When starting a new business, there are many elements you need to consider. Careful planning is essential to ensuring the longevity of your business, but what exactly goes into a good business plan?
A good business plan is one that is detailed. Sections should include; an executive summary, company description, market analysis, organization and management, service or product, marketing and sales, funding request and financial projections. These topics cover as much of the business as you can in the planning stage.
Showing attention to detail in your written plan demonstrates commitment to the business going forward. When writing a business plan, there are a few ways to ensure you are creating the best guide for your idea. Researching the industry and other companies in the market you are looking to step into can give you an insight into more than just the competition. As a business owner, it is your responsibility to know how and if audiences will respond to you.
Backup your information where you can with relevant files and supporting documentation. This provides sources to strengthen your plan and justify data. You should also keep records of your resume and any permits you may need if presenting your plan to an investor, this will help to support your commitment and ideas.
If you aren’t presenting your plan to investors or potential partners, determine what purpose your business plan will serve. A good business plan can be used not only as a sales document but a map for the business into its future. Writing a business plan that makes projections for the first five years can keep you on track and show you areas in which you need to focus on.
A business plan is a guide to help you create and maintain the best business you can. Even if things don’t go exactly as planned, a successful business plan is one that teaches you the things you want to get out of the business and ways in which you can achieve them.
The 2019-2020 Federal Budget suggested a deferral of the extension of SuperStream to self-managed superannuation fund (SMSF) rollovers from 30 November 2019 to 31 March 2021. The commencement of this deferral has recently been confirmed by the government.
The deferral will coincide with the $19.3 million that will be provided to the Australian Taxation Office (ATO) over three years from 2020-21, enabling electronic requests to be sent to superannuation funds for the release of money required under a number of superannuation arrangements. This change applies from 31 March 2021.
With the combined date for both bringing electronic release authorities into SuperStream and allowing SMSF rollovers, changes needed to update SuperStream will only need to be undertaken once. The deferral aims to reduce administrative costs for funds and allows for a more integrated design of SuperStream.
First introduced in 2015, SuperStream is a government standard for processing superannuation payments electronically in a streamlined manner. Currently, SuperStream can only process rollovers between two APRA funds electronically but with the change will see this process extend to SMSFs. This means rollovers between an APRA fund and an SMSF can be processed through SuperStream later this year, and the time taken could even be reduced to three days.
Regulations for the deferral to put into effect will be made promptly.
Small business owners may be able to claim deductions for the costs of using your home as a principal place of business when filing your 2019 income tax return.
Tax deductions may be claimed for the business portion of expenses that include electricity, cleaning, rent payments or mortgage repayments. However, it can be difficult to ensure you are claiming expenses you are entitled to. How you operate the business out of your home will determine the types of expenses that may be claimed. Your business structure will also affect your entitlements and obligations when claiming deductions on home-based business expenses.
Individuals that operate a business as a sole trader or partnership are entitled to claim a deduction for the costs of running their business from home. There are two types of expenses that can be claimed, running expenses or occupancy expenses.
Running expenses refer to the increased costs of using your home’s facilities for the running of your business, including:
- Repairs to your business equipment
- Heating, cooling and lighting a room
- Phone and internet
- Depreciation of business furniture and equipment
Occupancy expenses are those that you pay to own or rent your home, including:
- Mortgage interest or rent
- Land taxes
- Council rates
Typically, those that are eligible to claim occupancy expenses can also claim running expenses. Occupancy expenses are calculated based on the proportion of the floor area of your home that is used for the business and the proportion of the year that it was used. To calculate the running expenses of your home-based business, you must ensure that you exclude your private living costs and that you have records to show how you calculated the expense. Records that need to be kept include written evidence, tax invoices and receipts, which should substantiate your claims for all home-based business expenses.
You may consider consulting a trusted advisor or registered tax agent to ensure that you meet all obligations when claiming deductions in your tax return.
Getting your tax refund back is exciting, but as tempting as it is to splurge, consider other ways you can put that money to good use. It is easy to get caught treating your return as extra money when you shouldn’t see it any differently than your regular paycheck. Give the money a purpose by thinking about your personal financial situation and determining your needs.
An emergency fund can make all the difference if a difficult financial situation comes up, acting as a backup in the case of an emergency such as losing your job or medical costs. Building an emergency fund with enough money to cover at least three months worth of expenses is a good starting point. Make sure the money is added to a high-interest savings account to utilise compound interest. If you are contributing regularly to this fund, adding money from your tax return can boost it above schedule.
Increase your nest egg:
Boost your super by making an after-tax contribution. For eligible low-income earners, the Government will match your after-tax super contributions with a maximum co-contribution of up to $500. It is important to note that caps apply to contributions made to your super in any tax year. These can depend on your age and whether you contribute before or after tax, so make sure you don’t exceed these caps.
Make debt repayments:
With a bit more money at your disposal, now is the time to make repayments on debts you may have. Start with the higher interest debts and work down, as your interest repayments will drop when you lower your outstanding balance. These debts can be things like credit cards, personal loans, outstanding bills or mortgage repayments.
After being responsible and using your tax return to better your future, spending some of that money on yourself isn’t something to feel guilty about. As long as you remember to live within your means and don’t overspend, you should enjoy the rest of your money.