Estate planning for the living!

Many of us go through life not thinking about the end.

Many often think do I need a will? Many don’t bother! We start life naked with nothing and we end up leaving an imprint on this earth that others must follow.

Telling others how you want what you have accumulated in life is important

Wills establish wishes after death and are essential for estate planning

The chances are that you may have wishes about who gets the large loot of assets and possessions. These assets you have accumulated in your lifetime. Or you may have a young family and provision needs to be made to provide for their welfare and education.

No matter what your situation is you need a plan! A plan to look after your loved ones.

Start planning now for your estate wishes.

Leaving this earth without instructions to your executor can mean that you will leave headaches for others. Do I need a will? YES  Take time as to what instructions you would leave for things such as :

• Your business – what is your desire and are others capable of taking it over? 
• Your car 
• Your children and wife from the first or second marriage
• If you die with young kids who will look after them?
• How will you deal with your superannuation?
• Who gets what?
• Is their tax and capital gains tax to be addressed?
• Any favourite charities that are important to you
• Have you documented your life achievements?
• Passwords for eBay, Facebook and Instagram?

Leaving a will allows those you love can be financially rewarded or cared for. A Will that has been created well will address issues of taxation and division of property.

No will – dont leave a problem to someone else

Not leaving a Will can result in an executor being appointed that must follow the standard formula for those without a will.  When a person dies without leaving a valid will, their property, etc. must be distributed according to certain rules called the rules of intestacy. A person who dies without leaving a will is classified as an intestate person. You may need to apply for probate and if this is the case seek legal advice.

Many of our clients have businesses. If not dealt with a mess can be left and on some occasions, any value in the business is wittered away due to inaction after death.

Many fights start due to greed and expectations. Many of us will accumulate wealth during our lifetime but it is your wish as to how it will be distributed. We encourage clients to tell others so it should not be something of a complete surprise. Eliminate those self-focused beneficiaries who think that they have a sense of entitlement by controlling the conversation about why you are living.

It can pay to start dealing out assets early before death and enjoy the process. Some assets such as the property will have tax and stamp duty implications for you if sold early or transferred not under will. You can and you may enjoy giving cash away (as long as you are on no Government Benefits) and slowly depleting the estate. 

If you have lent others money, make sure it’s documented so your estate can recover if necessary or even out the distribution amongst family if needed. Finally, there are those who hide money in the walls and the garden. Make sure you let someone know what to look for. 

Make a confidential appointment if you wish to explore some of our discussion points. Best wishes Geoff

An Initial repair occurs when you acquire a new rental property with existing known repairs. The old house might need fixing before it can be rented. Initial repairs may include such things as plumbing, painting, new carpet or appliance repairs, to name a few.

Initial Repair must be capitalised!

Though Initial repair cannot be claimed outright in the first tax year, there is some tax relief. These repairs should be treated as a capital expense. Treating them as a capital expense will add them to the property’s cost base.

We are often asked what the tax treatment of an initial property repair is. Can you claim a tax deduction for repairs to a newly acquired rental property investment? Will the ATO allow it!

Why won’t the ATO treat all repair claims as an expense?

What is the Government thinking about initial repairs legislation? Why did they decide you can’t claim the repair outright when you buy the property?

In looking at the intent of the legislation, the lawmakers said if you haven’t yet rented the property out there is no right to claim an expense on revenue account. Furthermore, the ability for some taxpayers to buy a rundown property and then claim all the expenses in fixing that property up would mean the ATO would be inundated with excessive claims. Hence, the initial repairs must be capitalized.

A repair claim should be evaluated on merits. You may find it may not be classified as an” initial repair” simply because it’s the first repair made after you acquired a rental property. The ATO has designed a tool kit, which can be accessed here. Also, you can refer to taxation ruling TR 93/23 where you can read more. The ruling outlines a repair is not an ‘initial repair’ simply because it is the first repair made after the property is acquired. The ATO has numerous examples within these two resources.

