Evolve Bookkeeping Updates

FS360 Podcast - Hiring Employees

Mon, 28 Apr 2025 02:07:05 GMT

FS360 Podcast - Episode 78

Natalie from Evolve Online Bookkeeping is back to chat about 'What's involved in hiring employees?'. An interesting conversation that covers topics such as responsibilities, registering as an employer, recruitment, onboarding, payroll and evaluations.

Also available on Spotify, Apple & Google Podcasts.

Register as an employer

As an employer, you must register as such, with an ABN number required.

“You need your ABN number to register for PAYG withholding tax that you deduct … it’s money that you deduct on behalf of the employee and pay across to the ATO,” Grohn said.

“If you are anticipating employing working holiday makers … you need to register as an employer of working holiday makers.”

Write a job description

It is important to ensure that you and your applicants are aware of what the job entails and what responsibilities would be placed on the new employee.

“You don’t have to go into every little detail, but it’s just making sure that they’re very clear on their requirements … often they’re signed as well,” Grohn said.

The recruitment process

When it comes to the recruitment process, it is important to ensure the job profile is done first.

From there, using the right avenues to find your candidates, such as LinkedIn, Indeed, Seek etc, depending on what the role is, is imperative.

“I would very much suggest that you have your job profile done first and then make sure that you use relative avenues to make sure that you attract the right candidate,” Grohn said.

Employee onboarding

While an important step in the process, Grohn said that doing one thing correctly would ensure that this aspect is as smooth sailing as possible.

“It’s about being organised, making sure you’ve got the right information and using that information to feed into Xero. Valid tax file number, super guarantee details up front, whether there’s any student loans and so forth,” she said.

Run payroll for your employees

Paying your employees is essential and a legal requirement. A list of your employees and the total amount of money you pay them, payroll includes salaries and wages, bonuses, allowances, benefits and deductions such as tax.

There are three ways you can run your payroll for employees:

- Using handwritten spreadsheets

- Using timesheets that can be integrated with Xero

- Using Xero Me

“You need to pay an additional payroll tax to your state government and you need to report on it as an employer. It’s only if your wages exceed $1.3 million per year,” Grohn explained. (but can differ depending on which state you are based in).

“You need to register as an employer for payroll tax. It flags once you hit the threshold once.”

Manage employee evaluations

Once a member of your staff, communication and feedback is vital to ensure enjoyment in the role and fulfilment of the job’s requirements.

“It’s that need to give feedback and obviously as an employer you benefit from that as well because there might be a few issues that you’re not aware of that are causing difficulties for the employee to perform their duties,” Grohn said.

“Just make sure you touch base with them, make them feel wanted, review salaries where applicable and touch on any issues.”

Tools and guides for your business

The ATO contains resources, videos and training materials that cover the above areas.

“Right from engaging a worker, employing a worker, hiring, obligations, if the employee leaves your business and when you’re no longer hiring,” said Grohn.

“You can use the Fair Work Guide to double check on award wages if you need to. There’s a calculator that you can use to double check that what you’re paying an employee is correct.”

FS360 Podcast - Assisting Small Business - Part Two

Thu, 14 Nov 2024 05:37:50 GMT

FS360 Podcast - Episode 74

Assisting Small Business - Part 2 of a 2 part series with Evolve Online Bookkeeping's Natalie. Host Gavin Nash and Natalie talk about how you can leverage Xero and other technology to run your small-medium business finances effectively for sustained success!

Also available on Spotify, Apple & Google Podcasts.

Modern small businesses have access to a variety of performance tools, and for Evolve Online Bookkeeping’s Natalie Grohn, the focus is on effectively utilizing these resources to achieve sustained success.

In a discussion with Gavin Nash on the FS360 Podcast, Grohn highlighted the potential contributions of Evolve and Xero in ensuring that small businesses operate at their highest efficiency.

According to a recent CPA Asia-Pacific (APAC) small business survey, the limited utilization of technology and a shortage of young entrepreneurs have resulted in Australian small businesses ranking at the bottom or near the bottom in several critical performance indicators.

Last year, only 40.9% of Australian small businesses reported growth, significantly lower than the APAC average of 59.6%. Projections for 2024 indicate that fewer Australian small businesses are expected to achieve growth compared to other nations surveyed.

Two primary factors contribute to this trend. First, Australian small businesses are trailing in the adoption of new technologies and their willingness to adapt to the evolving technological landscape. Second, the data reveals a concerning lack of young Australians entering the business sector, with Australia having the lowest percentage of businesses owned or operated by individuals under 40.

Evolve can play a pivotal role by leveraging modern technologies to foster business success.

A notable area of focus is budgeting, where Xero’s budget variance report serves as a valuable tool for small business owners.

Grohn stated, “You can easily download a template, input your budget figures, and subsequently upload it back into Xero.”

“This process allows for the creation of multiple budgets that can be referenced in management accounts. The significance of this practice lies in the opportunity to analyze your numbers closely during the budgeting phase.”

“By doing so, you will possess comparators on a month-to-month and year-to-year basis, enabling you to assess your actual performance against your budgeted expectations.”

Xero provides various reports, with the budget variance report being particularly beneficial. The platform's user-friendly setup allows business owners to generate these reports independently at any time.

Xero also offers visual analytics, including charts and graphs, to monitor critical performance metrics such as gross profit, net profit on sales, and debt-to-equity ratios.

As businesses engage with Xero over time, a comprehensive array of graphical representations is available on the business dashboard, facilitating performance evaluations.

“As part of our service, we provide our clients with a monthly management accounts package. This package includes various reports, which can be tailored to specific client needs, such as a budget variance report,” Grohn explained.

“It may also encompass standard reports like profit and loss statements, balance sheets, aged receivables, aged payables listings, and executive summaries, all generated through Xero and personalized for our clients.”

FS360 Podcast - Assisting Small Business - Part One

Thu, 14 Nov 2024 05:36:16 GMT

FS360 Podcast - Episode 73

Assisting Small Business - Part 1 of a 2 part series with Evolve Online Bookkeeping's Natalie. Host Gavin Nash and Natalie talk about how you can leverage Xero and other technology to run your small-medium business finances effectively for sustained success!

Also available on Spotify, Apple & Google Podcasts.

Evolve Online Bookkeeping's Natalie Grohn emphasizes that, in the current uncertain Australian economy, a clearly defined set of business analytics can provide crucial support for small businesses during challenging times.

In her discussion with Gavin Nash on the FS360 Podcast, Grohn articulated the range of services Evolve offers to help small businesses navigate these difficulties.

Current forecasts indicate an increase in the small business failure rate from 4.4% to 6% this year, with continued operational challenges anticipated in the near future.

The Australian Securities & Investments Commission reports that small businesses account for a significant portion of annual insolvency statistics, with the risk of failure surging by 20% compared to the previous year. This spike is attributed to high interest rates, escalating costs, and a decline in consumer spending.

"Businesses are facing elevated costs, and consumers are increasingly cautious about discretionary spending," Grohn noted.

"Survival beyond the first five years is a significant challenge for small businesses in Australia. Additionally, sourcing the necessary skills to sustain operations in the current labor market remains a concern."

Evolve provides various services, including monthly bookkeeping, bank reconciliations, business reporting, preparation for activity statements, payroll, superannuation processing, as well as Xero setup and conversion.

They also focus on cash flow management, a critical component for small businesses during this period.

"There are various software integrations that can transform cash flow concerns into confidence. Effectively utilizing Xero can help maintain oversight of cash flow," Grohn stated.

Recommended strategies for managing slow payments include monitoring invoices, tracking payment histories, conducting credit checks, identifying potential customer issues, and employing tracking software.

"Xero offers excellent features that enable automatic reminders for customers regarding their invoices," Grohn added.

While these services provide immediate benefits, such as ensuring timely payments, they also promote strategic long-term decision-making.

Xero facilitates the monitoring of profitability, emphasizing the importance of gross and net profit for small businesses. This platform enables users to compare current performance with historical data, customize profit and loss reports, and keep track of assets and liabilities.

“Two primary areas of reporting involve analyzing aged receivables—essentially your debtors—and aged payables, which refer to your creditors,” Grohn stated.

“Regularly monitoring these figures can help identify trends, such as a slowdown in customer payments or the status of aging balances. This vigilance is crucial for effective planning of upcoming financial obligations.”

Moreover, Xero allows the establishment of tracking categories, enhancing the capability to monitor various aspects of the business and identify areas that may require future investment.

“You can assess the performance of different locations in terms of sales. It is essential, however, to ensure that tracking categories are included in all transactions, whether through accounts payable invoices or journal entries,” Grohn advised.

“This data can then be utilized for comprehensive reporting, including profit and loss statements, segmented by categories.”

What is new in Xero - Tap to Pay and How to Benefit

Mon, 30 Sep 2024 22:46:03 GMT

In this fast -paced world of business, staying ahead of technological advancements is crucial for maintaining efficiency and competitiveness. One of the biggest challenges for small business is getting paid on time when 50% of small businesses are paid late.

How it works and the Benefits

Accept payments on the spot

Spend less time chasing payments and time managing cashflow. This means shorter waiting times for clients and improved customer satisfaction due to ease of the process.

Xero has released a groundbreaking new feature “Tap to Pay”. This is a new innovative secure way to get paid by your customers in-person. You can accept payments on the spot on completion of a job.

All you need is a smart phone, Stripe account and the Xero Accounting application. No physical terminal is needed. This is a great application to assist with getting paid on time in these challenging economic times and enhance your cash flow.

Improved Cash Flow

Receive payments via Stripe using the Xero Accounting app on your mobile with faster payment processing times leading to quicker receipt of funds. Payments can be processed immediately. This is especially beneficial for business with tight cash flow where every day a payment is outstanding can really matter.

This feature can significantly improve a business’s cash flow. This enables better financial planning and management, helping businesses stay on top of their financial obligations.

Simplified Payment Processing

Invoices are automatically marked as paid, ready for reconciliation. This eliminates the need for manual entry of payment data. No need to log into another application or integrate another application. Payments are processed in real-time, ensuring the financial records are always up to date.

“Tap to Pay” integrates seamlessly with existing Xero features, providing a cohesive and comprehensive accounting solution. The ability to easily track payments, generate reports, and manage financial data all within Xero.

This reduces the time spent on manual reconciliations and allows yourself, bookkeeper or accountant more time to focus on strategic financial tasks.

Who is Tap to Pay available to?

Tap to Pay is available to all customers using an Android phone at this stage. There are plans to roll out to other mobile services in the future.

There are some restrictions as presently physical debit and credit cards can only be used for transactions under $100 as PIN verification for amounts greater than $100 is not yet available. Transactions over $100 can still be processed using a digital wallet or wearable device.

What are the fees?

Tap to Pay is free to set up, with no ongoing monthly or subscription fees. There is, however, a processing fee once a customer makes payment.

The fees are 1.7% + A$0.25 per transaction for domestic cards (inc. GST), and 3.5% + A$0.25 per transaction for international cards.

What is required to use Tap to Pay?

Xero is launching Tap to Pay in partnership with Stripe, so you’ll need a Stripe account and the Xero Accounting app on your mobile phone. Both Stripe and the Xero Accounting app are free to download and easy to set up.

Tap to Pay isn't currently available for users with multiple Stripe accounts connected to their organisation. Tap to Pay is only available to use along with Stripe.

Tap to Pay is available with the following Android devices, as long as the operating system is Android 11 and above: Google Pixel, Samsung Galaxy, Oppo, OnePlus, Xiaomi.

Tap to Pay supports payments made using physical cards, a digital wallet or wearable device. Physical debit and credit cards can only be used for transactions under $100 as PIN verification for amounts over $100 is not yet available. Transactions over $100 can still be processed if a digital wallet or wearable device is used for payment.

Tap to Pay needs an internet connection to work. It could be a mobile signal or wi-fi. Tap to Pay will not work offline.

What industries is Tap to Pay suitable for?

Tap to Pay is a great option for small business owners who invoice customers and accept in-person payments, for example, those working in construction, retail or professional services. Examples include tradespeople who do house visits and can collect payment on site; fitness instructors who are off site and need to take payment at the end of class; and hair stylists who need a backup solution for their usual point-of-sale system. Any business on the go.

Also, it is very beneficial for businesses with high customer turnover, such as retail stores and restaurants.

How Evolve Online Bookkeeping Can Help

Evolve Online Bookkeeping can assist you in seamlessly integrating the Tap to Pay feature into your business operations. Our services include:

Setup and Integration: We help you set up your Stripe account and integrate it with the Xero Accounting app, ensuring everything is configured correctly.
Training and Support: We provide training for you and your staff on how to use Tap to Pay effectively, ensuring you can take full advantage of this feature.
Ongoing Bookkeeping Services: Our team can manage your financial records, ensuring all payments are accurately recorded and reconciled in real-time.
Cash Flow Management: We offer expert reporting to help you manage your cash flow, to make informed financial decisions and maintain a healthy cash flow.
Customized Solutions: We tailor our services to meet the specific needs of your business, ensuring you get the most out of Xero’s features.

By partnering with Evolve Online Bookkeeping, you’ll not only enhance your financial management but also improve customer satisfaction.

To learn more contact us at Evolve Online Bookkeeping.

The Benefits of Xero KPIs for Business Owners

Mon, 02 Sep 2024 02:16:38 GMT

In today’s competitive business environment, leveraging the power of Key Performance Indicators (KPIs) through Xero can be a game-changer for your business. At Evolve Online Bookkeeping, we specialise in setting up and monitoring these Xero KPIs to provide you with real-time, data-driven insights. This enables you to make informed decisions, manage cash flow effectively, and streamline operations. By partnering with us, you’ll not only enhance your financial management but also improve customer satisfaction and employee productivity.

Here’s how engaging us, a Xero Platinum Partner can help you achieve your business goals:

1. Enhanced Decision-Making

Data-Driven Insights: Xero KPIs provide real-time data that helps business owners make informed decisions. By analysing metrics such as revenue growth, profit margins, and cash flow, you can identify trends and make strategic choices to drive your business forward.

Performance Tracking: Regularly monitoring KPIs allows you to track your business’s performance against set goals. This helps in identifying areas that need improvement and those that are performing well.

2. Improved Financial Management

Cash Flow Management: One of the most critical aspects of running a business is managing cash flow. Xero KPIs like accounts receivable turnover and cash flow forecasts help you understand your cash position and ensure you have enough liquidity to meet your obligations.

Expense Control: By keeping an eye on KPIs related to expenses, such as cost of goods sold (COGS) and operating expenses, you can identify areas where you can cut costs and improve profitability.

3. Operational Efficiency

Efficiency Metrics: KPIs related to operational efficiency, such as inventory turnover and production costs, help you streamline your operations. By optimizing these areas, you can reduce waste, improve productivity, and increase profitability.

Automation: Xero’s automated features, combined with KPI tracking, reduce the time spent on manual data entry and reconciliation. This allows you to focus more on strategic activities that drive growth.

4. Customer Satisfaction

Customer-Related KPIs: Metrics like customer acquisition cost (CAC) and customer lifetime value (CLV) provide insights into your customer base. Understanding these KPIs helps you tailor your marketing strategies and improve customer retention.

Service Quality: By monitoring KPIs related to service delivery, such as on-time delivery rates and customer satisfaction scores, you can ensure that your customers are happy and loyal.

5. Strategic Planning

Goal Setting: KPIs are essential for setting and tracking business goals. Whether it’s increasing revenue, expanding market share, or improving customer satisfaction, KPIs provide a clear roadmap for achieving your objectives.

Benchmarking: Comparing your KPIs with industry standards or competitors helps you understand where you stand in the market. This benchmarking process is crucial for identifying areas of improvement and staying competitive.

