Client Login
Ph: 08 9921 8218 | Em: info@encompasscpa.com.au

Photography by Debra Mitchell

Firm News

Older Entries

Building a sustainable lifestyle

While there have been no tax cuts for individuals in the Budget, the Government has introduced concessions in several areas addressing the cost of living.

Downsizing retirees

From 1 July 2018, Australians over the age of 65 can contribute the proceeds of downsizing into their superannuation. A non-concessional contribution of up to $300,000 can be paid to their super using proceeds from the sale of a principal residence that has been held for a period of at least 10 years. Contributions will not be subject to any age or work tests.

Affordable housing

To assist Australian households, in particular first home buyers, the Government will support households building deposits by providing access to their superannuation. This will be implemented from 1 July 2017 and will allow access to voluntary concessional contributions and non-concessional contributions to super of up to $15,000 per annum; $30,000 of which will be concessionally taxed. Withdrawals on these contributions can be made from 1 July 2018.

The Budget also imposes a $5000 annual levy that must be paid by foreign owners of Australian residential property that is under-utilised or not available for rent in an effort to contain the cost of rising rent.

Medicare

The establishment of the Medicare Guarantee Fund (MGF) from 1 July 2017 will provide funding to the existing Medicare Benefits Scheme (MBS) and the Pharmaceutical Benefits Scheme to ensure Australians have continued access to affordable health care. The MGF will attain revenue generated from the Medicare levy as well as a small portion of personal income tax.

The Government will provide $1 billion towards the reintroduction of indexation on specific areas of the MBS, including specialist procedures and diagnostic imaging fees.

Bulk billing of under 18-year-olds and concession cardholders will be encouraged through incentives introduced to general practitioners from 1 July 2017.

Higher Education

From 2018, fees for university students will increase by 7.5 per cent. More repayment options through the Higher Education Loan Program will be offered to assist students with this. For 2018 and 2019, universities will pay a 2.5 per cent dividend and will also be subject to measures creating greater accountability and transparency.

National Disability Insurance Scheme (NDIS)

The Medicare levy will be increased by 0.5 per cent from 1 July 2019 with one-fifth of its revenue going towards the NDIS Savings Fund to ensure all Australians with significant and permanent disability have adequate support and lifetime care.

An Independent NDIS Quality and Safeguards Commission has been funded through the budget, allowing for improved quality of safe services for those using the NDIS.

Posted on 10 May '17, under General News. No Comments.

Tips to get out of debt faster

An overwhelming majority of people will face debt at some point in their life.

Uncontrolled debt can easily snowball and severely impact an individual’s lifestyle and financial freedom.

Fortunately, debt is manageable and is often contingent upon an individual’s motivation to get rid of debt fast. Tackling debt is often a process of managing expenses against income and formulating a plan of attack. Here are three ways to get out of debt faster:

Stick to a budget
If you are looking to get out of debt quickly, it is critical to stick to a budget. A budget can help you achieve your financial goals and ensure you do not spend more money than you earn. Budgeting is a great way to review your current expenses and see where you can realistically cut costs. It is also a good way of allocating money for an emergency fund i.e savings for a medical emergency etc.

Don’t borrow more money
Although it seems glaringly obvious, it can be tempting to continue down the borrowing spiral. Avoid getting into any further debt by holding off financing more items, signing up for credit cards etc. Instead, focus on paying off your current debts and necessary living expenses and try to eliminate any unnecessary expenses, such as TV subscriptions, daily takeaway coffee and so forth.

Make extra repayments (if possible)
Any excess cash you receive, i.e tax return, ideally should go towards making extra repayments. Making extra repayments not only shortens the length of time to pay off your debt but saves you paying more money on interest. Be sure to check with your credit provider if extra fees will be incurred for extra repayments.

Posted on 9 February '17, under General News. No Comments.

Thinking about your cash flow

If the three most important things in real estate are “location, location, location,” the first three rules of business are “cash, cash, cash.” It is necessary to be profitable, but “profit” is a number that shows up on your accounts at the end of the year; cash is the money you have in the bank. In a small business, it is cash that determines whether you can pay your bills.

Businesses can’t get money in unless they get their invoices out. However, many business people delay sending out their bills. This may be because they feel uncomfortable asking someone for money, afraid of being challenged on how much they’ve billed, or just too busy working to bill for it. The longer you wait to send out your invoices, the greater the chance you won’t get paid.

No matter what business you’re in, you’re going to have a lag between outgo and income. If you’re a consultant, you have to pay for your phone, stationery, marketing materials, and rent before you get your first client. Once you’ve got them, you’re not going to see complete payment for at least 30-60 days after you finish a project. Things are much worse if you’re a manufacturer. You’ve got to pay for raw materials and equipment many months before you’ll see final payment.

Draw up a cash flow projection. Even if you don’t write up a budget or income statement, it is a good idea to sketch out when you expect money to come in and when you need money to go out. In your projection, be sure to include:

Posted on 16 October '15, under General News. No Comments.

