How you can respond to underperforming employees

By 19 November 2020 People
How you can respond to underperforming employees

Given how confusing and stressful these times have been for individuals, you might find that employees are not performing at the standard you expect them to. This can prevent the company from meeting its goals and slow down growth.

It is important that you critique yourself before you start questioning the employee. The employee should be aware of what is expected from them, both in terms of role and the standard at which it should be completed. They should also be aware of the consequences of underperforming. You should also ensure that you are not expecting them to complete tasks which they have no training for, and be prepared to provide training if you find this to be the case. In some cases, the employee may not be aware that they are not performing to expectations, in which case, having a conversation with them might be more useful than confronting them about their failures.

Rather than confronting them emotionally, where the conversation is accusatory or potentially threatening, you should prepare what you have to say beforehand and keep it specific to their work and what needs to be done. This will help you address the exact issue of underperformance rather than getting sidetracked with any other factors.

As mentioned above, the current times have led to a lot of anxiety and stress throughout the public. This sheds light on the fact that an employee may be experiencing personal issues which are causing a decline in their performance. It might be worthwhile to discuss this with them. You may not necessarily be able to help, but it will help you understand the cause.

Creating performance goals that outline what tasks the employee needs to complete and what expectations they need to meet might be a helpful process. Through this method, you might be able to arrange follow-ups which can indicate to both the employee and you whether those goals are being met and what further steps can be taken if they are not. Additionally, if the goals are being met, then you should consider rewarding their improvement to let them know their efforts are valued.

While the above considerations and strategies are valid, you should also prepare yourself to let the employee go. You should learn from the experience and think about what you could have done differently as well as what individual circumstances caused underperformance in the employee.

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Things you should know before applying for a business loan

By 19 November 2020 Business
Things you should know before applying for a business loan

A business loan can give you the support you need to fund growth or temporarily relieve cash flow pressures. These are some things to know before applying for the loan:

  • Understand the purpose of your loan: You should be sure about why you want a loan and what you will be doing with the loan.
  • What loan amount do you need: Realistically calculate how much money you need and how you’ll be allocating it to your needs
  • What can you afford to pay: Consider the length of the loan, payment options and other details before you apply. Think about what you can afford to pay so that you can discuss which of these features can and cannot be adjusted to suit your needs.
  • Secured or unsecured loans: A secured loan means that you provide an asset for the loan, your interest will be lower than for an unsecured loan and the lender may be able to sell your asset if you are unable to pay the loan. An unsecured loan means that you don’t provide an asset so that the interest rate is higher. It may be difficult to get approved for an unsecured loan.
  • Fixed or variable interest: If you are confident that you can meet the repayment requirements even if the rate increases but a fixed rate makes it easier to manage your cash flow as all your repayments are the same.
  • Fees and charges: The true cost of any loan is only apparent when you take into account all the additional payments that are incurred. These could include early repayment fees, exit fees, valuation fees (to secure your loan), etc.
  • Paperwork: Planning your paperwork ahead of time will make it easier for the lender to approve your loan, this will also make the entire process faster.
  • Consider speaking to an expert: You may want to discuss with an advisor about whether a loan might be the best option for you and what alternatives are available if any.

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What do the super fund categories actually mean?

By 19 November 2020 Super
What do the super fund categories actually mean

There are four different categories of super funds. These have different primary features and are more applicable to certain people than they are to others.

Retail super funds

Anyone can join retail funds. They are mostly run by banks and investment companies:

  • Allow for a wide range of investment options.
  • Financial advisors may recommend this type of fund as they receive commissions or might get paid fees for them.
  • Although they usually range from medium to high cost, there may be low-cost alternatives.
  • The companies that own these funds will aim to keep some of the profit they yield

Industry super funds

Anyone can join bigger industry funds, but smaller ones may only be open to people in certain industries i.e. health.

  • Most are accumulation funds but some older ones may have defined benefit members
  • Range from low to medium cost
  • Not-for-profit, so all profits are put back into the fund

Public sector super funds

Only available for government employees

  • Employers contribute more than the 9.5% minimum
  • Modest range of investment choices
  • Newer members are usually in an accumulation fund, but many of the long-term members have defined benefits
  • Low fees
  • Profits are put back into the fund

Corporate super funds

Arranged by employers for employees. Large companies may operate corporate funds under the board of trustees. Some corporate funds are operated by retail or industry funds, but availability is restricted to employees

  • If managed by bigger fund, wide range of investment options
  • Older funds have defined benefits, but most are accumulation funds
  • Low to medium costs for large employers, could be high cost for small employers

Self-managed super funds

Private super fund you manage yourself. Many more nuances to this type of fund. Most prominent feature is the autonomy over investment.

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CGT concessions available to small businesses

By 19 November 2020 Tax
CGT concessions available to small businesses

Businesses receive four different types of concessions on top of CGT exemptions and rollovers which are available to everyone. These allow businesses to disregard or defer some or all of the capital gains from an active asset which is used in the business.

