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The 2020-21 Federal Budget is a road to recovery paved with cash.

Click Here to Download our detailed Budget 2020-21 Client Guide

Below is a summary of key initiatives that may be applicable to you:

Personal income tax cuts from 1 July 2020

Bringing forward the personal income tax plan will:

  • Increase the top threshold of the 19% tax bracket to $45,000 (from $37,000)
  • Increase the top threshold of the 32.5% tax bracket to $120,000 (from $90,000)
  • Increase the low income tax offset from $445 to $700

In addition, the LMITO (low and middle income tax offset), which provides a reduction in tax of up to $1,080 for individuals with a taxable income of up to $126,000, will be retained for 2020-21.

A $4 billion ‘JobMaker’ Hiring Credit to encourage businesses to take on additional employees aged 16 to 35 years old

The JobMaker Hiring Credit will be available to eligible employers over 12 months from 7 October 2020 for each additional new job they create for an eligible employee.

Eligible employers will receive:

  • $200 per week if they hire an eligible employee aged 16 to 29 years or
  • $100 per week if they hire an eligible employee aged 30 to 35 years.

The JobMaker Hiring Credit will be paid quarterly in arrears. It will be available for up to 12 months from the date of employment of the eligible employee with a maximum amount of $10,400 per additional new position created.

Immediate deductions for business investment in capital assets

The Government is really keen for business to invest. This measure enables businesses with an aggregated turnover of less than $5 billion to fully expense the cost of new depreciable assets and the cost of improvements to existing eligible assets in the first year of use. This means that an asset’s cost will be fully deductible upfront rather than being claimed over the asset’s life.

While many businesses were already eligible for an instant asset write-off for asset purchases of up to $150,000, this measure does not cap the asset’s cost, and eligibility for the higher instant asset write-off has been significantly broadened and extended (the existing $150,000 instant asset write-off applies to businesses with turnover less than $500 million and will not apply to purchases after 31 December 2020).

Changes to how companies can manage losses

Companies with an aggregated turnover of less than $5 billion will be able to carry back losses from the 2019-20, 2020-21 and 2021-22 income years to offset previously taxed profits in the 2018-19, 2019-20 and 2020-21 income years.

Under this measure tax losses can be applied against taxed profits in a previous year, generating a refundable tax offset in the year in which the loss is made. The amount carried back can be no more than the earlier taxed profits, limiting the refund by the company’s tax liabilities in the profit years. Further, the carry back cannot generate a franking account deficit meaning that the refund is further limited by the company’s franking account balance.

The tax refund will be available on election by eligible businesses when they lodge their 2020-21 and 2021-22 tax returns.

Access to generous tax concessions for a wider range of businesses

Including:

  • Immediate deduction for certain start-up expenses
  • Immediate deduction for prepaid expenditure
  • FBT cark parking exemption
  • FBT exemption on portable electronic devices
  • Simplified trading stock
  • PAYG instalments based on GDP adjustment amount
  • Simplified accounting methods

Please contact our office on (02) 9531 0922 for any queries you might have regarding these announcements.

Government Announces Further Changes to JobKeeper Payment Eligibility Tests

 

 

On the 7th of August 2020, the Government announced adjustments to JobKeeper extension tests for both business and employee eligibility – now referred to as JobKeeper 3.0.

Both of these eligibility requirements are being relaxed to help increase the amount of businesses that have access to the extended JobKeeper payments, primarily in the wake of tougher restrictions imposed in Victoria. The adjustments contained within JobKeeper 3.0 will apply nationwide.

Adjustments to employee eligibility

From 3 August 2020, the relevant date of employment (which is used to determine an employee’s eligibility to JobKeeper) will move from 1 March 2020 to 1 July 2020. This is designed to increase employee eligibility for both the existing JobKeeper scheme, as well as for the new extension periods from 28 September 2020. Casual employees will still be required to have been employed on a regular and systematic basis for a minimum of 12 month.

Adjustments to the ‘Decline in Turnover Test’

Previously to be eligible for the JobKeeper Extension Period 1 (i.e. from the 28th of September to the 3rd of January 2021), businesses needed to demonstrate a decline in turnover in both the June 2020 quarter AND the September 2020 based on their actual GST turnovers.

Under the new requirements announced on the 7th of August, businesses only need to demonstrate a significant decline in turnover in the quarter of September 2020.