Examples of an initial repair

Here are some initial repair examples:

Fixing a Damaged Roof: If the rental property’s roof was damaged or leaking at the time of purchase.

Replacing Broken Windows: If any windows were broken or dysfunctional when the property was bought, their replacement is categorized as an initial repair.

Repairing Electrical Systems: If the electrical systems, like wiring or electrical appliances, were not functioning correctly at the time of purchase. Therefore, any repairs to make them operational would be considered initial.

Plumbing Repairs: Fixing any pre-existing issues with the plumbing system, such as leaking pipes or faulty plumbing fixtures, is classified as an initial repair.

Restoring Damaged Flooring: This includes repairing or replacing floorboards, tiles, or carpets that were in poor condition when the property was acquired.

Repairs that are regarded as initial cannot be claimed outright and must be capitalized. The capitalized repairs are added to the cost base of the Asset. This will assist when calculating the capital gain upon sale as a cost. This means you can reduce your capital gain at the sale of the property but not claim it against your tax when you acquire the property in the first year.

Here is an example of an ongoing repair that is tax-deductible!

If the dishwasher worked perfectly when you started renting the property but needed repairing a couple of months thereafter. This would be considered an ongoing repair and tax-deductible.

Repair vs Improvement need help?

Gartly Advisory looks after many happy clients who own rental properties. Plan carefully and do your homework. The ATO is looking closely at rental property claims as more Australians love to acquire property for investment purposes.

Unsure what can be claimed upon purchasing your new rental property, reach out to us, and we can assist!

Insolvency – Worrells Liquidation observations

Despite the last 2 years being a rocky road for small businesses in Australia, liquidations and actions by the ATO have been very low. Yesterday I attended the Worrells Solvency seminar on the current state of play. Here is a quick summary:

• The ATO has been quiet over the last 2 years about debt recovery, but soon the sleeping giant will awake!
• Jobkeeper forced many taxpayers  to get their lodgments up to date, so the ATO is aware of who owes what,
• ATO debt is sitting at $61 billion outstanding. That’s a lot to collect expected that $20 Billion might never get collected
• ATO has been kind regarding payment plans, but now it is likely that things will tighten up.
• Last 2 years, there has been a drop off insolvency appointments, but soon the ATO will start,
• The prediction is that corporate insolvency appointments will rise with higher interest rates, lack of supply and labour, and more excellent ATO activity.
• Directors changes in terms of appointment and debt

Small Business needs to start managing their debt. To avoid becoming personally liable for ATO Debt in an insolvency situation, make sure you ensure that all returns are lodged on time or within three months of the date of lodgment.

If you need advice on how to manage your debt, please call us, and we can assist you in exploring your options

Like Real Estate, then listen to our client Sue

and her podcast Real Estate Right

The podcast is designed to educate, inform and better prepare the public with expert information about how to maximise their real estate transactions and dealings

PODCAST! – go to her website or search on Spotify etc

https://www.podbean.com/ew/pb-uupcs-11d0846

TOP EXPERTS TALK ABOUT HOW TO BUY, SELL, RENT AND INVEST… RIGHT!

New date for online “Freedom Discovery Workshop.”

Join us as we explore what business freedom means to you and your business

New date Monday, April 4^th 7:30 pm online – rsvp admin@gartly advisory.com.au

https://www.eventbrite.com.au/e/276167834427

The implications of your home business and cgt needs to be considered if your home is regarded as a place of business.

Typically many small businesses operate their business out of the home. Especially since the onset of covid.

Occupancy expenses you can claim

In this case, then you are entitled to claim home occupancy expenses if you are running a business.

If you use some or all of your business from your home, you may be able to claim tax deductions for home-based business expenses in the following categories:

• occupancy expenses (such as mortgage interest or rent, council rates, land taxes, house insurance premiums)
• running expenses (such as electricity, phone, the decline in value of plant and equipment, furniture and furnishing repairs, cleaning)
• the expenses of motor vehicle trip between your home and other locations, if the travel is for business purposes.

