at Level 2, 34-36 Thomas Drive, Gold Coast, 4217 Australia
Assisting people with reducing debt
Andrew Salsbury and Chris Paton have been associated for over 8 years in related businesses. Both through their own practices identifying a real need for a program that provides current and future financial goals Chris who is a qualified practicing accountant (fellow of the national tax and accountants association and CPA), with over 25 years experience in assisting clients with their tax and business finances. Through talking with clients Chris saw a real need for individuals and businesses to better manage their cash flow and finances. Andrew is the director of Australian Finance Centre a long running established mortgage broking business, established in August 2000 prior to that working in the finance sectors and development finance. Budget Buddies is not limited to Queensland where we are based, clients stretch from Humpty Doo in the far north, to Perth, Tassie and all major areas including isolated regions of Australia. Some of the topics we hear all the time: • Not reducing their home loans quickly enough • Accountants not giving up to date advice on financial matters until a tax bill comes • Failing to pay bills on time, or just not getting on top of those credit cards and paying ridiculously high interest charges • Earning really good incomes but again no cash at the end of the week, identifying it is the high tax rates so we work towards strategies to minimise tax (However if you are not paying tax then your earning s are not high enough), so it is important that you maximise your tax savings, the plan is to earn more money, pay less tax and have more disposable income • There is no age restriction to improve your current situation. • Like most of us we tend to leave our finances until tomorrow, thinking it will sort itself out, our clients that have requested strategies enjoy the regular communication, monitoring of their home and business finance and tax affairs, letting us make the right choices so that they can focus on what is right for them. • A lot of people when asked “do you take regular holidays or weekends away, or even that luxury pampering session” most laughed and said I would love to be able to afford it- Our aim is to ensure that this happens with the right budgeting and monitoring and that does not mean putting it on the credit card
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Cash is king! Take out enough cash to last one week at a time. It's much easier to turn down a $60 pair of shoes when it will take the last of your week's cash than it is when you just have to swipe a credit card. This can be an excellent way to help you prioritise your purchases.
RATES REMAIN OH HOLD 3/6/2014 NOW IS A GOOD TIME FOR BUDGET BUDDIES TO HELP YOU GO INTO THE NEW FINANCIAL YEAR TO ASSIST YOU BETTER IN YOUR FINANCIAL NEEDS • Mixed economic news indicates continuing wait and see approach • Housing markets reinvigorating although likely solid prices growth to remain below 2013 levels The Reserve Bank has decided to leave interest rates on hold over June with the likely prospect that the current settings will remain throughout the remainder of 2014 at least. The Bank has indicated it is taking a wait and see approach and that rates are likely to stay at current levels reflecting recent mixed economic news. Unemployment rates have remained steady with solid jobs growth although jobless levels in some states are still stubbornly high. Latest wage growth data is benign reflecting the low inflation economy with the level of real wages generally declining. The local currency has settled at levels probably higher than Bank expectations but with the recent upward trajectory moderating. The share market has also recorded recent moderate growth but without a real sense of surging confidence or rising speculative activity with overall levels remaining below the previous peaks of 2007. Home building levels although flattening recently remain encouraging higher than a year ago although the greater proportion of activity is with unit development which has a longer term impact on housing supply imbalances and economic activity. Housing markets are providing signs of reinvigorating following a softening of growth rates over the March quarter. Strengthening auction clearance rates over May in both Melbourne and Sydney from record listings together with rising buyer activity now in Brisbane and Adelaide indicate upside potential for solid prices growth over winter although not at the strong levels of 2013. Although official interest rates remain on hold at the lowest levels for 60 years, indicative mortgage rates remain higher than the levels of 2009. This indicates scope for downward mortgage rate movements from competition between banks for market share. Low and falling mortgage rates will continue to fuel housing market activity.