The four additional concessions include:

  • 15-year exemption: If the business has owned an asset for 15 consecutive years and you are 55 years or over and are retiring or permanently incapacitated, then the capital gain won’t be assessable when you sell the asset.
  • 50% active asset reduction: Being a small business, ATO permits reduction of the capital gain on an active asset by 50%. This is in addition to the 50% CGT discount if ownership of the asset extends over a year.
  • Retirement exemption: Capital gains incurred from the sale of active assets are exempt up to a lifetime limit of $500,000. However, you must pay the exempt amount into an appropriate super fund or retirement savings account if you are under 55 years of age.
  • Rollover: You may defer all or part of a capital gain for two years upon selling an active asset. Your deferral period can be longer than two years if you acquire a replacement asset or incur expenditure on making capital improvements to an existing asset.

Note that these concessions are only available upon disposal of an active asset and either of the following:

  • Small business with an aggregated annual turnover of less than $2 million
  • Asset used in closely connected small business
  • Net assets have a value of no more than $6 million (this excludes personal assets e.g home, as long as these have not been used to produce income)

There are also other criteria and conditions that the business will need to meet but you can apply to as many concessions that are applicable to you. Importantly, you can only apply to these in a certain order so be wary of this.

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Here’s why you need a written partnership agreement

By 12 November 2020 Business
Heres why you need a written partnership agreement

Having a strong relationship with your partners is extremely important, but sometimes it isn’t enough. Having a document which covers all aspects of running the business, both those which are liable to disputes and those which are not is essential.

If you haven’t done so already, the following are some reasons why you should create a written agreement now:

  • You and your business partners have a clear understanding of the rules and regulations which will apply to the business and to your business relationship.
  • If there is no agreement in place, then all the partners share equal profits and cover losses equally. This will be regardless of how much time and effort each partner contributes to the business. Creating an agreement will allow partners to tweak these aspects and create a unique division which represents the partner contributions more accurately.
  • If there is no agreement in place, then the terms of the partnership will be covered by the legislation of your state or territory. These have a one-size-fits-all approach which might not suit your business. Creating an agreement specific to your partnerships will mean it is tailored to the specific circumstances and relationships within your business.
  • Minor disagreements can lead to bigger problems if there is no set method to resolve them. A written agreement will allow you to create clear and unambiguous procedures to deal with those sorts of matters and allocate roles to each partner so that there are no confusions about decisions-making.
  • Creating an agreement will allow you to focus on the business end of things as opposed to spending time on dealing with specifics of the partnerships.

A written partnership will help streamline the nitpicky processes so that you can focus on the growth of the business.

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The importance of websites and social media

By 12 November 2020 Web
The importance of websites and social media

Businesses may be questioning whether they need to create a website if they have a social media presence. However, each plays a distinct role in the formation of a brand identity and therefore, both are important.

Social Media

Social media is straightforward and simple to set up, with no maintenance costs. It allows businesses to build brand awareness and interact with their customers in a more casual and relaxed way. Social media is essentially an in-depth marketing strategy which allows for paid advertising and has the capacity to reach many prospective customers from across the globe.

On the other hand, businesses could spend many hours working on content that does not end up reaching the expected audience. A lot of time is required to continually create and post content which receives engagement and loyalty from customers. Although there are no costs with having an account, if you want your content to be targeted to your audience, this requires payments which can be expensive.

Although social media gives access to customers you might not have otherwise had access to, it is difficult to convert these interactions into sales or use of your business services.


Your website means you have full control of the platform. You can create a platform that reflects your business and your values. This also means that there are no external terms and conditions you are required to follow, instead, you determine those conditions. A website is also perfect for referrals, as it demonstrates professionalism and builds confidence in your business.

Owning your own website means that you are able to track all incoming traffic and monitor the characteristics of your audience. This will provide you with a clear indication of what facilities you need to have on your website.

However, maintaining a website that is heavy in content can be time and money consuming. There are also a lot more details to be weary about when it comes to marketing – but considering the amount of customisation you can have on a website, this is no surprise. Finally the design and set up of a website can be quite complex, and isn’t necessarily something you can or should tackle on your own.

In summary, you should have both a social media presence and a website. Social media is an excellent marketing tool but a website is the heart of your brand’s online presence.

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Managing your finances to save more

By 12 November 2020 Money
Managing your finances to save more

It’s hard to know where to start when you decide to take control of your money. It can be helpful to know exactly how much money is coming in and going out to start this process.

Understand where your money is going

Although it can seem daunting to track every dollar you spend, it will give you a clear view of where you are spending your money. Small things often go missing when you estimate your spending, so taking note of these will help you understand the gap between your estimations and your actual spending.

Track your spending and expenses

You should start tracking your spending every day for a set period of time. This could be a few weeks or a few months. You will begin to notice patterns of spending the longer you track your expenses.

A simple way to track your spending is through a phone app. Certain apps will even allow you to limit your spending and give you an easy-to-understand overview of your expenses.

If you regularly use your card, then your bank statement will contain every translation detail. Views these regularly or at the end of the week.

