Visit to our Indian Team.

Visit to our Indian Team.

In mid July I visited our team in Ahemedabad, India.   Ahemedabad has a population of around 7 million and is the sixth largest city in India.


It was great to meet the team and get an opportunity to sit down with them, and visits the offices and see the out sourcing operation that is currently providing services to the US, UK, Australia and New Zealand.
The team work only for us, using our systems and procedures.  They are incredibly professional and well trained accountants, with a very strong knowledge of Australian accounting standards and tax law. The company, Bck Offis, is a subsidiary of one of India top accounting practices.
It was not all work and I got the opportunity to visit some amazing temples and taste a lot of the regional food which was fantastic.

However the best part of travel is getting to meet the locals.

I have to thank Namit, Hardik, Punit and the rest of the team for making me feel so welcome and showing me some of their amazing city.
I look forward to returning.

Preparing your Management Rights for Sale


Preparing your Management Rights for Sale

This week the RAAS group held a conference in order to educate all those interested in preparing their business for sale.  A range of speakers from different specialties, [Accounting, Legal & Banking], were invited to speak to the group at the Maroochydore Surf Club.  Peter O’Rielley from our firm was invited to provide that specialist advice.  From all reports the conference was well attended and participants took the opportunity to educate themselves on some of the issues that need to be considered when preparing for sale.  If you were unable to make the conference but would like to hear more about how McAdam Siemon can assist in this area, then please give Peter a call.

New ASIC fees for the 16/17 year


New ASIC fees for the 16/17 year.

To Register a New Company

$469.00 (was $463.00)

Late lodgement fees

If paid within 1 month after payment due date –$76.00 (was $75.00)

If paid after 1 month of payment due date –$316.00 (was $312.00)

Annual Review Fees

Proprietary company –$249.00 (was $246.00)

Special Purpose Company –$47.00 (was $46.00)

Change Company Name

$387.00 (was $382.00)


Voluntary Deregistration


Ransomware Alert

Ransomeware Alert

Earlier this month, we were alerted by our IT guy regarding a computer virus raring its’ ugly head again.  This virus comes in an email format and has an attachment that if opened is a virus with ransomware.  This is where the virus locks your entire system and you have to pay a Ransom for it to be unlocked. He has advised that in most cases these viruses can cause huge amounts of damage and down time for our business.

We suggest that you check with your IT Provider that they have implemented policies to lock down systems and also implemented multi – layer protection and ensure good backups.

Warning on Bank advice to business owners


Warning on Bank advice to business owners

Some banks are advising customers with business accounts to transfer excess cash to pay down the business owner’s home loan.  While it might sound like common sense to use the excess cash in your business, there are significant potential problems for business owners who do this.
Money in your business account is the money of the business, not your personal cash.  You can’t just take it out and move it around at will, even if it is your business.

If you run a company, there are a set of tax rules called Division 7A that apply.  Division 7A is a particularly tricky piece of tax law designed to prevent business owners accessing funds that have not been taxed at their individual tax rate – only the corporate rate.  While these amounts are often debited to the shareholder’s loan account in the financial statements, Division 7A ensures that any payments, loans, or forgiven debts are treated as if they were dividends for tax purposes unless there is a valid shareholder loan agreement in place.

So, if you take money out of your company bank account to pay down your personal home loan, this amount might be treated as a deemed dividend.  That is, you need to declare this amount in your personal income tax return and the dividend is not frankable. This means that even though the company might have already paid tax on this amount, you will be taxed on it again without the ability to claim a credit for the tax already paid by the company (basically leading to double taxation).


If you have taken money out of the company account for personal purposes you can either pay back the amount or put a complying loan agreement in place before the earlier of the due date and actual lodgement date of the company’s tax return for that year.  To be a complying loan agreement the agreement requires minimum repayments to be made over a set period of time and the minimum benchmark interest rate to apply – currently 5.45%. The rules are also very strict when it comes to loan repayments because these can actually be ignored if it looks like you are planning to borrow a similar or larger amount again from the company.

A similar issue can also arise if you transfer funds from a trust bank account, especially where that trust already owes amounts to a related company in the form of unpaid distributions.