To be eligible for the JobKeeper Extension Period 2 (i.e. 4th of January 2021 to the 28th of March 2021), businesses now only need to demonstrate a significant decline in turnover in the December 2020 quarter.

Under the previous scheme, businesses needed to demonstrate a decline in turnover in the June, September AND December 2020 quarters.

It is important to note that the applicable rate of decline in turnover remains unchanged. That is, there must bee a 30% decline in turnover relative to the same quarter in the previous financial year (or 50% for entities with an aggregated turnover of more than $1 billion and 15% for ACNC-registered charities)

Furthermore, the dual payment rate system originally proposed in JobKeeper 2.0 will remain, with the full rate of payment decreasing from $1,500 to $1,200 per fortnight from 28 September 2020 and then to $1,000 per fortnight from 4 January 2021. The proposed reduced rates (being $750 from 28 September 2020 and $650 from 4 January 2021) will also remain for employees and business participants who worked fewer than 20 hours per week in the relevant period.

Contact our office on 02 9531 0922 to discuss how these changes will affect your businesses future eligibility and see the below resources for more information.

Posted on the 10-08-2020

The Future of JobKeeper

 

On 21 July 2020, the Government announced an extension of the JobKeeper program to 28 March 2021 but with tighter access and reduced rates. From 28 September 2020, employers seeking to claim JobKeeper payments will need to reassess their eligibility and prove an actual decline in turnover.

If your business currently receives JobKeeper, your arrangements will generally remain unchanged until 27 September 2020.

Eligibility of the JobKeeper 2.0

To receive JobKeeper payments from 28 September 2020, businesses will need to meet the basic eligibility tests and an extended decline in turnover test based on actual GST turnover. The

  • For the period of 28 September to 3 January 2021 – Actual GST turnover in the June and September 2020 quarters fell by at least 30% (15% for ACNC-registered charities, 50% for large businesses) compared to the same periods in 2019. The decline for both of the quarters needs to be met to continue receiving JobKeeper payments.
  • For the period of 4 January 2021 to 28 March 2021 – Actual GST turnover in the June, September and December 2020 quarters fell by at least 30% (15% for ACNC-registered charities, 50% for large businesses) compared to the same periods in 2019. The decline for all three of the quarters needs to be met to continue receiving JobKeeper payments.

The Commissioner of Taxation will have discretion to set out alternative tests that would establish eligibility in specific circumstances where it is not appropriate to compare actual turnover in a quarter in 2020 with actual turnover in a quarter in 2019, in line with the Commissioner’s existing discretion.

Eligible employees

Employee eligibility will remain broadly the same but the value of the payment will change from 28 September based on average weekly hours in February 2020. As a reminder, the eligibility requirements for employees can be found here.

The new JobKeeper rates that apply for future periods are as follows.

  • 28 September to 3 January 2021
    • $1,200 per fortnight per employee or business participant who worked > 20 hours per week
    • $750 per fortnight per employee or business participant working < 20 hours per week
  • 4 January 2021 to 28 March 2021
    • $1,000 per fortnight per employee or business participant who worked > 20 hours per week
    • $650 per fortnight per employee or business participant working < 20 hours per week

Will I continue to receive the JobKeeper until September?

If your business and your employees passed the original eligibility tests to access JobKeeper, and you have fulfilled your wage requirements, you can continue to claim JobKeeper up until the last JobKeeper fortnight that ends on 27 September 2020.

Click Here to view the full JobKeeper 2.0 Guide or contact our office on 02 9531 0922 to discuss how these changes will affect your businesses future eligibility.

Posted on the 22-07-2020

Payment Summaries and STP

The introduction of Single Touch Payroll (STP) has changed the year end processes for both employers and employees. Payment Summaries (or Group Certificates) are now a thing of the past, with income statements replacing these. Here’s what it means for both employers and employees:

Employers

Employers no longer need to provide payment summaries to your employees or lodge a payment summary annual report with the ATO. STP replaces this need as information that is reported on these forms have already been reported to the ATO when you file your pays.

Submitting an STP Finalisation is easy and XERO have provided some easy to follow instructions for this: https://central.xero.com/s/article/Finalise-Single-Touch-Payroll-data

We recommend that you let your employees know that they will no longer be receiving a payment summary. Once the STP Finalisation has been submitted, we should advise your employees that the income statement is ‘tax ready’ and that they can proceed with preparing their 2020 income tax returns.