Utilise your small team for success

Small teams provide many benefits to both employees and employers. In comparison to larger teams, small teams are shown to have higher levels of productivity and effective communication. However, a vital component to the success of these teams relates to the support and coordination provided by management. Ways to maximise your small team’s efforts can include:

Cross-functional communication
If your employees understand how the other functions of your business work and how their work will directly impact all aspects of the business, it can provide them with more responsibility. It allows for all staff to work towards a common goal. The key is to provide staff with holistic training and education that fosters greater understanding.

Delegate with descriptive job roles
Delegation can provide employees with guidance on what needs to be achieved to reach the end goal. It can provide clear direction for staff while employers can oversee budget and timing schedules. It also allows the employer to focus on other opportunities such as business growth.

Break down large goals into small, achievable tasks
It is important to keep in mind the overall strategic goals when completing daily tasks. The daily tasks set should directly correspond with the larger goals. Reframe the way your employees can view large goals by sticking to the SMART principle that includes specific, measurable, achievable, realistic and timely objectives.

Posted on 16 October '15, under General News. No Comments.

What is a transition to retirement strategy?

A transition to retirement (TTR) strategy is ideal for those Australians looking to ease into retirement by slowly reducing their working hours.

It is the kind of pre-retirement strategy that allows individuals to continue working while drawing down some of their superannuation benefits at the same time.

TTR uses a portion of an individual’s super to create an additional income stream (a retirement income account) while they are still working. The super account continues to receive contributions from the individual’s employer and any before-tax (salary sacrifice) contributions. The retirement income account uses some of the super savings to provide regular payments that top up the individual’s income.

Prior to the government introducing the TTR strategy, an individual could only access their super fund once they turned 65 or retired. Under the new TTR rules, an individual must be over the age of 55 and under the age of 65 to access the strategy.

The benefit of a TTR strategy is the fact that an individual can boost their superannuation savings while easing into retirement and pay less tax at the same time.

The investments in the super fund are free of CGT and earnings tax while an individual draws on their super, so a transition to retirement income stream provides some benefits beyond saving income tax.

Posted on 16 October '15, under General News. No Comments.

SMSF’s under scrutiny for ‘loose’ loans

The ATO has reiterated it will be investigating self-managed super fund members who have an estimated $600 million in related-party loans for shares and property in their funds.

Some members are taking out loans with a related party, which refers to friends, associates or family, on terms more favourable than what might have been attained from a bank. The tax office is concerned that these loans are not being made and maintained on a strict commercial basis and so, are breaching regulations. The ATO is willing to assist members who are caught up in such arrangements and resolve any issues.

There are certain characteristics that can help lenders identify these inappropriate loans:

– no compensation.

– no repayments.

– a single lump sum when the loan term ends.

– the loan amount provided for 100 per cent of the value of the assets purchased.

– the lender has not sought personal guarantees from the members of the fund.

Posted on 22 June '15, under General News. No Comments.

newsletter

Posted on 1 October '13, under General News. No Comments.

newsletter

Posted on 1 October '13, under General News. No Comments.

Budget 2013:Medicare Levy increase affects small business

The increase in the Medicare levy from 1.5 per cent to 2 per cent, will effectively bring the top marginal tax rate to 47 per cent. This will not only impact on individual taxpayers but will have a flow on effect to small businesses. A number of tax laws that businesses regularly comply with apply the top marginal income rate as a penalty rate of tax.

As a result, the following common tax items will be subject to tax of 47 per cent, up from the previous 46.5 per cent:

–          Fringe Benefits Tax (FBT)

–          TFN and ABN Withholding Tax

–          Family Trust Distributions Tax

–          Trusts, where Section 99A applies to retained income

–          Excess non-concessional contributions to super (with tax on excess concessional contributions to increase to 32%)

Posted on 16 May '13, under General News. No Comments.

Budget 2013: Personal income tax rates

The 2013 Federal Budget, released on Tuesday contained a number of significant taxation changes that will impact on individual taxpayers.

Personal Income Tax Rates

Although individual income tax rates have remained unchanged, changes that were due to apply from 1 July 2015 have been deferred. Initially, the tax free threshold was set to increase from $18,200 to $19,400. The current legislated rates applicable for the 2013/14 income year are set to remain in place until 2017/18.

Tax rates for non-residents

For the 2013/14 income year, non residents will pay a flat rate of 32.5 per cent on all taxable income up to $80,000. For taxable income exceeding $80,000, the marginal tax rate for non-residents are the same as those for resident individuals. Proposed legislation to remove the capital gains tax discount for non-residents seems to be on schedule to be introduced in the final few weeks of Parliament.  Finally, non-residents will be subject to a non-final withholding tax of 10 per cent of the proceeds from the sale of certain taxable Australian property with effect from 1 July 2016.

Posted on 16 May '13, under General News. No Comments.

« Older Entries   

Contact Us

You can contact us at the following;

Office Location
18 Francis Street
GERALDTON WA 6530

Mailing Address
PO BOX 1865
GERALDTON WA 6531

Phone: 08 9921 8218
Fax: 08 9964 3818
Email: