Where to next?
This is what we’re asked by many people and the reason why our clients chose Hayes Knight.
Our clients know we are good at the fundamentals – accounting, tax compliance, and audit – but they come to us because not only are we good at the fundamentals, we have the expertise to help them identify, structure, and secure, their future … their next step.
The 1 April Salary Packaging Trap
Why a tax on high income earners will disadvantage many with salary packaging agreements.
In last year’s Budget, the Government introduced a 2% ‘debt tax’ on high income earners – the temporary budget repair levy. Unlike many other announced Budget changes, the debt tax bill passed Parliament in record time – 12 sitting days with no amendments.
While the debt tax itself only directly affects those with taxable income above $180,000, there are a number of other tax changes that came in with the debt tax that affect everyone else.
To prevent high income earners planning around the debt tax, the Government increased the Fringe Benefits Tax (FBT) rate from 47% to 49% from 1 April 2015 – bringing it in line with the top marginal tax rate. Like the debt tax, the FBT rate change is temporary, with the tax scheduled to reduce back to 47% on 1 April 2017.
The gross up rate for reportable fringe benefits also increases from 1 April 2015 – 2.1463 for type 1, and 1.9608 for type 2 (type 2 is used for employee payment summaries). Read on…
In the Company of Strangers
Should your business bring in investors?
Sometimes the difference between a good business and a great business is simply having sufficient capital to execute your business plan. For many businesses, the owners have put everything they have into growing the business but there is still a gap. Investors offer an opportunity to close that gap, but at what cost?
How do you know you need investors?
Unfortunately, most businesses seek investment funding at the point it is most critical or for the wrong reasons – seeking funding for a business when it is in financial distress is always going to be hard. Neediness is never a good negotiating position or very attractive. And, few will be prepared to invest to save you.
Funding from investors is used to fund growth where a major investment is required – where the business cannot service its growth or capital requirements and these requirements are greater than what the business can fund on its own.
On most occasions, investment is needed to build out scale and take advantage of the potential of the business. In many cases the owners can only afford to fund a portion of what is required but the scale they need will make the difference between an okay business and a great business. More….