For the 2020 financial year, the finalisation declaration deadline is:

  • 31 July if you employ 19 or fewer employees
  • 14 July for businesses with 20 or more employees

Employees

Instead of receiving payment summaries, employees will find their year-end income information on ATOs Online Services – being either MyGov if they prepare their return themselves; or through the Tax Agent Portal if they have an accountant prepare them.

Once you have been advised by your employer that your income statement will display as ‘tax ready’, meaning your tax return is ready to complete.

As your registered tax agent, we have access to your income summary from ATOs Online Services. So the good news for you is that there is no longer a need to  – provided your employer has submitted the STP Finalisation.

If your income statement doesn’t not display as ‘tax ready’ by the due dates above, we recommend contacting your employer to discuss this further.

Please don’t hesitate to contact our office on 02 9531 0922 if you have any queries regarding this new process.

Posted on the 16-07-2020

$1,500 JobKeeper subsidy to keep staff employed

A subsidy of $1,500 per fortnight per employee, administered by the ATO, will be paid to businesses that have experienced a downturn of more than 30% (50% for businesses over $1bn). 

To be a part of the subsidy, employers will need to ensure that their employees receive at least $1,500 per fortnight (before tax). See the example below.

Eligibility

There are two levels of eligibility; for employers and employees.

Eligible employers are those with:

  • Turnover below $1bn that have experienced a reduction in turnover of more than 30% relative to a comparable period 12 months ago (of at least a month); or
  • Turnover of $1bn or more that have experienced a reduction in turnover of more than 50% relative to a comparable period 12 months ago (of at least a month); and
  • Are not subject to the Major Bank Levy.

Sole traders and the self-employed with an ABN, and not-for-profits (including charities) that meet the turnover tests are eligible for the JobKeeper payment.

Eligible employees are those who:

  • Were employed by the relevant employer at 1 March 2020; and
  • Are currently employed by the employer (including those who have been stood down or re-hired); and
  • Are full time, part-time, or long term casuals (a casual employee employed on a regular basis for 12 months as at 1 March); and
  • Are at least 16 years of age; and 
  • Are an Australian citizen, hold a permanent visa, are a Protected Special Category Visa Holder, a non-protected Special Category Visa Holder who has been residing continually in Australia for 10 years or more, or a Special Category (Subclass 444) Visa Holder; and
  • Are not in receipt of a JobKeeper Payment from another employer.

While it appears that businesses without employees can potentially qualify for JobKeeper Payments, it is not clear at this stage what conditions will need to be satisfied.

How the support is calculated

The ATO will administer this program and will make the $1,500 payments based on payroll information. The payments will be made monthly in arrears, so it is essential that you ensure your business and your employees continually meet the eligibility criteria.

The business will continue to receive the payments for eligible employees while they are eligible for the payments. While the program is expected to run for 6 months, payments will stop if the employee is no longer employed by the relevant employer.

How the support is provided

To access the JobKeeper subsidy, you should talk to your accountant or adviser to assist you with the registration process and calculations.

If you want to manage the process yourself, you must:

  • Register
    • Applications are not yet open. However, you should register your intent to apply for the JobKeeper subsidy with the ATO (here). The ATO will provide you with regular updates and advise you when you can lodge your application
  • Assess turnover
    • Ensure you have an accurate record of your revenue for the 2018-19 income year and for the 2019-20 year to date
    • Ensure you keep an accurate record of revenue from March 2020 onwards
    • Compare your revenue for the whole of March 2019 with the whole of March 2020
    • Measure the % decline in your revenue and ensure it has declined by more than 30%
    • If you are not eligible in March, you may become eligible in another month
  • Identify eligible employees
    • Nominate the employees eligible for the JobKeeper payments – you will need to provide this information to the ATO and keep that information up to date each month. The ATO will use Single Touch Payroll to prepopulate the information in most cases.
    • Notify all eligible employees that they are receiving a JobKeeper payment. Employees can only be registered with one employer.
    • Pay eligible employees at least $1,500 per fortnight (before tax). If an employee normally receives $1,500 or more per fortnight before tax the employee should continue to receive their regular income. 
    • Pay superannuation guarantee on normal salary and wages amounts paid to employees. If the employee normally receives less than $1,500 per fortnight before tax, the employer can decide whether to pay superannuation on the additional amount that is paid as a result of the JobKeeper program. 

