Creating a robust SMSF trustee succession plan is critical for Self-Managed Super Funds (SMSFs) managed by aging trustees.
An effective succession plan ensures the smooth transition of control and management of the SMSF when the original trustees are no longer able or willing to manage the fund due to age, health, or other reasons. A trustee succession plan must encompass preparation, clear communication, and legal compliance.

Understanding SMSF Trustee Succession

SMSF trustee succession plan involves preparing for the future management of the SMSF, ensuring it continues to operate effectively and complies with Superannuation Industry (Supervision) Act 1993 (SIS Act) requirements. Remember to check that your new Trustee appointment is suitable and not a disqualified person to act as an SMSF Trustee.

Looking after you and your SMSF. It’s about safeguarding the fund’s assets and the beneficiaries’ interests, ensuring that the transition of trusteeship does not negatively impact the fund’s performance or compliance status.

Early Planning

Start planning early. It can sometimes be a difficult decision or discussion, but dealing with dignity can mean no surprises. Don’t wait for health issues or other urgent matters to force a quick decision. Early planning allows for a thoughtful, strategic approach to selecting and preparing the next generation of trustees.

It also may mean reviewing the asset composition of the fund. This may result in uncomplicating the Funds strategy or selling down investments that require the Trustee’s time and experience to manage. Consult a Financial Planner if you require assistance in this area.

Selecting Successor Trustees for your SMSF

Consider potential successors’ capabilities, willingness to take on the responsibility, and their alignment with the fund’s goals. Successors can be family members, friends, or professional trustees. Discussing the responsibilities and expectations with potential successors is crucial to ensure they are prepared and willing to take on the role.

Ensure that the succession plan complies with the SIS Act and Trust Deed.

Check your Fund’s Trust Deed. You may need to update it to include provisions for the succession process. Consult with legal professionals to ensure the plan is legally sound and not inadvertently compromise the fund’s compliance status.
Documentation and Communication of your Trustee strategy

Document the succession plan clearly, including the roles, responsibilities, and process for transitioning trustees. Communicate the plan to all relevant parties, including current trustees, successors, and professional advisors such as your Accountant.

Keep your potential Trustees in the loop. This may either be by making them Trustees early or by keeping them informed annually with the audited financial statements.

Can my SMSF Trustee replacement get paid while carrying out their Trustee duties and my wishes?

As a trustee of an SMSF, your primary responsibility is to manage the fund prudently. Therefore you cannot receive compensation from the SMSF for fulfilling your trustee obligations, such as overseeing investments, administration, and compliance.

Review and update the succession plan regularly to reflect changes in the fund’s circumstances, membership, or legislation. This ensures the plan remains relevant and effectively safeguards the SMSF’s future.

A well-crafted trustee succession plan is essential for an SMSF’s long-term success and stability, particularly when managed by aging trustees. By taking a proactive approach to succession planning, SMSF trustees can ensure a seamless transition that protects the fund’s assets and the financial security of its members.

Ultimately, the goal is to ensure the SMSF continues to meet its members’ retirement goals, regardless of changes in its management. When it comes to Estate planning, peace of mind is thinking outside the unexpected and dealing with sometimes hard and awkward what-if scenarios.

To maximize your profit is not that hard. It would be best if you focused on a few changes in your business. Running a business allows your creativity to thrive. You are in charge and can make decisions that push you out of your comfort zone. Making a profit is one of the most important business operations.

When you make more than you spend, you are technically making a profit. Even a small profit is worth celebrating, so look at our short guide on maximizing your profit when running a business.

How to maximize your profit and run a successful business Four Points to maximize your profit.

Cost-effective decisions

Always ensure your decisions are cost-effective. Consider whether your decisions will increase your income or overall expenditure.

● For example, if you want to sell artwork and make a living in the creative industry, it will be worth considering whether you could make more money selling your wares online or in a shop.

● A shop has overhead to consider, but an online space is entirely digital and may mean you ultimately make more money.

Overhead that eats into your profit!

Remove unnecessary overhead. If you aren’t making money on a specific product or service yet still spending money to source, stock, or create, you may be making an unnecessary loss. Focus on removing any unnecessary overheads.

● Consider ways to cut back on expenses and save money. For example, if you are selling goods, ensure you shop around to get the best deal from the wholesaler.

Water and nurture will help your business grow!

Start small and grow gradually. When you are working to turn a profit, make sure you keep an eye on the services or products that sell.
● Avoid spending significant amounts of money on stock if it repeatedly fails to sell. Stick to your popular services and products and maximize profit by always selling what people will buy.

● Keep an eye on the specific services and products you have and make a list of the most popular sellers. Consider creating promotional tools and making those items or services as prominent as possible to catch attention.

Promote

Concentrate on your marketing. Remember, potential customers need to be aware that your business exists.

● Consider how you can market your business for free or as little expense as possible. Remember, you are trying to profit, so keep your expenditures low.

● Social media can be a powerful free tool. Consider using it to promote your business and enlist the help of your friends and family to get them to spread the word.

● Spend time pushing the products that sell well and develop innovative marketing campaigns for struggling stock. If customers know a particular item or service exists, it might pique their interest and make you an unexpected sale.

● Ask customers to leave you reviews and allow everyone who uses your business to offer feedback. You’ll build up a trusted customer base and be seen as more reliable than other businesses. It’s a great way to stand out from the crowd!

Tip – watch what you spend!

The most important thing to do is to keep your expenditures low. Once you’ve made enough to cover your outgoings, you’ll find everything else is a profit. Ongoing profit reporting is a must. Knowing your profit or loss every month means you are reviewing every opportunity to maximize profit.

Be bold and ensure people have a positive experience working with your business. Be creative and adventurous, and stand out for all the right reasons.

The government has just announced that from 1 July 2024 the standard concessional contribution cap will increase from $27,500 to $30,000

The non-concessional contribution cap which we calculate as four times the standard concessional contribution cap will also increase from $110,000 to $120,000.

This will also bring about a higher non-concessional bring forward cap of $360,000 if triggered in the 2024/25 year onwards.

We encourage our clients to continually review their superannuation plan. In many cases superannuation is an effective strategy moving forward as you are nearing retirement . Please contact us if we can assist you in this area

Profit Margin vs Markup can be calculated and result in different outcomes 

Profit margin and markup are separate accounting terms that use the same inputs and analyze the same transaction yet show different information.

 Both profit margin and markup use Revenue and costs as part of their calculations. The main difference between the two is that a profit margin refers to sales minus the fee of goods sold, while markup is the amount by which the cost of good increases to get to the final selling price.

Profit Margin needs to be healthy

Understanding these two terms can help ensure that price setting is done to get the best profit for your product or service.

 If the price setting is too low or too high, it can result in lost sales or profits. Over time, a company’s price setting can also have an inadvertent impact on market share since the price may fall far outside of the prices charged by competitors.

KEY TAKEAWAYS to generate profits from your profit margin

• Profit margin and markup are separate accounting terms that use the same inputs and analyze the same transaction, yet they deliver different results
• ion.
• Profit margin refers to the Revenue a company makes after paying the cost of goods sold (COGS).
• Markup is the retail price for a product minus its cost.

Understand your profit terms

An understanding of the terms revenue, cost of goods sold (COGS), and gross profit are important.

Your Revenue refers to the income earned by a business for selling its goods and services.

COGS refers to the expenses incurred by manufacturing or providing goods and services.

GROSS PROFIT profit refers to any revenue left over after covering the expenses of providing a good or service.

Making sure your cost of goods to Revenue is important

Monitoring the gross profit margin is essential for several reasons, as it provides critical insights into your business’s financial health and operational efficiency. Here are the key reasons why:

A higher margin suggests that the company is selling products at a higher markup over its costs, signifying better profitability.

It’s important to monitor profitability

Monitoring gross profit margin helps you as the business owner identify trends in cost structures and take action to manage costs more effectively. If the margin is declining, it could signal rising production costs or pricing pressure, prompting a review of suppliers, costs, or production processes.

Your product’s gross profit margin can influence pricing strategies. Understanding the margin allows businesses to adjust prices without dipping below profitability thresholds. It’s crucial Businesses can identify the most and least profitable by monitoring gross profit margins for different products or services. This information can guide resource allocation, product development, and marketing strategies to focus on the most lucrative areas.

Yes, increasing your markup can potentially lead to better gross profit margins, but it’s important to approach this strategy carefully to ensure it doesn’t negatively impact sales

Here are some considerations and strategies for increasing your markup:

Before raising prices, it’s crucial to understand your market’s price sensitivity. If your customers are price-sensitive, a higher markup could lead them to competitors. Market research and testing can help you assess how price changes might impact demand.

After adjusting your markup, closely monitor sales data and customer feedback. This will help you understand the impact of price changes on demand and customer satisfaction. Be prepared to adjust your strategy if you see adverse effects on sales volume.

