The advent of cloud accounting has changed the face of bookkeeping and accounting for small businesses across Perth and the broader Western Australian region. And a common question for a start-up business is – should I start off with Xero or MYOB? And for those start-up owners who don’t like reading – our endgame answer is that Xero will work better. And if your business is established and growing the answer is not so clear cut – so read on.

As businesses from Perth expand internationally looking for growth the difficult issue of offshore taxation becomes relevant. In effect as you generate profits from another country – that country will seek to tax those profits in that other country. And understanding offshore taxation requires clarity on the tax regimes in both countries.

Across Perth and wider Western Australia business owners are faced with ensuring that their staff and team members are wearing face masks and PPE to come to work. And typically the provision of this personal protective equipment in a tax effective way is of up most importance to ensure that your team is functional and working well.

The cost of land tax is a commonly overlooked tax within Perth’s tax advisors. The common focus on the “big” taxes of income tax, main residence exemption, CGT, GST and the 50% CGT discount is a primary driver for many families structuring their investments. However as a family grows their property investment portfolio the land tax cost is real and continues to grow. And simply because commercial property investors can “pass on” the cost of land tax to the tenants does not mean that the land tax has not been paid by the landlord. A tenant will effectively view the total rent payable to the landlord – including land tax. If the variable outgoings for a property are high (due in part to land tax) then the amount of rent payable to the property, by market forces, is lower.

With the property market booming across Perth the tax structuring and asset protection for property investment is becoming a significant focus. And while no “one size fits all” approach ever works with tax advisory, the importance and benefits of a unit trust to acquire and hold residential and commercial property is increasingly important.

The practice of issuing a quote to your customers is an important part of running a small to medium sized business and should be part of your overall business plan. The quote will give your customers an indication of price, service expectations and turnaround times. Around Perth the practice of requesting a quote is now an accepted business practice for many industries (including accounting businesses). A quote can also help you understand your future cashflow forecast as converted quotes become sales which then results in cash. However, the tiresome process of preparing, issuing and tracking quotes for many new businesses has meant that this process is often overlooked.

Over the summer holidays a lot of small to medium business will have a small to non-existent finance team as everybody starts to go on holidays – especially in Perth where the weather is so good. And this concern is even more so for family business’s when a family member is given the role of either managing the cashflow or controlling the finance staff to manage cashflow. If your team for the business is on leave the bills do not stop and neither do wages. So, managing cashflow over this period when everybody is focused on the festive season is an important part of running the business.

Purchasing cars for many small and medium businesses can be a significant cost. And as accountants in Perth, we have clients with a single car salary packaged in the business and clients with a fleet of over 50 cars. Regardless of the size of your business the cost of buying, running and maintaining a car comes with a significant tax cost.

If you run a small to medium business through a company you are likely enjoying a lower tax rate. The company tax rate is currently at 25% for a trading business (<$50m) which compares well to the individual highest tax rate of 47%. The tax rate differential is an incentive for many Perth based small to medium businesses to have their business profits taxed at the 25% rate and then for the companies to lend the profits to the shareholders. The loan effectively means that the shareholders can enjoy the profits at the 25% tax rate compared to what would otherwise be taxed at the 47% tax rate. The tax law contains a deep area within the Tax Act (Division 7a) that is directed at ensuring that the tax advantage with private company loans is effectively reversed over a period-of-time. And the law is comprehensive and contains a myriad of options to deal with the complexity of business and the reasons why companies lend money to the shareholders.

Many business plans are not created for the owner. The business plan might simply be a tool to get bank finance, entice an investor into your business or they might be drafted to assist in getting a government grant.

The introduction of “stapled super” has been effective from 1 November 2021. And many employers around the country – from Perth to Melbourne – are not yet fully across their new obligations.

As a business employer you have an obligation to pay superannuation on behalf of your staff. And the tax penalties and tax administration of the superannuation guarantee system is complex and littered with multiple tax penalties ranging from higher superannuation, administration fees, loss of tax deductions and interest costs. The SGL applies to employment Australia wide – so workers in Perth or interstate will attract SGL for their employer (whether based in Western Australia, Victoria or elsewhere).