Sole traders and the self-employed can register their interest in applying for the JobKeeper payment with the ATO. These businesses will need to provide an ABN for the business, nominate an individual to receive the payment, provide the individual’s TFN and declare their continued eligibility for the payments. Payments will be monthly to the individual’s bank account.

Posted on the 09-04-2020

The Second $66.1 bn Stimulus Package: What You Need To Know

The Government yesterday released a second, far reaching $66.1 bn stimulus package that boosts income support payments, introduces targeted changes to the superannuation rules, provides cash flow support of up to $100,000 for small business employers, and relaxes corporate insolvency laws.  

The stimulus measures are not yet legislated. Parliament will reconvene on Monday 23 March.

The Prime Minister has warned that there are no “quick solutions” and that business should prepare for 6 months of disruption.

In Summary

Business

  • Tax-free payments up to $100,000 for small business and not-for-profit employers. An increase in the previously announced initial tax-free payments for employers to a maximum of $50,000. In addition to this, a second round of payments will be made up to a maximum of $50,000, accessible from July 2020.  
  • Solvency safety net – temporary 6 month increase to the threshold at which creditors can issue a statutory demand on a company from $2,000 to $20,000, and an increase in the time companies have to respond from 21 days to 6 months. Directors also are provided with temporary relief from personal liability for trading while insolvent for 6 months.
  • Access to working capital – Introduction of a Coronavirus SME guarantee scheme protecting financial institutions by guaranteeing 50% of new loans to SMEs. 
  • Sole traders and self-employed eligible for Jobseeker payment – the eligibility criteria to access income support relaxed for the self-employed and sole traders. 
  • Temporary relief from some Corporations Act requirements

Individuals

  • Early release of superannuation – individuals in financial distress able to access up to $10,000 of their superannuation in 2019-20, and a further $10,000 in 2020-21. The withdrawals will be tax-free and will not affect Centrelink or Veterans’ Affairs payments.
  • Temporary reduction in minimum superannuation draw down rates – superannuation minimum drawdown requirements for account based pensions and similar products reduced by 50% in 2019-20 and 2020-21.
  • Deeming rates reduced – from 1 May, superannuation deeming rates reduced further to a lower rate of 0.25% and upper rate of 2.25%.
  • Supplements increased, access extended and eased – for 6 months from 27 April 2020: 
    • A temporary coronavirus supplement of $550 will be paid to existing income support recipients (people will receive their normal payment plus $550 each fortnight for 6 months). 
    • A second one-off stimulus payment of $750 will be paid automatically from 13 June 2020 to certain income support recipients (in addition to the payment made from 31 March 2020).
    • Eligibility for access to income support eased to include sole traders and the self-employed, and to those caring for someone infected or in isolation.
    • Waiting periods and assets tests temporarily waived.   
  • Bankruptcy safety net – temporary 6 month increase to the threshold for the minimum amount of debt required for a creditor to initiate bankruptcy proceedings against a debtor from $5,000 to $20,000.

The Government has flagged that additional stimulus packages will be required.

In detail

Support for business

Tax-free payments up to $100,000 for employers

  • From: 28 April 2020
  • Eligibility: Small and medium business entity employers and not-for-profit entities, with an aggregated annual turnover under $50 million.

The Government has increased the previously announced measures to provide cash flow support to business. 

Now, eligible businesses with a turnover of less than $50 million will initially be able to access tax-free cash flow support, with the minimum amount being increased to $10,000 and the maximum amount increased to $50,000 (previously $2,000 to $25,000). However, additional support will be provided in the July – October 2020 period so that eligible entities will receive total minimum support of $20,000 and up to $100,000.

In order for a business to qualify for this support it must have been established prior to 12 March 2020. The rules are more flexible for charities because the Government recognises that new charities might be established in response to the pandemic.

The cash flow support measures will be provided in the form of a credit in the activity statement system. The support will be provided in two phases.