While focusing on increasing markup, look for ways to reduce costs without compromising quality. Improved cost efficiency can enhance your profit margins without needing to rely solely on price increases.

Consider implementing price increases gradually. Sudden, significant increases can shock customers and drive them away. Smaller, incremental increases might be more palatable and less likely to cause a negative reaction.

Profit Margin and examples

Profit margin refers to the Revenue a company makes after paying COGS. The profit margin is calculated by taking Revenue minus the cost of goods sold.

The difference is shown as a percentage of gross Revenue.

For example, if a company sells a product for $100 and it costs $30 to manufacture the product, its margin is $70 or 70% gross margin

Profit margin is sales minus the cost of goods sold. Markup is the percentage amount by which the cost of a product is increased to arrive at the selling price.

Markup

Markup shows how much more a company’s selling price is than the amount the item costs the company.

Therefore the greater the markup, the more revenue a company makes. Markup is the retail price for a product minus its cost, but the margin percentage is calculated differently. In our earlier example, the markup is the same as gross profit (or $30) because the Revenue was $100 and costs were $70. However, the markup percentage is shown as a percentage of costs as opposed to a percentage of Revenue.

However, using the same numbers as above, the markup percentage would be 42.9%, or ($100 in Revenue – $70 in costs) / $70 costs.

Profit margin and markup show two aspects of the same transaction. Profit margin shows profit as it relates to a product’s sales price or Revenue generated. Markup shows profit as it relates to costs.

Markup usually determines how much money is being made on a specific item relative to its direct cost, whereas profit margin considers total Revenue and total costs from various sources and various products.

SMSF for Property development undertaken by an SMSF can be undertaken. We however strongly recommend seeking advice.
ATO has issued a warning about relates to the use of SMSFs to invest in property development in a manner that inflates the profits earned by the SMFSs when compared to the capital the SMSF commits to the venture.

Can my SMSF invest in a property development?

An SMSF can as part of its investment strategy invest in property ventures. This is provided the investments are entered into on a genuine arm’s-length basis. As trustees, you should document your strategy including a risk analysis of the project.

If investments are entered into with related parties, even though on an arm’s-length basis, care still needs to be taken. Keep reading to understand what you should do!

A scheme that was identified by the ATO, an arm’s length third party contracts with a company related to SMSFs to build several units or apartments ie a property development. Those who control the SMSFs provide services to the company (which they control) and charge low fees to that company. Also, loan capital is provided to the development company at a low or no interest rate.

Inflated profits warning signs

In this scheme, the development company earns inflated profits. These profits (after the company pays tax on the profits) are then paid as fully franked dividends up a chain of companies to the SMSFs.

The development company in this case will have paid tax at a rate of 30% on the profits earned. When the profits reach the SMSF as fully franked dividends, the tax paid by the company is refunded to the extent of the SMSF only paying 15% of the profits. Hence reduced tax liability

The ATO would state that this means the SMSF contravenes the superannuation and tax laws. Furthermore, this is because the SMSF is earning “non-arms length income” (NALI). NALI earned by a superannuation fund is taxed at 45%. The SMSF may also be treated as a non-complying fund because it may have breached the “sole purpose” test. This means it will have lost all of its tax-concessional status.

Tips worth noting before using your SMSF for property development:

Financing and Borrowing

• Limited Recourse Borrowing Arrangements (LRBA): While SMSFs can borrow to invest under LRBAs, there are strict rules about borrowing, especially when it comes to property development.
• Personal Guarantees: Trustees should be cautious about providing personal guarantees for loans, as this can risk personal assets.

Development and Construction

Building the development and Contractor Selection: Engaging contractors for property development must be done at arm’s length,. This means competitive pricing and no preferential treatment to related parties. The building also needs good Project Management: Trustees need to actively manage the project or engage professional project managers to ensure the development is completed on time and within budget.

Tax Considerations and Implications for SMSF Property

• Capital Gains Tax (CGT): SMSFs can benefit from reduced CGT rates on investment properties held for more than 12 months.
• Income Tax: Rental income and any profits from the sale of developed property are subject to income tax at concessional rates within the SMSF.

Exit Strategy

While an exit strategy requires a sale of property Liquidity and Exit is important considerations. Before embarking on a property development venture, consider how the SMSF will exit the investment. Property can be difficult to sell quickly, which may impact the fund’s liquidity. Especially if the member is of old age or needs to fund a pension

Gartly Advisory specializes in helping both clients establish and operate an SMSF and also those who undertake property development.

How do I sell my commercial business property? When selling your business, your business operations and HQ are an essential and strategic part of your business.

Most businesses operate from a premise of some sort, so when it comes to exit planning, your decisions on what to do with your business premises is equally important as one of the essential items that require serious discussion and planning.

When it comes to planning, the first thing to do is to review how and what you use your office, factory shop, etc., as part of the business on a day-to-day basis. For that reason, the location may be the reason for the business’s success,. Coupled with the possibility that the business building and surrounds such as a hotel, fun park or caravan park may be the selling point. The business HQ property may also have been purpose-built, and your business sale value may be exploited if the business and property are sold as one package.

Further your business may have multiple premises to consider, which factor into the strategy along with what can be sold, consolidated, and required moving forward.

Strategic Review of the Business, how it operates and where

As part of the exit strategy, take a moment to review the business. In short look at the location it operates to help you work through your exit planning:

• Will, upon exiting or selling, the business be relocated?
• If the business is to be sold separately from the property, how does this affect the business disruption?
• CGT issues?
• Will the owner wish to sell or retain the property for the next generation, and how will this take place?
• Are there other uses for the property, e.g., development or retirement?
• If the business operates from home, consider whether this is the right location for selling the business.
• What are his wishes for the family and passing the property on to the next generation?

Is your property ready for Sale?

The owner needs to review the property to ensure it is in a sellable state. Take a moment and look at:

• Access and potential change of Council Zoning. What points of access are there in and out of the property?
• Fire safety:  Does the property comply with fire safety and other emergency safety factors?
• Security:  Is the property safe and secure?
• Surfaces:  Do they feature lead paint and dust? Are the floors slippery, OHS?
• Hazardous materials and toxins:  Does the building present any dangers associated with asbestos used in its construction?
• Old fuel tanks and other old substances – Banks hate these when it comes to financing
• Installed plant and equipment:  Is the equipment, such as air conditioning systems, in good working order and maintained?
• Lighting: Is the property well-lit for the purpose you intend to use it?
• Air quality: Is the building adequately ventilated?
• Is your property have sentimental memories? Will this influence you and should be considered as being held for the next generation

Consider all options!

There are some options to consider when it comes to your business real estate you own. These can be classified as follows:

• Keep the property and treat it as a long-term investment
• Transfer to SMSF
• Sell with business
• Sell the property separately from the business
• Relocate the business and develop the property before selling the business
• Leave to next-generation – family farm
• Sale-leaseback arrangement

Sell or keep your freehold property

Let’s first look at why you may not sell the freehold property and choose to keep it and sell only the business:

• It might be too hard to consider – too much work
• The passing of the land onto family – save for subsequent generations, so needs to be kept
• The property value may exclude or reduce the number of  potential interested  buyers if the property is sold with the business
• You may start another business on the property
• It is better sold as a development opportunity
• Maybe a good long-term investment
• Strategy – especially for hotels etc., where you may wish to sell the business but take back long-term for a family
• Your real property may have been used to guarantee a business loan, i. Selling the property may impact another loan security used in another part of the business that is not being sold.
• The business may have multiple uses, or some businesses may work on the same premises.

Why you may consider selling the best option!

Opposite to the above, here are some valid reasons why you would sell the property at the time of selling the business:

• Some businesses need specialised buildings and assets from which to conduct their operations. Therefore, you may have the opportunity to sell the property to a buyer who appreciates the attributes of the building.
• When deciding to sell the business,  will the purchaser of your business wish to relocate it to another location and may leave you with an unwanted property in the future
•  Investors avoid investing in highly specialised assets like laboratories or dedicated production facilities. The primary risk for investors is the use of the building should the tenant company, the buyer of the business, default or not renew at the end of the lease period.
• If your business is specific, it would most likely be best sold with the business for the buyer to have business certainty.
• Time to reassess the financial plan for retirement
• Issues of maintenance that will require significant capital moving forward.

Whatever you intend to do, take time to make sure the structure you have chosen to hold the business vs the property works for you from a tax and estate planning perspective.

Reduce the CGT pain – use the tax concessions available for small businesses and the sale of your business commercial property:

• General 50% discount but not for Companies and reduced for SMSF
• 15-year exemption: If your business has owned the premises for 15 years and you are 55 or over, retiring, or permanently incapacitated, you will not have an assessable capital gain when you sell.
• If you have held the property for less than 15 years – it must be held for 7.5 years
• 50% active asset reduction:  You can reduce the capital gain on your premises by 50%.
• Retirement exemption:  Capital gains from the sale of your premises are exempt up to a lifetime limit of $500,000. If you are under 55, the exempt amount must be paid into a complying superannuation fund or retirement savings account.
• Rollover: You can defer your capital gain from the sale of the business until another event happens that crystallises the gain. For example, suppose you sell your existing business premises and buy different premises for your business within a specified period. In that case, you can defer your capital gain until the new premises is sold down the track.