The material and contents provided in this publication are informative in nature only.  It is not intended to be advice and you should not act specifically on the basis of this information alone.  If expert assistance is required, Please do not hesitate to give us a call.

(Courtesy: The Knowledge Shop)

Pushing too hard with deductions!

In 2014, a Sydney man had to pay a hefty penalty after the ATO discovered he was falsely claiming thousands of dollars on work related expenses.

McAdam Siemon Business Accountants Upper Mt Gravatt, Noosa Heads & Maroochydore. Specialising in Accounting, Taxation, Management Rights, SMSF Administration, Business Advisory, Business Valuations , Management Rights specialist accountants, If you push too hard the tax man will get you.

If you push too hard with deductions the taxman will get you.

This guy worked as a salesperson and under the conditions of his employment he was able to work from home. He was advised by a Registered Tax Agent.

The dispute arose out of an audit of his tax affairs triggered by his 2010 tax return in which he declared a taxable income of $21,377, and claimed deductible items to the value of $97,162.

The ATO disallowed various tax deductions for the 2011 and 2012 financial years.

The tax office also imposed a penalty on the basis that he or his agent had “failed to take reasonable care or comply with tax law when claiming work related expenses”.

The sales person disputed this and took the matter to the Administrative Appeals Tribunal.

Here are examples of some of the expenses he tried to claim deductions for:

  • Thousands of dollars for secretarial services completed by his son. (His son was around 7-years-old at the time)
  • Thousands of dollars of groceries as work related expenses (The groceries included cheese in a can and 39 packets of Monte Carlo biscuits.
  • Clothing, rubber soled shoes, dry cleaning, sunglasses, broad rimmed hat and sunscreen (just to name a few!)
  • Home office expenses
  • Other work related expenses

To read the full rulings click on the link below.

To find out more, please contact us

So, what are the deductions you can claim?

(Source: ATO, 14 March, 2016)

When completing your tax return, you’re entitled to claim deductions for some expenses, most of which are directly related to earning your income.

To claim a work-related deduction:

  • you must have spent the money yourself and weren’t reimbursed
  • it must be related to your job
  • you must have a record to prove it (there are some limited exceptions)

If the expense was for both work and private purposes, you can only claim a deduction for the work-related portion.

Follow the links below for specific deductions you can claim:

The staff at McAdam Siemon will get your deductions right because we have the checks and balances in place.



If you have one employee but less than 19


If you have one employee but less than 19, You must be Super Stream ready by 30 June 2016

  • Do you have 19 or fewer employees?
  • Are you an SMSF Trustee? Self-managed super funds (SMSFs) must be able to receive employer contributions and the associated data electronically.
  • APRA – regulated funds

From 1 July 2016, the ATO’s SuperStream standards are set to be enforced.

A reminder:

  • If you are a larger employer, you should already be using SuperStream.

A Brief Overview

These new rules require employers to pay and report contributions to superannuation funds electronically. Both the payment and the reporting will need to be completed on the same day.

  • These measures don’t apply to individuals who are making personal contributions direct to their superannuation funds, only employers.

SuperStream will make it easier for you. 

  • You need to use SuperStream when paying employees super.
  • With SuperStream contribution payments are made electronically and you can pay all your employees super; sending all their information through one clearing house; saving you time and effort.
  • Providers must be approved by the ATO and are listed on the ATO website.

You should have already started transitioning by choosing an option to make super contributions electronically: 

  • Your payroll system
  • Your super funds online system, or
  • The Small Business Super Clearing House (SBSCH). This is a free service administered by the ATO whereby you can make super guarantee contributions as a single payment to the clearing house and it distributes the payments to the employees fund/s.

Next: You need to collect the following information on your employees. 

  • Their Tax File Number (TFN) and,
  • A Unique Super Identifier (USI)
  • Super fund ABN
  • For employees who have selected a SMSF for their contributions, they will also need to provide their Fund’s Bank Account details and Electronic Service Address (ESA)

Once this is done, these details must be entered into your preferred clearing house site.

For new employees, the ATO has updated the Super Choice form to include collection of the extra information required.