A home-based business is one where your home is also your principal place of business. That is, you run your business at or from home and have a room or space set aside exclusively for business activities.

Where you are renting a home, then there are no cgt implications

Where you are operating as a Trust or a Company, you cant directly claim the interest etc., on the house. However, you are entitled to charge your business rent.

Your claim is based on % of occupancy of your home. Make sure you do a mud map and work out the area allocated. Please don’t include your toilet or kitchen as the ATO considers this material and need it for private purposes.

However, your home will be subject to CGT on the proportion of use and time.

CGT implications upon sale of home if used for business

Selling your home from which you have run your business will make it subject to capital gains tax on the percentage set aside for business multiplied by the period. However, as a small business, you will be able to claim the small business capital gains concession. These concessions may considerably reduce or eliminate the gain.

Please discuss your options with us and keep adequate documentation if the ATO decides to review your claim.

Motel Occupancy rates are a good indication of the profitability of your accommodation business. What brings back your customers? Why do some accommodation providers have high occupancy rates and some don’t?

In the seventies, it was “free colour tv ” now it is “free wifi” to add that little extra to attract the customer.

All small businesses need a point of difference to attract customers and retain their competitive edge. With the advent of online reviews and social media, it’s important to keep your accommodation business inviting at all times. A bad review impacts your online chances of securing a customer.

Your higher Motel Occupancy rates are driven by customer satisfaction

The occupancy rate should be monitored weekly. Its is an indication of how space is generating revenue

Traveller surveys show that customers want:

• Cleanliness
• Value for money
• Happy welcome
• Facilities that work
• Quite and restful
• Comfortable beds

It is not a lot to ask for but often one or two of these just doesn’t happen will make repeat business hard to sustain.

To see how Melbourne fairs when it comes to occupancy rates follow this link

Treat travellers how you would like to be treated

How often have you experienced a situation after a long drive and you are greeted with the owner is grumpy or unaccommodating of travellers needs? Rooms, where lights are broken or are so harsh with the lighting as they have inserted those energy-saving globes in that, save money but makes a dull night lighting.

It’s often the little things that can make or break an accommodation business. I was at a meeting in country SA and a fellow meeting attendee complained about her motel. Her story was one of amusement but handled badly by the owner.

She proceeded to tell us after a big day she retired to her room and bed only to find a pair of men’s pj’s under the pillow. It was late so she decided to sleep on top of the bed thinking the sheets had not been changed. She informed the owner the next day and he laughed saying it was probably the old guy who was going to stay before her but changed his mind moved on. The motel owner showed no empathy to the customer and hence she proceeded to warn others not to stay there.

Of course, not all motel owners are the same and many go out of their way to help you. In fact, if you are a regular many add that extra something to keep you coming back.

Look after your customers, keep your lodgings clean and tidy and customers will continue to make your hotel accommodation of choice. A low vacancy percentage is good. This means more revenue to your business and ultimately a higher value upon sale of the business leasehold or freehold, depending on how your business is structured.

Online Reviews help customers decide if your place is where to rest their head!

Always ask and seek online reviews. Reply glowingly when someone leaves a great review and reply empathetically when a review isn’t satisfied.

Always be aware of the reviewer that pays out after the event without having confronted you first hand. Having told someone that you have fixed the problem for next time is better than ignoring it completely.

Running a motel or air BnB takes effort and you need to be a people person which ensures success. Occupancy rate is something that takes time to maintain but ultimately is what drives profitability and value in your business

Making job profit on every job is important to make a profit and cover your business overheads and administration.

In the world of Building and Construction, there are many types of tradespersons who operate small businesses in Australia.

Some people are great trades person but not always running a business.

Amongst the construction industry, there are those who can run a successful business, those that can make a living but not much else and those that lose money and should not be self-employed!

Making a profit is an art and takes some understanding of your trade, what the market will bear and the cost of the ingredients it takes to make the end service product or project. Might at this stage also throw in mess ups where you have to fix a problem caused by not doing things right!