  • The first phase ensures that eligible employers receive a credit equal to 100% of the PAYG amounts withheld from salary and wages paid to employees during the relevant period, up to the maximum amount of $50,000.
  • The second phase ensures that eligible employers receive another series of credits, equal to the credits that were received under the first phase. For example, if a business received $40,000 of credits in the first phase it will receive a further $40,000 of credits in the second phase. These additional credits will be spread over two or four activity statement periods, depending on whether the employer lodges on a quarterly or monthly basis. 

If a business pays salary and wages to employees but is not required to withhold any tax then a minimum payment of $10,000 will be made in the first phase and a further payment of $10,000 will be made in the second phase.

The credits are automatically calculated by the ATO and employers will need to lodge an activity statement to trigger the entitlement. If the credit puts the business in a refund position the excess amount will be refunded by the ATO within 14 days.

Businesses that lodge activity statements on a quarterly basis will be eligible to receive credits in the first phase for the quarters ending March 2020 and June 2020. Credits in the second phase will be available for the quarters ending June 2020 and September 2020. The minimum $10,000 payment will be applied to the first lodgement.

Business that lodge on a monthly basis will be eligible for the credits in the first phase for the March 2020, April 2020, May 2020 and June 2020 lodgements. Credits in the second phase will be available for the June 2020, July 2020, August 2020 and September lodgments. The minimum $10,000 payment will be applied to the first lodgement.

Eligibility for the measure will be based on prior year turnover. We will have to wait for the legislation for the finer details.

Not-for-profit employers, including charities, with an aggregated turnover under $50 million will also be able to access the cash flow support.

Solvency safety net

A safety net has been put in place to protect businesses in temporary financial distress as a result of the pandemic by lessening the threat of actions that could unnecessarily push them into insolvency and force the winding up of the business. These include:

  • A temporary 6 month increase to the threshold at which creditors can issue a statutory demand on a company from $2,000 to $20,000.
  • The time a company has to respond to statutory demands will increase from 21 days to 6 months. 
  • For 6 months, directors will be provided with temporary relief from personal liability for trading while insolvent.
  • See also bankruptcy safety net below

It will be more important than ever for business to stay on top of their debtors.

Debts incurred will still be payable by the business. Only those debts incurred in the ordinary course of the business will be subject to the safety net measures.

Access to working capital for SMEs – supporting lenders

The Government has announced a Coronavirus SME guarantee scheme that will guarantee 50% of new loans to SMEs up to $20 billion. These loans are new short-term unsecured loans to SMEs.

SMEs with a turnover of up to $50 million will be eligible to receive these loans.

The Government will provide eligible lenders with a guarantee for loans with the following terms:

  • Maximum total size of loans of $250,000 per borrower.
  • The loans will be up to three years, with an initial six month repayment holiday.
  • The loans will be in the form of unsecured finance, meaning that borrowers will not have to provide an asset as security for the loan.

Loans will be subject to lenders’ credit assessment processes with the expectation that lenders will look

through the cycle to sensibly take into account the uncertainty of the current economic conditions.

This latest measure builds on the previous initiatives to ensure small business can access capital, including:

Sole traders and self-employed eligible for Jobseeker payment

The eligibility criteria to access income support payments will be relaxed to enable the self-employed and sole traders whose income has been reduced, to access support.

More: 

Temporary relief from Corporations Act requirements

The Treasurer has been given a temporary instrument-making power to amend the Corporations Act to provide relief or modifications to specific compliance obligations. 

ASIC has announced measures for those companies with a 31 December financial year that need to hold their AGMs by 31 May 2020, providing a two month no action period and enabling hybrid virtual AGMs. 

Individuals

Early release of superannuation

From mid-April, individuals in financial distress will be able to access up to $10,000 of their superannuation in 2019-20, and a further $10,000 in 2020-21. The withdrawals will be tax free and will not affect Centrelink or Veterans’ Affairs payments.

To be eligible to access your superannuation you need to meet the following requirements:

  • you are unemployed; or
  • you are eligible to receive a job seeker payment, youth allowance for jobseekers, parenting payment (which includes the single and partnered payments), special benefit or farm household allowance; or
  • on or after 1 January 2020:
    • you were made redundant; or
    • your working hours were reduced by 20% or more; or
    • if you are a sole trader — your business was suspended or there was a reduction in your turnover of 20% or more.

For those eligible to access their superannuation, you can apply directly to the ATO through the myGov website from mid-April.

