Business Update – 2 June 2021
Welcome back to our Weekly Digest. Read on for the latest updates and some ideas to help us all move forward.
Melbourne to Stay in Lockdown For Another Week
Melbourne’s lockdown has been extended for another seven days, but stay-at-home measures will be lifted in regional Victoria.
Residents of Greater Melbourne will only have five reasons to leave home: shopping for food and supplies, authorised work and education, care and caregiving, exercise (up to 2 hours and with one other person only), and getting vaccinated.
Meanwhile, the rest of Victoria will have relaxed restrictions from 11:59 pm on Thursday. Here is a roundup of the restrictions that will be in place for regional Victoria.
New Zealand’s Travel Bubble Pause With Victoria Extended
New Zealand has extended its travel bubble pause with Victoria until 7:59 pm on 4 June (Friday), as the new community COVID-19 outbreak in Melbourne continues to grow.
The New Zealand government has implemented new pre-departure testing measures on 31 May from 11:59 pm. Under new restrictions, travelers flying to New Zealand must now return a negative COVID-19 test within three days of departure if they have been in Victoria on or after 20 May. Those who have been to Victoria since 7.59 pm on 25 May will not be allowed to travel to New Zealand.
Australians must keep evidence of a negative COVID-19 test result at all times. Failure to produce evidence could result in being denied boarding or being subjected to penalties upon arrival in New Zealand.
4.24 Million COVID-19 Vaccine Doses Administered
Minister of Health and Aged Care Greg Hunt announced in a press conference on 31 May that a total of 4.243 million doses have already been administered nationally. The government was able to double their vaccinations over the course of a four-week period.
Q1 Business Investment Booms
Australian business investment rose by the most in nearly a decade for Q1, as business owners took advantage of tax breaks to purchase new machinery.
Data from the Australian Bureau of Statistics showed capital expenditure increased 6.3% in the March quarter compared to the previous quarter. This is above market forecasts of a 2% increase, and suggests that economic growth could also beat forecasts.
Considering a big purchase in your business? Get in touch with us to chat through your options.
Australian Home Prices Surge
Australian home prices increased in May and approvals to build new houses hit record highs due to low interest rates. This adds another challenge for the Reserve Bank of Australia (RBA), which wants to keep rates low until inflation recovers.
Latest data from property consultant CoreLogic showed national home prices surged 2.2% in May, representing its eighth consecutive monthly increase and second fastest since the late 1980s. Meanwhile, data from the Australian Bureau of Statistics showed approvals to build new houses skyrocketed 67.4% in April from a year ago.
Record low rates and the government’s HomeBuilder incentive has pushed the housing demand higher. The RBA kept the interest rate at 0.1% for June.
QLD Small Business Grants
The Queensland Government announced the Business Basics, Business Boost, and Business Growth Fund worth $25 million over two years.
- Business Basics grants of up to $5,000 each support new and emerging businesses to boost core capabilities and adopt best practices. Applications will open on 31 May 2021.
- Business Boost grants of up to $15,000 will help small businesses to improve their efficiency and productivity through organisational development and upgrades. It can be used for website development, strategic marketing, training, advisory services, and planning for business continuity and succession. Application will open by late July 2021.
- Business Growth Fund grants of up to $50,000 will allow businesses to purchase highly specialised equipment to accelerate growth. Applications have opened on 11 May 2021.
More information can be found here.
WA: $14.5 Million Boost for Community and Mental Health Services in WA
The Western Australian government has delivered an additional $14.5 million in funding and extended contracts for 12 months to ensure the continuation of important community and mental health services.
JobMaker Hiring Credit’s Second Claim Period Now Open
The second claim period of the JobMaker Hiring Credit is now open. So if you’ve taken on additional young employees between 7 January and 6 April 2021, you may claim the following payments:
- up to $10,400 over a year for each additional eligible employee aged 16 to 29 years
- up to $5,200 over a year for each additional eligible employee aged 30 to 35 years
Register any time until the scheme ends.
Providing Health Care Remotely During COVID-19
From 13 March to 30 June 2021, new temporary MBS (Medicare Benefits Schedule) telehealth items have been made available to help reduce the risk of community transmission of COVID-19. You can find the temporary Medicare items that will help health care practitioners deliver telehealth services via phone or video conferencing here.
Wage Subsidy Scheme for Apprentices to Be Expanded
The government will spend $1.2 billion to expand its wage subsidy scheme for apprentices, as JobKeeper ended last month.
Under the apprentice scheme, the government will pay half the wages of apprentices up to a maximum of $7,000 each quarter for 12 months. It will run until September 2022. Ask us if you have any questions.
EOFY tips for small businesses
- Get your accounts in order in a cloud accounting system. Get in touch with us so we can recommend the right software for your business.
- Get in touch with your accounting advisor now to see if you can take advantage of tax minimisation schemes like the loss carry back tax offset scheme.
- If cashflow permits, you may consider bringing forward some expenses or purchasing capital assets that will help you save time or generate more money. This will allow you to make the most of the instant asset write-off scheme.
- Seek an accountant who can translate the tax jargon, COVID schemes and deadlines into plain and simple English.
We’ll help you get ready for EOFY, without the stress. Chat to us if you have any questions.
Income Statements can be found in myGov in July
Since Single Touch Payroll (STP) came into place in 2019, payment summaries (previously called Group Certificates) now known as Income Statements can be accessed through myGov. These are no longer directly provided by employers. This will be prepared and ready for employees by 14 July if your or 31 July, depending on if the employer has 20+ employees or 19 or less respectively.
Upcoming Key Dates
Upcoming key lodgment and payment dates for businesses:
- Lodge tax return for all entities with a lodgment due date of 15 May 2021 if the tax return is not required earlier and both of the following criteria are met:
- non-taxable or a credit assessment in latest year lodged
- non-taxable or receiving a credit assessment in the current year.
- Lodge tax returns due for individuals and trusts with a lodgment due date of 15 May 2021 provided they also pay any liability due by this date.
- Lodge and pay May 2021 monthly business activity statement.
- Lodge and pay 2021 Fringe Benefits Tax annual return if you have a tax agent that lodges your return electronically.
- Super guarantee contributions must be paid by this date to qualify for a tax deduction in the 2020–21 financial year.
Contact us if you have any questions.
SME Recovery Loans open until 30 June
The Government’s SME Recovery Loan Scheme is open to small-medium businesses with a turnover of up to $250 million that were recipients of JobKeeper or were affected by floods in certain areas. This Scheme means the Government will guarantee 80% of the loan amount. You can find more details and eligibility criteria here, but please get in touch if you have any questions.
Debt Management Tips for Entrepreneurs
When building a business from the ground up, you may get to a point where you need to take on some debt in order for your business to take off or grow. This Forbes article differentiates good debt from bad debt, shares some ways to avoid bad debt, and provides some tips to manage debt.
Below is an overview of the effective debt management tips for entrepreneurs shared in this article:
- Analyse your budget regularly– Know where your money is going and find ways so debt won’t get accumulated.
- Identify the most appropriate sources of financing– Typically, there are two primary sources of funding for small business owners: debt from banks and financial institutions and debt from family and friends.
- Consolidate debt payments– Combine short-term loan payments into a more significant debt payment to preserve the business’ credit score. If your debts are piling up, try to negotiate with creditors to set a more reasonable credit limit.
- Create a contingency plan– Establish a contingency plan in place and have enough liquid assets to repay huge liabilities.
Financial assessments, proper debt management, and growth plans are important to run a successful business. Need help getting a grip on your business finances? Book a one-on-one consultation with us today!
Get in touch
Contact us if you have any questions or want to discuss the next steps for your business.