Start using SuperStream as soon as this process is completed so that any problems can be solved before 30 June, 2016.

If you any questions on setting up SuperStream super contributions for employees, please contact McAdam Siemon.



Golfing greatness….
We all strive for it don’t we?

Well I do anyway!  That perfect round where everything drops and you split the fairway every time.  I have been trying for close to 17 years for that one round and it still eludes me; not from lack of trying I might add, probably more so the lack of ability hinders me.

I love golf. I’m a golf tragic and happy to admit it! I would probably prefer to talk about golf with someone than pretty much anything I can think of.

So when the opportunity came about to become involved with the Australian PGA; its members and the golfing industry; I jumped at the chance.

Last year PGA Australia undertook a program on behalf of its members to offer a network of preferred service providers to the industry.  I was part of an intense two – day program exploring the golfing industry as a whole and how it could be better serviced.

The main focus was on PGA Australia members, which include, touring (playing) pros, coaching pros, pro shop owners, and general golfing retailers and support sectors.  This was a valuable process and built on the knowledge of the industry I had already accumulated.  Further work with PGA Australia followed and has resulted in McAdam Siemon Pty Ltd becoming a registered preferred supplier to the golf industry.

In order to build on this foundation, it was necessary to get the word out on the street, to promote the services to the industry.  What better way to do it than through a PGA member.

We chose to sponsor Matthew Field, who has been a PGA member for a number of year now and is searching for his break on tour.  Matt has played in a number of events around Australia and internationally.  Matt is also a key member of the Golf Queensland team and organises many of the events for amateur golf around the state.  We welcome Matt to the McAdam Siemon Team and wish him all the best for the coming year. We hope it is a successful one for him!!

If you would like to read more about Matt and his adventures visit his website at

I have already had the pleasure of working with a number of PGA members so far and the experience has been fantastic.
The industry seems to be growing to high levels and it takes professional members with great knowledge, skill and attitude to succeed.

I hope to offer valuable ongoing support to the industry and its members for years to come, and maybe sneak a few extra rounds in here and there!

If you ever want to chat about Golf, drop me a line.

Happy Golfing

Jordan Spieth World #1 (Left)  Matthew Field (Right)

2016 represents the 20th year of McAdam Siemon

Well Christmas seems but a distant memory and Easter is just around the corner (I think Hot Cross buns hit the stores on 6 January), kids are back to school and the year is well and truly underway.



2016 represents the 20th year of McAdam Siemon when John  and I opened our doors on 1 January 1996 at Kangaroo Point and a hole in the wall at Noosa Junction with 4 staff. 

Today we operate out of Upper Mt Gravatt, Noosa Junction and have just opened an office in Buderim.  Sam Hodgetts joined us as a partner in 2013, having started work in the Noosa Office and 12 staff.

It has been an amazing 20 years with us still acting for clients from our inception.

John, Sam, and I certainly appreciate and never underestimate the loyalty shown by our clients through the good times and bad. (luckily lots more good times.) 

This year the team at McAdam Siemon will be focusing on working with our clients so that they can focus and achieve your goals.

To help you achieve this we have developed a number of tools that will allow you to have a better understanding of your business and focus that is required. 

1. Breakeven analysis

2. Using your accounting package effectively and efficiently to save time and money. 

3. Tax planning tool

4. Fathom – to truly understand your business and set goals 

We will discuss these in more detail in future newsletters and of course our experienced team will discuss them in more detail when they meet with you. 

We look forward to our continued close working association with you.

Random ATO Audits 2016



Random ATO Audits  2016

The ATO has decided not to reduce their random audits in 2016. They have now confirmed that random audits will recommence.
The compliance program will be physically audited, targeting 600 individuals and small businesses and focusing on underreporting and tax evasion.

There is good news for some though.

The ATO has contacted 500,000 taxpayers advising that their tax returns will not be subject to further review. This ATO project is aimed at taxpayers with straight – forward affairs and a taxable income of less than $180,000.
The ‘certainty letter’ is an assurance that the ATO will not review the return unless they find evidence of deliberate avoidance or fraud.

What is a ‘certainty letter’?

This year the ATO is sending letters to some taxpayers as part of a trial to confirm their 2014-15 tax return is finalised.

