Blog

JobKeeper to be extended

0
JobKeeper to be extended
JobKeeper to be extended

The Australian Government has announced that JobKeeper payments will be extended for a further six months after the initial 28 September 2020 deadline. However, the extended JobKeeper program will have substantial payment reductions compared to the original JobKeeper amounts, as well as revised eligibility requirements.

The new JobKeeper flat-rate payment after September will be reduced from $1500 per fortnight to $1200 a fortnight for eligible employees who were working an average of 20 hours per week in the four weeks before 1 March 2020. The rate for employees who were working less than 20 hours per week for the same period will be reduced to $750 a fortnight. These rates are set to apply until the end of 2020.

A further reduction in JobKeeper payments will be administered from 4 January 2021. After this date, eligible employees who were working more than 20 hours per week in the four weeks before 1 March 2021 will receive a flat rate of $1000 per fortnight, while employees who were working less than 20 hours per week for the same period will receive $650 per fortnight.

The JobKeeper extension shares a similar eligibility criteria as the initial JobKeeper program, however, it will be targeting support to businesses and not-for-profit organisations that are facing continual impacts from COVID-19. Those seeking to claim the JobKeeper extension payments must reassess their eligibility by demonstrating that they have met the decline in turnover test for the new required periods. Businesses who have experienced either one of the following will meet the decline in turnover test:

  • A 30% fall in turnover for an aggregated turnover of $1 billion or less.
  • A 50% fall in turnover for an aggregated turnover of more than $1 billion.

To be eligible for JobKeeper from 28 September to 3 January 2021, the decline in turnover test must be met for the June and September quarters 2020. Businesses must reassess their eligibility again in January 2021 to be eligible for JobKeeper from 4 January to 28 March 2021. To remain eligible for the March 2021 quarter, businesses will need to demonstrate that they have met the decline in turnover test in each of the previous three quarters.

The extended JobKeeper program is set to end on 28 March 2021.

Getting your money back from late-paying customers

0
Getting your money back from late-paying customers
Getting your money back from late-paying customers

Businesses can be heavily impacted by customers who cannot, or simply will not pay when payment is due. A single unpaid invoice can cause issues, and the longer this debt is left uncollected, your chances of getting your money back become slim. Consider these tips to avoid and manage debt recovery to save your business from major losses.

Reduce credit terms
If late payments and managing bad debt is a regular occurrence, consider reducing your credit terms. You may want to remove your credit terms entirely, but it is important to look at your customer base, the services you offer, and whether there is an average credit term that is expected by your clients. If you offer credit terms shorter than your competitors, you may end up losing valuable customers. However, if your credit terms are too spacious, your cash flow will be slow, putting you at financial risk.

Encourage timely payments
Your business might require a set credit term to meet the industry average. In these situations, consider offering discounts on payments made early or within a set date from invoicing. An alternative is to charge a late fee to encourage your clients to pay on time. In these situations, it is necessary to first make your customers aware of the introduction of this policy clearly through your terms and conditions. To maintain good customer relationships, try to limit overdue fees to repeat offenders. You may want to monitor incoming payments to see if these policy changes are reducing your late payments.

Hire a debt collection agency
Efforts to pursue your late-paying customers may not always be successful. If the debt amount is less than $1000, it may not be financially viable to pursue legal action for violation of your credit terms. In such situations, consider outsourcing your debt collection to professional collectors. However, timely involvement is key to getting your money back. Give your clients sufficient time to make a payment, and if over two times the trading terms have passed, hire a collection agency to prompt your clients into making defaulted payments.

How to avoid SMSF disputes

0
How to avoid SMSF disputes
How to avoid SMSF disputes

Self-managed super funds (SMSF) can be vulnerable to disputes, especially when family members are involved.

SMSF disputes may be caused by a number of reasons such as relationship breakdowns, (common in funds where parents and siblings are in a member and trustee relationship) and fundamental differences in opinions. Other common triggers for SMSF disputes include:

  • investment strategy disagreements,
  • differences in opinions over the payment of benefits, especially in SMSFs involving both parents and their children,
  • payment of death benefit disputes, and
  • disagreements on the distribution of SMSF death benefit payments between surviving members.

Consider the following methods to avoid SMSF disputes.

Clear decision-making procedures
Disagreements are bound to occur when it comes to money, so it is important to include concise decision-making provisions to keep things fair for all parties involved. For example, trustee decisions can be made by a simple majority rather than unanimously, and a particular trustee may be provided a casting vote in the case that a deadlock occurs. Provisions could also include voting rights that are based on the value of a member’s account balance within the SMSF to avoid situations where a member with minority interest out-votes a member with a large fund account balance.

Updating your SMSF regularly
An SMSF trust deed will provide provisions which determine the trustees’ rights, obligations and options. It is important to keep your SMSF and trustee information up to date to prevent any unwanted beneficiaries and claims. For example, in the case of an unfinalized divorce or legally unchanged relationship status, a former spouse can claim the others’ superannuation death benefits. To prevent such situations and avoid their inevitable disputes, be sure to update your super fund regularly.

Pin It on Pinterest

Share This