6. Employee Performance

Employee Productivity: KPIs related to employee performance, such as sales per employee or project completion rates, help you assess the productivity of your team. This information is valuable for making decisions about training, promotions, and resource allocation.

Engagement and Satisfaction: Monitoring KPIs related to employee engagement and satisfaction can help you create a positive work environment. Happy employees are more productive and contribute to the overall success of the business.

In conclusion Xero KPIs are powerful tools that provide business owners with valuable insights into their business’s performance. By leveraging these metrics, you can make informed decisions, improve financial management, enhance operational efficiency, boost customer satisfaction, and drive strategic planning.

Talk to us at Evolve Online Bookkeeping to help you setup KPI monitoring that will help you succeed.

Tips for finding the right tech for your business

Tue, 06 Aug 2024 23:08:47 GMT

Build a Tech Stack for Business

In technology, a ‘stack’ is a way of visualising a collection of software systems (tools, platforms, apps and pieces of software) used together to get work done and consists of various front end and backend technologies. They allow a system to be built that involves multiple tools but feels like one single workflow.

As a business adapts and grows it will change its tech stack to maximise efficiency and lower costs and no single piece of software or tool can accomplish everything a business needs. Successful businesses will leverage various apps and build a technology stack to achieve their business goals.

As businesses advance their digital transformations, they need to ensure that all the applications they use are integrated with their accounting software. Integration is the key to building an efficient, connected work environment. The objective being.

Data is shared between solutions automatically, eliminating the need to rekey data and reducing the chance of errors.
Teams make better use of time, leaving routine, repetitive tasks to technology so they can focus on higher-value activities.
Cash flow is enhanced when accounting has all the information it needs to immediately invoice or request reimbursements for digital transactions.
Businesses can take on more clients without hiring additional employees.
Employees experience less stress than if they were continuously inundated with paper and manual work.

Businesses need to audit their tech stack on a regular basis. By reviewing the apps your business uses, you may discover ways to:

Save employees’ time
Save money on apps
Consolidate apps
Maintain a single source of truth for data

Identify what tools are required to run your business effectively. Any apps used should tie back to the strategy of the business. The audit must look at all the business processes, what apps are used to complete daily tasks, what is the impact of each app on employee efficiency and the overall customer experience in using the apps.

Accounting platform integrations that benefit businesses

There is no single tech stack that will work for every company. However, some types of software provide value to a wide range of businesses, particularly if they integrate with an accounting software such as Xero.

Payroll
Document Management
Payments
Billing or invoicing
Expense Management

Industry specific solutions

Although businesses often operate with some common processes, other facets of their operations are specific to their industries. Niche software solutions are designed to meet these unique needs and provide the best possible experiences for their customers and employees. The below lists how applications in tech stacks for businesses in these industries could actually differ.

Real Estate business applications:

Commercial property management
Compliance management
Commission management
Expense management

E-commerce business applications:

E-commerce sales platform
Enterprise resource planning (ERP)
Inventory management
Online shopping cart
Compliance management
Commission management’

Agriculture business applications:

Crop and livestock tracking
Farm budgeting and forecasting
Multi-location inventory
Sales and distribution

Help clients optimise their IT environments with Xero

With Xero, you can utilise software from the Xero App Store. You can subscribe to SaaS solutions and connect them to Xero. The Xero App Store is home to a range of tools that help you with onboarding, invoicing, approvals, reporting and payroll. Some popular tech stack app integrations with Xero include:

Syft
Ignition
FYI
GoCardless
Dext Prepare

By generating reports filled with insights based on app use. These provide “health checks”, including adoption rates and performance indicators. These can be used to make informed decisions about the app’s value to the business, and whether they need to look for a solution that is a better fit.

If you need assistance with finding the right tech stack for your business, please contact us at Evolve Online Bookkeeping on 07 5413 9393.

Minimum Wages Increase

Mon, 08 Jul 2024 22:32:33 GMT

The National Minimum Wage increase to $915.90 per week or $24.10 per hour.

Award Minimum Wages increase by 3.75%.

Other Award wages will get a proportionate increase. This includes junior, apprentice and supported wages that are based on the adult minimum wages.

The increase applies from the 1st full pay period on or after 1 July, 2024.

These pay increases follow the Fair Work Commission’s Annual Wage Review 2023-24 .

National Training Wage Increase

Wage increases for trainees under the National Training Wage come into effect on the same dates as award minimum wage increases. This includes awards that refer to and incorporate the terms under Schedule E of the Miscellaneous Award, which has an operative date of the 1st July 2024.

Agreements

If an employee is covered by a registered agreement, the minimum wage increase may still apply. This is because the base pay rate in a registered agreement cannot be less than the base pay rate in the relevant award.

What employers need to do now

All tools and resources have been updated with the new rates. You can:  

Use the Pay and Conditions Tool to calculate your new pay rates (including any changes in allowances).
go to our Pay guides page to access the updated pay guide for your award
use our find my award tool to check what award you are covered by
download an updated version of the Fair Work Information Statement.

learn more about the minimum wage increase at 2023 – 2024 Annual Wage Review

Other changes from 1 July 2024

From 1 July 2024 , there are other changes employers and employees should know about. These include:

New end dates for the additional fixed term contract exceptions

Closing Loopholes

There are changes to the Fair Work Act as part of the new ‘closing loophole’ laws. These could impact you or your business, so make sure you’re prepared for the changes.

changes as part of the ‘closing loopholes’ laws including:
new rules for right of entry permits and exemption certificates
changes to rights and protections for workplace delegates under awards, enterprise agreements and workplace determinations.

From 26 August 2024 , there are further changes. These could impact you or your business and including:

a new definition to help determine the meaning of ‘employee’ and ‘employer’.
changes to casual employment including how casual work is defined, the pathway to permanent employment, and employee and employer responsibilities.
a new right to disconnect for eligible employees (this doesn’t apply to small businesses until 26 August 2025). Eligible employees will have the right to refuse employer, or third party contact outside of working hours.
new minimum standards and protections for ‘employee-like workers’ in the gig economy and certain industries.

For a visual snapshot of all the closing loopholes changes, including when they start, check out the easy-to-read timeline .

For more information on enterprise bargaining and agreement changes, check out the visual summary below.-

Learn more about other changes at 2023 - 2024 Annual Wage Review .
 

Other Changes

From 1 July 2024, other changes include:

an increase to  Parental Leave Pay  to 22 weeks. Visit Services Australia’s website for more information on  Paid Parental Leave scheme changes
increase to the amount of  unpaid flexible parental leave  for children born or placed for adoption from 1 July 2024
an increase to the  high income threshold  to $175,000
an increase to the superannuation guarantee to 11.5%. For more information, visit the Australian Taxation Office’s  Super guarantee  page
an increase to the unfair dismissal compensation cap to $87,500. For more information, visit the Commission’s  Compensation for unfair dismissal  page.

Updated Fixed Term Contract

The  additional temporary exceptions  to the use of fixed term contracts in some industries have been extended. An updated version of the  Fixed Term Contract Information Statement  is now available. Employers must give every employee engaged on a new fixed term contract a copy of the Fixed Term Contract Information Statement (FTCIS) when they enter a contract with an employer.

Stay up to date

Subscribe to Fair Work Ombudsman email updates so you don’t miss out on keeping up to date. It only takes a few minutes to sign up. You can also follow the Fair Work Ombudsman on social media for other announcements and reminders.

Federal Budget 2024-25 payroll changes and the new tax year

Wed, 05 Jun 2024 01:11:12 GMT

A large part of the 2024-25 Federal Budget is aimed at cost-of-living relief, there are also several important announcements relating to superannuation. Some changes are already legislated to take place. Others need to become law before they can be implemented.

Individual income tax rates and threshold changes

Changes to individual income tax rates and thresholds from 1 July 2024. On 25 January 2024, the government announced changes to Individual income tax rates and thresholds from 1 July 2024. These changes are now law.

From 1 July 2024, the proposed tax cuts will:

reduce the 19 per cent tax rate to 16 per cent
reduce the 32.5 per cent tax rate to 30 per cent
increase the threshold above which the 37 per cent tax rate applies from $120,000 to $135,000
increase the threshold above which the 45 per cent tax rate applies from $180,000 to $190,000.

Increase in Medicare Levy Low-Income threshold

The government has announced they are increasing the Medicare levy low-income thresholds for singles, families and seniors and pensioners to provide cost of living relief. The increase ensures that low-income individuals continue to be exempt from paying a Medicare levy or pay a reduced levy rate.

threshold for singles has increased from $24,276 to $26,000.
threshold for families has increased from $40,939 to $43,846.
Threshold for single seniors and pensioners, has increased from $38,365 to $41,089.
family threshold for seniors and pensioners has increased from $53,406 to $57,198.
family income threshold will now increase by $4,027 for each dependent child, up from $3,760.

Small Business Instant Asset Write-Off

The government announced that small businesses (with an aggregated turnover of < $10 million) will be eligible for the $20,000 instant asset write-off for an additional year.

This will enable small businesses to immediately deduct eligible depreciating assets costing less than $20,000 that are used or installed ready for use by 30 June 2025. From 1 July 2025, the asset cost threshold will revert to $1,000. The existing small business accelerated depreciation rules will continue to apply for assets costing more than $20,000.

There is also a proposal that is not legislated to increase the threshold to $30,000.

HELP Debts - Changes to Student Loans

A measure was announced ahead of the Budget to assist those who have student debts under the Higher Education Loan Program (HELP). The reform includes changes to the calculation of HELP debts, amending the way HELP loans are indexed each year so that the lower of the Consumer Price Index (CPI) or the Wages Price Index will be used to apply indexation to HELP loans. This will hopefully allow students to repay these debts faster.

This is effective 1 June 2023. In the past, HELP loans were indexed solely by reference to CPI. The ATO will automatically adjust any outstanding HELP loan balance that was indexed on 1 June 2023, and/or will be indexed on 1 June 2024, and apply any resulting credit to the individual’s HELP account.

Superannuation changes

Superannuation will be paid on Government funded Paid Parental Leave (PPL) for parents of babies born or adopted on or after 1 July 2025.

Payments will be made annually to individuals’ super funds from 1 July 2026. This will help to reduce the impact of career breaks to care for young children on superannuation balances.

The start date for this measure is 1 July 2025 with the Government estimating that approximately 180,000 families per year will benefit from superannuation on paid parental leave. The federal government is committed to providing additional investment over the next two years to provide additional support for employers in administering paid parental leave.

As part of the 2024-25 Federal Budget, the Treasurer announced a 12-month extension to 30 June 2025 of the current freeze in deeming rates for retirees .

This measure will assist part pensioners with bank deposits, investments and also super pension income streams which are captured under the deeming rules. The measure will allow retirees to benefit from increases in interest rates and returns without reductions in their age pension.

The deeming rate has been frozen for the last two years with the top rate unchanged at 2.25%.

Previous Super Announcements

Super guarantee

From 1 July 2024, the super guarantee, that is - the percentage of your wage that your employer is required to pay into your super account, will increase from 11.0% to 11.5%. The super guarantee will continue to rise in 0.5% increments until it reaches 12% in 2025.

Changes to super tax concessions

On 28 February 2023, the Australian Government announced from 1 July 2025 a 30% concessional tax rate will be applied to future earnings for superannuation balances above $3 million, instead of the current 15%. This measure is not yet law.

Detailed information can be found on the  ATO websites  and in the  Treasury Superannuation Concessions Factsheet .

Increase in super contribution caps

From 1 July 2024, both concessional and non-concessional contributions caps will be increasing as follows:

The total super balance for non-concessional contributions, remains at $1.9 million. The general transfer balance cap also remains unchanged at $1.9 million.

Future Changes

Payday super

From 1 July 2026, employers will be required to pay their employees’ super at the same time as their salary and wages. This delayed start date provides employers, super funds, payroll providers and other parts of the superannuation system with sufficient time to prepare for the change. This measure is not yet law.

A large amount of funds have been committed over four years from 2024-25 to increase the Productivity, Education and Training Fund to support practical activities by employer and worker representatives to boost workplace productivity. This will also support workplaces to implement policy changes such as the introduction of payday superannuation.

Improving your Cash Flow

Mon, 29 Apr 2024 23:51:12 GMT

Monitoring cash flow can quickly turn into a full-time job. Many business failures are related to issues with managing cash flow and without a healthy cash flow, you are unable to pay bills, invest in new opportunities, and grow your business effectively. There are various practical strategies that can be used with the help of Xero for optimising your invoicing process, speeding up your payment collections, getting cash in faster, and improving cash flow.

Cash Flow refers to the amount of cash flows in and out of your business over a specific period. Put simply, it is the movement of money into and out of a business. Cash flow can be positive, meaning that more money is coming in then going out, or negative , meaning that more money is going out than coming in.

When a business operates with negative cash flow it must find alternative means to satisfy its debts and expenses, such as dipping into its cash reserves. If the company continues to operate with cash flow outflow exceeding inflow. It will eventually deplete its cash reserves and runs the risk of defaulting on its debts. This may require additional loans or raising capital.

When a business operates with positive cash it means you have more cash coming in then going out. This does not mean that you should start spending your profits straight away. It is important to understand future anticipated cash flows before making any decisions. An understanding can be obtained by completing a cash flow forecast.

A forecast should consider any upcoming expenses that you have. By doing so you can ensure there is enough cash to cover expenses when they come due. It is also important to consider long term financial goals. If there is excess cash it might be better to consider investing in your business for business growth. This could include the upgrading of equipment or expansion to new premises, covering operating expenses, or simply taking a holiday.

Improving Collection

Cash flow software integrations can turn your cash flow concerns into cash flow confidence. Xero has various apps that can support cash flow decisions.

By identifying customers who are slow payers, you can put strategies in place to reduce the likelihood of these customers paying later in the future. These strategies include:-

Tracking invoices
Monitor payment history
Credit checks
Customer red flags
Tracking Software

Credit checks allow you to assess any potential risk before doing business with a customer. These will highlight any red flags. This should be a standard part of due diligence when onboarding new customers.

Customer reminders sent by SMS or text message have a much higher open rate. By supplementing your email payment reminders with SMS messages, you can reach customers on the go, increase chances of getting paid on time, and improve your collection rates.

Offer flexibility in terms of payment arrangements. When customers are struggling to pay or have a large value invoice you can receive partial payments faster then if you asked for the full amount upfront. Offering extra flexibility helps build positive relationships with customers.

Improve Communication as a lack of communication can cause problems between sales and finance departments if not aligned or sharing information. It is important to facilitate cooperation and communication between departments to avoid doing repeat business with late payers who can put cash flow at risk.

Identifying Cash Flow Needs

By diagnosing the problem, creating a cash flow statement , and checking it line by line you can see your biggest spends and sales more clearly. We can assist in setting up these reports. All processes and systems should also be regularly reviewed for improvements. Slow invoicing and poorly timed spending can leave you out of pocket or put you in a position of negative cash flow. So can delayed approvals or invoices.

Six ways to use Xero apps and features to support your cash flow

1. Connect your bank feeds

Transactions then automatically flow into Xero and bring all your accounts into one clear and up to date view.

2. Use data capture tools for receipts and bills

Data capture tools give you a better oversight on the money moving out of your business. This gives a clearer view of your exact financial position by capturing them in real time. Tools such as Hubdoc and Dext can save time on manual data entry and allow photos of receipts and invoices on the move that can be uploaded to phones.

3. Tighten up your approvals

Delayed approvals can cloud your cash flow picture as timing is everything when it comes to cash flow. Integrations such as Approval Max, Soldo and Lightyear enable you to set specific budgets and spending limits and controls for teams, projects and departments.