FINANCIAL STRESS AND CASH FLOW PROBLEMS FOR SMALL BUSINESSES If you’re facing increasing debt, take action instead of hoping for the best. If you fail to make payments on your business debts, the consequences can be disastrous. They can include loss of employees, seizure of stock and costly court cases brought by your creditors. Potentially worse, is the risk of government intervention (or in most cases the Australian Taxation Office). If you fail to pay the taxes you owe, the government will come after their money. The Australian government has the authority to get their money any way they can. They can seize your business assets, help themselves to the contents of your bank account, declare you bankrupt and even take personal assets such as your house or car. If you fail to pay the taxes you owe, the government will come after their money. Dun & Bradstreet handles debt collection for the ATO and has the biggest small business credit database in the country. Its chief executive, Christine Christian, says SMEs have not managed their cash flows well and are clearly showing signs of credit stress. The SME sector is unfortunately experiencing far more financial and credit stress than its big business counterparts. Part of the problem is managing cash flows. D&B says 66 per cent of businesses are failing to pay their bills on time: at present, it takes these businesses 56 days to pay each other. At its worst it took 58.3 days, and before June last year it took about 48-50 days. Small businesses are generally the last to get paid. Because the small business owners don’t have the wherewithal or understanding of the importance of cash flow, small businesses are not as assertive as they need to be. Manage what you owe before it becomes unmanageable. If you find yourself unexpectedly further in debt than you’d like, don’t panic. There are options available but they require action. If you sit back passively and wait for the worst to happen, it just might. So take action!!!! Manage what you owe before it becomes unmanageable. Here are some useful tips to help you take control of your debts. So stay sharp and aware of your situation. Use good quality accounting software to keep a close eye on your outstanding debt and monthly payments. This information should be at your fingertips at all times. After that, your priorities will depend on the type of business you run and how flexible your suppliers are willing to be. The following payment priorities are suggestions for you to consider: Payroll If you don’t pay your employees’ wages on time you may be penalised for this. You may be able to renegotiate contracts with some staff, but that’s likely to affect their morale. Suppliers and business partners Avoid losing valuable goodwill with your most loyal suppliers and business partners. Aged payables (60 days or more) If you don’t pay, your credit score will be impacted, which will affect your ability to borrow money in the future. Bills Outgoing costs such as rent and utility bills need to be paid to keep the lights on! And again, not paying these could affect your credit rating. Secured debts If you run your business as a sole proprietor or partnership, you might be held personally liable for debts, and creditors could try to take your assets. This is one good reason to form a corporation or limited liability company. Insurance Especially professional indemnity and public liability cover. Credit cards Avoid penalties or interest charges as these can pile up quickly. More than a third of business owners are less than comfortable about their levels of debt, so you’re not alone. Do everything you can to keep your business running, and talk to your accountant or Budget Buddies. With luck and perseverance, you’ll be able to turn your business around.
How will the Commonwealth Budget Affect you? The government’s 2014-15 Budget is likely to support business confidence with a range of positive measure, (ie cutting company tax by 1.5% which will help about 800,000 businesses) but the budget is expected to have a negative impact on households and families. Key components of the 2014-15 Budget: Tax Changes • Temporary budget repair levy income tax increase of 2 per cent for high income earners over $180,000 from 1 July 2014 for three years • Fuel excise indexation re-introduced from August 1, 2014 • Abolishing the carbon tax • Abolishing the mining tax Families • Family Tax Benefit Part B threshold reduced to $100,000 and no longer available after youngest child turns six • Family Tax Benefit Part A will start to reduce when family income exceeds $94,316 per year The Aged • Pension age eligibility rises to 70 from 2035 • Pensions increase twice a year linked to inflation instead of wages from 2017 • Pension asset and income test thresholds indexed between now and 2017 and then fixed for 3 years • Seniors supplement abolished from 1 July 2014 Unemployed • Unemployed under 25 to get youth allowance instead of Newstart • People under 30 to wait six months before getting on the dole and participate in Work for the Dole • Concessional trade support loans of up to $20,000 over a four-year apprenticeships • $10,000 payments to a business employing an Australian over 50 who has been on the dole Infrastructure • Infrastructure growth package of $11.6 billion to take government investment to $50 billion by the end of the decade • Money to drive $125 billion in spending on new infrastructure Government and the Public Service • Growth in Foreign Aid budget reduced to save $7.9 billion over five years • 16,500 public servants to lose their jobs over the next three years • Scoping study on government ownership of assets like defence housing, ASIC registry and the Royal Australian Mint • Abolish 230 bureaucratic programs • 70 government bodies abolished • Federal government to work with states to reduce overlap between layers of government • One year freeze on MPs and senior public servant salaries • Gold pass entitlements wound back for former and current MPs and eventually abolished • ABC and SBS funding cut by $43.5 million Business • Abolish industry assistance programs to save $845 million • Cutting company tax by 1.5 per cent for 800,000 businesses • Exploration Development Incentive to encourage small exploration companies • Reducing regulation and compliance costs on business by $1 billion a year Education • Universities to set own tuition fees from 2016 • Fees repayable after students enter the workforce and earn $50,000 • $820 million to expand access to higher education Medical • $20 billion Medical research Future Fund established • Funded by $7 Medicare co-contribution for GP visits starting in July 2015, and changes to the PBS until fund reaches $20 billion Defence • Defence spending to be increased to 2.0 per cent of GDP • New strategic plan for defence by the middle of 2015
What the Mega rich have been up to, please read post http://www.smh.com.au/comment/budget-pain-not-for-millionaires-who-pay-no-tax-20140512-zr9o3.html#ixzz31YshneLR