Traps when utilising the CGT concessions.

It is crucial to check that assets, such as the business real property owned by the taxpayer, have been held by a ‘connected entity’ for at least half the business ownership period (or 7.5 years).

Where the necessary level of ‘connection’ does not exist, it may be possible to implement a restructuring without material cost to ensure that the entities are ‘connected. ‘

Selling your business property: do you meet the definition of an Active Asset?

Where there is a question of whether the amount paid constitutes “rent”, a pivotal factor to consider is whether the occupier has a right to “exclusive possession” of the property. The payments will likely be classified as rent if such a right exists.  – means no active asset!

If the arrangement allows the occupier only to enter and use the premises for specific purposes and does not amount to a lease granting exclusive possession, the payments are unlikely to be rent.

In summary

• Exit planning requires advisors to review all aspects of the business operations, and the business location and premises impact the pathway chosen to obtain the best result for your client.
• Don’t ignore the legal implications of the property regarding lease and ownership.
• Think of generational ownership issues and how they may impact
• Look at specific property types and intrinsic matters
• If you ask a purchaser to relocate the business away from the present location – think about how and the implications for the business sale and ongoing stability. Also, the cost of relocation
• Plan the Tax, GST and stamp duty implications of the decision
• Don’t leave the planning too late

Of course, planning for any business should be part of every person’s business exit plan. Please note this is general advice. We welcome you to book a time to discuss your affairs and help you plan for a wealthy retirement.

The holiday season brings joy and celebration, but for small businesses, it can also bring challenges when it comes to cashflow planning

Cashflow, the lifeblood of any business. Cashflow is even more crucial during this period. Small businesses are starting to experience delayed payments, reduced sales, and increased expenses due to safety measures and additional costs associated with remote work or implementing safety protocols. The holiday season brings slow down and couple with higher interest rates the economy is changing
To address these challenges, small business owners must adopt proactive cash flow management strategies.

Between now and the 15th of January 2024 can be a cashflow bumpy ride for many small business. Its time to implement cashflow planning and effective strategies to manage cashflow. You can as a small businesses navigate through the Christmas season with aim of maintaining a healthy cash flow.
Here are our tips to make you get through the crazy festive season

Forecast and Cashflow Planning for Irregular Expenses for better cashflow planning

The festive season often comes with additional expenses that are not part of the regular operating costs of a business. These can include staff parties, client entertainment, and Christmas gifts. To ensure you have sufficient cash flow to cover these expenses, it is crucial to forecast and plan ahead.
Take into account the estimated costs of these irregular expenses and incorporate them into your overall budget. By doing so, you can avoid any unexpected financial strain and ensure you have enough cash on hand to cover these festive expenditures.

Additionally, it is important to consider any potential price increases during the holiday season.

Extend Accounts Payable and Optimize Cash Inflows

Maintaining positive cash flow during the holiday season can be a delicate balancing act for small businesses. One effective strategy is to extend your accounts payable, which involves delaying payment to your creditors for as long as possible. By doing so, you can reduce cash outflows and preserve more cash on hand.

Consider negotiating longer payment terms with your suppliers or vendors, and take advantage of any discounts they may offer for early payments. This is an old trick used in cashflow planning but be careful you don’t starve your suppliers who may in turn not supply you moving forward if you are a reliable payer . It’s a balancing act!

On the other side of the cash flow equation, it is crucial to optimize cash inflows. Actively communicate with your customers about changes to payment cycles and important cut-off dates. Issue invoices promptly and follow up on payment to ensure timely receipt of funds. Offering options such as partial payments or early payment discounts can incentivize customers to pay sooner, improving cash inflows during the Christmas season.

Maintain Active Control of Invoicing

Send our regularly – remind and follow up those not adhering to your payment terms , this is crucial for cashflow management.

Invoicing is a critical aspect of cashflow planning, especially during the holiday season. To maximize your chances of getting paid on time, it is important to maintain active control of your invoicing process. Send out invoices as soon as possible to avoid any delays in payment. Consider implementing automated reminders to gently nudge customers about upcoming payment deadlines.

In addition, proactively communicate with your customers about your payment terms and any changes that may occur during the holiday season. By keeping the lines of communication open, you can address any potential issues or disputes promptly, ensuring a smoother cash flow and minimizing the risk of late payments.

Utilize Credit Cards for Deferred Payments

For small businesses looking for a flexible cash flow solution during the Christmas season, utilizing credit cards can provide a much-needed buffer. When you pay your business expenses with a credit card, you can defer the payment until your next billing cycle. This can provide you with additional breathing room, allowing you to collect revenue from holiday sales before having to pay off your current balance.
Paying with credit cards also offers the opportunity to earn rewards, such as points or cashback, on your business expenses. These rewards can provide additional value and help offset some of the costs associated with the holiday season.

The downside however is important to use credit cards responsibly and ensure that you have a plan in place to pay off the balances in a timely manner to avoid accumulating excessive debt.

Explore Backup Finance Facilities , helps in cashflow planning

Even with careful planning and effective cash flow strategies, unexpected challenges can arise during the Christmas season. To safeguard your small business against cash flow shortages, it is wise to explore backup finance facilities. These facilities can provide you with additional funding when needed, helping you bridge any temporary gaps in cash flow. For some Invoice finance is one such option worth considering. But it will take time to set up and remember it’s a lag effect and must be repaid
With invoice finance, you can access funds owed to you in outstanding invoices before they are paid by your customers. This allows you to maintain a healthy cash flow by advancing the funds you need to cover upfront costs, overheads, and unexpected expenses. By leveraging your accounts receivable, you can access working capital quickly and flexibly, ensuring your business can navigate through the Christmas season smoothly. y to earn rewards and benefits associated with credit card spending.

Plan for Post-Holiday CashFlow management!

While the focus of cashflow planning during the Christmas season is primarily on generating sufficient cash flow to cover expenses, it is equally important to plan for the post-holiday period. Many businesses experience a lull in sales and cash inflows immediately after the holiday rush. To mitigate any potential cash flow challenges during this period, it is crucial to plan and budget accordingly.
Review your financial statements and cash flow forecasts to identify any potential gaps in cash flow post-holiday season. Consider adjusting your budget and expenditures to align with the anticipated decrease in cash inflows. This can include reducing discretionary spending, negotiating payment terms with suppliers, and exploring cost-saving measures to maintain a healthy cash flow during the quieter months.

Managing cash flow during the Christmas season is crucial for the success and sustainability of small businesses. By implementing effective strategies such as forecasting and planning for irregular expenses, extending accounts payable, maintaining active control of invoicing, and exploring backup finance facilities, small businesses can navigate through the holiday season with a healthy cash flow.
Remember to maintain strong vendor relationships, utilize credit cards for deferred payments, and seek professional advice when needed. With careful planning and proactive cash flow management, small businesses can thrive during the Christmas season and beyond.

Are you feeling trapped and forced out of your business by an aggressive business partner making your life hell?

This situation can be incredibly stressful, leaving you powerless and questioning your dreams, motivation and aspirations. But fear not because help is here.

Let’s explore the common signs and tactics that aggressive business partners use to push their partners out and strategies to regain control and protect your interests.

Being forced out of your business is a nightmare and unacceptable. The good thing is you don’t have to face it alone.

The first step is to recognise that your partner is becoming aggressive and no longer interested in a fair and harmonious partnership. You can start proactively protecting your rights and negotiating a more equitable arrangement.

Signs of an aggressive business partner

Dealing with an aggressive business partner can be a challenging and emotionally draining experience.
Identifying the warning signs early on would be essential to prevent further damage to your business and personal well-being. Here are some common signs that your partner may be becoming aggressive:

1. Control and dominance: An aggressive partner may exhibit controlling behaviour, making decisions without consulting you and exerting authority over every aspect of the business. They may disregard your opinions and ideas, leaving you marginalised and undervalued.

2. Lack of transparency: Transparency is crucial in any business partnership, but an aggressive partner may withhold important information or keep you in the dark about critical decisions. This lack of transparency can lead to a breakdown in trust and hinder your ability to contribute to the business effectively.

3. Undermining and belittling: Aggressive partners often resort to belittling and undermining their counterparts to assert dominance. They may criticise your work, question your competence, or blame you for any setbacks, eroding your confidence and self-esteem.

4. Financial impropriety: Dishonesty with finances is a major red flag. If you notice irregularities in the company’s financial records or suspect your partner of embezzlement or mismanagement, it’s crucial to address the issue immediately to protect your assets.

Note the signs early before a dispute becomes raging fire!

Watch for these signs early will protect yourself and your business by being proactive. By acknowledging the problem, you can regain control and work towards a more equitable partnership.