4. Enhance your invoices

The faster an invoice is issued the quicker payment is received. The Xero app lets you quote and invoice on the go. Xero can also schedule recurring invoices and automate reminders. The Chaser app gives you greater functionality with SMS invoice reminders that clients can click through to pay on their phones. Xero invoices also allow a pay now option.

5. Connect online payment options

With overdue payments being an increasing concern the more payment options provided, the better. GoCardless allows you to easily collect one-off and recurring payments, Stripe lets customers pay on the spot. These options can allow payment twice as fast. Ecommerce options include Square, Zettle and Shopify integrations pull transaction data into Xero, so you can see a live view of your income and assist with inventory management.

6. Use reports and forecasts

Cash flow projections in Xero can be customised. Using Xero Analytics Plus you can forecast the next 30 days, with Analytics Plus you can see what you can spend for the next three month. There are a number of reporting integrations that can be used. Including Float, Fathom and Spotlight.

Fringe Benefits Tax

Tue, 02 Apr 2024 22:45:22 GMT

Did you know that you may be liable for additional tax of 47% on additional benefits provided to employees? Many businesses know very little about this tax and are exposing themselves to potential audits from the ATO.

What are Fringe Benefits?

A fringe benefit is something extra an employer provides in addition to a wage or salary or in return for forgoing some of an employee’s salary under a salary sacrifice arrangement. It is not salary and wages or cash, and the benefit can be something for the employee, spouse, or children. The employer is liable for the tax (FBT) that may apply to the benefits received and not the employee.

For FBT purposes, an employee includes a:

current, future, or past employee
director of a company
beneficiary of a trust who works in the business.

If you are a sole trader or a partner in a partnership, you are not an employee. Benefits that you provide to yourself are not subject to FBT.

Why do businesses offer fringe benefits?

Fringe benefits can help employers to attract, retain, and motivate employees. Employers are becoming increasingly competitive with what they offer their employees and fringe benefits are one way they can gain that competitive edge. Common ones include free food, coffee bars, discounted gym memberships and entertainment. Providing these perks can make employees feel valued and create a happier workplace. Not all of these attract FBT.

What’s considered a fringe benefit?

A wide range of perks are classed as fringe benefits. The most common ones are:

a leased vehicle for personal use (under a ‘novated lease’ arrangement)
personal use of a company car
car parking
discounted loans
gym/health memberships
entertainment expenses – (free/discounted food, cinema or concert tickets, accommodation)
private health insurance
living-away-from-home allowance (LAFHA)
real property – land and buildings
right to property – shares, bonds
childcare costs and school fees

The following are not fringe benefits:

salary and wages
employer contributions to complying super funds
share or rights provided under approved employee share acquisition schemes
employment termination payments (including the gift or sale at a discount of a company car to an employee on termination)
payments deemed to be dividends under Division 7A
benefits provided to volunteers and contractors
exempt benefits, such as certain benefits provided by religious institutions to their religious practitioners

Items needed to do a job – e.g. mobile phones and occupational specific clothing – are not taxed as fringe benefits if an employer provides them. However, if an employee pays for these items, they might be able to claim a tax deduction. You can’t claim a tax deduction for a work expense if reimbursed for the expense by an employer.

Concessional contributions made to super are exempt fringe benefits. They can therefore be a tax-effective way of boosting retirement savings.

What is a Reportable Fringe Benefits Amount (RFBA)?

If the total taxable value of the fringe benefits provided in a FBT year exceeds $3,773, employees will have a reportable fringe benefits amount in their end of financial year income statement (formerly called a payment summary). Some fringe benefits, like meals, entertainment, and employer-provided car parking, are not included in the reportable amount.

While an RFBA isn’t deemed taxable income, depending on personal circumstances, it will be used to determine whether entitlements exist to several benefits and obligations. These include Family Tax Benefits, Medicare levy surcharge, private health insurance rebate, child support payments, superannuation co-contributions, Higher Education Loan Program (HELP), tax offsets and Financial Supplement repayments.

How much FBT do employers pay?

To work out how much FBT to pay as an employer you ‘gross-up’ the taxable value of the benefits provided. This is equivalent to the gross income employees would have to earn, at the highest marginal tax rate (including the Medicare levy), to buy benefits themselves.

The FBT you pay is 47% of the ‘grossed-up’ value of the fringe benefits.

As an employer you can claim an income tax deduction and GST credits for the cost of providing fringe benefits.

What do you need to do?

As an employer, you need to:

identify the types of fringe benefits you provide.
check for FBT concessions and ways to reduce FBT and seek advice from your accountant or business advisor. Some benefits are exempt from FBT that are work related, reduce your FBT liability by using alternatives or providing benefits that are eligible for a concession and not-for-profit employers may be eligible for an exemption or rebate.
work out the taxable value of fringe benefits provided
calculate your FBT liability
keep records, including employee declarations where needed
lodge an FBT return and pay the FBT you owe.
report each employee’s fringe benefits in their financial year income statement (formerly called a payment summary)

We can assist you in identifying the types of fringe benefits you may be providing, so please contact us to discuss this further.

Christmas parties and gifts the ATO has put you on notice

Wed, 20 Dec 2023 22:38:39 GMT

The ATO has recently put out a warning about the tax implications for the employer of holding a staff Christmas party. These events are a Fringe Benefits Tax (FBT) minefield and the ATO’s warnings are particularly timely given that we are now heading into the Christmas party season and thousands of Australian small businesses will pay for their staff to let their hair down at the annual end of year celebration.

If your business holds a Christmas function:

on a working day, on your business premises, and only for your current employees, you don’t pay fringe benefits tax (FBT) for the food and drink.
off your business premises at a hotel, restaurant, or function centre, or the party includes associates of employees (such as their partners), you don't pay FBT if the party is a minor benefit – that is, the cost for each person is less than $300 and it would be considered unreasonable to treat it as a fringe benefit.
that includes clients, you don't pay FBT for the costs relating to the clients.

If you give your employees a Christmas gift, you don't pay FBT if the value of the gift is less than $300 per person and it would be considered unreasonable to treat it as a fringe benefit.

The minor benefits exemption applies to each benefit provided. What that means in practice is that if you are feeling generous and spend $290 per head on the party and then give a gift to each employee valued at a further $290, then both expenses are free of FBT. If you spend more than $300 on the function, the whole lot will be subject to FBT, not just the excess.

If the Christmas party is not subject to FBT, you can't claim income tax deductions for the cost of the party. Nor can you claim GST credits for the costs incurred.

Example: Christmas party on business premises – ATO Case Study No 1

A company holds a Christmas lunch on its business premises on a working day.

Employees, their partners and clients attend.
The company provides food and drink, and taxi travel home.
The cost per head is $125.

In this instance Entertainment is being provided. A party for employees, associates and clients is entertainment, because the purpose of the function is for the people attending to enjoy themselves. Employees – no FBT, exemption applies. The employer doesn't pay FBT for the:

food and drink for employees, because it is provided and consumed on a working day on the business premises.
taxi travel, because there is a specific FBT exemption for taxi travel directly to or from the workplace.

Associates – no FBT, exemption applies. The employer doesn't pay FBT for the food, drink and taxi travel provided to the employees' partners (associates), because it is a minor benefit – that is, it has a value of less than $300 and it would be unreasonable to treat it as a fringe benefit. Clients – no FBT. There is no FBT on benefits provided to clients.

Income tax and GST credits

The employer can't claim an income tax deduction or GST credits for the food, drink or taxi travel provided for employees, associates or clients.

Example: – Holiday – ATO Case Study No 2

Example: holiday given as reward

A computer manufacturer offers a reward to employees of a retail computer store.

The retailer agrees that the manufacturer can offer the reward to its employees.
If an employee sells 200 computers in a month, they will receive a holiday consisting of 2 nights accommodation at the beach and 2 tickets to an aquarium.
The total value of each holiday package is $600.

Entertainment is being provided. The holiday and tickets to the aquarium are recreation entertainment.

Employees – FBT applies

FBT applies to the accommodation and tickets given to the employees who meet the sales target. The minor benefits exemption doesn't apply, because the value of the holiday package is $300 or more.

FBT liability – retailer

The retailer, as the employer, is liable to pay the FBT as the benefits are being provided under an agreement with the manufacturer.

Income tax and GST credits

The retailer can claim an income tax deduction for the FBT they pay.
The manufacturer can claim an income tax deduction and GST credits for the cost of purchasing the accommodation and tickets.

Employers must keep all records of all the entertainment-related benefits you provide, including records of how you calculated the taxable value of the benefits. In particular, records should be kept showing:

the amount spent on each employee.
when and where the celebration is held
who attends – is it just employees or are partners, clients and suppliers also invited?
the value and type of gifts provided.

If your business also covers the cost of taxi fares to and from the festivities, these costs also count as part of the $300 per head limit if the function is off-site but will be exempt if the party is at your premises.

These same rules apply to gifts to employees in terms of the $300 limit.

Gifts to Clients and Suppliers

If you give festive gifts to clients and suppliers, you can claim a tax deduction for the cost of those gifts where the gift is given with a view to generating future income in the business. As an example, an expensive bottle of Whisky to your best customer, with a view of building goodwill which leads to more sales next year, the cost of the Whisky is tax deductible. This rule does not apply to items of a capital nature.

The dividing line between a gift (such as giving a bottle of wine) and the provision of entertainment (such as taking the client to a bar and purchasing a bottle of wine) can be hazy.

Christmas can be a taxing time for small businesses if you’re not careful. Always check with your accountant or business advisor for the best advice.

Xero Me Overview

Tue, 28 Nov 2023 22:27:51 GMT

Xero Me is an employee self-service tool/app that empowers your entire team. It gives staff tools to scan receipts, claim expenses, submit timesheets, leave requests and more. Data and sensitive financial information is also kept private. It assists small businesses greatly reduce the time spent gathering and fielding requests on employee time, leave expenses and pay.

The Xero Accounting app is included as part of your Xero subscription and free to download from either the App Store or Google Play.

The app is available with any Xero plan that includes Xero Payroll and/or Xero Expenses. With Xero Payroll, your team can use Xero Me to access payslips, timesheets and leave balances. Timesheets are automatically fed into the payroll. With Xero expenses, your team can use Xero Me to claim expenses.

Three Main Advantages of Xero Me

Speed up payroll processing

Increase efficiency with less manual paperwork and less time chasing staff for information.
Simple set up for new employees.
Fewer manual requests from employees with Xero Me.
Sensitive financial information isn’t shared with all your team.

Capture expense claims

Exchange information and approve requests securely.
Keep employee information in one place
Have data on hand when you need it
Review and approve claims in Xero Expenses
Simple set up for new employees

Empower your team

Easy-to-use technology for your team. Assign access depending on an employee’s role and choose which Xero Me app features team members can access.
Employees can access their own information
No manual forms to fill out: it’s all done digitally.

How do I Invite payroll employees into Xero Me

You need payroll admin access to invite an employee to view their payroll information.

Check the employee's email address

1.In the Payroll menu, select Employees.

2.Click the employee's name to open their details.

3.In the Details tab, under Contact Information, check your employee's email.

4.Add or edit the address, if necessary, then click Save.

Give an employee access to Xero Me

1.In the Payroll menu, select Employees.

2.Select the checkbox next to the employee you want to invite.

3.Click Invite to Xero Me.

Remove a payroll employee's access to Xero Me

1.Click on the organisation name, select Settings, then click Users.

2.Select the employee.

3.In the Payroll section, click Remove employee access.

You can remove an employee's access to Xero Me so they can't see their payroll information through the employee portal.

Automatically remove access to Xero Me

When an employee cease working for an employer, they have 14 days from their date of termination (as set in Xero) to access the Xero Me portal. After this, they will no longer have access, so will need to contact you for any information they previously had access, (including payslips).

Invite an expenses user into Xero Me

You need a user role that includes managing users’ permission to set up an employee to use expenses.

Employees with submitter permission can use Xero Me mobile app to submit claims.

Employees with approver permission can use Xero Me to approve expense claims.

Employees with admin permissions can use Xero Me to manage team roles, company bank accounts and credit cards, chart of accounts for expenses claims, and enable receipt analysis.

Determining a New Employees Superannuation Fund - 3 Steps

Tue, 24 Oct 2023 02:31:31 GMT

Employers are required to pay superannuation (super) contributions into an eligible employee’s super fund.

For more information on which employees are eligible to be paid super, see Tax & superannuation. https://www.fairwork.gov.au/pay-and-wages/tax-and-superannuation.

Follow the below steps to determine a new employee’s super fund when they start employment.

The requirement is on the employer to ensure that you have paid all the required super by the 28 ^th of the month following each calendar quarter. The requirement is that the payment must be made in time so that it makes it to the employees super account by this date. In many cases, you need to pay at least a week before to satisfy payment by the due date. Payroll software such as Xero will notify you of the last date for payment to make this date.

ATO Super Deadlines

If the superannuation has not been paid and received by the due date, Super Guarantee Charge will apply and the payment will not be tax deductible. The Super Guarantee Charge is currently $20 admin fee per employee per quarter plus 10% interest up until the date you lodge the super guarantee charge form (not up to when you pay the amount)

Step 1: Employee chooses a fund

Most employees are eligible to choose their own super fund. If an eligible employee chooses a super fund, the employer must pay super contributions into this fund. Information about which employees can choose their own super fund is available from the Australian Taxation Office.

Employers must provide each employee a Super Choice Form when they begin employment which advises the employee what the employer’s default fund is and asks the employee their superannuation fund details.

https://www.ato.gov.au/business/super-for-employers/setting-up-super-for-your-business/offer-employees-a-choice-of-super-fund/

Step 2: Check for a stapled super fund if no fund is chosen

If a new employee doesn’t choose a fund, the employer is required to check if the employee already has a fund by contacting the Australian Taxation Office . An employer should pay into a stapled super fund if one exists, even if that fund is not listed in an applicable award or enterprise agreement.

You can request this information via this form: https://www.ato.gov.au/Business/Super-for-employers/Setting-up-super-for-your-business/Offer-employees-a-choice-of-super-fund/Request-stapled-super-fund-details-for-employees/

An employer has 28 days to provide them with a standard choice form. If a super fund already exists for the employee, the employer is required to pay super into this account, which is known as a ' stapled super fund'. If a ‘ stapled fund’ is not found, their contributions will go into the employers nominated default fund.

A ‘ stapled super’ fund is an existing super account linked or stapled , to an individual employee so it follows them as they change jobs. This aims to reduce account fees, avoiding new super accounts being opened every time an employee starts a new job.

If an employee chooses a super fund after you have requested stapled super fund details, an employer has 2 months to start paying contributions into that fund. Any payments you make prior to using the chosen fund must be in accordance with the stapled super fund response.

Steps in requesting stapled super fund details: The employer or your authorised representative can request stapled fund details using ATO online services.

They need full access in the ATO services or customer access that including the ‘Employee Commencement Form’ permission.
Their ‘Employee Commencement Form’ permission is removed when no longer needed, to protect your employees’ personal information.

Tax practitioners such as Evolve are also able to make a request on your behalf through online services for agents. You need to meet the same requirements when using payroll software to request stapled super fund details.

The steps to do this including navigate to ATO online under the Employees tab. Click on Employee Super accounts. Select request from the Request employee fund screen. Enter TFN number. Select declaration and then you are sent to default screen to show the details of employee super accounts. A bulk option is available if required for >100 employees.

Step 3: Pay into your nominated default fund

If there’s no employee chosen fund or stapled super fund the employer must then pay super contributions into their nominated default fund. According to ATO rules, every employer is obliged to make super guarantee payments on behalf of eligible employees, and the default fund is where those payments will go unless an employee has a nominated super fund.

