Business Update – 22 April 2021
Welcome back to our Business Update!
Australia- New Zealand Travel Bubble Now Open
The long-anticipated travel bubble between Australia and New Zealand started on Monday, marking the first step towards the gradual reopening to the rest of the world. Since October, Australia allows New Zealanders to arrive without going into quarantine, but New Zealand has taken a more cautious approach.
The start of this travel bubble comes ahead of the New Zealand ski season and is welcome news for many tourist towns, including the ski resort of Queenstown.
Australia to Speed Up COVID-19 Vaccine Rollout to Over-50s
Australia is planning to accelerate its COVID-19 vaccine rollout to those over 50 years old after advising under-50s not to get the AstraZeneca vaccine due to blood clot side effects.
State leaders agreed to bring forward vaccinating over-50s, going beyond frontline workers, the elderly, the disabled and people with underlying medical conditions. So far, 1.59 million shots have been given out of the 25 million population.
Besides the concerns about the AstraZeneca vaccine, the vaccination programme has also stalled due to supply hold-ups in Europe.
Australian Government Disaster Recovery Payment and Disaster Recovery Allowance Expanded for WA Cyclone
The federal government had expanded the Australian Government Disaster Recovery Payment (AGDRP) and Disaster Recovery Allowance (DRA) to cover more local government areas. Carnamah, Chapman Valley, Greater Geraldton, Mingenew, Morawa, Perejonori and Three Springs will now have access to the emergency grants which have seen more than $300,000 paid out so far.
The AGDRP is a one-off $1000 payment for adults and $400 for children who have been either seriously injured or had their homes damaged. Meanwhile, DRA is up to 13 weeks of income support for people who cannot get to work or whose place of work has been affected.
You can find out more and check your eligibility here.
$2000 Upfront Cash So Unemployed Move for Work
Starting in May, job seekers will get up to $2000 upfront if they move to a new location for ongoing work. Job seekers will get help relocating for jobs offering at least 20 hours a week, instead of the existing threshold of 30 hours.
Changes for Employee Superannuation Options
From the 1st of January 2021 the law relating to employees and their choice of superannuation fund has changed.
New workplace determinations and enterprise agreements made on or after this date must now offer employees the right to choose the super fund to which you pay their compulsory super contributions.
Once a new determination or agreement is in place, an employer needs to offer choice of super fund to:
- Existing employees who request to choose their super fund.
- All new employees.
An employee can nominate their fund by completing the standard choice form through ATO online services linked to their myGov account.
Alternatively, employers can give their employee a Superannuation (super) standard choice form to complete.
An employer must then pay the employee’s compulsory super to their nominated fund.
If an employee doesn’t nominate a fund, an employer can continue to pay an employee’s super to the same fund previously contributed to, or into a default fund.
Source: ATO – Employees now have more super choice
Note: This is not the same as the legislation implemented on the 1st of July 2005, where the primary objective was to make it law to give employees the right to choose which superannuation fund will receive their employer superannuation contributions. This change is in regard to agreements made at an enterprise level between employers and employees and their union, about terms and conditions of employment.
Upcoming Key Dates
Upcoming key lodgment and payment dates for businesses:
- Lodge and pay quarter 3, 2020–21 activity statement if electing to receive and lodge by paper and not an active STP reporter.
- Pay quarter 3, 2020–21 instalment notice (form R, S or T). Lodge the notice only if you are varying the instalment amount.
- Make super guarantee contributions for quarter 3, 2020–21 to the funds by this date.
- Lodge TFN report for closely held trusts if any beneficiary quoted their TFN to a trustee in quarter 3, 2020–21.
- Lodge lost members report for the period 1 July 2020 to 31 December 2020.
Fringe Benefits Tax Return
- The FBT year runs from 1 April to 31 March
- If you have an FBT liability lodgment, payment is due by 21 May 2021.
ATO – Fringe Benefits Tax Return
What Does It Take to Grow Profitably?
When you ask entrepreneurs what their business goals are, one of the most common answers will be something to do with growth. However, the real challenge is achieving both growth and profitability.
This Forbes article discussed how to grow profitably based on the model by Daniel Marcos of The Growth Institute. According to this model, different strategies are required depending on where a business is at in its development.
Startup stage (1-5 employees)– Focus on total revenue. Prove the business model and reach breakeven first. Learn who your more profitable customers are and build systems around delivering your products and services.
Grow up stage (6-15 employees)– Add the right revenue. Conduct an analysis of your gross profit to determine the customers you want to build processes around. It may be a difficult mind shift, but learn to say no to the customers that are not a good fit for your business.
Scale-up (16-100 employees)– Concentrate on the cash flow aspect of your business. Many companies grow too fast and flame out. So in order to not outrun your cash flow, you should know the cost of acquiring a new customer.
Ideally, you’d want the revenue generated by new customers to offset the cost of acquiring them. You want to have net cash flow from growth that you can fund through your operating profit.
Besides working on your cash flow, you must also continue refining the processes you started in earlier stages, growing your people, and adding talent with new skills that can help you in scaling up.
Get in touch
Contact us if you have any questions or want to discuss the next steps for your business.