Yet many don’t take the time to get it right. They rely on their gut and this leads to losses and cash flow problems.

Good habits help makes job profit

Get into the habit of examining every job and take the time to understand costs vs profit. Understand what work you should continue you win and which jobs you should work away. Look at the labour on job and was it efficient or were there defects that required additional time and loss of resources that could have been spent elsewhere?

There are tradies out there that use the back of enveloping approach For them this works only because the price quoted is well above the odds. Often it also leads to low margins and has the reverse impact on profit.

There is no excuse these days with the sophistication of accounting software that you cannot monitor these jobs properly.

Cloud accounting software

 Accounting software such as XERO and MYOB can help you track jobs. A good accounting system can tell you the result or ongoing costs of a job.

There is also specific job costing software that is functional and affordable for smaller trades.

A final tip that many trade businesses neglect to do is while they measure their results on a job to job basis they forget to keep the score of the annual year to date result. This is where you may make a profit in a job but with insufficient margin, your administrative overhead can dilute your profit quickly with undesired effects of cashflow and taxes being unpaid. 

Don’t fall into the habit of not looking at the big picture not just on a job to job basis. Practical ways that some tradies ensure that they make a profit on a job is to :

1. Add 10% to cover for incidentals
2. Throw in a couple of thousand to make it worth while
3. Use a professional quanity quote service
4. Compare othe jobs you have done
5. Ask other tradies as to what they quote

Plan your quotes, do the job and review the outcome. A good business will make nice profits and when you get the taste for profit it becomes something you strive for do better and this is a nice feeling to enjoy

Franked Dividends are recognising tax paid by the Company and transferring the tax as a credit when the Company pays Profit to shareholders.

Running your own Company will mean that as a shareholder you will want to access these profits. This is done as a Dividend. In simple terms your company is a money box and the only way to get it out as a shareholder is to pay profits as a Dividend. This will either be paid to you as a Franked or unfranked Dividend.

Profits to shareholders can be paid from the Company retained profits as a dividend.

A company pays distributions to its members. Shareholder members may be individuals or other entities such as your family trust. The amount of a dividend allocated will depend upon a number of shares you hold and the percentage of ownership.

What is a Franked Dividend and a Franking Credit?

Your Company, after paying a paid tax payment, either in the form of a company tax instalment or year-end company tax, will record these amounts as franking credits in the Company Franking Account.

Presently the Company Tax rate is set at 26%

When the Company issues a dividend, it will issue a distribution or dividend statement to each shareholder member.

The dividend statement is then given to each shareholder who receives a distribution outlining their entitlement.

Dividends paid by your company can be either Franked Dividend or an un-franked Dividend. The franking amount will depend upon the availability of tax paid by the company in the company’s franking account. When no company tax has been paid by the company a franked dividend may not be paid. Therefore, the Company may choose to issue a dividend, as un-franked.

The Dividend statement will show the amount of franking credit attached to the distribution. The statement will also show the extent to which it’s franked. Only resident taxpayers of Australia can claim a tax offset for a franking credit attached to a dividend.

Non-resident taxpayers, receiving a franked distribution are exempt from withholding tax in Australia. This is to the extent that it’s franked. Therefore, if it is 100% franked there is no final tax to pay or declare as a non-resident.

We recommend reviewing your Company’s Retained Profits regularly. Leaving large profits in retained earnings can lead to tax problems down the track when you decide you need to access these profits. Regular Dividends can eliminate the problem of tax implications being paid out in large Dividends.

Grossing up your Dividend in your tax return.

An individual shareholder in your Company will pay you a dividend. The franked dividend from the Company must include the amount together with any franking credit as declared taxable income. This is known as Grossing up your Dividend.

Receiving a franked divided also entitles you to a tax offset equal to the” franking credit amount. For tax purposes, this effectively means any tax up to 26% on the income will result in a neutral result.