A default super fund, also known as an employer, nominated fund, is the superannuation fund into which your employer will make your super contributions if you do not nominate a fund of your choosing.

Default funds are intended to be simple low fee options.

Employers should check their modern award or enterprise agreement for extra rules about default funds. Most awards set out a list of super funds from which an employer is required to nominate a default fund.

An employer can select any industry or retail super fund as their default , but their fund of choice must offer a MySuper account. For employees that do not take an active interest in their super, the MySuper system is designed to ensure that the employer’s default fund will be an appropriate place for their retirement savings.

An employer needs to work through the above three steps in determining the type of super fund. Issue all new employees with a new starter super form or Superannuation Standard Choice Form. If by the end of the quarter the employee has not provided their super fund details, then you are required to set one up for them to pay their super entitlement into.

There are a number of ways you can achieve this, and they are as follows:

Setup an employer account with an industry super fund.
Engage your financial planner for assistance.
Instruct your accountant to automatically create an account with an agreed industry fund to process the super to prior to the deadline.

Information on Default super funds available is found here by selecting the relevant industry and then the role of the employee.

https://www.industrysuper.com/for-employers/default-fund-finder/ An example shown below on how to look up the relevant inform ation.

All new clients to Evolve will be requested to provide the above information as part of the onboarding process and the industry fund details to be included on the job.

Tracking Business Performance in Xero

Tue, 05 Sep 2023 01:19:02 GMT

Xero has several tools available to aid your business to make decisions and set you on the right track. These include using Xero reports to track your business finances and understand key performance metrics, to manage money better and plan and make informed business decisions with confidence.

Track your Profitability

There are several reports available that allow you to track the business profitability.

Two figures to focus on are: -

Compare your performance with past periods

Customise your Profit and Loss report to see how your business is performing compared to previous periods, months or years.

This helps identify trends in your revenue and expenses to see what is working and what could be improved. For example, if you notice revenue increasing month to month, your sales or marketing strategy could be working well. Or, if expenses are steadily increasing, you can evaluate your spending and find ways to cut costs.

Use the filters at the top of the Profit and Loss report to add comparison periods. In the Compare with dropdown, select the past period you’d like to compare, then click Update to rerun the report.

Monitor your assets and Liabilities

Assets are what your business owns, and Liabilities are what your business owes. Monitoring your assets and liabilities will help you determine if your business is solvent. Run the Xero Balance Sheet to monitor your assets and liabilities.

Use the Balance Sheet to gauge how much risk your business carries, the cash you have available to fund your daily operations, and what collateral you can use to secure loans. Two figures to monitor in the balance sheet are: -

If your accounts receivable is consistently high, review your Aged Receivables Detail report and follow up on customers with overdue balances to collect payments quicker. Offering prompt payment discounts may encourage faster payment too. Or if your accounts payable is always high, run your Aged Payables Detail report to track and plan upcoming payments.

It is important to monitor your cash flow alongside your profit and loss and the balance sheet.

Compare different areas of your business.

Track the performance of different areas of your business to see which areas are making money. This helps you allocate resources effectively in the right direction and make changes to increase sales and reduce expenses.

Setting up tracking categories in Xero for the areas of your business you want to compare, like sales by region or expenses by department. When you enter transactions in Xero, assign them to the right category map sales and expenses to the right area.

You can filter the tracking categories to see how these areas are performing in the Profit and Loss Report. Different areas of the business don’t need to be profitable on their own. Its normal for some areas to require more investment than others.

Review your figures against Budget

Preparing a budget helps you understand how much it costs to run your business and generate income. Comparing your actual costs and income to your budget highlights areas where you may be overspending or not meeting your sales goals so you can adjust and get back on track.

You will need to have your budget created in Xero, then compare this with your actual figures by running Xero’s Budget Variance report .

The red and green arrows indicate how your actual figures compare to your budget. A green arrow means your sales are higher or your expenses are lower than planned, while a red arrow means your sales are lower or expenses are higher.

To run the Budget Variance report:

In the Accounting menu, select Reports , then find and open the Budget Variance report.
Select a Date range or click the arrow next to the date to choose a set reporting period, like Last month or Month to date.
Select other options you want the report to show by using the filter option.
Click Update to run the report.

Review Business Performance

Xero enables the use of charts and graphs to track performance across a wide range of business metrics such as gross profit, net profit on net sales, and debt to equity.

If you have at least a few months of transactions in Xero, you will have a range of graphs on your business dashboard. They can assist in answering questions such as “How much margin do I make on my sales?”, or How easily I can pay my bills?”.

Your business performance graphs form part of the Business Performance Report and are based on equations using account types from your chart of accounts. Monthly and weekly metrics will be complete at the end of the month or week they report on. Extra graphs are based on report codes your accountant or bookkeeper has mapped to your chart of accounts. These advanced ratios will display if your accountant of bookkeeper has added them to your organisation.

The Business Performance Dashboard is available to anyone with the Adviser, standard + reports or even read only access in the organisation. Click the star next to any performance graphs you would like to display on the main dashboard. As per the example below.

Add the metrics you use most often to the main Xero dashboard, so your favourite measures are right in front of you. Using the Accounting menu, select Reports . Find and open the Business Performance dashboard. You can use the search field in the top right hand corner.

You can drill down from the dashboard to show more detail and get in depth analysis of your numbers. This allows business decisions to be made with confidence.

Identify trends with the Analytics Business Snapshot

the analytics business snapshot provides further measures to review business performance and view profitability and other key financial metrics. These include a quick overview on profitability, efficiency, and gross profit margin. They also include measures such as average time to be paid and average time to pay suppliers. The ability to repay debts or generate future returns. They also show comparatives against prior years.

Profitability

Efficiency

Financial Position and Cash

Use the dashboard to set and track performance goals and see what is working well and what isn’t. It is always important to discuss these metrics with your accountant or advisor in order to make informed business decisions.

Year End Payroll Compliance and Year End Readiness

Sun, 06 Aug 2023 22:51:12 GMT

What has Coles, McDonald’s, Domino’s, Qantas and the ABC have in common? They have all made costly payroll errors. Normally we hear about wage theft, but it raises the issue that our award system is complex and it is very easy to make errors.

Businesses continue experiencing intense scrutiny of their payroll and wage compliance to ensure that they have not been underpaying wages and entitlements. Even small issues in payroll, or in time/attendance recording, when extrapolated over a large workforce over many years can add up to significant exposures.

In Australia payroll has always been a challenging compliance area for businesses, given Australia’s complex industrial relations system and factors such as the significant investment required in technology and resources to stay up to date.

Non-compliance and underpayments can expose organisations to the risk of significant financial penalties, reputation damage, loss of employee trust and remediation work.

Beyond deadlines, the threat of accruing fines and fees for late or inaccurate year end payroll is more than enough to motivate businesses to get the whole thing over with as soon as possibly able.

The best way to be prepared in ensuring payroll compliance:

Classify workers correctly
Keep meticulous employee and payroll records
Stay informed about the latest payroll regulations
Automate payroll with software programs
Integrate payroll with timekeeping and benefits administration
Audit payroll processes regularly
Review failed STP filing before the year end

Single Touch Payroll Phase 2

Since 1 January 2022 the ATO has expanded the STP system dubbed “STP Phase 2” which send additional information to the ATO each time you lodge a pay run. Primarily the “gross wage” figure that was previously lodged to the ATO as one figure is now split into all the components that make up that amount, including:

Ordinary hours
Allowances
Bonuses and Commissions
Directors’ fees; and
Overtime

Xero was the last of the major software providers to adopt STP Phase 2 and as of 31 March 2023 it has now enabled the lodgement of pay runs via the STP Phase 2 system.

STP Finalisation Declaration

Xero, QuickBooks and MYOB all have their own STP finalisation processes that need to be followed to ensure your employees have the correct information to lodge in their tax return. End of year STP finalisation declaration should be completed by the 14 ^th July each year.

Annual Payroll Tax 2022-2023 return

Payments and lodgements are due in QLD to the (Qld Revenue Office) on the 21 ^st July 2023 and NSW to the (NSW revenue office) this date in the 28 ^th July, 2023. Including wages for the June period.

The Queensland Revenue Office has extended the due date for the payroll tax annual return to Friday the 28 ^th July, 2023.

TPAR Returns

Some businesses and government entities will need to lodge a Taxable Payments Annual Report (TPAR). The due date for a TPAR is the 28 ^th August to the ATO Businesses need to report payments made to contractors.

These payments can include subcontractors, consultants, and independent contractors. They can operate as sole traders, companies, partnerships, or trusts.

Annual Wage Review Decision 2022-2023

The Fair Work commission (FWC) has approved a 5.75% increase in all modern award minimum wages.

To operate from the first full pay period after the 1 July 2023. The Panel decided to increase a national minimum wage of $882.80 per week or $23.23 per hour. This amounts to a 5.75% increase. The weekly rate is based on a 38 hour week for all full time employee. Additionally, minimum wages in modern awards will increase by 5.75% from 1 ^st July 2023 for all modern award minimum wages, modern award wages and State reference public sector awards.

Employees will be entitled to receive the increase from their first full pay period on or after 1 July 2023.

The minimum wage increases also effect other payments such as penalty rates, overtime, allowances and more.

The current casual loading figure will remain at 25%.

It’s a good time to review your payroll to make sure that:

Employees paid minimum wages under a modern award are paid no less that the minimum pay rates for their job classification under the applicable modern award. This includes casual and other loadings, overtime and allowances that are calculated by reference to the modern award minimum pay rates.

Superannuation Update

In addition to the above increase in the minimum wage, 1 July 2023 also sees an increase in the minimum superannuation guarantee contribution from 10.5% to 11%. Under the current legislated timetable, the Super Guarantee (SG) rate will continue to rise incrementally by 0.5% each financial year to 12% by 1 ^st July 2025.

Payday Super

It is also proposed that from 1 ^st July 2026, employers will be required to pay employees’ super at the same time they pay their wages. The measure part of the ‘Securing Australians Superannuation Package’ which was announced as part of the 2023-24 Federal Budget. Currently employers are only required to pay superannuation on at least a quarterly basis.

The measure enables employees to check the payment of their superannuation entitlements more easily and to benefit from higher compounding returns given their super will be paid more frequently.

Employers need to ensure whether the administration burden in complying with the payday super measure may be reduced by adjusting the frequency of payment of wages.

Visibility and Unpaid Super Recovery Targets

A large investment to the ATO has been made to improve data capabilities including matching employer and super fund data to identify instances of underpayment of the superannuation guarantee by employers. An additional investment in a new compliance system that will proactively identify instances of underpayment of the superannuation guarantee.

Employers need to be aware that the ATO will be subject to enhanced targets on the recovery of unpaid superannuation. So will be focusing on this even more in the future.

If you need assistance with your payroll, please contact us to discuss how we can help you.

Keeping on top of Superannuation changes as an employer in 2023

Wed, 03 May 2023 01:37:02 GMT

We are now almost half-way through the calendar year and near the end of the financial year. It is so important to set your business up for compliance changes and get the support you need to navigate these changes. It can be a challenge for any business to stay on top of changing superannuation obligations that are mandated by legislation.

As an employer and business owner you have an obligation to pay the superannuation guarantee. Staying compliant isn’t just a legal obligation, it’s a must for protecting your brand reputation from claims of dodgy super practices.

The Superannuation Guarantee is again increasing 1July 2023

The 2023 superannuation changes are here, starting with the Superannuation Guarantee. This is where the employer must pay a minimum amount to eligible workers with failure to comply resulting in hefty penalties. Businesses faced an increase to 10.5% Superannuation Guarantee on an employee’s ordinary time earnings on 1 July 2022 and that rate is set to increase again.

The Superannuation Guarantee is again set to increase by 0.5% every 1 July until it reaches 12% on 1 July 2025. The year 2021 marked the first increase of super contributions since 2014. Effective for FY24 1 July 2023 the Super Guarantee charge will be 11%.

Compliance is Key

Among other changes to superannuation in July 2022 was the removal of the $450 minimum income threshold for the Super Guarantee. Casual staff or staff working shorter shifts are now entitled to Superannuation Guarantee contributions, which can create a greater burden for small businesses. The changes come at a challenging time for many Australian businesses having faced ongoing natural disasters and a global pandemic over the past few years, against rising inflation, interest rates and supply chain demands.

Business owners cannot afford the consequence of failing a Super Guarantee audit. Good accounting advice and a quality bookkeeping service is crucial to assist with managing your cashflow and auditing your existing payroll and accounting systems in the leading up to and post 1 July 2023.

Getting it wrong can be costly

Failure to make your Super Guarantee payments by the due dates can be extremely costly. Typically, the superannuation contributions are to be paid within 28 days of the end of the quarter. Failure to make this payment on time means the employer will be liable to pay the Superannuation Guarantee Charge (SGC), which can be financially punitive, particularly when a Superannuation Guarantee Charge (SGC) underpayment perpetuates over several quarters.

Payment of the Superannuation Guarantee Charge (SGC) is facilitated through the preparation and lodgement of Superannuation Guarantee (SGC) statements, which can cost administratively. There is also a $20 administrative fee payable per individual, per quarter. If a SG underpayment is not rectified before an audit commences, a hefty penalty up to 200% of the Superannuation Guarantee Charge (SGC) can apply.

This is not a list you want to be a part of. The impact to the brand reputation can last for years when workers are left being owed thousands in superannuation and wages.

Contractors and Superannuation

There are also changes to contractors and superannuation. If you are a contractor tasked to do paid work for a business, then you may be entitled to receive the statutory superannuation guarantee contribution to your super fund.

But it all depends on how you are engaged as a contractor, as determined by the Australian Taxation Office (ATO). The ATO says the difference between an employee and a contractor is that an employee works in a business and is part of that business, whereas a contractor runs their own business. So it is possible for someone to be a contractor under the ATO’s definition and still be eligible to receive Super Guarantee SG payments.

A contractor who is paid wholly or principally for their labour may be considered an employee for superannuation purposes. That means they are entitled to mandatory superannuation contributions from their principal contractor to be paid into their chosen super fund.

Difference between an employee and contractor

To get Superannuation Guarantee (SG) contributions as a contractor, the ATO says you must work as an individual, not part of a company, trust, or partnership.

The ATO provides an example of Harry’s Hobby Shop that contracts Pete’s Paints to paint the shop, and the entire job is carried out by one painter working for Pete’s Paints.

As the contract is between Harry’s Hobby Shop and Pete’s Paints, the shop is not responsible for any superannuation guarantee to the painter. Pete’s Paints may have superannuation guarantee obligations to the painter, depending on whether they were an employee or a contractor for SG purposes.

If that all sounds complicated, then the ATO says there are six key factors that separate an employee from a contractor.

Classifying your worker
Superannuation obligations still may apply to certain contractors
Some workers are always employees
Companies, trusts, and partnerships are always contractors
Labour hire or on-hire arrangements
Hiring individuals

To further help determine whether you are considered an employee or a contractor the ATO has an online decision tool. It takes you step-by-step through a series of questions to determine the status for tax and superannuation purposes.

The ATO says this tool is only a guide and if you are still unsure at the end you should seek good accounting advice.

If superannuation guarantee (SG) is still to be applied and the usual superannuation guarantee eligibility rules still apply, which includes earning at least $450 a month.

Sham contracting

Some businesses may tell a worker they are engaged as a contractor when they should be regarded as an employee. The Fair Work Ombudsman says this is known as sham contracting and is illegal. This undermines a workers rights and entitlements.