Alternatively, you can also write down where you spend your money and how much you spent. This is especially useful if you regularly use cash.

Reflect on your tracking

At the end of this tracking period, you should be able to see where you most spend your money. Being aware of this might help reduce your spending but there are also other things you can do.

Take note of where you can save your money. There may be certain items that you regularly buy over time, which you might be able to cut down spending for by buying for the long term.

You should also distinguish between what you ‘need’ and what you ‘want’. This will give you a good estimate of what ‘wants’ you are spending most on and how to best cut down on them.

Test out a budget

Using this information, test out a budget and see if it works. This time, you should aim to set a realistic limit for the next week or month. You should account for some of your wants as well as your needs.

Your budget may require revising, but you should create one which balances your previous spending habits, and your future financial goals.

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What does an annuity involve?

By 12 November 2020 Super
What does an annuity involve

An annuity provides guaranteed income for a number of years, or for the rest of your life. It is also known as a lifetime or fixed-term pension.

You can buy an annuity from a super fund or life insurance company. You are able to choose whether you want the payments to last for a fixed number of years, your life expectancy, or the rest of your life.

In order to buy an annuity through your super fund, you must be in the ‘preservation age’ which is between 55 and 60. Additionally. You are required to meet a condition of release e.g. permanently retiring.

You are also able to buy an annuity in joint names using savings. Through this method, you can split income for tax purposes. If either you or your partner dies, then the survivor has ownership and access to the funds. On the other hand, buying an annuity using a super lump sum can only be in the name of the owner.

When you buy the annuity, you decide the payment amount you will receive. This can increase each year by a fixed percentage or indexed with inflation. Further, you can also choose if you are paid monthly, quarterly, half-yearly or yearly. There are some conditions the ATO has about minimum annual payments if your annuity is bought with super money e.g. must pay a certain percentage of the balance based on your age.

You decide what happens with your annuity if you pass away. You can either nominate a reversionary beneficiary or choose a guaranteed period option. A reversionary beneficiary will receive your income payments for the rest of their life, usually at a reduced level. The guaranteed period option will allow your beneficiary to receive their payments as a lump sum or an income stream.

An annuity will impact your eligibility for the Age Pension as it is accounted for in the income and assets tests which are conducted. You should discuss exactly how the annuity will impact Age Pension entitlement with a Financial Information Service (FIS) officer.

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What you need to know about claiming tax deductions

By 12 November 2020 Tax
What you need to know about claiming tax deductions

There are different types of deductions that individuals can claim to reduce their taxable income.

Work-related expenses

In order to claim work-related tax deductions, the expenses must have to meet three criteria. Firstly, all the expenses have to be paid by the individual, without being reimbursed by the employer. Secondly, they must be directly related to earning your income. Finally, there must be a record of the expenses (i.e. a receipt).

There are various different expenses that can fall under this category.

  • Vehicle and travel expenses: Commuting between different locations but not usual travel between home and work
  • Clothing, laundry, and dry-cleaning expenses: Cost of work uniform which is distinct and unique (i.e. has a specific logo)
  • Self-education expenses: Any courses or study associated with employees current role, such as textbooks
  • Tools and other equipment: If you purchase tools or equipment, then a deduction for some or all the cost could be claimed

Investment expenses

The cost of earning interest, dividends, or other investment income can also be claimed. This can include:

  • Interest charged on money borrowed to invest
  • Investment property ex[enses
  • Investing magazines and subscriptions
  • The money you paid for investment advice

Home office expenses

A portion of the costs associated with installing your home office can be deducted. The process is now much easier due to COVID-19. It allows people to claim 80 cents per hour for all running expenses. Additionally, people living in the same house can claim this individually, there is no need for a dedicated office.

Other deductions

There are also other deductions available. These include:

  • Union fees
  • The cost of managing your tax affairs
  • Income protection insurance (If not through super)
  • Personal super contributions
  • Gifts and donations to organisations that are endorsed by the ATO as deductible gift recipients

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Why your business should focus on innovation

By 5 November 2020 Business
Why your business should focus on innovation

Innovation doesn’t have to be a revolutionary and world-changing breakthrough. It can also be small changes you make to continually improve your business. Innovation can help in multiple aspects of business.

  • Improve sales and customer relationships: Putting the time and effort into improving your products and services is essential if you want to retain customers. Customers will recognise the changes you make and your commitment to doing the best you can for them. This will inevitably translate into improved sales.
  • Reduce waste and costs: Implementing changes which utilise new ways to eliminate waste and increase efficiency are extremely important. This will help you either increase your profits, or invest the money you save back into other necessary improvements for the business.
  • Improve employee performance: Creating a work environment that promotes innovation is more likely to keep employees stimulated and interested in their work. When employees are given the opportunity to suggest and implement changes, they are more likely to take pride in their work. This will also result in greater productivity.
  • Boost your market position: Innovation is also important in keeping up with changes in the market. Creating a company culture which is flexible and facilitates regular changes will mean that you can transform according to the needs of the market. This will differentiate you from competitors and boost your position in the industry.

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