Information Centre

1.Common GST Mistakes

The GST was introduced on 1 July 2000, yet there are many errors and omissions being made by small businesses on their GST returns. SB Bookkeeping ensures all transactions are correctly categorized. Below are some of the more common GST mistakes:

  • 1. Bank Fees are treated as input taxed meaning the bank does not charge GST to the customer. Note, GST is charged on credit card merchant fees and therefore a GST credit can be claimed on these expenses.
  • 2. Expenses relating to residential rental properties are not claimable even if the entity is registered for GST.
  • 3. Business insurance policy has stamp duty component in the premium which is not subject to GST, a GST credit cannot be claimed on this portion of the payment.
  • 4. GST-free purchases such as basic food items, exports and some health services doesn’t have GST in it so should not be claimed,
  • 5. Wages and superannuation payments are non-taxable supplies,
  • 6. Entertainment expenses where the business has elected to use the 50/50 split method for fringe benefits tax purposes. Only 50% of the GST credits can be claimed in this situation,
  • 7. Motor Vehicles with a purchase price in excess of the luxury car limit of $57,466 GST inclusive. The maximum GST credit that can be claimed is limited to $5,224.
  • 8. Sole traders and partnerships not allocating input tax credits and making adjustments to expenditure that is partly private and partly business use.
  • 9. Yellow Pages advertising are accessible where the business chooses to pay for the cost of advertising by installments, the entire GST is charged up-front.

SB Bookkeeping provides onsite bookkeeping services in Perth. If you would like to talk to us about becoming your Bookkeeping department then Contact Us Now.

2. The Hidden Costs of Employment

Case study to explain the hidden cost of employment:

  • 1. Base Salary is normally quoted as the base excluding other costs such as superannuation. For our example SB Bookkeeping will use a base of $50,000.
  • 2. In this case employer must pay 9.5% superannuation for all employees earning more than $450 in a calendar month. On a base of $50,000 this would equate to $4,750.
  • 3. Annual Leave is normally 4 weeks per year. Remember that you are therefore paying the base of $50,000 for only 48 work weeks per year.
  • 4. Public Holidays are usually 10 in Australia each year.
  • 5. We should allow 10 days for sick leave per annum so add another 3.85% at $1,925.
  • 6. Workers Compensation Insurance can vary broadly depending on the risk of the industry. The rate is fixed each year by statute and cant be negotiated.
  • 7. Payroll Tax. is a state government tax that is levied once your annual payroll (including super) exceeds a certain threshold.
  • 8. Recruitment cost, average cost of recruiting an employee is around $5,000. This includes recruitment costs, down-time and training.

While these apply to all aspects of employment within your company, it demonstrates why it is worth looking at areas within your company which may be suited to outsourcing to a specialist provider. One of these areas is Bookkeeping Services. At SB Bookkeeping we can surely help, Contact Us Now.

3. XERO and its ADDONS

If you are using Xero Software for your Accounting, depending on your Industry there might be few additional features that can be added on to your Xero Software by adding add ons to your software which can eventually save a lot of stress, time and costs, there might be situations when you are Using the wrong Accounting software for your Organization and just by making a change you could save $000’. Please see below the

Case Study,

One of our many Happy Clients, Churches of Christ In WA have been using QuickBooks Desktop Version for their Accounts, recently we came up with the suggestion of Changing over from QuickBooks Desktop Version to Xero Online Platform, by switching over to the online Platform we managed to link their Accounting with the Bank, where their Bank sends all the information to their Online Accounting Software which eventually helped us to save around 25% of their Bookkeeping Costs, and this way we managed to make a win-win situation where we don’t need to travel to their place for Bookkeeping Service as it can be done remotely and they were happy because it is going to save them around 25% in their Bookkeeping Costs, so everyone wins.

4. Obtaining Finance as an SME

You need to convince your lender that your business is a low risk for them while choosing source of finance. To do this you must be able to explain your business model and represent strengths professionally in the form of a business plan.

The Presentation

You should provide a background of both your business and your personal experience and qualifications. Then give your view on the direction of your business and the industry you operate in.

Documentation

You will need to provide current financial statements. If they are older than 3 months an interim set of financials signed off by a CPA can be helpful.

Be confident, prepared and share your enthusiasm about the future of your business with the lender. Your attitude, approach and commitment to the long term business goals of your company will help establish you as a sought after customer.

5. How a good bookkeeper can save you $$$

One of the first things we at SB Bookkeeping do is, when we get a new client is to perform an audit on the client’s current bookkeeping systems. We check if there are areas where we can implement efficiencies within the bookkeeping process. In nearly all cases, SB Bookkeeping is able to reduce the number of hours required to perform the role.

6. MYOB Add-on- Money Manager

XERO, MYOB and QuickBooks now dominate the SME market for bookkeeping and accounting software. If you use jobs within MYOB to report on the profitability of different profit centers within MYOB, you will find that there are some limitations with setting budgets for these different profit centers.

Money Manager overcomes these limitations and allows you to set detailed budgets for all of your profit centers and then consolidate them to form the company budget. Money Manager also provides a fantastic cash flow forecasting tool. It integrates with your MYOB data file to combine your actual YTD result with your latest forecast in Money Manager to produce cash flow forecasts years in advance. Not only is this a great management tool but banks love it if you need to apply for finance.

  • "We have been using SB Bookkeeping services since ...View All

    Cheryl Loots

    Safari Life Pty Ltd