“Unfortunately, it is becoming an increasingly common practice for many businesses to engage workers as independent contractors to avoid paying entitlements such as superannuation and leave, when workers should in fact be hired as employees,” she said. “Sometimes, sham contracting occurs recklessly or deliberately by an employer. ”

Courts can impose hefty penalties on businesses or individuals for sham contracting.

Make 2023 the Year of Compliance

The Federal government has previously flagged a proposa l t o take non-super-paying employers to court. Being compliant for 2023 superannuation changes might have you feeling a little overwhelmed and all business owners have ample on their plate.

Additionally, if you think you have incorrectly engaged an employee as a contractor, follow through using the steps on the ATO portal using the decision tool and obtain good independent accounting advice.

If you need assistance with any of the above please do not hesitate to contact us on 07 5413 9393 or enquiry@evolveonlinebookkeeping.com.au

Xero Projects

Mon, 03 Apr 2023 05:44:47 GMT

How to Track projects and jobs with Xero Projects

Xero projects is a profitability tool integrated inside Xero that enables you to track time and expenses against your work, as projects. It simplifies quoting, getting paid, and monitoring project profitability in real time.

You can also keep track with the profitability project and job tracker software. This allows time on the job to be measured using the start-stop timer and through the location-based tracker on the mobile.

Workflow for a Project

Steps Start to Finish

Create a project for a new or existing contact.
Assign the relevant staff members to the project.
Add tasks to break down the work. Estimate your time and set the charge rate for each task.
Estimate your expenses and send the customer a quote.
Record time worked against tasks.
Add actual expenses and track them back to your estimates.
Invoice your customers and accept online payments.
Monitor your project profitability in real time.

The below Xero features can be used within projects

Link invoice line items, bills and spend money transactions.
Pay staff for project time in Xero Payroll.
Recover staff expenses and mileage by assigning them to your projects from Xero Expenses.
Add inventory items to projects.
Link existing quotes or create new ones.
Add customer and supplier credit notes.

Setting up Projects

Projects is fully integrated with Xero and for a small additional fee can be added to a Xero plan, just set up a project to get started. Then allocate tasks and expenses to the project.

Track time and costs

Keep track of everything in one place and allows you to stay on top of time and costs. Time is recorded against specific tasks. Tasks determine the rate at which time is charged for on quotes and invoices.

The app can be used for keeping projects on the go. Xero Me also can allocate time to projects or an existing entry can be copied. See exactly where every dollar has been spent and see if your job is making a profit using projects.

Invoice and get paid

Quotes can be turned into branded invoices for project accounting. You can also set how much detail to display on the invoice. You can create fixed time or time and materials invoices. Send invoices for deposit and lump sums like progress payments. Also, add a ‘Pay now’ button to online invoices and get paid faster.

Four types of invoices can be sent from Xero Projects:

Deposit invoice
Tasks & expenses invoice
Project amount invoice
Accepted quote invoice

When work finishes, close the project so that reporting accurately reflects the state of the project.

Project Reporting

Monitor project financials to maximise profit on current and future jobs using a range of project reports. These reports can be accessed via a profitability dashboard.

Run reports specific to Xero Projects:

Project Financials – insight into how tasks and expenses are tracking against budget.
Project Detailed Time – insights into the time your team spends on projects and what proportion of that time is chargeable.
Project Staff Time Overview – monitor time spent across all projects for a given date range.
Project Summary – basic financial summary. Project Details – overview of project activity, including a summary of project financials. Also, provides a snapshot of a project at a moment in time.

Staff access and Time

If you want to use Xero Projects, give them the appropriate user role and access to the relevant projects. As an example, only a projects admin user can view or modify staff cost rates or see the information in projects reports. The other two user roles that exist are projects standard, and projects limited.

You can trial Xero Projects free for the first month. Simply add it to your existing Xero subscription, which includes five active users.

If your business requires assistance with any of the above please do not hesitate to contact us on 07 5413 9393 or enquiry@evolveonlinebookkeeping.com.au

Payroll Tax

Wed, 22 Feb 2023 23:57:34 GMT

Payroll tax is a self-assessed tax on the wages that employers pay to their Queensland employees when the total taxable wages are more than a certain threshold. It is a levy on taxable wages paid within a particular state or territory by employers. The payroll tax base included wages, salaries, superannuation and other forms of employee benefits such as bonuses and fringe benefits.

The payroll tax rates and thresholds vary between state and territories and is administered by revenue offices in each individual state and territory. Over recent years there has been progress towards a harmonised approach between the states in several key areas. In Queensland, payroll tax is administered by the Queensland Revenue Office and returns are lodged via QRO online. For further information on QRO online: https://qroonline.treasury.qld.gov.au/

An employer must register for payroll tax within 7 days after the end of the month in which they:-

Pay > than $25,000 a week in Australian taxable wages, or
Become a member of a group that together pays > than $25,000 a week in Australian taxable wages.

Businesses may be grouped and treated as one unit for payroll tax if they are related or connected. The current threshold is $1.3 million in Australian taxable wages annually or $108,333 monthly. If your annual taxable wages are $1.3m or less, you may not have to pay payroll tax, but you still might need to register for payroll tax and lodge annual returns.

If you are a member of a group of employers, the $1.3m threshold is calculated on the group members combined annual Australian taxable wages.

If you do not employ for a full financial year, the $1.3m threshold is calculated proportionately on the number of days you paid, or liable to pay.

The table below details the weekly, monthly, and yearly thresholds that apply.

In QLD the payroll tax % rate is:

4.75% for employers or groups of employers who pay < $6.5m or less in Australian taxable wages
4.95% for employers or groups of employers who pay > $6.5m or more in Australian taxable wages

Regional employers are entitled to a 1% discount on the rate until 30 June 2023.

Fixed Periodic Deductions

A deduction can be claimed if you:

Are not in a group but pay interstate wages, or
You are a designated group employer.

The periodic deduction is calculated using the estimated Queensland and interstate taxable wages for the full financial year, for non-grouped employers and estimated total groups Queensland and interstate taxable wages for the full financial year, for designated group employers.

A fixed periodic deduction calculation or the estimator is available in QRO Online to work out what the deduction will be.

Components of Payroll Tax

Include the following taxable wages in completing returns:

Gross salary and wages for payroll tax
Termination Payments (Except payments that are not taxed such a redundancy payments)
Bonuses
Taxable allowances
Interstate Wages
Groups of businesses
Contractor payments
Commissions
Director fees
Shares and options
Superannuation contributions
Salary sacrifice arrangements
Fringe benefits
Termination payments

Exempt wages for Payroll Tax

The following wages are exempt from payroll tax in Queensland:

Apprentices and trainees
Employers with special exemptions
JobKeeper payments

Apprentices and Trainees are exempt from payroll tax if the employee has signed a registered training contract with their employer to undertake an apprenticeship or traineeship under the Further Education and Training Act 2014. There are several restrictions surrounding these areas in terms of exempt wages.

Some employers have special exemptions from payroll tax. These include public hospitals, charitable institutions, teachers training college, local government, consular and other government bodies.

Mental Health Levy

From 1 January 2023, a mental health levy will apply to employers and groups of employers who pay more than $ 10m in annual Australian taxable wages.

This levy applies to:

Employers and groups of employers who pay > than $10m in annual Australian taxable wages
Annual Queensland taxable wages

Payroll Tax Due Dates in Queensland

New ID requirements for Directors

Tue, 08 Nov 2022 00:01:05 GMT

Company directors need to verify their identity as part of a new director identification number (Director ID) requirement.

A director ID is a unique identifier that a director will apply for once and keep forever - which will help prevent the use of false or fraudulent director identities. When you must apply depends on when you were appointed as a director.

Existing directors have until 30 November 2022 to apply.
Directors appointed between 1 November 2021 and 4 April 2022 should have applied within 28 days of their appointment.
From 5 April 2022, intending directors must apply before being appointed.
The new Australian Business Registry Services (ABRS) is responsible for administering the director ID initiative.

ASIC is responsible for enforcing director ID offences set out in the Corporations Act 2001. It is a criminal offence if you do not apply on time.

How to apply:

The Australian Business Registry Services are responsible for administering the new Director ID Number (“DIN”) scheme for all Australian companies.

You can apply or manage your DIN at https://www.abrs.gov.au/director-identification-number but requires you to have already completed the following:

Verifying ID:

The application process is relatively simple, but will require you to have a myGovID already setup. If you don’t already have that, you will need to follow the steps here: https://mygovid.gov.au/AuthSpa.UI/index.html#login (you will need a smart phone and 100 points of ID documents).

Once you’ve confirmed your ID, you are directed to the Australian Tax Office website. Here you:

Confirm you agree to their terms and conditions are carefully reading these;
Confirm your full name and date of birth, and include your:
current residential address as held by the ATO;
Tax File Number.
This should verify your ATO Record.

Phone Application:

If you have any issues setting up the above apps and applying for a Director ID via this method you can call the ABRS (Australian Business Registry Services) on 1300 306 275 and verify your identify over the phone and they will issue with an ID number. This process should only take 10-15 minutes.

Ensure you have your passport, drivers’ licence and/or Medicare card handy along with your tax file number.

Obtaining the DIN:

You must be eligible for a DIN, meaning you must be eligible to be a Director or intend to become eligible in the coming 12 months. Don’t apply for a DIN if you’re not a director or becoming a director. Tick the first box to confirm this.
You must also confirm you’re an individual, over 18 years of age and not disqualified from being managing corporations. Tick the second box to confirm this.
You need to confirm your ASIC personal details, such as any previous names, birth place, residential address and postal address. You will be asked to confirm by ticking a box that all is correct before moving ahead.
Assuming the above steps are completed correctly, you will receive your Director ID immediately online. Keep this safe – print and save it carefully. We are unable to retrieve it easily for you if you do not correctly record the details. Please also provide your accountant with your new DIN for their records.

You’re done. Over time, entities will be added to your ABRS portal page.

If you need any assistance with completing this process, please don't hesitate to contact us on 07 5413 9393 or enquiry@evolveonlinebookkeeping.com.au .

What you need to know for stage one of Xero's STP Phase 2 roll out

Mon, 26 Sep 2022 23:43:09 GMT

All customers using Xero Payroll have been granted an extended deferral until 31 March 2023.

Just like they did with Phase 1, the Xero team is working to ensure that STP Phase 2 compliance is as seamless as possible for their partners and customers. For Xero, STP Phase 2 has been one of the largest and most complex platform build changes to affect Xero Payroll and they want to get it right.

Their product teams have done a huge amount of work to deliver this project to date, but due to the impacts of COVID-19 related illness and the resource constraints affecting the tech sector, the delivery of STP Phase 2 within Xero Payroll has been delayed. They also needed to build additional foundational features into the Xero Payroll platform prior to commencing development of STP2. These changes were complicated and required additional time and resources.

Xero have been working closely with the ATO to ensure everyone has the time they need to become fully compliant. As a result, they have been granted an extension to our STP2 deferral from the ATO to support their customers to meet the STP Phase 2 requirements until 31 March 2023.

The first stage of Single Touch Payroll (STP) Phase 2 is right around the corner in Xero. For a quick refresher, STP Phase 2 will see Australian businesses build on their existing STP reporting to share more information with the ATO and other government agencies each pay run.

Read on to find out everything you need to know about what stage one will look like within Xero – and what you’ll need to do to prepare.

First things first, STP Phase 2 is the next evolution of STP reporting

Where phase one had you reporting employees’ tax and super directly to the ATO, STP Phase 2 expands the program to capture more detailed information. This reduces the compliance burden for employers and individuals, and helps the admin side of things for the ATO and Services Australia.

The changes will start rolling out from late August within Xero

T he rollout is kicking off in three key stages within Xero. While stage one is taking place as planned, so we can ensure that stages two and three are equally as streamlined, we’ll be pushing their delivery dates out (rest assured, everyone will have the time they need to transition). To help you work through the upcoming changes, we’ll also be launching transition tools at each stage.

Here is our updated timeline:

Stage one – Starting from late August : The first part of this process is transitioning your existing employee profiles to be STP Phase 2 compliant. This means providing new details on existing staff, like whether they’re an employee or contractor. Some of you may already be testing out the new employee set up process as part of our limited release so will be familiar with these fields.

Stage two – Starting from late September : Next, you’ll need to identify and update pay items with the new earnings categories as defined by STP Phase 2. New earnings categories like Directors’ fees and Bonuses and Commissions are already available in Xero Payroll, if you want to get a head start.

Stage three – Coming soon: This is the final step in the STP Phase 2 transition and will break paid leave into additional subcategories. We’ll support you with a guided payroll experience to help update existing leave categories to meet the new reporting requirements.

Stage one involves some changes to new employee setup in Xero Payroll

As detailed above, with stage one, employee onboarding will be changing. As a result, all new employees set up in Xero Payroll will naturally be STP Phase 2 compliant. These changes will start rolling out from late August and as part of this process, the employment and taxes tabs will have a new look and some additional fields to complete.

Xero have launched the employee profile transition tool to help you with stage one

Using this guided experience, you’ll be able to update existing employee profiles to capture relevant STP Phase 2 information.

https://www.youtube.com/watch?v=ubwLSE4XVUk

As part of the August release, Xero is updating the STP Phase 2 Portal within Xero Payroll. This will become the central point for customers to understand and action the steps for a successful STP Phase 2 transition over the coming months.

https://www.xero.com/blog/wp-content/uploads/2022/08/STP2-Portal.mp4?_=1

You will be notified within Xero Payroll when each stage is available

The transition to STP Phase 2 reporting will be gradual, and we encourage all customers to action the steps as soon as they become available within Xero Payroll. This will be made clear to you within your account, complete with guidance on what needs to be done (as will be the case for the stages to follow).

Start planning for your transition now

While you’ll have the time to make all relevant changes, the best approach is to set aside time to get started as soon as possible. This might require some planning to ensure you have all the information needed. If you’re unsure about updating your payroll data for STP Phase 2, speak to your advisor.

Xero’s educational resources and transition tools will help you through the process

Looking for more information on STP Phase 2? Check out our guide to STP Phase 2 , timeline infographic and this handy checklist . You can also visit Xero Central or refer to the ATO’s employer reporting guidelines .

Xero will be sharing plenty of information and educational resources over the next few months as the transition continues. Keep an eye out in Xero Payroll, Xero Central and across their social media channels for further updates, and reach out to us here at Evolve if you have any questions – we’re here to help.

If you or your business requires any assistance with the above please do not hesitate to contact us on 07 5413 9393 or enquiry@evolveonlinebookkeeping.com.au

Year End Payroll compliance and Year End readiness

Mon, 15 Aug 2022 06:46:48 GMT

Businesses contribute to payroll processes all year, before looming deadlines cause some pressure. Businesses are experiencing intense scrutiny of their payroll and wage compliance to ensure that they have not been underpaying wages and entitlements. Even small issues in payroll, or in time/attendance recording, when extrapolated over a large workforce over many years can add up to significant exposures.

Non-compliance and underpayments can expose organisations to the risk of significant financial penalties, reputation damage, loss of employee trust and remediation work.

Beyond deadlines, the threat of accruing fines and fees for late or inaccurate year end payroll is more than enough to motivate businesses to get the whole thing over with as soon as possibly able.

The best way to be prepared in ensuring payroll compliance:

Classify workers correctly
Keep meticulous employee and payroll records
Stay informed about the latest payroll regulations
Automate payroll with software programs
Integrate payroll with timekeeping and benefits administration
Audit payroll processes regularly
Review failed STP filing before the year end

Specific Payroll Reporting Compliance Dates

End of year STP finalisation declaration should be completed by the 14 July each year if you have 20 or more employees or 31 July for less than 20 employees.