A tax offset can result in a refund or excess tax payable. The tax may result in the need to pay additional tax liability on the distribution. When this happens, it is known as ‘top-up’ tax.

Taxpayers with lower taxable incomes can receive a refund of all or almost all the franking credits. This will be dependent on their income position.

As your accountant, we try and work with you to obtain the best result for your tax position. Managing how you declare your declared Frank Dividends using the right tax opportune time. The aim is to help smooth out your tax position and reduce your retained earnings in the Company.

Contact us for help 03 9597 9966

Starting out in a new business and being your small business startup journey

I remember many years ago how exciting it was to begin the small business journey.

It has been a journey twenty years later that’s is full of ups and downs, fun and pain and plenty of laughs.

Twenty years in and I have no regrets. In fact, anyone that can do it, should. Yes like all of us I have made some dumb decisions but I don’t have any regrets? No way, in fact, I have also made some good decisions too.

There have been a lot of characters I have met in my business career over the last twenty year’s. Some shady ones, some terrific ones and some that have become lifelong friends. Yes, I have been used, abused and ripped off but I have also been supported, encouraged and led to opportunities.

Starting out needs support

Your business startup relies on lots of support from friends family and associates. You really know who are your friends and where your support comes from. For me, it was my wife and kids who have driven me to success. There have also been many friend’s who have looked out for me along the way.

You see as an accountant many don’t see you as a small business person but there to help others. It took me a long while to accept that I too am a small business owner with the same pain, enjoyment and problems that you too have in small business.

Tips for business startups

So what advice can I give you as a new budding small business owner :

1. Just go for it! Have no regrets and enjoy the ride. Believe in yourself! Destroy the non-believers and the dream stealers. If you make strategic decisions based on evaluation then your business will grow.

2. Set goals. Set a road map don’t amble along in business with no direction. A person who knows his direction might get lost along the way but will always find the way to their final goal or destination.

3. Celebrate success, acknowledge others and enjoy the ride. Failure will happen but pick yourself up learn to understand what went wrong. Remember the sun shines tomorrow and you can do it all again. Don’t give up and follow the plan.

No matter at what stage you are in business a big congratulations It’s not easy to run a small business and the statistics say many don’t succeed in the first three years.

Live life to the fullest and grab every opportunity with no regrets. All the best.

Many of us launch a new business based on an idea or a need to sell our professional or trade expertise.

Business startups offer challenges

Starting a new business will provide you with new challenges and opportunities! It’s fun, it’s exciting and it will be rewarding.

Whatever your reason for starting your new business, your future will be an exciting time. However, it requires careful planning, lots of energy and the ability to follow through with the journey during times of toughness.

Geoff and his experienced team of professionals can guide and advise you on launching your new business and making it successful from day one!

Whether you are yet to start or are in the early stages of launching your new business, we can help you to work through the logistics and questions that everyone has.

Practical startup tips

Here are some practical tips that can help you start your new business:

• Talk with us so we can gain an understanding of what you are trying to achieve, your dreams and business aspirations.
• If you are buying an existing business, we can help make sure it’s the right one for
• We will discuss and explain the different structures available (sole trader, partnership or company).
• We can set up your company or family trust if that is the right structure for you.
• We can clarify what you need to do to meet ATO regulations when getting started and applying for an ABN.
• We will help you establish a practical business plan, cash flow projections, budgets and trading forecasts. We will help you set a 90-day action plan.
• We can help you present your program to your Bank manager if you’re looking for finance.
• We can also advise on the best sources of finance.
• We can work with you to ensure that you set up the right accounting systems in place to manage the financial paperwork.

We have helped lots of small businesses start out. We know you will have lots of questions such as dealing with government red tape and other businesses as this may be something you haven’t done before. We can help you determine what are the essential tasks in the first few months to get your business off to a flying start.

We welcome you to contact us for a FREE initial consultation. Please call us on 03) 9597 9966.