An aggressive business partner can devastate your business, both financially and emotionally. Their actions can undermine the stability and success of the venture, leaving you feeling powerless and defeated.

Here are some of the expected impacts of dealing with an aggressive partner:

1. Decreased productivity: Constant conflict and power struggles can significantly impact productivity and efficiency within the business. The toxic environment created by an aggressive partner can decrease motivation and collaboration among team members, leading to reduced output and missed opportunities.

2. Loss of clients and business opportunities: Aggressive behaviour can drive away potential customers away by a hostile environment. Additionally, an aggressive partner may make impulsive decisions or alienate critical stakeholders, resulting in missed business opportunities and damaged relationships.

3. Legal complications: Dealing with an aggressive partner can lead to legal battles and disputes. If your partner engages in unethical or illegal practices, you may face legal consequences or have to defend your reputation in court.

4. Negative impact on personal well-being: The constant stress and anxiety of dealing with an aggressive partner can take a toll on your mental and physical health. Please seek help as soon as possible if you are experiencing this.

The impact of an aggressive business partner on your business.
Seek help for you if needed!

It’s important to prioritise self-care and seek support from friends, family, or professional counsellors to navigate this challenging situation.

The impact of an aggressive partner can be far-reaching, affecting your business and personal life.

Knowing your rights as a business owner

When confronted with an aggressive business partner, knowing your legal rights and responsibilities as a business owner is essential. Understanding the legal implications can help you protect your interests and make informed decisions.

Partnership agreements: Review your partnership agreement to understand the rights and obligations of each partner. Here are some options to consider:

Corporate laws and regulations: Understanding your legal rights and obligations can give you leverage when dealing with an aggressive partner.

Breach of fiduciary duty: If your partner breaches their fiduciary duty, which includes acting in the business’s best interest, you may have grounds for legal action.

Alternative dispute resolution: Mediation or arbitration can effectively resolve conflicts with a business partner without resorting to costly and time-consuming litigation. Explore these options to find a fair and mutually beneficial resolution.

Our role as Dispute Strategy Accountants is to help you explore your options and implement the right strategy. Please reach out to you have any questions or would like to devise a strategy!

What to do moving forward!

Please make sure to document everything: Keep a detailed record of all interactions, decisions, and incidents involving your partner. This documentation can serve as evidence in case legal action becomes necessary and provides a clear timeline of events.

Be open in your communication.In doing so you can try to address the issues with your partner through open and honest communication. Express your concerns and attempt to find common ground. However, be prepared for resistance, and don’t hesitate to seek alternative solutions if communication fails.

Empathy and active listening by giving your partner your full attention and seeking to understand their perspective. As a result this shows respect and can help foster a more constructive dialogue.

Focus and set boundaries – all part of the strategy.

Focus on interests, not positions: Uncover the underlying interests or needs driving your partner’s behaviour, furthermore, instead of focusing on your differences. Find common ground and work towards a mutually beneficial solution.

Set clear boundaries: Establishing clear boundaries and expectations can help prevent future conflicts. Clearly define roles, responsibilities, and decision-making processes to ensure everyone is on the same page.

Look for that win-win position. Look for win-win solutions. Explore compromises that address both your interests and your partner’s.

Seeking professional help can provide you with the expertise and guidance necessary to navigate the complexities of dealing with an aggressive business partner.
These preventive measures can minimise the risk of encountering an aggressive partner and protect your business from potential harm.

Empowering yourself as a business owner after facing an aggressive partner!

A good strategy gives you peace of mind!

Never go head-on with an aggressive business partner. Plan and deal with financial facts and events. Always consider what you would like as the outcome of resolving the situation before starting any partnership negotiations. Professional accounting and legal help lead a suitable path with one goal in mind resolution: to move forward but not destroy what you have built!

If the dispute is resolved, let’s look at the culture of the business, how to prevent it from happening again and the transparency of decision-making. Do we also have to put a strategy to repair the damage done to the organisation that resulted from the distraction the dispute has caused? Let’s look at how this has impacted staff, suppliers, customers, and your family.

Remember to prioritise your well-being and seek support from your network. You can rebuild, recover, and continue on your path to success. Look beyond the problem; the solution may be to be empowered in a new business structure. Don’t let anyone force you out of your dreams!

Superannuation Death benefits are an estate planning matter that is a crucial aspect of financial planning.
It is essential to consider what happens to superannuation upon death.
Understanding the intricate system of superannuation death benefits is essential for effective financial planning and ensuring that your loved ones are taken care of.

When a superannuation member dies, the remaining balance in their super fund and any associated insurance payouts are generally paid out as a superannuation death benefit. This benefit is intended to provide financial support to the deceased member’s beneficiaries, including their spouse or partner, children, or other dependents.

However, the distribution of these benefits is subject to various regulations and considerations, making it a complex area of financial management.
It’s important to note that superannuation death benefits are not automatically distributed according to a will.Firt thing to remember is that super funds typically provide a set of criteria for determining who is eligible to receive the benefits.

In some cases, the Fund Trustee may have discretionary power to allocate the benefit to the most appropriate beneficiaries, considering the deceased member’s relationships and financial dependents.
This is an estate planning opportunity or danger for those operating an SMSF.

With this purpose in mind, everyone should familiarise themselves with superannuation death benefits rules and options. The result is to ensure that your wishes are carried out, and their loved ones are well provided. This involves nominating beneficiaries, understanding the tax implications, and integrating superannuation benefits into estate planning strategies.

Who Receives the Superannuation Death Benefit?

A superannuation death benefit distribution is typically prioritised according to specific rules and regulations. A death benefit is first paid to the deceased member’s dependents. These include their spouse or partner, children, and any individuals financially dependent on the dead at the time of their death. If there are no eligible dependents, the benefit may be paid to the deceased member’s estate.

It’s worth noting that the definition of dependents can vary between superannuation funds and may include both financial and interdependency criteria. Understanding these distinctions is crucial for ensuring the benefit is allocated appropriately and by the deceased member’s intentions. Furthermore, the rules governing who can receive a superannuation death benefit may change depending on the specific circumstances, such as the age and marital status of the deceased member.

In cases where the deceased member has not made a binding death benefit nomination, the fund trustee may exercise discretion in determining the benefit distribution. This underscores the importance of proactive planning and communication to ensure the benefit is directed to the intended beneficiaries. By understanding the eligibility criteria and potential beneficiaries, individuals can make informed decisions regarding the nomination of superannuation death benefit recipients.

Taxation of Superannuation Death Benefits

Taxing superannuation death benefits is a critical consideration that can significantly impact the ultimate value of the beneficiaries’ benefits. The tax treatment of these benefits is influenced by several factors, including the relationship of the beneficiary to the deceased member, the components of the superannuation benefit, and the age of the dead at the time of their passing.
Generally, superannuation death benefits paid to a deceased member’s dependents are tax-free.

This includes benefits paid to the deceased member’s spouse, children, and any individuals who were financially dependent on the deceased. However, the tax treatment may differ if the benefit is paid to a non-dependent, such as an adult child who was not financially dependent on the deceased.
In such cases, the tax payable on the superannuation death benefit is influenced by the components of the benefit, which typically include taxable and tax-free elements. The taxable component of the benefit is subject to tax at a beneficiary’s marginal tax rate, while the tax-free component is not subject to tax. Understanding these tax implications is crucial for both the deceased member and their beneficiaries, as it can inform decisions regarding the nomination of beneficiaries and the potential tax consequences of the benefit distribution.

Furthermore, individuals may explore strategies to minimise the tax impact of superannuation death benefits, such as utilising binding death benefit nominations or implementing effective estate planning measures. By considering the tax implications in advance, individuals can optimise the financial outcomes for their beneficiaries and minimise potential tax liabilities.

How to Nominate Beneficiaries for Your Superannuation

Nominating beneficiaries for your superannuation is a fundamental step in ensuring that your superannuation death benefit is distributed according to your wishes. Most superannuation funds offer members the option to make binding or non-binding death benefit nominations, providing a mechanism for specifying who should receive their superannuation benefit in the event of their death.

A binding death benefit nomination legally compels the superannuation fund trustee to distribute the benefit to the nominated beneficiaries, provided they meet the eligibility criteria. This nomination must be kept current and aligned with the fund’s requirements to remain valid. In contrast, a non-binding nomination serves as a guide for the trustee but does not impose a legal obligation to follow the member’s wishes.

Individuals need to review and update their death benefit nominations regularly, particularly in the event of significant life changes such as marriage, divorce, or the birth of children. By keeping these nominations current, individuals can ensure that their superannuation is directed to the intended recipients and aligns with their evolving family and financial circumstances.

Moreover, considering the potential tax implications of superannuation death benefits, individuals may seek professional advice to structure their nominations tax-efficiently and maximise the financial outcomes for their beneficiaries. By proactively nominating beneficiaries and staying informed about the nomination options available, individuals can exercise greater control over the fate of their superannuation benefits and provide for their loved ones according to their wishes.