Record Keeping for Tax Purposes




Frequently our clients ask us these questions with regards to record keeping for tax purposes.

  • How long should I keep my records
  • Is it acceptable to keep my records in an electronic format, or are paper copies sufficient?
  • Why should you keep records?
  • How do I know what records I should keep?

How long are you required to keep your records? 

Generally speaking, all of your evidence must be kept for five years from the date you lodge your tax return:
i.e. If you lodge your 2015 tax return on 1 December 2015 any records associated with that return (generally) can be destroyed on 2 December 2020.

·      If you acquire or dispose of an asset (e.g. shares or a rental property, dividend reinvestment statements) – 5 years after it is certain that no capital gains tax event can happen.
·      If you are in a dispute with the ATO – 5 years from the date you lodged your tax return and the dispute is finalised.

The Australian tax system relies on taxpayers self-assessing, so what do you need to keep?

As far as the ATO is concerned, you can store your documents in either format. Remember though…

  •  If you keep paper copies they must be a true and clear reproduction of the original.
  • If you keep your records electronically, we strongly recommend that you keep backup copies – what if your hard drive is corrupted?

Why should you keep records?

  • To provide written evidence of your income and expenses.
  • To help you or your tax agent prepare your tax return.
  • To ensure that you are able to claim all your entitlements.
  • In case the ATO asks you to prove the information you provided in your tax return.

What records should you keep? 

  • Any payments you have received.

  •  Any expenses related to payments you have received.
  • When you have acquired or disposed of an asset (shares or rental property)

  • Any tax deductible gifts, donations and contributions.

You may also need to keep records in some other categories, or for other members of your family – for example, if you receive the family tax benefit.

You may decide not to keep particular records – for example, because you expect to claim for only a small amount of business travel. If it turns out that you travel more than you expected during the year, you may be limited to a smaller claim than if you had kept more records.

If you are unsure about whether to keep or destroy a record please do not hesitate to give one of the team at McAdam Siemon a call.

Kind regards

Rob McAdam, McAdam Siemon Accountants

Rob McAdam


5 Essential Elements of Business Success

What succeeds in Business land?


Recently I joined a interested group involved in franchising for drinks, nibbles and networking event hosted by Peter McLaughlin, (Director of redchip Lawyers); on behalf of FAN.

We heard from Peter McLaughlin & Peter Knight, Founder of the Franchise Accountants Network and his business partner Katie Groom. They spoke about the 5 Essential Elements of Business Success

It was an enjoyable and informative couple of hours we all had, hosted in redchips’ sensational architecturally designed premise.


What were the 5 Essential Elements of Business Success that were talked about?


  1. Adaptability

“It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change”

Charles Darwin

One of the franchisors in the room had recognised “That if you fail for adapt, your business will pay the price”.

  • Does the bore of social media come to mind?
  • Have you investigated the use of cloud based accounting software. We have a number of case studies that show significant cost savings and real time financial data.
  • Do you keep a watch on the economy?
  • Is your business up to date with technology?

2. Planning

Think about this: “Doing things right vs Doing the right thing”

When it comes to business is there a difference in doing the right thing and doing things right? You need to do the right thing in your business as a business owner for it to flourish and grow.

  • Where is your business heading? Your likes vs dislikes.
  • How do I get to where I want my business to be?

Essentially you need a Business Plan.

Rather than try and plan out for the next 12 months break your plan down into 4 x 90 days per year (less than 100 if you hate large numbers). Your BAS is due every 3 months, so this is a great time for a review.

FAN publish weekly business tips which will help you:

3.Business & Financial Disciplines

Regular weekly meetings are a must. Which day works for you?

These meetings get the team focused on achieving the goals for the week and dealing with any issues.

It is also recommended that a monthly meeting looking at the 3 key elements of your business:

  • Sales & marketing
  • Operations & productivity
  • Business & financials

4. People Development

How are you developing your team (staff & associate staff) to make them more productive?

Why bother with staff training when it can be expensive and they might leave? Because your staff are your primary customers. Creating a great culture in your business will be very rewarding.

