some other leading accountancy firms, are increasingly adopting new measures and initiatives within the workplace.

From basic mental health awareness programs, maintaining open communication within the workplace, senior leaders endorsing mental health as being important, boosting mental health awareness and knowledge within the workplace is continuing to improve.

For further mental health resources, please visit the World Mental Health Day website.

If you or someone you know is suffering from mental health issues, please contact Lifeline on 13 11 14.

Today’s Home Loan market is a complex proposition for potential borrowers, from First Home Buyers through to experienced property investors. Engaging a Mortgage Broker to assist you can make all the difference in being able to find a suitable loan from a maze of lenders, with complex lending rules and regulations currently in place. Mortgage brokers can do all of the leg work for you, including checking your borrowing capacity and ensuring you meet the lending criteria, of dozens of lenders, and you choose who you want to deal with.

It is important to note that a Mortgage Broker is required to work in your best interests by law, and consumers have legal protection if a Broker doesn’t do so. Hrkac Group Mortgage Brokers don’t charge any fees to our clients. If we do our job properly and locate a suitable loan for our clients, the Lenders will pay a commission to us. The commission isn’t added to your loan amount or interest rate, so it is a completely free, ethical and professional service we provide.

Why use The Hrkac Group’s Mortgage Brokers

1) We’re thorough

We discuss and analyse your existing situation, your home loan needs and requirements, and obtain all necessary information pertaining to your home loan application.

2) We make it simple

We explain the types of home loans available to you from a range of banks and specialist finance companies. Such as:

• Home Loans
• Investment Home Loans
• Vehicle & Equipment Loans
• Small Business Loan
• Refinances
• Debt Consolidations

3) Specialised & personalised service

Based on the information provided by you, and utilising specialist home loan software, we match your home loan requirements to a selection of home loan products offered by our panel of lenders.

4) Overview of costs

We provide an overview of your ‘Purchase Budget’ incorporating the relevant costs associated with your home loan application in writing.

5) In-depth view of products

We provide an in-depth overview of the home loan product or products you select, in writing.

6) We do the tricky parts

We complete and package your home loan application and deliver it to the lender’s assessment team on your behalf.

7) We dot the i’s and cross the t’s

We act as an intermediary between you and the lender, negotiating the terms and conditions of your loan. We will also answer any questions the lender’s assessment team may have, on your behalf.

8) Communicate with all parties

We liaise with your solicitor, real estate agent accountant, and any other related parties to ensure a smooth and timely settlement.

9) Going the extra step

We assist with future home loan requirements, whether you wish to check, change, or top-up your loan, or renegotiate your current home loan interest rate with your existing lender.

10) Keeping you updated

We act as a valuable information service beyond the settlement of your loan by providing you with relevant information on the home loan market, updates on products, and special offers that may be of interest to you.

 

Take control of your financial future by meeting with the best Mortgage Brokers in Geelong at The Hrkac Group. Make an appointment today via Contact Us, or phone (03) 5224 2366.

As we’re gearing up for our busy period, we want to make sure your preparation for this year’s Tax Return appointment is easy and hassle free. From experience, providing the right paperwork, receipts and statement information is the key to ensuring you get the best out of your Tax Return appointment. With this in mind, our Accounting specialists have gathered together an informative checklist you can use as a guide.

Anyone can use our business or personal tax return checklists to prepare for their appointment – flag it in your inbox, bookmark it or even print it out. You can keep coming back to these guides, so you know what to bring to make your appointment run smoothly.

 

Personal Tax Return Checklist

Some important items to remember:

• A copy of last year’s Tax Return
• PAYG/Group Certificates
• Receipts for claims/deductions
• Self-Education costs
• Private Health Insurance Annual Taxation Statement

Business Tax Return Checklist

Some important items to remember:

• Back up or invite your Hrkac Accounting specialists to your accounting program
• Capital purchase documentation
• Payroll records

Download

 

Not all items on these checklists may apply to your return and you don’t have to bring these to your appointment, but they can be handy to keep on file for next year. If you are unsure about any of the items on the checklist, bring as much information as you can to your appointment, and we can help you know what is relevant to your tax return.

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This year, The Hrkac Group is taking online bookings for Tax Return appointments. You can use the link below to book your appointment online or use the top right button on our website whenever you’re ready.

Top Tip 2019:

Although technology is helping us improve our taxation processes, we don’t always have online access to the most up to date information available.

It’s important to bring your Group Certificate to this year’s appointment so that we can work with the correct and most recent information (we can’t always access your certificates online.)

If you have any questions or would like to book your Tax Return appointment, please contact The Hrkac Group here.

 

Liability limited by a scheme approved under Professional Standards Legislation.