Key dates in July:

14 July - Finalise STP report if you have 20 or more employees
21 July - Lodge monthly BAS
28 July - Q4 BAS due (you get an extra 2 weeks if you lodge online)

- Q4 Super and PAYG instalments due

31 July - Finalise STP if you have less than 20 employees

Annual Payroll Tax 2021-2022 return and payments are due in QLD to the (Qld Revenue Office) on the 21 July 2022 and NSW to the (NSW revenue office) this date in the 28 July, 2022. Including wages for the June period.

Key dates in August:

11 August - Q4 BAS final due date
14 August - PAYG withholding payment summary annual report due
21 August - Lodge monthly BAS
28 August - Taxable payments annual report (TPAR) due

TPAR returns are due to the ATO on the 28 August each year. Businesses need to report payments made to contractors or subcontractors during the financial year.

Annual Wage Review Decision 2021-2022

The significant changes since last year’s wage review decision have been the sharp rise in the cost of living (inflation) and the strengthening of the labour market. There is also a marked difference in the inflation forecasts.

Business inputs increase and depending on the capacity to pass on those costs, adversely affects profitability. Inflation erodes the real value of a worker’s wage and reduces living standards. Changes in relation to the .5% increase in the Super guarantee rate from July and the removal of the $450/month threshold were also moderating factors. That said, the Panel noted that the low paid are particularly vulnerable in the context of rising inflation.

The panel review concluded that the changes in the economic context weigh in favour of an increase in the modern award and minimum wages.

To operate from 1 July 2022. The Panel decided to increase a national minimum wage of $812.60 per week or $21.38 per hour. This amounts to a 5.2% increase.

Modern award minimum wages will increase by 4.6% subject to a minimum wage increase of $40 per week. Award rates above $869.60 per week will increase by 4.6% and award rates below $869.60 per week will increase by $40 per week. The $40 per week increase is based on a 38 hour week for a full time employee.

A delayed operative date was decided for awards in the aviation, tourism, and hospitality sectors. The following modern awards will increase as from the 1 ^st October 2022.

Aircraft /Cabin Crew Award 2020
Airline Operations – Ground Staff Award 2020
Air Pilots Award 2020
Airport Employees Award 2020
Airservices Australia Enterprise Award 2016
Alpine Resorts Award 2020
Hospitality Industry (General) Award 2020
Marine Tourism and Charter Vessels Award 2020
Registered and Licensed Clubs Award 2020
Restaurant Industry Award 2020

Some businesses covered by modern awards will face two minimum wage increases within a twelve month period.

If you or your business requires any assistance with the above please do not hesitate to contact us on 07 5413 9393 or enquiry@evolveonlinebookkeeping.com.au

Benefiting business through the power of eInvoicing

Tue, 21 Jun 2022 06:23:33 GMT

What is eInvoicing?

Electronic invoicing, or eInvoicing is the automatic exchange of invoices between accounting software and a key component of the Government Digitisation Strategy. It eliminates the need to PDF or email an invoice. The eInvoice is automatically sent directly to the accounting software of another business or Government department almost instantly - via a secure dedicated eInvoicing network. It eliminates the need for the manual entry of the invoice.

Below are the steps in the process:

The Supplier - sends an invoice as an eInvoice from their accounting software
eInvoice – sent via a secure, dedicated network
Customer – with no need for manual entry, the eInvoice is delivered directly into the customer’s software system ready to be approved and paid.

Benefits of eInvoicing?

It is an extremely powerful tool when you think about the fact that $1.2b invoices were sent and received in Australia alone last year. The efficiencies for business, money and cash flow benefits with eInvoicing are listed below:

Savings of approximately $20 between the invoice sender and receiver
Estimated $29b over the coming years
Saves time – A fast and accurate delivery means less time spent entering bills
Faster payment – A near real-time exchange and reduced admin leads to faster payments of invoices.
Secure – Exchanged via secured network – reducing the risk of fraud.
Cash Flow – Get an accurate and complete picture of cash flow with eInvoices.
Interoperable – As long as your customers are using software connected to the network, you can exchange eInvoices with them.
Government backed – You’ll benefit from 5-day payment - from Government suppliers to participating agencies.

How to use eInvoicing?

Before you start

To use eInvoicing you need to make sure you have added your business ABN in your organisation’s settings. This needs to be included in the Basic Information section. This needs to match the information on file with the ABR.
You need to have the standard or adviser user role in Xero to register your Xero organisation with Peppol .
In your business file in Xero, go to Bills and register for e-invoicing.
Choose a business contact and a legal representative for registration. This can be the same person.

In the Business menu, click Bills to pay
Click Receive eInvoices , then click Register to receive eInvoices .
Verify your business information, then click Yes, these details are correct .
Enter details for the business contact and legal representative. Select the checkbox to agree to the Terms and conditions .
Click Complete registration to receive eInvoices.

Your business is now registered with the Peppol network. Its name will be listed in the Peppol network directory. Your business is now set up to receive eInvoices from suppliers.

Peppol network directory - https://directory.peppol.eu/public/locale-en_US/menuitem-search?q=aunz

Receiving eInvoices

An eInvoice automatically appears in Xero as a draft bill under the bills to pay draft tab. These invoices can also be viewed on the dashboard. You can then approve the bill or add a planned payment date. If you receive an eInvoice with a PDF, CSV, JPG or PNG attached, you can view the file in Xero.

If there are any issues with processing an eInvoice, it won’t be created as a draft bill in Xero. Instead, we will send an email to let you know which supplier tried to send you an eInvoice. It is not possible to choose who receives this email at this stage it will be sent to active users in your organisation.

Creating eInvoices

An eInvoice is sent directly to the accounts payable software of your customer through a secure eInvoicing network. Customers do not need to be using Xero to receive an eInvoice, but they need to be registered with Peppol. Xero uses Peppol for its eInvoicing network because it is the framework that the New Zealand and Australian governments adopted for standardised eInvoicing.

When you send an eInvoice, their registration is validated. If they are not registered, you’ll be notified that the eInvoice can’t be sent and you can send the invoice as a PDF or by email instead. You don’t need to be registered with Peppol to send an eInvoice.

Before you Start

Ensure both your ABN and your customers ABN is added to their contact details in Xero, so they can receive the eInvoice. Their ABN is entered in the Tax field under Financial Details . Then confirm the customer if registered to receive eInvoices through their accounting software. The Peppol directory can be used to see if the customer is registered. The ABN number can be checked using the below ABN lookup address.

https://abr.business.gov.au/

Send an eInvoice

Switch to new invoicing at the bottom of the page.

If you are still using classic invoicing, click Switch to new invoicing at the bottom of the page.
Select the customer in the To field .
Select the Send as an eInvoice toggle at the bottom of the page.
Populate the invoice.
Include the reference number in the Reference field (compulsory field).
Click Send and follow the prompts.

It is important to double check the eInvoice invoice before sending as if it has been sent and received and it is incorrect it must be voided and redone.

If you or your business requires any assistance with the above please do not hesitate to contact us on 07 5413 9393 or enquiry@evolveonlinebookkeeping.com.au

Superannuation changes from 1 July 2022 that impact business

Thu, 14 Apr 2022 05:09:56 GMT

Announced in the May 2021 Federal Budget superannuation announcements have now finally been passed in Parliament. The below key measures will largely take effect from the 1 July 2022.

These changes will impact business in hospitality and retail and those with a high number of casual employees, it has the potential to increase costs and put pressure on some businesses that are under strain through the impacts of COVID-19 and natural disaster events.

Depending on the size of the business there could be payroll tax implications as well as other flow on costs.

Removal of $450 monthly income threshold

You’ll need to pay super guarantee contributions to an employee’s super fund regardless of how much they are paid. Employees will still need to satisfy other eligibility requirements. This includes other workers who are eligible for super including contractors.

These employees were previously being excluded from their employer’s superannuation guarantee obligations. These changes ae expected to affect around 3% of all employees.

The ATO is to work with digital service providers to assist them in updating their payroll and accounting software to be ready for this change.

Employers will need to check their payroll and accounting software to be ready for and ensure systems have been updated for super payments made after 1 July 2022 to ensure they correctly calculate their employee’s super guarantee entitlement.

Eligibility for Superannuation

Generally, all employees are eligible for super. It does not matter if they are:

Full-time, part-time or casual
Receiving a super pension or annuity while working
A temporary resident such as a backpacker
A company director
A family member working in your business

Work performed by non-residents outside of Australia and work performed by individuals under the age of 18 years and employed for less than 18 hours per week, are still exempt from superannuation guarantee and will not be affected by these changes.

Increase in Super Guarantee percentage

From 1 July 2022, the percentage rate for the super guarantee increases from 10% to 10.5%. Employers are required to contribute additional money into their employee’s superannuation account in line with the higher super guarantee percentage rate.

The Superannuation Guarantee has been 10% since 1 July 2021 and under the current schedule of legislated increases, the percentage rate will raise again to 11% on 1 July 2023. It will continue rising 0.5% each year until it reaches its final rate of 12% on 1 July 2025.

Reduction in eligibility age for downsizer contributions

The eligibility age for making downsizer contributions into super was reduced from 65 to 60. From 1 July 2022, more people in their sixties can make contributions (up to $300,000 per person or $600,000 per couple) into their super account using the downsizer measure, provided they meet the eligibility criteria.

Apart from being over the age of 60 the downsizer contribution eligibility is not dependent on total super balances provided other criteria is met.

The criteria include the house being owned for 10 years or more and at some time was their primary residence and the contribution must be made within 90 days of settlement.

Abolishing the Work Test for those aged between 67-74

The current work test requires you to be employed at least 40 hours in a consecutive 30 day period during the financial year, before any contributions are accepted both before and after tax. As from 1 July 2022, the work test will be abolished.

Other eligibility criteria still apply, such as the amount you can contribute.

If your business requires assistance with any of the above please do not hesitate to contact us on 07 5413 9393 or enquiry@evolveonlinebookkeeping.com.au

Managing staff absence during COVID

Thu, 14 Apr 2022 04:47:21 GMT

As Covid-19 case numbers continue and borders open, employers are now faced with the ongoing challenge of managing employees who are unable to attend work because they have been diagnosed with Covid-19, are suspected of having Covid-19 or required to isolate.

Employers and employees both have legal obligations to support workplace health and safety. Because of these obligations, employees who have Covid-19 can’t attend the workplace. They are required to immediately isolate for 7 days from the date that you had your test, so you don’t give the virus to someone else.

The best approach if an employee is unable to work and needs to isolate is to contact their employer to discuss possible leave or flexible working options.

Employer direction for an employee to not come to the workplace

Under workplace health and safety laws, employers must do what they can to ensure the health and safety of their workers and others at the workplace. Employees also have responsibilities under those laws. Further information is available under the Safe Work Australia website.

If an employer has directed an employee not to attend work in these circumstances, the employee isn't entitled to be paid unless they take paid personal/carer’s sick leave or some other type of paid leave. If they have no paid personal/carer’s sick leave, they should arrange with their employer to take some other type of paid or unpaid leave. They may be also able to apply for the Pandemic Leave Disaster Payment.

What is Unpaid Pandemic Leave?

Some employees have access to unpaid pandemic leave for up to two weeks under their modern award if they are unable to work. This type of leave can be used if required to isolate. The leave is available to full-time, part-time, and casual employees in full and is not pro-rata or accrued over time. Employees do not have to use all their paid leave before accessing pandemic leave.

Entitlement to paid personal/carer’s (sick) leave

Under the Fair Work Act 2009, employees are entitled to take paid personal/carer’s (sick) leave if the leave is taken:

a) because the employee is not fit for work because of a personal illness, or personal injury affecting the employee: or

b) to provide care or support to a member of the employee’s immediate household, who requires care or support because of:

· a personal illness, or personal injury, affecting the member; or

· an unexpected emergency affecting the member.

If an employee is diagnosed with Covid-19, they are clearly suffering a personal illness and not fit for work.

They must provide notice to their employer as soon as possible, and if requested, provide evidence that the leave is taken for a prescribed reason. If an employee is unable to obtain a medical certificate, the employer may request the employee provide a statutory declaration confirming that the employee has been diagnosed with Covid-19 or ask for evidence of a positive Covid-19 test.

Under the Fair Work Act 2009, an employee is protected from losing their job because of their temporary absence due to illness or injury. Employees also can’t be dismissed in their employment because they have a responsibility under a workplace health and safety law to quarantine or self-isolate.

Employees can request to not go to work because of a health condition that puts them at a higher risk of getting Covid-19.

Isolation under a Government Directive

If an employee is deemed as a close contact, they must quarantine and therefore are unable to leave their premises to attend work. There are some exemptions for critically essential workers who can leave quarantine if they have no Covid-19 symptoms and are fully vaccinated.

An employee is deemed a close contact if they are a “household member” of someone who has tested positive to Covid-19 or have spent 4 hours or longer with someone in some settings since they developed Covid-19.

If an employee is deemed a close contact and cannot work from home, they are not entitled to take paid personal/carers (sick) leave under the Fair Work Act because as they are not suffering from an illness. The exception being unless they are required to provide care or support to a member of their immediate family, or their household, who requires care and support because of a personal illness affecting the member. Some modern awards were updated to include provisions for 2 weeks of unpaid pandemic leave up until June 2022.

Employers can agree to an employee accessing other forms of paid leave such as annual leave or long service leave. Otherwise, a period of absence for a close contact to quarantine (who is not suffering from any illness), will be treated as unpaid leave.

Return to work

A staff member who has completed their period of isolation and no longer has symptoms is free to return to work. You should ask them to produce a negative test before they can return to work. This is because most people who get Covid-19 will continue to test positive for some time after they have recovered, even though they no longer have Covid-19 and are no longer infectious.

More information is available on the Fair Work Ombudsman website .

Transition to Single Touch Payroll (STP) Phase 2 reporting

Tue, 22 Mar 2022 05:12:09 GMT

What is Single Touch Payroll Phase 2?

In the 2019–20 Budget, the Government announced that Single Touch Payroll (STP) would be expanded to include additional information.

The expansion of STP, also known as STP Phase 2, significantly increases the data required to be reported to the ATO. It is hoped that this additional reporting will assist in ensuring employees are paid correctly as well as reducing the need for employers to report information about employees to multiple government agencies.

It will also help Services Australia’s customers, who may be your employees, get the right payment at the right time.

The official start date for Phase 2 reporting was 1 January 2022 , however the ATO has advised that employers who provide the additional reporting required under Phase 2 by 1 March 2022 will be accepted as having met the deadline.

Digital service providers (DSP’s) may apply for a deferral if they need more time to make changes and update their solutions.

Xero and its customers have been granted a deferral until 31 December 2022 . This means that all customers using Xero payroll will also have until that date to report their first STP Phase 2 pay run.

If more time to transition is required, you may apply for a deferral beyond your software provider’s deferral. Registered agents will also be able to apply for a deferral.

What is Changing?

STP Phase 2 expands the data being collected each pay period. Most significantly, there is now a requirement to separate the components of gross earnings to assist employees with their tax return deductions.

This will also assist Services Australia in identifying different types of income for the purposes of administering their programs. One example being child support deductions.

Gross earning components (disaggregation of gross) that will now need to be itemised separately include:

Allowances (specific categories)
Paid leave (specific categories)
Overtime
Bonuses and commissions
Directors’ fees
Lump sum payments and employee termination payments (classified by type)
Salary sacrifice and deduction amounts (specific categories)

Other data captured in STP Phase 2 includes:

Employee’s basis of employment (full-time, part-time, casual etc.)
Tax treatment of employee (TFN declaration details, tax variations)
Reason for employee termination (voluntary cessation, redundancy, dismissal etc.)
Income type and country codes (working holiday makers, labour hire)

What isn't changing

the way you lodge your STP
the due date
the types of payments that are needed
tax and superannuation obligations
end of year finalisation requirements.