More: 

Temporary reduction in minimum superannuation draw down rates 

Superannuation minimum drawdown requirements for account-based pensions and similar products will be reduced by 50% in 2019-20 and 2020-21.

The upper and lower social security deeming rates will be reduced further. As of 1 May 2020, the upper deeming rate will be 2.25% and the lower deeming rate 0.25%.

More: Providing support for retirees

Time limited fortnightly $550 ‘coronavirus supplement’

For the next 6 months, the Government is introducing a new Coronavirus supplement to be paid at a rate of $550 per fortnight. This supplement will be paid to both existing and new recipients in the eligible payment categories.

The payment will be made to those receiving:

  • Jobseeker payment (and those transitioning to the jobseeker payment)
  • Youth allowance jobseeker
  • Parenting payment
  • Farm household allowance
  • Special benefits recipients

In addition, eligibility to income support payments will be expanded to:

  • Permanent employees who are stood down or lose their job
  • Casual workers
  • Sole traders 
  • The self-employed
  • Contract workers who meet the income test

The Government notes that these criteria could include those required to care for someone affected by the Coronavirus.

Asset testing has also been reduced and will be waived for 6 months. Income testing will still apply.

The payment is not available if you have access to any employer entitlements such as annual or sick leave or income protection insurance.

More: 

Second $750 payment to households

The Government is now providing two separate $750 payments to social security, veteran and other income support recipients and eligible concession card holders residing in Australia (see the full list here). The payment will be exempt from taxation and will not count as income for the purposes of Social Security, Farm Household Allowance and Veteran payments.

  • Payment 1 from 31 March 2020 (previously announced on 12 March): Available to people who are eligible payment recipients and concession card holders at any time between 12 March 2020 to 13 April 2020;
  • Payment 2 from 13 July 2020: Available to people who are eligible payment recipients and concession card holders on 10 July 2020.

The payments will be made automatically to those that meet the criteria.

More: 

Payments to support households

Bankruptcy safety net

A temporary 6 month increase to the threshold for the minimum amount of debt required for a creditor to initiate bankruptcy proceedings against a debtor will increase from $5,000 to $20,000. In addition, the time a debtor has to respond to a bankruptcy notice will be temporarily increased from 21 days to six months.

Where someone declares their intention to enter voluntary bankruptcy, the period of protection from unsecured creditors will be extended from 21 days to 6 months. 

More:

More information:

Posted on the 23-03-2020

Clarifying Car Expense Claims

car-expenses

CLARIFYING CAR EXPENSE CLAIMS If you are claiming a deduction for using your own car (including a car you lease or hire), it is treated as a car expense.

If you use someone else’s car for work purposes, you may be able to claim the direct costs (such as fuel) as a travel expense.

If the travel was partly private, you can claim only the work-related part.

When you CAN claim for car expenses: You can claim a deduction for work-related car expenses if you use your own car in the course of performing your job as an employee, for example, to: – carry bulky tools or equipment – attend conferences or meetings – deliver items or collect supplies – travel between two separate places of employment (for example, when you have a second job) – travel from your normal workplace to an alternative workplace and back to your normal workplace or directly home – travel from your home to an alternative workplace and then to your normal workplace or directly home (for example, if you travel to a client’s premises) – perform itinerant work. If you receive an allowance from your employer for car expenses, it is assessable income and the allowance must be included on your tax return. Most people CAN’T claim the cost of travel between home and work because this travel is private. Call the Eclipse team on 9531 0922 to find out how this applies to you.
Posted on the 27-10-2015

Disaster proof your finances.

Over One Hundred Dead As Major Tornado Devastates Joplin, Missouri

Disaster proof your finances.
You’ve carefully filed all your important documents – but how can you protect them from being destroyed if the worst happens to your home or business?

Consider placing originals of important documents and critical records in a fire resistant, waterproof safe or in a safe deposit box with your bank, lawyer or deposit box service. You can also back it up in the cloud or keep an electronic copy off site. That way, if your home or business is damaged by fire or flood, you’ll be protected.