Single Touch Payroll (STP) is a way of streamlining tax and super information to the ATO from your payroll or accounting software. Designed to provide ‘real-time reporting solutions, the implementation of STP will mean employers will now report figures at the time of payroll, and employees can access year-to-date tax and superannuation details as they require them.

So what does this mean for employers and employees alike?

 

For the Employers

All businesses will be required to comply with Single Touch Payroll from 1st July 2019. In the coming months, we will see new software solutions and options enter the market. Early adoption is possible, and some businesses may have seen this already as providers have begun rolling out new software options for those businesses wanting to uptake this method of data processing. Businesses utilising STP will be able to report employees’ salaries and wages, allowances, deductions (for example, workplace giving) and other payments, pay as you go (PAYG) withholding, and superannuation information, while eliminating the need to provide end of year payment summaries.

 

For Employees

The main change for employees is the introduction of real-time reporting meaning we will slowly see the reduced need for EOFY PAYG Withholding Payment Summary. This information will now be available via your myGov account, allowing access to year-to-date taxation summaries and super information, continuously being updated in real-time as your employer pays you. You will also be able to continually check your super contributions and receive your tax-ready payment summary information (income statement) via myGov.

For more information, visit the ATO website.

Follow our handy Personal and Business Tax Time Checklists to make sure you’re prepared.

So it’s that time of year yet again! If you are new to lodging a tax return or if you are a new Start-Up Business or Sole trader/contractor – even if you’ve been doing it for years – getting all of your financial documentation together can be a daunting task.

If you just don’t know where to start, the Hrkac Group are here to help. We strive to take the guesswork out of Tax time and have put together helpful checklists for both personal and business taxation clients, so that you can be confident that you have everything in order.

For those looking to lodge a personal tax return, here is a list of some of the items required by your registered tax agent:

• A Copy of your previous years income tax returns (new clients only)
• PAYG payment summaries Group Certificates
• Dividends and other investment income
• All Rental Property Information
• Receipts for any possible claims/deductions including:
• Motor Vehicle expenses
• Any Travel expenses
• Uniform purchases and Laundry costs
• Self Education Costs
• Any Work related expenditures
• Tax agent fees paid during last financial year (new clients only)
• Your account bank details for any refund
• Any Gifts or Donations
• Income Protection premiums paid
• Private Health Insurance Annual Taxation Statement

For those of you running a business, here is a list of some of the items required by your registered tax agent:

• Backup or invite your agent to join your Accounting program
• (i.e MYOB/Reckon/Quickbooks/Xero)

• Bank Statements for all business accounts including loan statements
• Documentation for any new Capital purchases such as Motor Vehicles or properties
• Trade Debtors listing as at the end of the period
• Trade Creditors listing as at the end of the period
• Detailed payroll records
• Do you have any carried forward capital losses? If yes, how much

New clients will also need:

• a copy of most recent years financials and tax returns
• Previous accounting fees paid
• Personal and business details

Download our Personal Tax Checklist or our Business Tax Checklist here!

If you would like to know more or to make a time to see one of our Geelong based Personal or Business Tax Specialists, feel free to contact the Hrkac Group today!

The Hrkac Group has access to a Car Buying Service for both Corporate and Private car buyers with an impartial, cost-effective, and stress-free solution for purchasing your new motor vehicle. An average car purchase takes approx. 40 hours from start to finish, this service can eliminate all that stress.

The process is, we get to understand the client’s new vehicle requirements and can offer suggestions if required. We arrange a test drive at your local dealership in the chosen vehicle or it can be brought to your home or workplace without any obligation to buy. We handle all the price negotiations with our preferred dealers to ensure the exact vehicle you want at the very best price.

We can sort out your trade-in also to obtain the best price. We arrange the paperwork, car accessories, and registration. We can deliver the car to your home or work and we can take you through your new vehicle. If you prefer, your car can be picked up at the dealership. There are no fees for this service. You pay the best price that has been negotiated for your new vehicle.

Should you, your staff, family, or friends like further information, contact The Hrkac Group Finance Department, on 5221 2355 or email paul@hrkacgroup.com.au. We have had multiple clients use it so far and it has saved them time and stress and as a result, they have recommended it to others already.

Are you an employer? Are you aware of the recent changes?

As of October 1^st 2016 the ATO have put out changes to the PAYG withholding tax rate for employees earning over $80,000 a year.

These changes see the 32.5% Tax threshold increase from $80,000 to  $87,000 in the withholding schedules as a result of  personal income tax relief changes.

If any extra tax was withheld from your employees before the rate change on October 1^st, your employees will be credited when they lodge their 2016-17 income tax returns. No employer adjustment or refund is required.

Feel free to contact us at The Hrkac Group for advice on these PAYG tax rate changes and download the updated tax rate tables here.