Claiming the Superannuation Death Benefit

Once a superannuation account holder has passed away, claiming the superannuation death benefit begins.

This involves navigating the administrative procedures outlined by the relevant superannuation fund, which may include submitting necessary documentation and fulfilling specific requirements to facilitate the benefit payment.

Step one involves notifying the deceased member’s superannuation fund of their passing and initiating the process of claiming the death benefit. This may entail providing the fund with a certified copy of the deceased member’s death certificate and completing any required claim forms. Additionally, the fund may request information about the deceased member’s beneficiaries and their relationship to the deceased, mainly if a binding death benefit nomination is in place.

The beneficiaries must engage with the superannuation fund promptly and comply with any documentation requests to expedite the processing of the death benefit claim. Delays in the submission of required information or discrepancies in the provided details could prolong the benefit payment process, potentially impacting the financial stability of the deceased member’s dependents.

During this period, beneficiaries may also seek professional guidance to ensure they understand the steps in claiming the superannuation death benefit and are equipped to navigate any potential complexities. By actively participating in the claiming process and communicating effectively with the superannuation fund, beneficiaries can facilitate the efficient distribution of the benefit and mitigate any administrative hurdles.

Options for Receiving the Superannuation Death Benefit

Upon the approval and processing of a superannuation death benefit claim, beneficiaries are presented with several options for receiving the benefit. The payment method can significantly influence the tax treatment and long-term financial implications for the beneficiaries, making it a critical decision that warrants careful consideration.

One standard option is to receive the death benefit as a lump sum payment. This provides the beneficiaries immediate access to the total benefit amount, allowing them to utilise the funds according to their financial needs and priorities. However, it’s essential to recognise that receiving the benefit as a lump sum may result in tax implications, particularly for non-dependant beneficiaries and the taxable component of the benefit.

Alternatively, beneficiaries may opt to receive the superannuation death benefit as a pension or income stream, providing a regular and potentially tax-effective source of income over an extended period. This can be particularly advantageous for dependant beneficiaries who seek ongoing financial support and prefer to manage the benefit as a long-term income stream.

By evaluating the available options and their associated considerations, beneficiaries can make choices that align with their preferences.

Superannuation Death Benefit and Estate Planning

Integrating superannuation death benefits into estate planning is critical to comprehensive financial management. By strategically aligning superannuation benefits with estate planning strategies, individuals can exert greater control over the distribution of their assets and ensure that their loved ones are well provided for after their passing.

One key consideration in estate planning is the interaction between superannuation death benefits and your will. While superannuation benefits do not automatically form part of an individual’s estate, they can be directed to specific beneficiaries through binding death benefit nominations, bypassing the probate process and providing expedited access to the benefits.
Furthermore, individuals may explore the use of testamentary trusts to manage the distribution of their superannuation death benefits. Testamentary trusts can offer increased flexibility, asset protection, and potential tax advantages for the beneficiaries, making them a valuable tool in structuring the inheritance of superannuation benefits.

In addition, those with self-managed superannuation funds (SMSFs) may consider including a comprehensive succession plan within their fund’s trust deed.

Ultimately, by integrating superannuation death benefits into their broader estate planning framework, individuals can exert more significant influence over the allocation of their assets and provide their beneficiaries with a secure and efficient inheritance process.

Seeking Professional Advice on Superannuation and Death Benefits

In conclusion, the fate of superannuation after death is a crucial aspect of financial planning that warrants careful consideration and proactive management. Understanding the intricacies of superannuation death benefits, including the eligibility criteria, tax implications, and distribution options, is essential for ensuring that the benefits are directed to the intended recipients and aligned with the deceased member’s wishes.
Individuals should prioritise the nomination of beneficiaries for their superannuation, regularly review and update their nominations, and integrate superannuation benefits into their broader estate planning strategies. Seeking professional advice from financial advisors, estate planning experts, and taxation specialists can provide invaluable support in navigating the complexities of superannuation death benefits and optimising the economic outcomes for the beneficiaries.

By proactively engaging with these considerations and seeking professional guidance, individuals can secure the financial well-being of their loved ones and ensure that their superannuation benefits serve as a lasting and impactful legacy. Empowered with the knowledge and resources to navigate the labyrinth of superannuation after death, individuals can approach this critical aspect of financial planning with confidence and clarity, ultimately shaping a secure future for their be

5 Startup Mindset Shifts You Must Make as you launch your New Business.

Starting out. Grab that winning mindset from day one to conquer challenges and thrive in the competitive business world.

Starting a new business is an exhilarating experience requiring a unique mindset.
Business owners are like modern-day supermen/women, equipped with the determination and courage to face any challenge head-on. The excitement of embarking on a new small business venture is unparalleled, as the possibilities are endless, and the potential for success is immense.

Get the right startup mindset from day one!

With the right startup mindset, you as a small business owner, can conquer any obstacle that comes your way. When starting out in a new business, having the right mindset is crucial for success.
It is important to approach every task with a positive attitude and unwavering belief in oneself. A business owner must be confident to take risks and make bold decisions, even in the face of uncertainty.
This mindset of fearlessness and optimism sets entrepreneurs apart from the rest and fuels their drive to succeed.

The mindset of a business owner starting out in a new venture is akin to that of a superhero. Like Superman, they possess extraordinary powers to overcome challenges and achieve greatness.
Don’t be afraid to step out of your comfort zone and push the boundaries of what is possible. Their unwavering determination and resilience will enable you to navigate the ups and downs of business.
Starting out in a new business requires a mindset that embraces failure as a stepping stone towards success. Every setback becomes an opportunity to learn and grow, allowing business owners to improve their strategies and approaches continuously. With this mindset, entrepreneurs can turn obstacles into stepping stones towards achieving their goals.

Most people assume starting a successful business requires a great idea and a substantial cash injection. Both are correct, but to truly make your dreams a reality, the truth is your transition to being a business owner begins with a new mindset.
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If you really want to be a successful business owner, you need to shift how you think about yourself, the world, and your business!

So, where do you get started to get your startup mindset mojo?

Here are some of the most valuable mindset shifts you should make before you begin your small business journey

1. Embrace The “Growth” Startup Mindset

If you’re thinking of starting your own company, do yourself a favor and read the book Mindset by Dr. Carol Dweck. Dr. Dweck has inspired countless business leaders and entrepreneurs because she teaches what it means to abandon the “fixed” mindset.

Premiership winning Coach at Collingwood, Craig Mc Crae, recommended it, and so do I. It helps keep you in the mindset zone.

Most of us have a “fixed” mindset. This is the belief that there’s a limit to your skills, what you can do, and what you can achieve at any given time. While that might seem like a humble position, it can be detrimental. Why it place limitations on you and your company from day one?

Shifting to a “growth” mindset means embracing the belief that you can improve anything, including your company, skills, and future, whenever you choose.

Focusing on constant growth ensures you’ll always work to make your business bigger and better.

2. Stop Prioritizing Quantity Over Quality

We’ve all heard that quality matters more than quantity, but many of us are still hardwired to seek out volume instead of value.

Prioritising quality over quantity means using your resources and people as effectively as possible to generate the best results. In the same way, prioritising quality over quantity as a business owner means you’re more cautious about which projects you take on and which clients you work with.

This can save you from making expensive mistakes. Don’t take on a contract or a sale if it leaves you potentially out of pocket to get work in the door.

3. Learn to Value Yourself

You may find that being a business owner brings a fair share of impostor syndrome. This is the belief that you’ve come to a place where you don’t deserve to be.

Without delay you need to remove that thought if you want to thrive.

Above all ,everyone feels this way occasionally, but never undervalue yourself,

You need to understand what your value is and be confident in yourself.

As can be seen take the time to regularly remind yourself what you’re good at and what you’ve accomplished so far. Tell yourself you deserve to be where you are and act like a small business champion.

4. Commit to Being a Lifelong Learner

There will always be new trends and technology to understand. Learn, embrace and grow you and the productivity of your business.

You need to be willing to keep up with the changes. Committing to a mindset of lifelong learning can help with that.

If you cultivate a constant curiosity and development attitude, you’ll be more likely to seek ways to improve your business. Being a lifelong learner makes you more agile, adaptable, and willing to evolve as your business grows.

A learning startup mindset requires shifting from seeing failure as an opportunity to learn. Take your mistakes as the lessons they are and use them to help you grow.

5. Have the tools and the fan club to support you

Confidence in yourself is a big mindset tool. With this in mind, your Mindset is best when you have the tools and people behind you to make it a success when you launch. This includes people who will provide direction, support, encouragement, and objectivity.

Without delay the tools are in the form of your documented plan, the 90-day launch and the financial targets to hit need to be implemented.

The most compelling evidence is that mindset medicine helps keep you focused.

Start Shifting Your Startup Mindset

Without a doubt any great business owner will tell you passion and money will only get you so far.