If your business requires assistance with any of the above and/or you would like an obligation free quote for any of these services, payroll or general bookkeeping services, please do not hesitate to contact us on 07 5413 9393 or enquiry@evolveonlinebookkeeping.com.au

Super Choice Rules Have Changed

Fri, 03 Dec 2021 00:58:26 GMT

Super Choice Rules changed 1 November 2021

On hiring new employees, it is important you are providing them with a Tax File Number Declaration form and a Standard Superannuation Choice form. However, for any new employees hired from 1 November 2021 who have not provided you with their Superannuation Choice information, you will now need to obtain their ‘Staple Super Fund’ details directly from the ATO via their Online services for business portal (or via your Tax/BAS agent). Previously you may have just added them to your Default fund.

A staple super fund is an existing super account that follows employees as they change jobs. This change has been made in an effort to ensure employees don't have multiple superannuation funds created in their names and then having their super eaten away by administration fees each fund.

You may need to request stapled super fund details when:

Your new employee started on or after 1 November 2021
You need to make superannuation guarantee contributions for that employee, and
Your employee is eligible to choose a super fund but does not do so or does not provide you with this information.

Step 1: Offering Eligible Employees a Choice of Super Fund

Give your new employees a Super Standard Choice Form and pay their super guarantee contributions into the account they provide you on the form. Most employees are eligible to choose what fund their money goes into.

If your employee does not choose a super fund, you need to move onto Step 2.

Step 2: Request Stapled Super Fund Details

You need to log into the ATO’s Online Business Services and go to ‘Employee Super Accounts’ to request their stapled super fund details. Evolve can also assist you with this if needed.

The ATO will provide your employee’s stapled super fund details once they have established that you are the employer by confirming information in the lodged TFN declaration (which is now filed online after the employee has completed the form) or you can verify the employee has commenced work with you or has received their first pay. Once you receive the super details from the ATO, you must pay the super into that specific account.

Step 3: Pay Super into a Default Fund

You can only pay into a default fund if your employee has not chosen a super fund and the ATO have advised that they do not have a Stapled Super Fund.

EMPLOYERS OF CASUAL WORKERS

Wed, 22 Sep 2021 05:58:48 GMT

What you must know and action before 27 September 2021.

On the 27 March 2021 the Fair Work Act 2009 was amended to include a new statutory definition of ‘casual employee’ – please refer to our previous newsletter Changes to Casual Employment if you missed this communication.

Non-Small Business Employers

As per the amendments that were handed down from the 27 March 2021, all new employees since that date should have been provided with a copy of the new Casual Employment Information Statement (CEIS). If you are a Small Business Employer, all of your existing casual employees should also have been provided with this statement on or as close as possible to that date.

From the 27 September 2021, all existing casual employees for Non-Small Business Employers must also be provided with a copy of the CEIS.

From this date, employers must also assess all existing casual employees for eligibility to be converted to a permanent position (as per the criteria listed in the following paragraph) and within 21 days of this assessment, the employer must provide eligible employees with one of the following:

A Casual Conversion Offer in writing to convert to permanent employment
Written notice that no offer for casual conversation is to be made based on ‘reasonable grounds’; or
Confirmation in writing that a casual employee engaged for 12 months is not eligible for a casual conversion offer because the employee has not worked a regular pattern of hours on an ongoing basis during at least the last 6 months.

Casual employee eligibility is based on whether the employee has:

Worked for the employer for a period of 12 months; and
During the last 6 months of employment, the employee worked a regular pattern of hours on an ongoing basis; and
The employee could easily convert to part-time or full-time employment without ‘significant adjustment’ to their schedule.

Reasonable grounds for not making an offer may be sought which could include:

The employee’s position will not exist within the next 12 months;
The employee’s hours will significantly reduce; or
Days and times of work will significantly change and cannot be accommodated within the employee’s available days or times of work.

Small Business Employers

Whilst Small Business Employers are not proactively required to offer eligible employees permanent employment, an eligible employee can request to convert to a permanent employee after they have worked for a period of 12 months (this became possible from the 27 March 2021). An employer has 21 days to provide a written response to the employee advising if the employees request has been approved or denied, however if it is denied, the employer must explain the reasons why the request has been denied and these must fall within the parameters of reasonable grounds.

If you have any questions, speak to Fair Work, or Contact us , so we can help you find the information you may need.

Disclaimer: The information in this article is general and as we are not HR specialists, it should be used as a guide only. We recommend you seek professional advice for your particular circumstances before applying any of this information.

Taxable Payments Annual Reports (TPAR)

Thu, 12 Aug 2021 06:06:14 GMT

If your business offers the following services, even if it is only part of your full-service offering, you are obligated to lodge a taxable payments annual report to the ATO by the 28 August 2021:

A business in the BUILDING & CONSTRUCTION industry and have made payments to contractors or sub-contractors for building & construction services or labour
A business who provides CLEANING SERVICES and made payments to contractors for cleaning services
A business who provides COURIER SERVICES and made payments to contractors for courier services
A business who provides INFORMATION TECHNOLOGY and made payment to contractors for IT services
A business who provides SERCURITY, INVESTIGATION or SURVEILLANCE services and made payment to contractors for these services.

Put simply, the TPAR is an industry specific report declaring the annual total amount of payments made for companies who pay contractors for services to complete work on their behalf. The ATO uses this information to data match the annual income declared by contractors in an effort to improve compliance.

The TPAR can be used by the ATO to help identify if a contractor has not included all of their income on their tax return, if they have failed to lodge tax returns, quoted an incorrect ABN or have not registered for GST.

Generally speaking, you are required to lodge a TPAR if you are in one of the above industries and:

You have an active Australian Business Number (ABN)
You have made payments to contractors who have completed a service on your behalf.

Not all payments need to be reported however. Payments that do not need to be included are:

Payments solely for materials
Payments within a consolidated group
PAYG withholding payments
Contractors who did not provide an ABN
Payments for private and domestic projects
Incidental Labour
Unpaid invoices as of 30 June

Details required for each contractor include:

Contractor name
ABN
Address
Total amount paid
Total GST paid
Total tax withheld if an ABN was not quoted.

If you need some assistance completing your TPAR and/or would like a quote, please contact queries@evolveonlinebookkeeping.com.au or visit our website: https://www.evolveonlinebookkeeping.com.au / We would be more than happy to help you.

Annual Wage Review 2021 and Super Guarantee increase

Tue, 22 Jun 2021 01:27:12 GMT

Minimum Award Rates

The Fair Work Commission (FWC) has announced a 2.5% increase to the national minimum wage following their annual review. This will apply to all awards however, similar to last year, this will be rolled out in 3 stages.

The new national minimum wage rate will apply from the 1 July 2021 with the exception of the Retail Award, which will not increase until 1 September 2021 and rates in the following awards where the FWC deemed there were exceptional circumstances. These awards listed below will not increase until 1 November 2021:

Hospitality Award
Restaurant Award
Registered Clubs Award
Hair & Beauty Award
Fitness Award
Racing Clubs Events Award
Racing Ground Maintenance Award
Sporting Organisations Award
Wine Award
Live Performance Award
Pilots Award
Cabin Crew Award
Airline Ground Staff Award
Airport Award
Alpine Resorts Award
Amusement Award
Dry Cleaning Award
Models Award
Marine Tourism & Charter Vessels Award
Travelling Shows Award
Nursery Award

Although the award rate increase only affects employees who are paid on the minimum award rates, if you pay your employees a salary or above the award rates, you will still need to do your due diligence & ensure that their current rate is still above the NEW minimum rate.

The FWC will now go about issuing draft determinations and orders about how this decision affects awards. Then all pay rates will be updated in each award. These are usually issued right before the increase takes affect so keep an eye out for these here: https://www.fairwork.gov.au/awards-and-agreements

Superannuation

Please also note the Superannuation Guarantee will increase from 9.5% to 10% from 1 July 2021. Super Guarantee is payable on all ordinary time earnings which includes ordinary hours of work, shift loadings & allowances, but not overtime.

If you would like any assistance with these pay increases or would like to discuss any other payroll assistance or bookkeeping needs, please do not hesitate to contact Evolve Online Bookkeeping for an obligation free quote on 07 5413 9393 or queries@evolveonlinebookkeeping.com.au.

Are you prepared for the end of the FINANCIAL YEAR

Tue, 22 Jun 2021 00:07:19 GMT

The end of the financial year is 30 June and this date is fast approaching. We have put together a few tips & reminders to ensure you are on track for a smooth finish to what has been a pretty hectic year for most business owners.

Paying June quarter Superannuation Guarantee Contributions prior to 30 June

If you are a business who likes to pay their June quarter superannuation before the end of the year to be able to claim it within this financial year, please note the cut off date to process these payments is 21 JUNE 2021. The superannuation can only be claimed if the money has been RECEIVED by the FUND prior to 30 June, regardless of when it left your bank account. In order to be processed through the clearing house & received by your fund in time, it must be processed via XERO no later than the 24 JUNE 2021 at 2pm. If you would like to take advantage of this, please advise your dedicated bookkeeper so we may batch the payment & send to your for authorisation in time.

Make sure your employee records are up to date

Your employees PAYG Payment Summaries must be issued and lodged with the Australian Taxation Office (ATO) by 14 July 2021. These are all completed in your STP (single touch payroll) function via Xero however, in order for them to be finalised correctly, you must ensure all of your employee’s information is up to date. It is a good idea to check your files now to ensure you have the correct details:

1. Name

2. Address

3. Date of birth

4. Tax File Number

5. Employment Basis

6. Residency Status (especially for working holiday makers or those on a Visa)

7. Superannuation details.

If any of these things are missing it can prevent the file being accepted by the ATO and you don’t want to be chasing this up in the final hour. Plus, any incorrect information will have the employee coming back to you requesting an amended payment summary.

Get your business records up to date

The next few months are traditionally the busiest period of the year when it comes to bookkeeping so please ensure you are continuing to send through all your receipts of purchase, daily takings reports, payroll information, quarterly bank statements, float balances, stocktakes - all of your paperwork in general - as soon as humanly possible, so we are able to process all your information efficiently. Chasing information wastes your time and ours so it is a good idea to upload everything to DEXT (formerly Receipt Bank) or forward your emails as soon as you receive them, rather than holding them off to send at another time. Paperwork is too easily lost this way and the sooner we have it, the sooner it is processed and the more accurate your Xero file is.

Complete your stocktake

If you have stock, the most ideal time to complete a full stocktake is after close of business on 30 June and before opening for business on 1 July. This is not always practical however this will ensure you have the most up to date asset figure in your balance sheet for your end of year financials. If this is not possible, please complete on the most practical day, as close to 30 June as you can.

Payroll Tax Annual Report

If your gross annual wages are in excess of $1.3 million (in QLD – this differs from state to state), you are required to pay payroll tax to the Office Of State Revenue. This should be paid on a monthly basis once your wages are in excess of $108,333.33 for the month. The annual Payroll Tax report is then due to be lodged on the 21 July 2021. Part of this process requires that you have reconciled your wages and subcontractor payments for the year.

Business Activity Statements

The June quarter business activity statements are due 21 July 2021 for monthly GST remitters and 28 July 2021 for quarterly remitters. In the midst of all of the other deadlines to be met, we cannot stress enough how important it is that you send your bookkeeper all of your information and respond to any email queries as quickly as you possibly can.

Taxable Payment Annual Report

If your business makes payments to contractors or sub-contractors, you may need to lodge a taxable payments annual report by 28 August 2021.

Whilst this was once only applicable to the building industry, the ATO has now widened the net & if your business provides any of the below services, even if they are just part of the services you provide, you will be required to provide the report:

Building & Construction Services
Cleaning Services
Courier or Road Freight Services
Information Technology Services
Security, Investigation or Surveillance Services
Government Entities

As with checking your employee details prior to year end, now is a good time to start reviewing the details you have on file for your subcontractors to ensure you will be able to provide all necessary details such as the correct entity name, business address & ABN. When reporting you also need to provide details of the gross amount of payments made, the total GST you paid them and any tax amounts withheld where an ABN was not quoted.

WorkCover

Annual WorkCover declarations will also need to be submitted once you have completed the process of reconciling the wages for the year. This is compulsory for any business who hires employees and they use these figures to renew your policy for the coming year. These are due for lodgement no later than the 31 August 2021. If then paid by the 16 September, you receive a 5% discount on your premium however WorkCover do offer a payment plan for those larger premiums, provided your declarations are lodged on time.

Summary of due dates for lodgement

Date Due for lodgement

21/06/2021 June quarter superannuation Guarantee Contributions (if to be claimed in 2021 year)

30/06/2021 Complete your year end Stocktake

14/07/2021 PAYG Payment Summaries

21/07/2021 Annual Payroll Tax Returns

21/07/2021 June BAS for Monthly GST remitters

28/07/2021 June BAS for Quarterly GST remitters

28/08/2021 TPAR (Taxable Payment Annual Report)

28/08/2021 WorkCover Declarations (due 16/09/21 for discount or 30/09/2021 no discount)

Changes to Casual Employment

Mon, 19 Apr 2021 06:53:49 GMT

Industrial Relations Reforms March 2021

The Fair Work Act 2009 was amended on 26 March 2021 to change workplace rights & obligations for casual employees. These changes came into effect on Saturday 27 March 2021.

What Has Changed?

The introduction of the Casual Employment Information Statement (CEIS)

To accompany the Fair Work Information Statement which already needs to be provided to all new employees, employers must now also provide every new casual employee a CEIS, before, or as soon as possible after, they start their new job.

Small Business employers need to give their existing casual employees a copy as soon as possible after the 27 ^th March 2021. Other employers need to provide this to all of their existing casuals as soon as possible after 27 ^th September 2021.

The definition of casual employment:

Under the new definition, a person is a casual employee if they accept a job offer from an employer knowing that there is no firm advance commitment to ongoing work with an agreed pattern of work.

Once employed, an employee will continue to be a casual employee until they either:

become a permanent employee through casual conversion or, are offered & accept a full-time or part-time position or;
stop being employed by the employer.

The pathway for casual employees to move to fulltime or part-time employment

The Amendment Act provides for a new entitlement to the NES giving casual employees a pathway to become permanent employees. An employer (excluding Small Business) now has to offer their casual employees a conversion to permanent employment when the employee:

Has worked for their employer for 12 months
Has a regular pattern of hours for at least 6 of those 12 months, on an ongoing basis
Could continue working those hours as a permanent employee without significant changes.

The exceptions to this rule are:

Small Business employers
If an employer has ‘reasonable grounds’ not to make an offer to convert

For more information in regards to casual employees, or to download the Fair Work Information Statement or the Casual Employment Information Statement, please head to the Fair Work Ombudsman website : https://www.fairwork.gov.au/employee-entitlements/types-of-employees/casual-part-time-and-full-time/casual-employees

If you would like Evolve to assist you in processing your payroll, please contact us for an obligation free quotation.

Casual & Overtime Provisions – Changes to 97 Modern Awards

Mon, 07 Dec 2020 22:40:52 GMT

As part of its’ 4-yearly review, the Fair Work Commission has clarified overtime for casuals in 97 of the 100+ Modern Awards. The need for clarification was initiated back in 2017 due to the ambiguous nature of awards in relation to overtime entitlements for casual employees.

The Commission has since published a number of decisions on this topic however the latest decision handed down in October 2020 has resulted in 97 of the modern awards being varied from the first full pay period on or after 20 November 2020.

The modern awards have primarily been reviewed & updated individually rather than the Commission taking a ‘model clause’ approach around the following common issues:

How casual & overtime loadings interact;
Whether casuals are entitled to overtime; and
The hours when overtime applies.