Types of documents to keep safe:
– birth certificate
– marriage certificate
– will & power of attorney
– house deeds
– life, home, contents, car & other insurance policies
– health insurance & other medical files
– bank account details
– passports
– copies of driver’s licence, medicare card, bank and credit cards
– superannuation documents
– investment documents (securities, share certificates, bonds)
– details of funeral investments or arrangements
– photos, especially of valuable items such as jewellery, furniture or paintings (having a listed home inventory can also help)
– receipts for expensive items in your home (including renovations)
– business registrations, contracts, agreements & other records
– year end records
– employee & contractor records, such as payments, super, copies of TFN declarations & contracts
– asset purchase records
– vehicle records

Contact the Eclipse team today on 9531 0922 for more information.

Posted on the 15-10-2015

5 ways to get cashflow – FAST!

cashflow

Sometimes you need to get some cash in the door quickly, and to do that you have to make sales happen fast.  Here are some proven ways you can get the ball rolling quickly and crank up your sales.

1.  Make an enticing offer to your existing clients or customers, with the aim of getting repeat business and add on sales.

If you own a dry cleaning business for example, you could offer customers a special deal on their next dry clean. It could be something like two shirts for the price of one. The result will be repeat business because you have provided something to entice that customer to come back to you (and you could promote this special to customers who normally don’t bring shirts in too). If you are a plumber you can offer say a special deal on replacing all their tap washers whenever you’re doing a job for a customer (you can promote this special offer to prospective customers as well).

2.  Make an offer to somebody else’s clients.

Look at your business and ask what other businesses would have clients or customers like yours. For example, a young woman who buys a phone today could well be looking for a pair of jeans tomorrow. If you sell jeans, go to the phone store and give them $20 vouchers redeemable in your store to give away to customers who buy a phone.

Explain to the other retailer that this enhances the deal they’re doing with their customer but it will also encourage that customer to go into your store. If they then give you vouchers for your customers to spend in their store you’ll then be able to send all of your customers their way. This is called cross promotion and it works gangbusters.

It’ll work in any business too! A painter can set up a cross marketing deal with a builder and easily say “When I paint your home, I’ll give you a voucher for $750 worth of building improvements that you’ll want to have done once you see your home looking so good!” and the builder can say “When I do your renovations I’ll set you up with $400 towards getting your painting done!”

Of course there’s an extra powerful motivator that makes this work so well. And that’s simply… the credibility of word of mouth recommendation. Your customers or clients know darn well that you wouldn’t recommend some other business unless you were happy with that business. And that’s powerful stuff!

3.  Use the power of promotion, promotion, promotion!

Promote the pants off your product or service using the power of the personal approach. Be upfront and approach people who are in the area when you are quoting, or are about when you actually are delivering the service or who are walking past your shop.

For example, you are quoting for some building renovations at someone’s home. Find out from them the names of the neighbors on both sides and those across the road as well. Go and knock on their doors and tell them what you are doing. Explain, “Because you will be doing a job in the neighbourhood they could get themselves a great deal if they wanted something done at the same time.” This approach consistently averages two extra jobs for every 5 neighbours seen.

If you operate a retail store have someone with a great smile and a friendly personality standing outside your shop giving out vouchers that offer something for free. The secret is to get a voucher in the hand of everyone who strolls past along with a cheerful comment that emphasises the offer like “This is for your piece of free carpet!” or “They’ve got 25 dollars for you inside!”

You must adopt this fun approach because, if you just have some wooden faced person glumly handing out a piece of paper, most people will take it and not read it. If it’s fun and done with a smile with a spoken offer many more people will act on it. If you or your team members don’t have the aplomb, the personality or the courage to do it, hire a casual team member with the right skills to do the job. It will reap huge rewards.

4.  Advertise.

Put together an ad that grabs people’s attention. Use a compelling headline that drags people in, even if they weren’t in the market for your product or service. Of course the copy you write that amplifies and explains the headline must be just as compelling. As they read it they should be thinking “Hey, this is about me and the answers to my problems, I’m really interested in this.” To get them to act straightaway have a coupon with an expiry date in your advert that entitles customers to an irresistible special deal.

Then do something most people don’t do. Measure the sales you make from the advert and, if it works for you, keep doing it!

5.  Stay with prospects.

Many business people make one attempts to get the business and, if the prospect doesn’t buy then, they forget them.

That’s downright crazy. You see when we talk with a prospect we know that they are interested in buying but we just don’t know when.