Take your, mindset, attitude and mental framework to keep pushing forward and achieving your goals. Shifting your mindset in the five ways mentioned above will prepare you to thrive.
Business owners possess the superhuman qualities of determination, fearlessness, and resilience. With the right mindset, you can overcome any challenge that comes their way and achieve phenomenal success. So gear up, put on your entrepreneurial cape, and embrace the adventure of starting your own business!

Can you live in SMSF residential property held by your Fund?” No not directly, but follow the rules at retirement, and it may be possible.

As you retire, retirement planning opens up opportunities for living and the next stage for your SMSF, your lifestyle and your needs.

An SMSF is established for the sole purpose of meeting your retirement objectives. And this is the overal objective of holding any assets in the Fund!

Retirement planning involves planning and managing your assets into the senior years of your life. Opportunities arise as clients look at the strategies such as the downsized option for superannuation contributions along with other strategies. At this stage in life, you may wonder if you can live in the SMSF residential property after retirement. The property may be a residential holiday letting or an apartment.

Unfortunately, there is a misconception that you can move into the SMSF property as soon as you retire, regardless of whether the property is still in the SMSF. This is a big misconception as, at present, the Trustee of the Fund still owns the property, and it still forms part of your existing investment strategy.

Selling the residential property to a member prior to retirement is not allowable as it may breach the non-arms-length rules.

To live in SMSF residential property, it is necessary to transfer an asset to a member upon retirement

The Trustee, upon retirement, may provide benefits to the retiring member by utilising the major asset directly to satisfy the benefit by an in-specie transfer.

Member payments are the distribution of the member’s superannuation entitlement within the SMSF. The benefit is calculated based on the proportion of net assets at market value. Accessing superannuation entitlements is subject to conditions of release.

These conditions include reaching age 65, or, retirement, or medical incapacity. Not meeting one of these conditions means members cannot access their superannuation entitlements from the SMSF
Transferring the residential property from an SMSF as a Member Payment at Retirement.

As the Trustee of the SMSF, which is you, can determine that it will pay a lump sum. Your decision will be to sell the property or assets or undertake an in-specie transfer to the member.

Another term used for residential property transfer from an SMSF is known as an “in-specie transfer.”

In this case, the market value of the asset transferred within the SMSF decreases the member’s balance drops by the same value to reduce the amount held by the Fund on the member’s behalf.

How do you ensure the property transfer is done right?

A property that can be held in a superannuation fund can be transferred out of the Fund to satisfy as a member payment providing it meets the SIS conditions.

First Step. the Trust Deed. Check that the SMSF Deed will determine whether if the Deed permits in-specie transfers of assets. The Deed also outlines any specific processes that the Trustee must follow.

The asset being transferred must be valued at its market value. Where it was part of a borrowing arrangement check that it has been fully discharged.

The member also must have sufficient member entitlements in the Fund to cover the value of the asset being transferred. Complicated transfers where the value is greater than the value of the benefit need a professional plan. Reach out, and we can help work through your strategy.

Tax and Duty Considerations

We suggest you check with your solicitor in relation to the legal matters. Your solicitor will ensure any property transfer is done correctly. As accountants, we can advise you if there will be any income tax implications behind your strategy. There may be stamp duty savings but the solicitor can help you here. Therefore to be legally binding the asset change of ownership needs to be properly documented.

Plan and do it right.

Seek advice surrounding your requirements to avoid any costly mistakes.

This article is general and should not be construed as personal advice. You should consult a qualified professional for advice specific to your circumstances.

How to Build a Business You Love, A Business With Purpose: 7 Steps To Help You Find Your Passion And Grow Profits

Creating a business you love is not something that can be done overnight. It requires a lot of introspection, creativity and planning. You can do many small things to ensure your business has a purpose and that it aligns with your values. The key lies in breaking the cycle of doing things just for the sake of it. Instead, create an atmosphere where you’re creating a business for the pure joy of it. The rewards will follow and grow with your passion. In this blog post, we will discuss seven practical steps you can take to help you find your passion, and grow with purpose as a business owner:

Assessing your values

Do you have love and passion for your business? When you first start to consider building a business, the first thing you should do is assess your values. This will help you identify the values that are important for your business, and for you as a person. There are many ways you can go about this; one way is to identify the core values that form the basis of your personality. You can also look at the core values of your industry, and choose those that feel most aligned with your values. Once you have identified your core values, you can also look at how they align with your business. This is important, as you want to ensure your business is aligned with your values.

Define your business’s purpose.

When assessing your values, you must consider why you do certain things. This will help you to decide on a purpose for your business. Purposes are important in business and can help businesses align with their core values, and best fit their customer’s needs. A business with a purpose will generally align more with customers’ needs and have a higher success rate.

Decide on a growth path for your company.

Another important step is deciding on the growth path for your business. This can help you to start aligning your actions to your values. It is important to start with a growth path that fits your values and is feasible. This can help you avoid wasting months or years of your life on a growth path that does not align with your values or business goals.

Develop the practices you can rely on

As you build your business, you will find that much of your time will be spent on practices. These practices can be for your staff members or your own business. Some of the practices you will find yourself investing a lot of your time in are: – Training. Businesses thrive on people who are fully trained and know how to do the job. You will need to invest time in training your staff members on best practices and make them fully aware of your values and purpose. – Managing expectations. In any business, people will have expectations. You must manage expectations by setting realistic expectations and aligning actions with values. –

Planning and forecasting. Businesses thrive on planning and forecasting for profit growth. Again, you will be on a constant planning and forecasting cycle if you get excited about your plan. Planning and forecasting will help you to make well-informed decisions and align your company’s growth path with its purpose. – Day-to-day operations. As an owner, you must monitor day-to-day operations and ensure your practices run smoothly. Practices must be well organized and managed. – Communication. Businesses thrive on communication and must ensure they communicate with their staff members and clients. Communication is a two-way process.

Build a team that reflects your philosophy.

Many small businesses struggle with hiring the right team members. This can be because they did not plan well for their company’s growth. They might not have planned for their hiring, or they might have hired the wrong people. Hiring a team that reflects your philosophy and values can help you avoid many of the struggles businesses face when hiring the right team members. It is important to note that you should hire for fit, and not just for skills. You should hire for values. This does not mean you should hire people with the same values as you, but it means you hire for a values fit. You can hire for values like passion, tenacity, creativity, etc. You can hire for less obvious values, like how people approach work. You can hire for values like high integrity or kindness.

Get out there and just do it!

Businesses thrive when profits grow when they have a purpose; you must align values. It is important to assess your values and those of the industry that you play in. This will help you identify the core values that are important to you and most aligned with your industry. When you have identified these values, you can start working towards creating a business with a purpose and a growth path aligned with these values. One of the practices that you can employ is building a team that reflects your philosophy. This will help you to avoid hiring team members who do not align with your philosophy and help you to get team members who reflect your philosophy.

Cheating in business happens more than we like to realise.

Trust in business is the foundation upon which successful partnerships are built. Without trust, a business partnership is like a house of cards that is vulnerable to collapse at any moment. As a business owner, it is crucial to understand the significance of trust. Cheating in business has detrimental consequences when your business partner isn’t on doing the right thing!

In business, we see Trust in business as believing that your partner will act in your best interest with integrity and honesty. It means relying on their actions and knowing that they will follow through on their commitments. It’s a partnership like a marriage.

When you suspect that your business partner is cheating you and your business! It’s time to act! Recognizing the signs of potential cheating or betrayal is crucial in protecting your business, your ownership share, and profits and preserving your own well-being.

When things are wrong at worst, It may indicate that the business relationship is over. You will need to determine the extent of business cheating and organise a business exit plan.
Warning signs that indicate that things are not right include sudden changes in behaviors or attitude. Your business partner may have unexplained secretive actions, excessive control or manipulation, frequent and unexplained financial discrepancies. There also be a lack of transparency or accountability.
If you notice any of these signs, addressing them promptly and openly is important. Ignoring these red flags can damage your business and personal life irreparably.

What drives people to cheat?

You might be aware why things are right such, but leads people to undertake to cheat against you maybe reasons such as:

+ A feeling of being undervalued.
+ Greed
+ Marriage and other personal problems
+ Addiction such as gambling or drug and need to make extra.
+ Other influences such as offers of a better deal.

Trust your instincts and gather evidence before confronting your partner about your suspicions. It then means you can have a clear, evidence-based conversation rather than relying purely on emotions or assumptions.

3 tell-tale things that may mean things are right!

Be diligent and watch for hidden business relationships.

Discovering that your partner is working with competitors or starting side businesses without your knowledge can be common for those looking at going out alone.

· The decline in business performance: A sudden drop in business performance without any valid explanation could signify mismanagement or unethical practices.
· Lack of commitment or interest: If your partner appears to be less involved or engaged in the business, it may indicate that their attention is focused elsewhere.
· Unavailability or avoidance: Difficulty reaching your partner or constant avoidance of meetings and discussions might indicate they are hiding something.

