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Home Office

Do you have a home office?

Do you have a home office?

If you have a home office for your business, you should be able to claim some of the costs involved in maintaining, owning and using your home.

It’s important to be aware of what you can and can’t claim, and the record-keeping involved in making a claim.

How does it work?

In order to claim, the space you use must be used primarily for your business.

This doesn’t mean setting up at the kitchen table from time to time, it means having a dedicated space that you work from.

If you are selling online and storing stock, you may also be using other spaces in your house for storage or stock maintenance. Or, if you are making or creating products, you may be using other areas like your kitchen or workshop.

Costs that you might be able to claim include:

  • home office equipment
  • repairs to the home office or work-related furniture and equipment
  • cleaning expenses
  • any other day-to-day running expenses for your home office.

You may also be able to claim the costs of some trips in your car if these are from your home office to other locations where you are carrying out business.

The ATO has developed a calculator tool, to help you better understand what you might be able to claim. View the tool here.

Keeping track of your costs

Make sure you keep a record of all your expenses. It’s important to keep your personal and business expenses separate. Consider using online accounting software so the paperwork is kept in good order.

We can help you review your home office expenses to make sure these are included when you claim.

Talk to us, we can help.

business structure

Set your business up for success with the right structure

Set your business up with the right structure

Before you start a new business it’s essential to make sure you’re choosing the right structure for the long term. 

The business structure you choose can have big implications down the track, so it’s best to set up for success from the beginning.

The structure of your new business has repercussions in terms of tax, costs and the protection of your assets. When you decide on what structure you’ll use, keep in mind your future plans, because this may impact your decision.

business structure

There are three main structures you could consider.

Sole Trader

If you’re operating on your own, this may seem an obvious choice. It’s a quick one to set up and incurs minimal costs. Bear in mind that a sole trading business can be trickier to sell, and you are taking on greater personal risk in establishing the business. It may be worth looking into how you can protect your personal assets, should anything go wrong.

Partnership

If you’re working with a partner, you could consider this option. It lets you share the load, along with the costs of getting a business established. You’re also sharing the risk and potential liabilities.

Company

Setting up a company means more admin and higher costs to get going. You’ll become a ‘director’ as the person who runs the company, and a ‘shareholder’ as a part-owner. Companies have additional reporting duties, but you assume less personal risk. Also, the clear structure and reporting involved, may set you up for an easier sale when the time comes.

You could also consider setting up a trust, but as this is a relatively expensive and complex undertaking, it’s less likely you’ll go this way initially. You can change the structure as your business develops, but it’s important to consult with your accountant, lawyer or advisor as you go.

Before Deciding

Before deciding, think ahead to the future you want for your business. Ask yourself:

How am I hoping to grow the business? 

If you plan to bring on additional people to run the business alongside you, a company or partnership arrangement may suit.

When do I want to sell the business? 

Again, while selling any kind of business is possible, the clarity provided by a company may be an advantage and make your business more attractive to a buyer.

How sure am I that this business will succeed? 

It may be that you are setting out to prove a concept or explore a business idea. If this is the case, you may not look to incur too many costs up-front, and a sole-trader or partnership model may appeal.

Whatever you decide, make sure you understand the tax implications. Talk to us before setting out on your new venture.

All you need to know about single touch payroll

Single touch payroll regulations may require you to make some changes. Automation or outsourcing will make compliance less of a time burden for your business. We can help.

Single touch payroll (STP) is a new regulation that changes when and how small businesses report payroll activity to the Australian Tax Office (ATO). Businesses used to report this information to the ATO once a year. Now, they need to send a report after each payday. And those reports must be submitted digitally, using a very specific format.

Changes to when you report payroll

Small businesses used to finalise their payroll records at the end of the financial year and produce:

  • a payment summary annual report for the ATO, stating how much the business had paid in salary or wages, the PAYG withheld, and some superannuation contributions they’d made
  • a payment summary for each employee, stating what each employee received in wages or salary, the payroll taxes collected from their pay, and some superannuation contributions made on their behalf.

No more payment summary annual reports

Because you’ll be updating the ATO on a pay-by-pay basis, you won’t need to prepare a payment summary annual report anymore. You’ll just let the ATO know when you’ve made your last pay run of the financial year for your employees.

Payment summaries won’t need to be sent to employees anymore, so employers won’t be required to produce them. The ATO will use single touch payroll reports as the sole record of salary/wages paid, taxes collected, and superannuation contributed.

Your employees will be able to see the information that would normally be on their payment summary by logging on to myGov.

You’ll need to report payroll online

There’ll be no more paper forms for reporting your payroll activity to the ATO. You’ll need to submit the information online, using a specific format known as SBR (Standard Business Reporting). Depending on how you do payroll now, you may need to change software or find a service provider who can produce compliant reports for you.

When is the single touch payroll deadline?

Small businesses with fewer than 20 employees don’t have a confirmed deadline for switching to single touch payroll. However, small business advisors expect it to be compulsory from 1 July 2019. Businesses with more than 20 employees switched to single touch payroll on 1 July 2018.

Your options for switching to single touch payroll

To be ready for the switch, you’ll need to make sure you can submit compliant reports every payday.

Here’s what it means:

  • If you use online payroll software, it should be able to handle the job. Just make sure it produces ATO-compliant reports.
  • If you use desktop payroll software, you’ll need to find a service that can upload your payroll reports, convert them into the ATO’s required format and submit them on your behalf.
  • If you use spreadsheets or pen and paper, you’ll need to find a service to convert the data into a compliant digital report format and submit it on your behalf.

We can answer your questions about single touch payroll. Book an appointment now.

Remote work is on the rise – here’s what you need to know

Remote work is on the rise. 

Here's what you need to know.

Remote working has many benefits for your business and you may be offering it already. Make sure you have strong communication channels, and robust systems to support your flexible workers and ensure continued productivity for your business.

Remote working has become more and more common as developments in technology have allowed us to communicate and collaborate no matter where we are. In fact, most of us are already logging on from home or holiday already. In May 2018, Swiss serviced office provider IWG released a study that found that 70% of professionals work remotely at least once a week.

Sometimes called ‘telecommuting’, remote work is on the rise, and it’s challenging traditional ideas about where and when work should take place. Offering flexibility to your staff can be a valuable tool to both attract new talent and retain your existing team. But before deciding to offer remote work, you need to make sure you’re able to support this way of working.

Remote work has many benefits for a business. Offering this option can mean that you retain employees through a change in their circumstances, for example, becoming a parent or relocating to a different part of the country. When you’re recruiting, the ability to offer an entirely remote position can mean that you’re suddenly able to consider candidates from across the country, rather than limiting yourself to one area, or to people who are in the position to be able to relocate.

So what do you need to consider before introducing remote working?

When you’re working with a distributed team, communication is key, and as the employer, it’s your job to provide the resources and systems to make this happen. Typically, these might include:

  • Laptops and other tech as required
  • Compensation if an employee is using their home internet connection
  • A way to stay in touch with the team, beyond email. Platforms like Slack are great for team communication
  • Guidelines around how often and in what way the entire team will catch up
  • Project management tools that are accessible for every worker

With these essentials in place, the biggest factor in making remote work a success is workplace culture. Consider upskilling your management team to make sure they are ready to support your remote staff or even to give them the skills to allow them to do their roles remotely.

Remote working can be isolating for an individual and sometimes the meaning in email and text can be lost so it is important to factor in a regular face-to-face meeting or video conference to bring coworkers together, enable mutual understanding and to build the team culture.

If you’re planning to offer remote work to your team, talk to us to make sure you’re across all of the tax implications.

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