Importantly, the Commission has confirmed whether the modern award calculates penalty rates for casuals using a ‘compounding’ or ‘cumulative’ approach.

Compounding Approach

Overtime penalty rate is applied to the casual rate of pay inclusive of casual loading:

EG. Base hourly rate ($25.00) x 125% casual loading x 150% overtime = $46.88

Cumulative Approach

Casual loading and the overtime penalty rate are added separately to the minimum hourly rate:

Base hourly rate ($25.00) x 25% casual loading = $6.25

Base hourly rate ($25.00) x 50% overtime penalty rate = $12.50

= $25.00 + $6.25 + $12.50

= Total of $43.75

The ‘cumulative approach’ results in a lower rate compared to the ‘compounding approach’.

If you employ casuals, we highly recommend you review your Modern Award for any updates at the following link: https://www.fairwork.gov.au/awards-and-agreements/Awards/list-of-awards

If we can help you with the processing of your payroll or any other day to day bookkeeping needs, please contact us for a no-obligation consultation and quote on 07 5413 9393 or queries@evolveonlinebookkeeping.com.au

Workplace Legal Advice Program

Wed, 18 Nov 2020 04:28:13 GMT

DO YOU NEED FREE LEGAL ADVICE ON WORKPLACE ISSUES ARISEN DUE TO CORONAVIRUS?

The workplace issues arising out of the coronavirus outbreak can be complex. There are so many changes to keep up with & so many scenarios that differ from business to business. The Fair Work ombudsman is offering a Workplace Legal Advice Program to help employers deal with these issues so they may get back to the important job of running their business.

WHAT IS THE PROGRAM?

It provides eligible employers free & confidential independent legal advice from law firms with specialist workplace experience to deal with workplace issues arising from Coronavirus, such as:

Standdowns when there is not enough work
Flexible working arrangements
Pay & entitlements
JobKeeper changes to the Fair Work Act

WHO CAN ACCESS THE PROGRAM?

Employers who contact the Coronavirus hotline on 13 13 94 or make an online enquiry via your Fair work Ombudsman account may be referred to the program. You will need to meet the following criteria:

The employer is an eligible employer (please see below for more details)
The Employer’s enquiry relates to workplace impacts of COVID-19, and
The Employer is willing to participate in the Program.

WHO IS AN ELIGIBLE EMPLOYER?

To be eligible you must meet the following criteria:

Not be represented by a lawyer or paid agent
Be covered by the Fair Work System
Agree to the Terms & Conditions

Please note the advice is limited to a fixed amount, usually 4 hours to help you deal with the immediate needs of your business. The law firm will advise you what your free service limit is when they contact you.

So, if you have questions in relation to staffing issues arising out of Coronavirus, follow the link below to contact the help hotline first and they are not able to assist you may receive a referral for the FREE Workplace Legal Advice Program.

https://coronavirus.fairwork.gov.au/coronavirus-and-australian-workplace-laws/contact-us/workplace-legal-advice-program-faqs

If you would like Evolve Online Bookkeeping to assist with your payroll or JobKeeper needs, please call us on 07 5413 9393 for more information or a free quote.

Not eligible for JobKeeper 2.0? You may be eligible for eased employment restrictions

Fri, 02 Oct 2020 02:34:09 GMT

Legacy Employers

With the extension of JobKeeper has also come about a new term, Legacy Employers. These employers can use some of the employment provisions provided under JobKeeper for their previously eligible employees if certain conditions are met.

What is a Legacy Employer?

A Legacy Employer is an employer who previously participated in the JobKeeper scheme but either chooses not to continue with the scheme or are no longer eligible past 27 September 2020, as they do not meet the minimum 30% decline in turnover. They must however be able to demonstrate at least a 10% decline in turnover for the relevant quarter.

What Can a Legacy Employer Do?

Under the extended JobKeeper provisions, legacy employers can:

issue JobKeeper enabling stand down directions (however this cannot result in the employee working less than 60% of their previously agreed ordinary hours of work & not less than 2 hours on a working day)
issue JobKeeper enabling directions in relation to employees’ duties and locations of work
make agreements with employees to work on different days or at different times (with some changes).

Some of the important changes to note from the original JobKeeper provisions are that you must comply with these additional consultation requirements:

A minimum of 7 days written notice must now be provided (previously this was 3) but additionally there are consultation requirements including;

providing the employee (or the employee’s representative) with specific information about the nature, timing and expected effects of the direction;
inviting views and feedback about the proposed direction from the employee (or the employee’s representative);
genuinely considering the employee (or employee’s representative) views and feedback; and
keeping a written record of the consultation.

Meeting the 10% Decline In Turnover Test Each Quarter

To demonstrate this decline, employers must obtain a certificate from a relevant financial service provider, such as your accountant, or if you a small business employer, make a statutory declaration.

In order to make an agreement or give a JobKeeper direction to your staff when the extended provisions apply, the certificate or statutory declaration needs to be held for the corresponding quarter as per below:

Record Keeping

Certificates are issued by eligible financial service providers for the purpose of qualifying for the extended JobKeeper provisions as a legacy employer. These records should be kept as evidence of the decline in turnover.

This provision gives employers flexibility, but you still miss out on what JobKeeper provided you – security in keeping your good staff! It is important to know where you stand so you do not cause yourself unnecessary Fairwork issues. Please contact us at Evolve Online Bookkeeping on 07 5413 9393 if you need help with your bookkeeping and payroll.

- The Evolve Online Bookkeeping team

Casual loading and overtime – Fair Work Commission clears up how casuals should be paid for overtime.

Fri, 11 Sep 2020 01:53:58 GMT

If you hire casuals, there is no doubt that you may have been confused over interpreting the wording of awards in order to figure out how to pay a casual who is entitled to both casual loading and an overtime rate.

Under most modern awards, casual employees are entitled to ‘casual loading’, which is an amount on top of the minimum hourly rate - often 25%. When these employees also work overtime, calculating what should be paid can be a nightmare. The Fair Work Commission has set out the way to pay overtime for these casuals under each award. In doing so, it split up the way awards deal with paying overtime to casuals into three different categories, namely awards where:

• Overtime penalty rates are payable in substitution for the casual loading

• The casual loading and overtime penalty rate are added separately to the minimum hourly rate (the cumulative approach)

• The overtime penalty rate is applied to an ordinary hourly rate consisting of the minimum hourly rate and the casual loading (the compounding approach).

Employers should check which category their award falls into and ensure they have been paying overtime to casual employees correctly to avoid any discrepancies that may result in a claim for underpayment.

Time to move from AccountEdge to the cloud.

Wed, 09 Sep 2020 06:03:46 GMT

In the current business environment, the benefits of being able to work from anywhere, on any internet-enabled device, is becoming more and more apparent to small businesses. Yet still, some drag their feet in making the move to the cloud.

AccountEdge from MYOB recently announced their decision to cancel new versions of the software. Now is a great time to think about your bookkeeping software and get it into the cloud!

Moving your bookkeeping to an online system such as XERO and you'll be platform independent and able to access your accounting on any internet enabled device.

Remote working is even easier as you can collaborate virtually with your Advisor or our team.
No more dealing with software upgrades as they are automatically built into Xero.
Xero was designed as a cloud software from the ground up in a way that is simple, elegant, and intuitive for a small to medium-sized business.
Jet Convert can bring across your transactional history from 1 July 2019, if the MYOB file hasn’t been rolled, so you have comparatives moving forward.

The data transfer only takes a matter of days so you will be up-and-running in no time.

Changes to Annualised Salaries under the Modern Awards

Wed, 12 Feb 2020 00:55:38 GMT

Do you have employees on annualised salaries? Major changes to these start on 1 March 2019.

There are 23 Modern Awards that are impacted by this change. The requirements that need to be met are outlined in the relevant award.

An employer and employee can agree that an annual salary covers entitlements like:

minimum weekly wages
penalties
overtime
allowances
annual leave loading.

Salary agreement should be documented in writing and identify which entitlements are include in the payment.

What does this mean for your business?

If you already have contracts in place with annualised salaries, you will need to ensure that the arrangement now complies with these new requirements. You may need to:

Review what employees are affected
Have a system to record all hours worked each pay period and have a way for the employees to sign off or acknowledge that this is accurate
Consider whether our current annualised salary arrangement meets the new Modern Award requirements of setting an outer limit of hours that can be worked. If not, you may need to issue new contracts.

Even if the annual salary you are paying your employees is higher than what they would be entitled to under a Modern Award , you need to take steps to implement the necessary changes so that the employer (and any managers) are not at risk of penalties under the Fair Work Act 2009 (Cth) for failure to comply with the terms of a Modern Award. This can technically occur even in instances where no underpayment has been made.

If you have any questions, speak to Fair Work, or give us a call , so we can help you find the information you may need.

What is STP and How will it Affect You?

Fri, 21 Jun 2019 05:03:35 GMT

STP or Single Touch Payroll is changing the way employees report to the Australian Taxation Office (ATO) and it will become mandatory for all employers from 1 July 2019.

For those with 20 or more employees, you should already be reporting STP, for those with under 20 employees, below are a few tips to help make sure you are STP ready.

About Single Touch Payroll

Each time you pay your employees you will need to report the year-to-date salary and wage information, PAYG withholding and super information to the ATO.

STP does not change your payroll cycle or PAYG withholding and super contribution payment due dates
Full details of mandatory and voluntary information to be reported on STP can be found in the ATO guidelines – click here
If there is an error in your lodged reports you will have to lodge an update event within 14 days of identifying the need to correct or in the next regular pay event where the affected employee(s) have continuity of employment

Employers will no longer be required to provide Payment Summaries at the end of the financial year, payments will be included on a finalisation declaration. This declaration is made by providing a finalisation indicator for an employee as part of your STP reporting. Your employees will then be able to view this information as ‘tax ready’ in myGov
Superannuation liability information will be reported through STP. Super funds will also report to the ATO once payments have been made. This does not change your existing SuperStream obligations

What are the benefits of Single Touch Payroll?

As a result of STP legislation, countless small business is required to report their payroll information to the ATO digitally. That means it’s now mandatory for all employees – whatever their size, to adopt a compliant STP payroll or reporting solution, which will likely be software based.

How will you report through STP?

Your accounting or payroll software may already offer STP reporting as part of your existing software or as an additional service
You may ask a third party such as a registered Tax or BAS agent to report on your behalf through STP enabled software for you
The ATO provides a list of no-cost and low-cost STP solutions

Make sure you are STP ready

To make sure your business is STP ready, follow the guide below:

Check your employee records are accurate and complete in your STP software. This is also a good time to review your pay templates to make sure superannuation, PAYG withholding and other payment amounts are calculating correctly
Declare the information is true and correct each time you submit a pay event or an update event through STP, so ensure you have a standard process in place to verify this data
Ensure you talk to your key staff who will be responsible for running your payroll and make sure they have any necessary authorities in your payroll software
Once you submit your first pay event, you should be able to check your software for a successful status indicating the report was sent to the ATO. You can check the ATO Business Portal for prior lodgements (allow 72 hours for processing)

Want to know more?

Looking to learn more about Single Touch Payroll? If you have any queries or need assistance in preparing your business for Single Touch Payroll changes, get in touch with us know. Our professional Sunshine Coast bookkeepers will assist you with your queries and STP setup.

Fair Work Commission increases minimum wage by 3.0% to $740.80 per week

Fri, 31 May 2019 00:52:26 GMT

From 1 July 2019, all minimum pay rates in all modern awards as well the national minimum wage will increase by 3.0%.

The Fair Work Commission has announced that the national minimum wage will increase by 3.0% to $740.80 per week, or $19.49 per hour. The weekly rate is based on a 38-hour week for a full-time employee. This totals to an increase of $21.60 per week, or $0.56 cents per hour.

The Commission made the following comments in relation to the decision to award a lower increase than in the past 2017/2018 minimum wage review:

[10] We have decided to award a lower increase this year than that awarded last year having regard to the changes in the economic environment (in particular the recent fall in GDP growth and the drop in inflation) and the tax-transfer changes which have taken effect in the current Review period and which have provided a benefit to low-paid households.

[11] We are satisfied that the level of increase we have decided upon will not lead to any adverse inflationary outcome and nor will it have any measurable negative impact on employment. However, such an increase will mean an improvement in real wages for those employees who are reliant on the NMW and modern award minimum wages and an improvement in their living standards.

Who does the increase apply to:

The 3.0% increase applies to employees that get their pay rates from:

The national minimum wage - Applies to employees who aren’t covered by an award or agreement.
A modern award – For employees covered by an award, award rates will increase by 3.0%. If you are not sure which award applies, use Find My Award .

If you are covered by a registered agreement, you should check it to see whether this increase affects you.

The increase will also apply to:

junior employees
employees to whom training arrangements apply
employees with a disability

The increase does not affect employees who already get paid more than the new minimum wage.

Some penalty rates are changing too:

There will be further changes to certain penalty rates in some hospitality and retail awards from 1 July 2019, following a Commission decision in 2017.

For more information about what the changes are, who they affect and how they’re being implemented, visit the Penalty rates changes .

What happens next?

The Commission will issue draft determination and orders about how this decision affects modern awards. Pay rates in each award will be then updated.

With all these changes, Evolve Online Bookkeeping can help you if you have any enquiry about the wage increase and its application to your bookkeeping. We can assist you on updating your payroll for your affected employees. Contact us today and we will be glad to help you.

If you are a current client of Evolve Online Bookkeeping and we do your payroll, we will contact you once the new rates have been updated in the awards so that we can update your pay rates accordingly.

Default Superannuation Fund and Super Guarantee Forms

Sun, 17 Mar 2019 23:59:42 GMT

Here are the things to remember before you offer your employee the option to choose a super fund via the Super Guarantee Choice Form.

When you employ someone you have to provide them with several forms:

TFN Declaration
Super Guarantee Choice Form
Fair Work Statement
Any other document to obtain information you require such as bank account details and next of kin.

Before you offer your employee the option to choose a super fund via the Super Guarantee Choice Form, you must nominate a fund that you will pay their super into if they can't or don't choose their own fund. You give your employee the details of this fund in section B of the Standard choice form.

This fund is your ‘default fund’

The super fund you nominate must:

be a complying fund (one that meets specific requirements and obligations under super law)
be registered by the Australian Prudential Regulation Authority (APRA) to offer a MySuper product.

You may also need to look at the award your employee is under, as the award may stipulate who you can use an a default fund.

Your default fund must be willing to accept the contributions. Some funds will not accept members who don’t contribute more than a certain amount each year. You also want a fund that you don’t have to setup paper work each time. Ensure the fund will accept the contributions when you pay it using the auto super function in Xero . Contact the fund prior to offering it as your default fund and listed it in section B of the Standard Choice Form.

What if they have a fund, and haven’t provided it to me by the time I have to pay super?

Remember, that not having superannuation fund details is no excuse for paying superannuation late. This is why you have to have a default fund. If the employee doesn’t provide any information, you must pay into the default fund before the 28th day following the quarter.

What if I do pay their super late?

If you pay superannuation late, your business will not be entitled to a tax deduction for the amount. You may also be required to complete a Super Guarantee Charge Statement and pay the required fees.

The Super Guarantee Charge includes the amount of superannuation, interest at 10% and an administration fee of $20 per employee, per quarter. The unpaid amount is to be paid to the ATO, not the employees superannuation fund. If you paid late, you may be able to offset this amount against the charge.

Many businesses we talk to do not have a default fund setup and often wait for employee details, which costs them in the long run. Talk to our trusted bookkeepers and accountants about your requirements to ensure you don’t miss out on tax deductions and pay super when you are required.