Some people are ready to make a decision then and there, some are getting ready to buy next week or next month and some are just gathering information for a purchase sometime in the future. If they don’t buy now despite your best endeavours, it’s important that you find out when they are planning to purchase and then stick with them until they buy or die!

Of course this means that you’ll need to have their contact details so that you can stick with them but naturally you’re getting those from every prospect you meet, aren’t you?

And that raises a final thought. Why don’t you go back to prospects you saw recently who didn’t buy then and see if they are ready to buy now? You’ll be amazed just how much business this will generate for you.

These techniques are simple, effective and will get results!

Posted on the 10-09-2015

Keep your customers satisfied

Physician-Disability-Customer-Service-Tips

Have you noticed that customer service is losing its way in business these days?

Customer service should be at the top of the list of priorities for every business.  Unfortunately, it is often neglected.  Once you realise how customer satisfaction affects your business, you will want to adopt some of the methods below to help keep your customers coming back.

Some businesses just don’t seem to care about keeping their customers happy.  If only they knew how damaging this is to their business!

Consider the following:

  • For every customer who bothers to complain, there are 26 others who remain silent
  • The average ‘wronged’ customer will tell 8 to 16 people
  • 91% of unhappy customers will never purchase services from you again
  • It costs about five times as much to attract a new customer as it costs to keep an old one
  • Each one of your customers has a circle of influence of 250 people or potential customers who hear bad things about you

Lack of quality customer care could be costing businesses thousands of dollars!  Kelly Sims in her article ‘5 Ways to Keep Your Customers Coming Back For More’ has these suggestions for improving customer care:

Say ‘Thank You’

This is the simplest possible way to keep your customers happy, but it is all too often overlooked.  A customer who feels appreciated is much more likely to bring you repeat business and/or refer you to a friend.  Your clients are the reason for your business’ continued existence, so they should be appreciated.

Saying thank you is often enough, but imagine how much more valued a customer would feel if something more personalised was done to thank them, such as a thank you card, or a simple coupon sent in gratitude for their business.

Respond to enquiries promptly

People simply don’t like to wait.  Today’s world of high speed Internet, microwaves and mobile phones is evidence of this.  If a customer has to wait days to have questions answered by you, they will likely take their business to a company that responds to their enquiries quickly.  This situation could be rectified by delegating this task to an employee.

Know when to say sorry

Learn to be accountable, not only for your own mistakes, but for those of your employees as well.  When you consider that it is estimated that 35% of dissatisfied customers would not go to the competitors if they received apologies, you realise the true value of “I’m sorry”.  We all know that there are difficult people who will never be pleased, but the vast majority of your clientele are not these people.  Being sincere and genuinely trying to make a disappointed customer happy will undoubtedly help you to retain more clients.

Give your customers a little extra

Value your customers by giving them a little extra.  This is a small step that doesn’t have to cost you a fortune.  It can be as simple as a small, unexpected free gift after a purchase, or providing a little extra service above and beyond that for which you were hired.  Going the extra mile for your customers will make them feel appreciated and might even generate some referrals.

Personalise your service

Call your customers by their names and ask them how their day is going.  Even if your business is conducted over the Internet, there are ways to personalise emails to let your customers know that you care about them.  If a client feels you know them, even a little bit, they are much more likely to show you loyalty and not move on to your competitors.

Some other ideas

  • Your customers will be happier if you promise less and deliver more.  They’ll also likely tell their friends about the good service if you keep your word.
  • Customers feel great when they save money unexpectedly.  From time to time, slip in some unadvertised sales to give your customers a pleasant surprise.
  • Make sure your employees are properly trained in how to handle a customer complaint.  Give them guidelines and make sure they know what to say and do to make that customer’s experience a positive, pleasant one.

Remember…

Without your customers, you don’t have a business.  Therefore, customer service should be your top priority.  Your customers will really appreciate being shown respect and sincere gratitude.  In return, you will likely receive their loyalty.

When customers walk away from dealing with you with a smile on their face, they’ll be less likely to take their business to an unknown competitor.

YOUR ACTION PLAN

– Put in place a method of obtaining regular and reliable feedback from your customers.

– Actively promote high quality service and ongoing improvement in your business.

– Perhaps tailor some of the ideas on these pages to your own business and put them to good use!

Contact the Eclipse team today on 9531 0922 for assistance with this action plan!

Posted on the 05-09-2015