Gifting Assets to your Family Trust or transferring property to a trust protects your investments and assets by placing them in a Trust Environment!

Let’s explore why you would transfer a property into a Trust or just give money to your Trust!

There are many opportunities for this. For a start a Family Trust is great for tax planning. Many of us establish a Family Trust for asset protection and to ensure our assets are correctly passed on to the next generation.

Your Family Trust should be the hub of your investments allowing for flexibility and control of your family assets!

Having now established your Trust, you may now ask how do I get money into the Trust and what can i use it for?

Fundamentals of a family trust

Let’s explore the basics of a family trust first. The Trust has a couple of fundamental elements that you should be aware of, but in simple terms these are:

• Trust Deed – the rule book of how you run your Trust
• Settlor – establishes the family’s trust.
• Trustee – runs the Trust on behalf of the beneficiaries
• Appointor – appoints the Trustee.
• Beneficiary – family who benefits from the Trust.

How do I get money into my family trust?

There are two main ways to add money into your trust :

1. Gifting assets from your funds to the trust.

2. A Loan from you to trust – repayable defined or non-defined

Either method works but gifting assets to your Trust is better for estate planning.

In transferring your Asset to the Trust make sure you have ticked all the legal boxes. This will mean that the Trust Assets are secure and recognised as owned by the family trust. The Trustee should for all property and loan transfers document the transfer. Minutes should explain why and how the it is a gift to teh Trust. Assets that are transferred to your Trust these will then be allocated to the Corpus of the Trust

A Trust is a legal entity. However, some registries won’t recognise the Trust but require the Trustee to be the registered owner on behalf of the Trust.

Beware Gifting means not easy to get it back

There are 2 points here you should consider

Transferring the Asset or loan to the Trust as a gift achieves your estate planning needs . The asset or money is gifted it forms part of the capital or corpus of the Trust. In simple terms your Trust now owns it and the only way to get it back is to either make a specific distribution as capital or vest (ie windup) the Trust. In most cases, upon vesting of the Trust the capital would be distributable to the default beneficiaries. To understand how it would work for your circumstances you should consult you’re Trust Deed

Point 2 – is the ability of the Trust to enter into a Gift and loan back arrangement. Be careful if you are considering this as again it needs a well-documented agreement and actual $$$ changing hands.

Loaning money to your Trust!

Loaning money to your Trust will allow you to request that you can recall the monies you have lent to the Trust . Repayments will depend upon the Trust the ability to pay and several other factors. Even though a loan agreement is not necessary, many people still decide to draw up an agreement for certainty and estate planning.

The Trustee has an obligation to repay the loan if requested. When there is no loan agreement is in place , then the loan should be recorded by the Trustee by a minute to ensue there is some documentation. The accountant should record it on the Trusts balance sheet. As Trustee or the lender you can request interest can be charged but that again depends upon what you have agreed to with the Trust and you as the lender.

Gifting assets to the Trust

There will be Capital Gains implications and we can assist you here . Tread carefully and allow us to help you work through the implications of the potential transfer..

A Trust can help protect you and your family’s assets. Many families gift assets to the Trust. This means that you forego ownership and the asset forms part of the Trust’s capital or corpus. A Trust can offer protection over time. Your Trust protects your assets when things go wrong. These include Creditors, angry family members and newly wedded children. The Trust protects your Assets as these people are now not able to make a claim on these assets as they are now owned by the Trust.

A Family Trust, mechanism allows the control to be established by yourself as the Appointor. The appointor has the ability to fire and hire the Trustee. This means that you effectively control the Trust.

Upon your death, your executor acts on your behalf. The great thing is that the Trust continues to the next generation detailed in the Trust Deed. This will continue until the trust vesting day normally 80 years after establishment.

There are Social Security opportunities . Gifting can in some circumstances for social security planning but seek advice!

Every person’s circumstances are different. Therefore what we have outlined above is a very simplified summary of the operation of the trust and your money. We suggest that you seek professional advice. We are happy to assist you if you need help in this area.

