UPDATE: FEBRUARY 2014
Small business – wow … what a ride!
We see the challenge for small business as generating a return on money invested. A very simple check - is the return on funds invested (not your labour), better than you would have earned if the money was in a bank term deposit?
As an idealist you set out in business to:
· build a revenue line,
· incur expenses to supply a product or service,
· employ a team to help you make it happen, and
· plan to make a profit.
You take this on with all the complexities and regulations in that journey. How is it working out for you?
A key element of the success of any business is the economy. Has it turned the corner?
Not sure how you are finding trade in your business, but listening to clients, reading the press, and listening to TV commentators, we are left with the impression the economy is on the mend. We are being told to spend up … how do you as an individual feel about that?
The US has started to taper money printing, down from US$85 billion a month to US$65 billion per month. (US$65 billion is still a staggering number!) The reason given - an improving US economy does not require as much government support. Good news … we hope.
Sadly in Australia, you would not want your business relying on the auto sector as a revenue driver – first Ford announce they are closing their manufacturing facility, then Holden, now Toyota. Despite a lot of finger pointing at state and federal levels of government as to the reason for the scheduled closures (2016 and 2017), the ramifications for employment, income and subsequent spending in Australia will be huge.
As a business owner, we suggest you be mindful in your decision making. Please be wary of the ATO. The ATO signalled that it is no longer prepared to support struggling businesses through financing business operations via unpaid tax and superannuation obligations.
In July 2012, the ATO made significant changes to the directors Penalty Notice regime. The primary reason: break down the safety/liability fire wall between directors and companies, and liability for unpaid PAYG withholding and Superannuation obligations.
In recent months, there has been an increase in activity by the ATO against businesses who are behind in the lodgement of their business activity statements and tax returns. This recent crackdown means that many businesses operating through companies and the directors face the possibility of prosecution or fines imposed if they do not comply.
To discuss how any of the above might relate to your business, please feel free to call the office.