Ways to detect cheating or fraud in your partnership.

Detecting cheating or fraud in a partnership requires a combination of vigilance, attention to detail, and a proactive approach.

Approaches to deal with business cheating may include:

– Regular financial review of the records may uncover discrepancies or irregularities.
– Monitoring cash flows, expenses, and financial records is essential to detect any signs of embezzlement or misappropriation of funds.
– Implementing robust internal controls, such as segregation of duties and regular reconciliations, can deter fraudulent activities.
– Understanding all aspects of your business, not just your area of control
– Be curious and ask questions.

Do you have open lines of communication with your partner? These should include regularly discussing the state of the business, sharing financial information. You must ensure transparency which can help identify any inconsistencies or discrepancies. Being vigilant about changes in behavior or attitude by conducting background checks on potential partners can also provide valuable insights into their integrity and trustworthiness.

If your business partner stops talking about their life outside of business, it could be a sign they are becoming secretive.

The impact of cheating on your business

Cheating or betrayal in a business partnership can have severe consequences for your business, both financially and emotionally. It can lead to financial losses, reputational damage, and the erosion of client trust. The fallout from a cheating partner can disrupt operations. It will strain relationships with employees, suppliers, and customers, and even result in legal battles. The emotional toll of betrayal can be equally devastating, causing stress, anxiety, and a loss of confidence in future partnerships.

The impact of cheating extends beyond the immediate fallout. It can create a culture of mistrust within your organization and make attracting and retaining talented employees and clients more challenging. Rebuilding trust after a betrayal takes time, effort, and a commitment to change. It requires acknowledging the pain caused, taking responsibility for one’s actions, and implementing measures to prevent a recurrence.

Steps to prevent cheating or betrayal in business.

Preventing cheating or betrayal in future partnerships starts with due diligence and careful partner selection. Thoroughly vetting potential partners, conducting background checks, and seeking references can help identify any red flags or warning signs. Choosing partners who share your values, have a track record of integrity, and are committed to open and transparent communication is essential.

Establishing clear boundaries from the outset and a robust shareholders agreement are crucial in preventing cheating or betrayal. This includes defining roles and responsibilities, setting up internal controls, and regularly reviewing and discussing the state of the business. Implementing checks and balances, such as regular audits, can deter fraudulent activities and provide peace of mind for both partners.

The role of communication and transparency in maintaining trust

Communication and transparency are the cornerstones of maintaining trust in a business partnership. Regular and open communication allows for sharing of information, ideas, and concerns. It fosters a collaborative environment where both partners feel heard and valued. Transparent communication involves being honest and forthcoming about the state of the business, financial matters, and any challenges or concerns that may arise.

Transparency also extends to decision-making processes. Ensure that both partners have an equal say and are informed about important decisions in the business. This includes sharing financial information, including revenue, expenses, and profitability, to build a shared understanding and ensure accountability. By fostering an open communication and transparency culture, partners can build trust and strengthen their partnerships over time.

Before pursuing legal action, it is important to gather evidence and document any instances of cheating or fraud. This may include financial records, emails, contracts, or witness statements. Presenting a strong case will increase the likelihood of a favorable outcome and hold the offending party accountable for their actions. Legal action should be considered as a last resort after all other avenues of resolution have been exhausted.

Addressing cheating or fraud in a partnership can be emotionally and legally complex. Professional help can also provide an objective perspective and help navigate the legal aspects of addressing cheating or fraud. Advisers can offer insights into the best course of action, potential risks, and the likelihood of success.

Professionals can see things that may not be obvious to you. Engaging the services of professionals with expertise in business partnership issues early can greatly assist in achieving a fair and satisfactory resolution.

Call to Action:

Protect your business and partnership by prioritizing trust and vigilance. Regularly communicate with your partner, If you suspect your business partner of cheating or unethical behaviour, addressing your concerns openly and honestly is crucial. In many cases, denials will be the first reaction Consider discussing the matter with them directly but have your ducks lined up so that you understand that if your business partner has been undertaking actions that are detrimental to you, you have a plan as to what to do next.

Invariably cheating in a partnership is irreparable, and a solid exit plan for you to salvage any undermining or financial loss is imperative for a successful outcome. As a small business accountant we can assist you in developing a plan with an outcome that protects your interests and sanity.

#cheating #trustinbusiness #businessowners #exitplanning #businessdisputes

A tax audit is often a result of business owners not doing something that’s the norm. Doing dumb things that alert the ATO that some things are not quite right.

It is becoming imperative that you prepare your GST records appropriately to avoid unnecessary scrutiny by the Taxation Office which may lead to a tax audit for your Bas. These include:

 Failure to allow for car expenses for vehicles that are used partly for business purposes.
 Claiming all the GST paid on the following expenses: (similar to last year )
o car operating expenses, a log book must be kept
o home electricity, – diary evidence floor area
o home rates,
o internet access and
o home telephone bills,

Partial Business Usage

When these items were only used partly for business purposes claim only part of GST. If you use computerised accounting software be careful with this one, as special procedures are required.
 Claiming GST on non-business items.
 Claiming all GST or not claiming GST when not applicable
o Most bank charges. Merchant fees charged by banks, for retailers to have credit card facilities, do have GST in them. Refer to the monthly merchant statement for the GST amount.

GST amounts are often not shown on normal bank statements.
o Motor Vehicle Registration fees.
o Stamp duty and most government fees.
o Rates on business premises.

Sales and GST

 Not charging GST on all sales – NOT RECORDING ALL GST ON SALES
 Not charging GST on the Sale of equipment

Partial GST

Assuming the GST is exactly one-eleventh of every amount paid. This assumption is not correct in the case of :
o Workers Compensation premiums, (which include GST-free stamp duty)
o Yellow Pages Advertisements paid by instalments, which often require all the GST to be paid “up-front”.
 Failure to put the correct “tax codes” on receipts or payments when using a computerised accounting system

Take some time to understand what the codes are and the types of income/expense which each tax code should be used for. As a small business tax accountant, we can help you get it right.

 Using “Cash accounting” when should be “accrual accounting”.
 Not including “Instalment Income” for PAYG or using the correct rate.

Spending the time to get some of these rights may help you to avoid a tax audit and the ATO snooping around into your affairs

Lodging a final Deceased persons Tax Return is one of the important things to do when managing someone’s final affairs. Dealing with the loss of a loved one is a deeply emotional and challenging time. Beyond grief and sorrow, there are often a number of administrative tasks to navigate. One of these tasks is managing the deceased person’s tax return. It’s a task that can seem daunting, especially if you’re unfamiliar with the tax system. However, understanding the process can make it less overwhelming. We as Accountants that specialise in this area can help.

In the Australian context, the taxation obligations of a deceased person don’t simply disappear upon their death. These obligations can transfer to their legal representative or the executor of their will.
. It is a crucial step in finalising the deceased’s affairs and ensuring compliance with the Australian Taxation Office (ATO).

Understanding a Deceased Person’s Tax Return in Australia

When a person dies, their tax obligations do not automatically cease. Rather, these obligations transition to their deceased estate. This means that any income earned from the day after the person’s death until the end of the financial year must be declared in the deceased person’s tax return.
In general, a deceased person’s tax return is prepared like a living person’s tax return. This includes all forms of income, deductions, and tax offsets until the date of death. However, there are some specific rules and regulations related to the taxation of deceased estates. These include the treatment of superannuation death benefits, capital gains tax, and the taxation of testamentary trusts.

Legal responsibilities for managing a deceased affairs

The responsibility for managing a deceased estate’s tax falls primarily to the legal representative. This can be the executor of the will, an administrator appointed by the court, or a trustee.
The legal representative is responsible for lodging the deceased person’s tax return from the start of the income year until the date of death. They must also lodge a tax return for the deceased estate for any income earned after the date of death by the estate.

In addition to lodging tax returns, the legal representative must also pay any tax owed. They may use the assets of the deceased estate to do this. It’s important to understand that as a legal representative, its your role to ensure that all tax obligations are met.

Who is responsible for filing a final tax return for the deceased person?

The executor of the will, or the court-appointed administrator, or the trustee is responsible for filing thedeceased persons final tax return for someone who has died. This individual is often called the legal personal representative (LPR), . Their role is to manage the deceased’s tax affairs.


The LPR’s tasks include notifying the ATO about the person’s death. It also involves gathering all necessary financial information, preparing, and lodging the deceased person’s tax return, and paying any outstanding tax from the estate’s assets.

We recommend working slowly through the issues. Don’t be pressured by beneficiaries keen to get their hands on the money.

Steps in filing a deceased person’s tax return

Filing a deceased person’s tax return involves several steps.

First, the legal representative should notify the ATO about the death.

This can be done by sending a copy of the death certificate, along with a written notice, to the ATO. Though often the ATO gets notified by other sources such as birth death and marriages.

Next, the representative should gather all necessary financial information. This will likely include bank statements, investment reports, and details of any superannuation funds. The data will be used to prepare the deceased person’s tax return.

The third step involves completing the tax return. Therefore after the tax return has been lodged, the representative must then pay any outstanding tax before making final distributions


Remember, these steps can take time and require attention to detail. It’s crucial to stay organised and keep accurate records throughout the process.

Common issues in managing a deceased estate’s tax return

Managing a deceased person’s tax return is not always straightforward. Various issues can arise, complicating the process.


One common issue is incomplete or missing financial records. This can make it difficult to accurately complete the tax return. In such cases, the legal representative may need to contact banks, investment companies, and other institutions to obtain the necessary information. Always plan by actively undertaking Estate planning so that when you die some of the complexity is ironed out.


Another common issue is the complexity of the deceased’s financial affairs. If the deceased had multiple income sources, substantial investments, or owned a business, the tax return could become quite complicated. In these situations, it might be necessary to engage professional help.

Being an executor can be a big responsibility. However, with a basic understanding, organisation, and patience, it can be managed effectively. Take time to work through the processes and reach out if you need guidance along the way.

Identifying and recording obsolete trading stock write-offs for a small business involves several steps.

Its that time of year, when you should undertake you annual stock take. We suggest to be practical in your approach. Use scales and estimates for small items such as screws , widgets and small items.

A practical approach – obsolete items.

Here’s a general guide on how to approach this process:

1. Identify the stock items: Begin by reviewing your inventory records and identifying any old trading stock that needs to be written off. Look for items that are damaged, expired, obsolete, or unsellable due to other reasons.
2. When doing a stocktake, use round stickers (i.e. red dots) or straws to identify those items that you have counted.
3. Assess the value: Determine the value of the stock items that need to be written off. This can be done by assessing their original purchase cost, current market value (if applicable), or any other relevant valuation method.
4. Document the write-off: Maintain proper documentation for the write-off. This should include details such as the date, description, quantity, unit cost, and total value of the stock items being written off. Store this information for future reference, especially for tax and audit purposes.
5. Update inventory records: Adjust your inventory records to reflect the write-off. This helps ensure accurate reporting and tracking of your remaining stock items.
6. Tax considerations: See Geoff and his team

Remember, if need help contact us .

You should combine your stocktake with a sales budget that should be done for coming year

Once you have undertaken your list let us know and we will help you record it in your accounting system. Happy new financial year.

Sabotaging your business can happen in several ways. It’s a silent killer of businesses for growth and success. It’s like wood termites that infiltrates behind the framework of your home as a result when finally uncovered it results disastrously.

Where on the surface, a business can look amazing. Sillly things people do can turn a business into a disaster. So are you quietly sabotaging your business?

The other day I visited a modern-looking café. At the cafe the staff allocated me a table. However they failed to clean it resulting in us having to move the dirty dishes of ourselves. Only a small thing but bad service. Then after we finally ordered a coffee, it came in paper cups . The staff apologized, stating they had run out of cups. Though more likely lack of cups probably they weren’t clearing the tables and understaffed was the main reason for poor service and delivery.

Well, the outcome was a big nar. Next time we will go somewhere else; the poor service sabotaged customer service and what had the hallmarks of an excellent place for a coffee.

How and why people sabotage their business !

While it is unfortunate, there are several ways in which a business owner may sabotage their own small business. As a result here are a few common examples of what we see as pure an unecessary self sabotage of a business

Poor financial management is a killer for a small business . Failing to keep track of finances, not budgeting properly, or mishandling funds can quickly lead to financial problems and the downfall of a small business. Disregarding the ATO debt and even following up with your own debtors will as result lead to a cashflow disaster.

Fail to plan and lack of strategy. Not having a clear business plan, neglecting market research, or failing to adapt to changing trends can hinder growth and sustainability. Without proper planning and strategy, businesses may struggle to compete and survive. This includes exit planning.

Ineffective marketing and branding marketing efforts or a lack of brand development can make it difficult for a business to attract customers. Neglecting to promote the business effectively or failing to build a strong brand identity can lead to limited visibility and diminished customer interest. Unable to project your vision means you may not be attracting the right customers.

The big killer and one that can be easily fixed!

Poor customer service is a massive sabotage for a small business. Failing to prioritize customer satisfaction can damage a business’s reputation and result in lost customers. Ignoring customer feedback, providing subpar service, or not addressing customer concerns promptly can lead to negative word-of-mouth and a decline in sales.

The final one that impacts a business is Internal conflicts and mismanagement: Disagreements among business partners, ineffective leadership, or a toxic work environment can create internal conflicts that distract from the company’s goals. Poor communication, lack of accountability, or an unproductive work culture can impact by undermining employee morale and overall business performance. A toxic environment is a bad business.

A strategy for you to build growth.

Developing your growth and exit plan needs careful planning. A business owner’s reluctance to adapt and lack of resilience can unknowingly sabotage the business. A business owner must adapt rapidly to a changing business landscape. Sometimes the inability to adjust to market trends, consumer demands, or industry disruptions can lead to business failure.

Resilience, flexibility, and a willingness to embrace change are essential for long-term success.
Part of what we do for our clients is help them plan. For growth Growth, prepare for change and plan for an eventual exit.

As a Chartered Accountant and business adviser, we help you through the journey. Ask these questions if you are at a fork in your business journey pathway.

• Am I happy with my business and my lifestyle?
• Is it time to consider if the business still lights my passion or am i over it?
• If your business faces change or uncertainty, are you prepared for it or ignoring it will sabotage the business.
• What are my options now and into the future concerning my role and ownership in the business?

Any decision about business direction needs to be quietly evaluated. Sometimes not stopping and assessing you and your business as a package is a sure way to sabotage the business. Move forward with confidence by having a plan that works for you with a clear direction that make your business a winner.

GST at property settlement is a tax that needs to be deducted at settlement. It continues to catch out Mum and Dad developers walking the cashflow-type rope. Many are not aware that they will only have effectively 90% of the sale at settlement to play with. This can cause pain as interest rates bite and property prices decline in some areas.

Since July 2018, you may need to pay GST at settlement if you are selling or buying new residential premises or potential residential land. How GST is paid for certain property transactions affects purchasers, suppliers, and their financiers. For those non-residents, there is a further hit of non-resident withholding tax.

What is remitted at gst at property settlement

In essence, the purchaser must remit 10% (being GST) or 7% withholding GST margin scheme to MR ATO at settlement. This is regardless of if there is a first mortgage on the property.

A reconciliation of the final GST is done in the vendor’s next BAS and any amount payable or refundable is collected then. This puts the ATO squarely in the front of the cash handouts and leaves the balance scrambling. Those who rely on making a deal with the ATO for a repayment plan are unable to do so, and potentially if things a tight, a vendor could come out short.

Some penalties will apply if the Vendor fails to provide the required Notice or fails to notify the Purchaser of the required details.  If either occurs, a penalty of $21,000 would be payable. This assumes the Vendor is an individual and maybe five times that if a corporate entity is involved.  The ATO can catch up with people using its data-matching systems.

There is no requirement for Purchasers to be registered for GST.

GST withholding notification.

Before the settlement of GST property settlement, a GST property settlement withholding notification needs to be completed. This needs to be lodged online to the ATO; a conveyancer or legal representative can do this on the Purchaser’s behalf. This Form needs to be completed as soon as possible, and the ATO will provide a unique payment reference number (PRN) and lodgement reference number (LRN).

Once settlement has occurred, the GST property settlement date confirmation. The form must be completed with the unique PRN and LRN provided by the ATO.

Don’t panic a purchaser does not have to pay a GST withholding amount at the time when they deliver a genuine deposit on the property paid or the deposit is forfeited.

GST complications

Should it be found that the deposit is not a genuine deposit, it will be treated as part of the consideration for the supply. This means the purchaser may be required to pay a GST withholding amount on or before paying the vendor’s deposit.

Some developers think we can avoid the 10% withholding regime. They try this using an instalment contract. Under this arrangement, when the purchaser pays the purchase price balance. Instalment contracts mean that the first payment under an instalment contract is the first day the purchaser pays any of the consideration for the supply. Therefore, the purchaser must pay the GST withholding amount on, or before, the day they provide this first instalment payment. GST withholding amount to be paid.

Again, if instalments extend over 12 months, the ATO gets their money well before full settlement.

Under these rules, the ATO gets paid first. If liquidation occurs, the Bank may be short of its loan as the ATO has snaffled the first 10%. Effectively, the Bank will argue that the ATO has received a preferred payment. Then the Bank will chase the 10% from the Vendor who, in most cases, guaranteed the loan. This is important to note if the development goes into liquidation. It also may delay settlement as the Bank will not release a clear title.

Be ready to remit gst at property settlement.

As a seller, get your ducks lined up early. This will ensure you can proceed smoothly toward settlement. Make sure you have enough money to clear the title. If not, consider delaying the settlement and finding the potential shortfall or consulting a professional insolvency expert for advice on your actions.