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ATO targeting private school parents

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In the latest crackdown on tax evasion, the ATO is targeting parents suspected of paying their children’s private school fees from secret offshore bank accounts.

Following concerns that overseas accounts are being used to hide away secret funds, the tax office will be contacting more than 100 parents with private school fees of up to $100,000 per year paid from offshore accounts this week.

While there is nothing wrong with Australians having an offshore account, those individuals are still required to pay tax on the account’s interest or earnings. Suspected parents will be asked to provide documents and attend interviews to answer questions about their arrangements.

Government introduces significant tax changes in innovation statement

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Significant tax breaks and incentives for Australian investors were unveiled on Monday when the Turnbull government released their National Innovation and Science Agenda.

The tax changes are designed to help support start-ups to develop their ideas in Australia.

Investors will now be able to access a 20 per cent tax offset instead of deductions or a (CGT) exemption in start-up companies that are less than three years old, are unlisted, and received less than $20,000 in income in the previous year.

The reason for changing to the offset model over a deduction is because it will benefit people more evenly across the differing income groups. The cost of the offset is estimated to be $106 million over four years, with most funding beginning after 2017.

This means that if someone was to invest $20,000 and claim the offset, they would be able to reduce their income tax by $4,000. If the investor then sold their shares three years later, their initial $20,000 will also be exempt from CGT. For start-ups, this will bring forward the point at which they can receive a tax break.

Have you considered seasonal packaging?

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Even though special seasonal packaging has become an important part of the holiday season for many brands, is it always a worthwhile endeavour for smaller businesses?

Getting seasonal packaging right can be difficult and may take a few years of practice which involves making mistakes and then learning from them. Even though it might be an easy way to engage with, and attract new customers to your business, there are still quite a few things that can go wrong.

Getting your business’s numbers right in terms of both demand and distribution is very important for a special holiday packaging initiative. Overestimating customer demand or expectation can end up in a business discounting their leftover products, which can severely eat into a company’s profit margins.

Seasonal packaging is a fun way for businesses to mix up their traditional brand identities, but going too far may lose customers, not gain them. Straying too far from your original or traditional identity may confuse and even annoy customers who may not be able to find your product because it looks so different.

Large businesses can often afford to make mistakes with seasonal packaging. Sadly, many small businesses often do not have this kind of luxury and are usually the ones who have the most to lose from taking this kind of marketing approach.

Clever seasonal packaging can play the deciding factor for a new customer choosing between your product and a cheaper, more generic option. So if your small business is ready to take the risk, all it comes down to is if you’re going to do it, make sure you do it right!

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