Reach out to Geoff if you wish to talk about your circumstances. Phone 95979966

Brighton (3186) accountants are here to help based in Ormond!

Gartly Advisory are Accountants based in Ormond, Melbourne. While we are not based in Brighton 3186, many of our clients are!

Accountants that help Brighton Small business

You need a professional Chartered Accountants group that will offer you a professional quality service to assist you and your business to grow. Our clients are based all around Melbourne and we have a great selection of clients based in Brighton. Also, we have clients located in the nearby Bayside suburbs.

Clients love our service because the team at Gartly Advisory ensures that we provide advice and knowledge that small business clients can act on!

Join us for a coffee to see what we can provide you

It’s true we are not based in Bay Street or in Brighton but we are not far away. Our clients love the easy parking and hot coffee. Gartly Advisory has a team of a number of professionals and the firm has been in operation almost 20 years helping many small businesses.

Geoff loves swimming and loves going down to Brighton Bathes for a quick dip in summer. Talk to us about your small business needs and see if we can help you on your business journey.

For many businesses, cash flow is an issue that holds the business back. But, unfortunately, there never seems like there is never enough cash when you need it.

With Christmas around the corner, it’s time to plan. Naturally, a business owner will not want to reduce their cash balance unnecessarily at this time. But, on the other hand, an increase in cash into the business can make life easier and lower the cost of financing. Moreover, squiring the money now can pay dividends in the post-festive month of January.

How to reduce cashflow leaks

 To help you preserve or increase your money, here are our five cash management leaks to avoid.

1. Bloated Bank Fees

Some banks are more business-friendly than others.  Therefore, we recommend you assess the fees you are currently charged and aim to eliminate any unnecessary services.

•  Is it practical to maintain a   cash balance to avoid monthly fees? Do you charge merchant fees to recover?
• Are you being charged online banking fees, and are these still necessary?
• Are you being charged for a high volume of transactions or cash drawer services, and are these competitive with other banks?

Banks are open to negotiation, and we sharpen their pencil for a long term relationship.

2. Are you sure you are paying the lowest amount of taxes you legally can do without entering into tax avoidance? 

 There are several opportunities to review to ensure that you are not overpaying taxes anywhere in your business or personally:

• Payroll taxes
• GST tax
• State and local income taxes
• Property taxes
• SMSF – are you in pension mode if you are retiring etc. and can have your smsf pay zero tax

3. The Cheque Is in the Snail Mail!

Customers who take too long to pay you are one of the biggest cash drains in your business. Consider reviewing your terms, asking for deposits, or becoming more aggressive with collections to bring your DSO (days sales outstanding) down. 

When you do, you will see an instant, permanent cash flow improvement. Don’t do work for people that can’t or won’t pay you or are slow

4.  Watch for those unknown bank errors and scammers

You may have an eagle eye on your most extensive bank account, but what about your other cash stashes? 

 PayPal, petty cash, credit cards and business savings accounts are among the places that may not get daily scrutiny.  Ensure those accounts are properly reconciled and have the proper controls so funds don’t go missing or someone else’s transaction ends on your account

5.  It’s in Your Interest

An excellent problem to have is when your bank balances get to be significant

What is your optimum working capital level? First, you don’t need the money immediately, so make it work for you.  Then, make sure that money is still working hard for you by putting the excess in an interest-bearing account, reducing loans or used for more resourceful opportunities. 

Cash is King and so is a good cashflow strategy

We always recommend a cashflow strategy of ensuring your trading company does not become a cash-rich piggy bank. In case of if things go wrong, you leave your cash exposed. Reach out if you would like to discuss this aspect further.

Cash management is important when conducting an import or export business. Planning for funding of containers, currency fluctuations and disruption are all strategic planning matters. We have assisted clients in scenario planning for lumpy cash flow and large inflows and outflows that can happen with these types of operations.

Cash can also disappear when job planning does not happen or the project goes pear shape. Read our article about job management.

