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The magic of Compound Interest

I’m certain we have all heard of compound interest and the benefits it provides over time. What exactly is compound interest? Put simply it is the concept of earning interest on your interest. Any interest or return earned in one period is then added to your original investment and then it all earns interest in the next period and so …

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Managed Funds Vs Direct Ownership

Most of us will have our precious superannuation nest egg invested in managed funds. This is common and, for those with smaller balances, there is nothing wrong with this. However some problems can arise with larger balances and there comes a point where direct ownership becomes more advantages.   What is a managed fund and what are some of the …

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Is it time for a Sea Change?

When we think of a sea change we tend to think of a move from the city to the country or the coast and we also associate a sea change more often than not with retirement. This is not always the case and there are now many different types of people looking for a sea change. Who would be classified …

Employee vs Contractor

They have an ABN, a business name, are registered for GST, you pay them a higher rate, they operate through a corporate structure and they even have a signed written contract; they are obviously a contractor right? Not necessarily! These are common incorrect assumptions made by business owners when considering if their worker is an employee or a contractor. How …

Buying a business in 5 steps

 1. Should you buy a business or start one from scratch? Buying an existing business can certainly have its advantages. In an ideal world you will take over a loyal customer base, reliable suppliers, experienced staff, sound processes and procedures and instant positive cash-flow. Your due diligence will evaluate each of these areas to determine if the target business is …

Selling Your Business

Like most things in life, when you are selling a business, it is only when you ask the right questions that you can get anywhere close to the right solution. Here we get you started with some of the basics: What is for sale? Do you intend to sell shares in your company or the business assets from within the …

The clock is ticking on income test changes

Two of the more significant changes for retirees that was proposed in the government’s 2014 budget are changes to age pension and seniors health card entitlements. From January 1 2015 there will be different method of assessing the income tests for these highly regarded government benefits by retirees, creating a window of planning opportunity for those who may be most …

Home based businesses

1. Cost of room’s utilities These claims must be apportioned and if the portion is based on anything other than the floor area the claim must be clearly documented. 2. Phone costs If a telephone is used exclusively for business, owners can claim for the rental and calls but not the installation costs. 3. Decline in value This can apply …

Review of management accounts

This is best done with a tax advisor as they can help to identify tax areas and opportunities that may require further consideration. A few key areas that need to be reviewed prior to year end include: Owner’s salary Business owners should consider the salary they are receiving. Owners should review the overall position of their business with the view …

Claiming deductions for plant and equipment

Due to the potential changes affecting capital allowances, it is important that businesses understand what they are entitled to this year end. The capital allowances for small business entities this year end is: small business entities would be able to claim a deduction for the value of a depreciating asset that costs less than $1000 (rather than the $6500 before …