New Covid support for businesses: are you eligible?

Covid Support

New Covid support for businesses announced

 

Your business may be eligible for new types of lockdown support from the Government, which was announced recently. If you’re not sure whether you can claim, get in touch and we can help.

 

New support announced this week:

  • Short-term absence payment

A payment of $350 per worker, available to employers to pay workers who stay home waiting for Covid-19 test results. Also available for those who are self-employed. This is a one-off payment; find out more here.

  • Resurgence support payment

If your business experiences a decline in revenue of at least 30% over a two-week period during Alert Level 2 or above, you can claim this payment. Anyone who has been in business for at least six months is eligible. Again, a one-off payment. Available from Tuesday, February 23. You can find out more here.

 

Ongoing support:

  • Leave support scheme

If your staff members can’t come into work because they must self-isolate, and they can’t work from home, your business can get help to pay their wages or salary. You can find out more here.

  • Wage subsidy scheme

This will apply if we are in Alert Level 3 or higher for at least a week.

  • Business finance guarantee scheme

Small or medium-sized businesses may be eligible for loans, supported by the Government, without needing a personal guarantee. You must still repay these loans, but they can with cashflow. Find out more here.

 

 

We’re closely watching all the announcements about support packages for businesses. We can work with you to identify any support you or your business are eligible for, and we can apply on your behalf for any of these schemes and payments.

Starter Pack for Trade Business

40% off for Tradies

Already downloaded our “Tradie’s Guide to Starting a Business” ebook? If so, it could be time to take the next step!

We’ve been so delighted with the positive feedback we’ve had that we’ve put together a special offer designed especially for Tradie Start-ups & Contractors thinking of going solo.⠀⠀⠀⠀⠀⠀⠀⠀⠀
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It’s just for Tradies and 40% off the normal price.⠀⠀

The Starter Pack includes:

 

  • One hour initial consultation
  • Company Formation – including AML compliance, IRD number and GST Registration
  • Set up Xero with subscription discount (subscription excluded).
  • Assist with the creation of Xero bank feeds, invoice templates, inventory items and payroll set up if required
  • Up to 3 hours of Xero Training and unlimited Xero support for the 3 months following set up.

 

Normal Value would be $1,100 plus GST including Companies Office charges. Our starter package is priced at only 

 

$650 plus GST including Companies Office charges.  

Sounds good? Call us on 09 366 7025 or drop us a line now.

10 Steps to a more Successful Business

Business Success

We know that setting up you’re own business takes courage and determination.

It’s challenging, and it’s very normal to question why you’re even doing it from time to time, particularly after the impact Covid-19 and the associated lockdowns had on business.

But you’re here because you had a vision. You decided being in business was a better way to achieve that vision than working for someone else. And, you’re right; you just have to work on it.

It’s likely that you’re an expert at what you do… maybe you’re a plumber and know the inside of a washing machine like the back of your hand. Or, maybe you’re an interior designer who can style anything. This doesn’t mean you’re an expert at running your business though. It’s hard taking time out of working in your business to work on it. But doing this is essential for its success.

There’s no magical overnight solution to building a more successful business. It’s about taking small steps every day to get a bit better than the day before.

So, what should you do to build yourself a more successful business? We’ve broken it down into 10 essential steps:

  1. Get clear on exactly what it is that you want.
  2. Be open to change and new learning.
  3. Define where you are now (warts and all).
  4. Make a plan.
  5. Get your organisational structure right.
  6. Be a better leader.
  7. Be held accountable by someone independent.
  8. Build strong networks.
  9. Monitor your progress.
  10. Keep your well of happiness full.

These are the 10 most important things you should be working on to ensure you achieve your goals. Small, incremental changes can have a massive effect on your success.

We’re here to help you, every step of the way. Get in touch!

“Success isn’t overnight. It’s when every day you get a little better than the day before. It all adds up.” – Dwayne ‘The Rock’ Johnson

Thinking of setting up business Online? Get sales ready..

Setting up Online

This year has seen a boom in businesses going online and needing to set up Payment Gateways. Making it easy for your customers to complete purchases or bookings online has never been more important. Whether you’re thinking about using Vend or Shopify there are considerations for an e-commerce site that differ from a normal website.

Think about the following 6 elements:

1. Use advanced features

Think about your audience and consider what features would make buying from your site easier and more pleasant. These could be the ability to buy gifts for others, track delivery, or check order history. If your visitors come from around the world, you can offer to show them prices in their local currency, or only the products that will ship to their destination. From your perspective, think about how you will plug your payment tool into your accounting software to keep an easy track of finances.

2. Follow a no-surprises policy

Tell people about any extra charges, delivery fees and the returns policy upfront. The more information you can provide, the better the experience for your customer. And happier customers means fewer support tickets you’ll have to process.

3. Focus on great imagery

Images must replace the in-store experience where shoppers can see and touch products. So, photography that makes products look good, while also giving as much detail as possible, will help reassure consumers that they’re making the right choice.

4. Make payment processing easy

You’d be surprised at how easily you can lose a sale if paying feels too hard, or takes too long. Make sure your payment process is easy with clear steps until the sale is confirmed.

5. Make sure it is secure

People are trusting you with valuable information such as their payment details and contact information. You need to keep that information safe. To protect the confidentiality and integrity of their data use HTTPS (hypertext transfer protocol secure). The ‘S’ is important as it makes sure that the communications between a user’s browser and your website are encrypted. Google are now indicating connection security with ‘secure’ in the address bar so make sure your site is up to date.

6. Support

Remember your e-commerce site replaces the in-store experience – help sections with things like FAQS, support desks and live chats can go a long way to replicating the role of the retail assistant. The goal is to make the process feel as easy as possible for your customers – and to be there with help if anything goes wrong.

Tradie Start Up Guide: Free to download today

contractor and tradie startup guide

Ready to create and grow a business where you can be the boss? Then you’ll need this!

Our simple guide to going starting a trade or construction business covers how to set up your own business, what you need to know to get started, creating a one-year basic plan and some of the systems you’ll need to succeed – all tailored for New Zealand tradies.
Get this easy read online book for free and you’ll discover how to launch yourself from tradie to independent business owner.
https://smefinancial.co.nz/tradiesguide/

Will your Trust still protect you under the new rules?

Refer a friend Scheme Accounting Auckland

Kiwis love trusts – we have up to 500,000 family trusts in New Zealand. We use them for all sorts of reasons, but mainly as a way to protect wealth. Trusts were once a bit of a free-for-all, but over the past decade or so, the law has been clamping down on how trusts must be run. The latest change is the introduction of the Trusts Act 2019, which gives us more clarity on how trustees must act and how trust beneficiaries must be kept informed. 

So what do you need to do differently under the new rules? 

As a trustee, what do I need to do? 

If you’re a trustee, your duties are now set out in the new Trusts Act. There are mandatory duties that always apply, like acting honestly, and default duties that only apply if your trust doesn’t modify or remove them. Check those duties and make sure you’re opting out of default duties that don’t suit your trust. For instance, the duty to “invest prudently” could arguably require diversification if you don’t opt out. You should take independent legal advice about your trust before the January 30 deadline. 

The first step is to make sure you provide the beneficiaries of the trust with the right information before January 30, 2021.

I’m a beneficiary – what changes for me? 

If you’re a beneficiary, you should get basic trust information without needing to ask for it:

  • You are a beneficiary of this trust.
  • These are the names and contact details of the trustees.
  • You can request a copy of the terms of the trust, and more information. 

You can then request more information, you should get: 

  • Details of the terms and administration of the trust.
  • Any information that is required for you to see that the trust is being run correctly. That will probably include financial statements.

What if I don’t want my kids to know how much is in the trust?

Sometimes trustees don’t want beneficiaries to know about what’s in a trust, often if it’s to do with an inheritance for the kids or grandkids. There is a process to help trustees work though a situation like this, which can result in partial information supplied to beneficiaries. You’ll need to work with your lawyer and your accountant to make sure your trust complies with the new rules. 

Is my trust still going to work as I want it to? 

In the past, there were lots of reasons to set up a trust. With these changes, and earlier legislative tweaks, trusts don’t provide the blanket protection they once did. When it comes to protecting relationship property or reducing your testable means, for instance, you should review your trust/s – they may not be protecting you as much as you think. 

Every case is different, and this is an area of finance where the right advice is crucial. You need to consult your accountant and your lawyer about your situation – give us a call today to talk about the potential tax implications of any trust changes.

Xero’s Starter Plan just got better

Xero Starter Plans for SMEs

It’s been a tough year for small Kiwi businesses, so it’s always nice to get a little bit of good news. Last month Xero announced changes to its Starter plan, the entry-level Xero monthly subscription – a way to support small businesses during the pandemic as on-the-go accounting is more important than ever.

Check out the upgrades to the Xero Starter plan, effective from September 14, 2020:

Previously

Now

Bank reconciliations

Limited to 20 per month

Unlimited

Invoices

Limited to 5 per month

20 per month

The Starter plan is $27.50 per month, although new users can pay $13.75 per month for the first four months – and you can try Xero for free for 30 days. Remember that if you’re an SME Financial client, you get a discount on your Xero subscription, which we pass onto you.

The bank reconciliation feature keeps your numbers accurate, and you can set up bank rules to automatically reconcile regular transactions, saving you time. You also have Hubdoc, which means you can automatically get bills and receipts into Xero, making reconciliation easier. With the new higher limit on invoices, the Starter pack means you can send an invoice almost every working day of the month. Check out this video for invoicing shortcuts, and don’t forget to set up automatic reminders to help you manage outstanding accounts.

With these changes, the Starter plan is perfect for small businesses. It is designed to provide you with the flexibility to grow, at an affordable price. The Starter plan might be ideal if you’re a sole trader, a freelancer, contractor or tradie. It might even work if you’re a better-established small business owner doing only a small number of invoices each month. A few of our clients are switching from the Standard plan at $60 per month down to the Starter and saving themselves over $30 a month.

SME Financial is a Xero Gold Partner, which means our team gets a high level of training and support from Xero. We pass on that knowledge to our customers through our Xero training services and ongoing Xero support.

You can explore all the features here, and the changes are already in place so if you’re currently a Starter pack user you can start using them right now.

Questions about Xero? Wondering whether you’re in the right plan for your business needs? We can help. Get in touch with SME Financial today.

Considering Buying a Business? 7 Top Tips to consider

Top tips for buying a business

Wondering how to go about buying a business? Taking over an existing business can be a great way to get go out on your own as a business owner, or to grow your profits if you are already running a business successfully.

Established businesses have put in the groundwork of the business set up, so you can get up and running on day one without a lengthy formation process.

7 Things You’ll Need to consider

  1. Why is the business for sale? – It’s important to understand the motivation for the sale, whether strategic or whether an emergency sale. There may also be hidden reasons for the sale which your research can uncover.
  2. Research – Do more than you think you need to! Market research, investigation, learning and questioning about the potential business, the locale, the industry, the customers, the suppliers, the competitors, the market and the nature of the goods or services being sold will ensure you don’t rush into a decision just because it looks like a good deal.
  3. Due diligence – You’ll need to see detailed financial records, contracts, licenses, supplier agreements, lists of equipment, assets and inventory, lists of liabilities, loans and debts, and all employee records before making your decision. We can help review this – we’ve seen every type of record imaginable over the years.
  4. A good business growth plan – That covers one year, two to three years and possibly five years as well. This will help you to look at the longer-term and big picture, assess the potential of the business and give a realistic picture of what you are committing to.
  5. Independent advice – one of our core services is business advisory and we often work with other industry experts like a business broker or lawyer. You might think a business looks like a great potential, but objective observers may pick up issues or queries that you have not.
  6. Finance – Whether it’s your own funds, a business loan or short term finance options, you will need to work with your advisors and refer to the business plan to assess how much you will really need for the initial purchase, transition period, and future investment.
  7. Commitment to the work – Being prepared for responsibility required to run a business. Running a business does require certain skills, as well as time, energy and money. You need to be clear about your reasons for going into business and to be sure you are up for the challenge!

When considering a business, SME Financial can help you to analyse the financial reports, activity statements, tax returns and sales and purchases records to give you an independent overview of the financial performance and potential of the business.

We can assist in understanding the financial performance and benchmarks of a business you are considering buying, so that you make the best decision possible!

Your home office: What expenses can you claim?

Home office expenses: a guide

Almost everyone has been working from home this year – some of us loved it, some of us hated it. But whether you love the chilled-out pyjama vibe or you’re longing for the bustle of a busy office, it does add a little extra to the power and water bills. 

 

So, how much can you claim in expenses when you’re working from home?

 

Home office expenses when you’re an employee

 

If you worked from home during Lockdown, is your employer required to cover some of your home office costs? Sorry, no. Despite earlier rumours of an Inland Revenue sum of $15 a week for those working from home, there is no obligation for your employer to recompense you for extra power, water, gas or phone costs. 

 

Your employer can choose to pay you up to $20 a week tax-free for expenses or a one-payment of up to $400 for furniture; that money comes out of their own pockets, not the government’s. 

 

Home office tax deductions – what can you claim? 

 

Whether you’re a contractor, sole trader, in a partnership or you own your own business, you can claim expenses for your home office. But the amount you’ll read about on the Inland Revenue website is – perhaps intentionally – much lower than what you might actually be able to claim. 

 

Inland Revenue provides a simplified per metre calculation rate of $42.75 per square metre for your home office for the 2019-2020 year. The calculations provided by Inland Revenue are extremely conservative and don’t take into account all the ways you might use your home. For example, your garage is excluded on this visual guide. But if you’re a contractor who uses the garage to store work tools and equipment at night, that’s a business use. And the numbers use a dedicated home office as an example, when thousands of Kiwi business owners use the kitchen table as their office. How do you work that out? We can help. 

 

IR numbers are just a starting point

 

The number you’ll come up with using the online information is a baseline only – by making sure we fully understand the configuration of your home we could add considerably to that. As a guideline, you may be able to claim between $100 and $300 per month. Give us a call or drop us an email, and we can make sure you’re claiming as much as you’re entitled to. We can provide a new perspective on how you use your home and how your business is positioned as part of your household expenses. 

 

We always work within the tax laws, making sure our clients get the maximum benefit possible by ensuring we fully understand the way you work from home and then working to maximise their claims – we ask questions, we dig into your accounts, and we aim to minimise the amount of tax you have to pay. 

Last chance to apply for the wage subsidy extension – and a reminder about IRD notices

wage subsidy

Now’s the time to get in touch about the wage subsidy

Is your business still struggling with the impact of the lockdowns? Applications for the government’s wage subsidy extension expire on September 1, so if you think your business might qualify, get in touch with us immediately.

The subsidy provides $585.80 a week for full-time employees and $350 a week for part-time employees. It covers eight weeks: $4,684 for full-timers and $2800 for part-timers, all tax free.

Is your business is eligible?

Your business needs to have had a 40% drop in revenue for a 30-day period in the 40 days before you apply. We’ll take a look at your accounts for the past months and see if there’s a period where your revenue is down 40% on last years. Then we can help you apply and if you’re eligible you’ll get the money in your account very rapidly.

Will there be another wage subsidy now we’ve had another lockdown?

The government is thinking about funding another wage subsidy for Auckland if the lockdown persists. Money has been set aside to support businesses in the event of another prolonged lockdown.

Check with us about any IRD notices

If you get a notice from the Inland Revenue in the post, or you login to MyIR and look at your information, it may be out of date. Before you make payments or panic about any tax that’s owed, give us a call or drop us an email.

The reason this happens is because the Inland Revenue Department is using automatic calculations, often based on last year’s results, which may not be accurate. Here at SME Financial, we’ve been working hard to recalculate how much tax you need to pay. We’re doing regular reassessments and loss carry-backs, which can reduce the amount of tax owed.

Get in touch

That means you might get a notice from IRD saying you need to pay a larger sum than you actually need to pay – talk to us before you make a payment or panic, we can check whether any IRD correspondence is accurate for your company’s current situation.

Any other questions you have about the wage subsidy or about how much tax you need to pay, just drop us a note or pick up the phone. We’re in lockdown right now but still operating a full capacity and normal working hours.