Make a your cashflow strategy a priority

If we can help you plug any of these cash leaks into your business, please don’t hesitate to reach out and let us know. A cash flow forward strategy allows you to plan where your working capital can find it hard. If you aren’t using a cash flow plan, then let us help you start the process.

Estimated reading time: 3 minutes

Are you taking a giant step to make a difference or falling into a black hole? The fear of failure has killed more dreams than all other fears combined.

The fear of failure is insidious because it’s mainly in your imagination.

It can also prevent you from trying new ideas, growing and trying something new. Fear guarantees failure.

Interestingly, young children have no concept of failure. They couldn’t care less if they failed to do something. They just try again. There are no negative thoughts or emotions involved. They just keep on going.

Having hesitations is essential, which leads to calculated risks. But, give it a go, and in most cases, success will outweigh failure most times.

Consider these facts:

The fear of failure doesn’t have to impact your life significantly.

1. Failure is temporary – unless you quit. Failure isn’t final unless you give up. Successful people experience failures too. But they ended up being successful precisely because they didn’t stop. So failure is just a temporary state that means nothing because it’s only temporary.
   
   
2. Failure will occur with everyone. You’ve failed thousands of times and managed to survive. Consider how many times you were unable to walk or to talk well. Babies have constant failure.
   
   
3. Successful people fail all of the time. It’s a massive part of how human beings learn. We realized that our approach didn’t work; we adjusted and tried again.
   
   
4. Failure allows you to learn. You can learn something from every single one of your failures. Failure makes you more knowledgeable and capable. The more you fail, the stronger you become.
   
   

Why it’s in your imagination

1. Others are far less concerned about your failure than you think. A few people might notice your disappointment, but they quickly turn their attention back to themselves and their own challenges.
   
   There’s nothing to worry about. Feel free to fail as much as necessary. Fail enough, and you’ll quickly see that no one relevant cares.
   
   
2. Focus on how great it will be when you succeed. Don’t look at possible failure; consider possible success. Make yourself feel excited and optimistic about taking action.
   
   With high enough expectations, you’ll do just about anything without worrying about failure.
   
   

3. Redirect your thoughts. Put your attention on what you’re doing. Forget about the outcome. Stay focused on your actions or something positive. Thinking about failing will freeze you in your tracks. Take risks but put stop gap measures in so that failure is only a small chance in scheme of what you want to achieve.
   
   
4. Consider the cost of doing nothing. Taking action might be a little scary, but what will happen if you do nothing?
   
   
   • What will you feel about failing to take action?
   • What if you’re stuck in your current life for the nextfew years or more?
   • Maybe taking a risk is far more attractive than remaining where you are.
     We’ve all allowed the fear of failure to influence our decisions. We’ve allowed this fear to stop us from trying new things or taking risks. As a result, we all have more minor lives than we could because we’re too concerned with what others think.

Rejecting the fear of failure is one of the most incredible things you can do for your future! Your small business , your team and your family will be incredibly proud if you achieve your goals.

Plan to succeed!

 Bite off what’s going to give you joy. Go where no one has gone!

In business, we have all failed, but many also succeed.

Personally, I have failed at things that looked right. Ultimately I have used my failures to move forward and help myself and others. Failure to me is if I do the same dumb thing again and don’t learn from past mistakes

When it comes to inspiration you need to read what others have achieved and make your own list.

Not sure where to focus on in your business then check out our business value score and within 15 minutes receive your free score.

In 2022 to succeed, start an action plan. Focus on those things you are passionate about that will make a difference in your business. Many of us have a long list of formal and informal goals. Some of us don’t start then for fear of failure. Others find excuses, and others try to do everything at once. Don’t over commit but start by actioning small runs that you can get on the board.

You can start today. What are you going to do today that you’ve been afraid to try? What small step can you take that may make a difference? Sometimes 1 per cent changes can result in extraordinary outcomes. Conquer your fear of failure and just do it