Training is a must because it:

  • improves loyalty –  staff need to feel valued
  • builds productivity –  insufficient staff training can increase how much value you are getting from your staff which can increase your costs.
  • helps attract new employees – have you thought about a staff succession plan?

The suggestion on the night was once or twice a year take some time to assess your “people development” Is the culture/vision of your business on track?

5. Sales

While number 5 this is the most important one.

Without sales everything else is meaningless.

Your business should constantly be in sales mode.

The whole perspective of your business should be being proud of the services you provide to your customers – that special moment between you and your customers.

This is the special moment that will influence whether your client or potential clients will decide to do business with you!

Whilst we practice the 5 Essential Elements across the range of our businesses…..

It was a great reminder on how important these elements are.

If you have hit a stumbling block in any of these areas or would just like to touch base, please give me a call:

07 3421 3421

Rob McAdam


I trust my Accountant: why can’t they advise me about an SMSF?

I trust my Accountant: why can’t they advise me about an SMSF?

Written for McAdam Siemon Pty Ltd, by Eric Walters FCPA(FPS) FAICD



The short answer is – they can, BUT….

Over the past several years, particularly following the Global Financial Crisis (also popularly referred to as: the GFC, the Great Recession, the global credit crunch), the rules and regulations around the provision of advice in relation to financial products have been tightened somewhat: and the regulations dealing with the necessary qualifications and experience of those delivering such advice have resulted in changes in licensing for Accountants as well as increased regulation for financial planners generally.

Whilst the previous provisions (the ‘Accountants’ exemption’) were more often recognised in the breach (‘ignored’) than complied with, the new rules which come into full effect on 1 July 2016 are far more onerous on accountants. Hence it is likely that there will be some reluctance on the part of most accountants to provide even the most basic of advice about whether to start, or indeed to continue, a self-managed superannuation fund (an SMSF) – once they understand how these new rules apply.

Under the Accountants’ exemption, accountants could advise about forming an SMSF – but could not advise about rolling existing superannuation accounts into that SMSF; nor about how to invest the contributions received by the SMSF.

In a change that took effect on 1 July 2014, this exemption is being phased out in favour of a limited licensing regime: accountants who extend their already broad range of expertise to qualify for the granting of the limited licence will need to undertake additional study – and maintain their new skills and knowledge with ongoing professional education.

Under the limited licence, accountants will be able to (amongst a limited range of compliance and associated ‘administrative’ matters) –

  • Advise on the establishment of an SMSF;
  • Advise on the formulation of an Investment Strategy;
  • Provide general information about investment assets – but NOT any specific shares, property of managed fund products; and
  • Provide general information about the various types of personal life insurance – but NOT about any particular insurance company’s product offering.

….and so, in view of the onerous conditions applicable to attaining the limited licence; and the justifiable approach of ASIC in supervising this rapidly expanding area of their responsibility – it is not surprising that many accountancy practices elect to outsource their SMSF advisory tasks to comprehensively-licensed financial planners.

Our position

McAdam Siemon Pty Ltd has operated under the Accountants’ exemption in the past, but since the incorporation of SmartChoice SMSF Administrators Pty Ltd (‘SmartChoice’, as an associated entity of the accountancy practice), refers all requests for advice in relation to SMSFs and their administration to that company.

One of the partners, John Siemon, is a director of SmartChoice: he is qualified and holds a limited advice licence. John will be supported by Susan Stainwald (who works in SmartChoice) who is currently undertaking the requisite licensing process. Under this arrangement, investment advice is often referred to financial planning specialists as appropriate to the circumstances of each SMSF.

ASIC: the Regulator for Financial Advice participants

Whilst the administration compliance of SMSFs is monitored by the ATO, financial planning advice generally is regulated by ASIC. As SMSFs are considered a financial product, advisers dealing with such an entity – whether accountants holding a limited advice license, or comprehensively-licensed financial planners, must be mindful of ASIC’s requirements in administering the legislation and regulations prescribed by the Federal Parliament.

In a couple of recent information papers (INFO 205 and INFO 206), ASIC has provided detail as to what they will be checking on in relation to advice that is provided to trustees of SMSFs, regardless of the license status of the person providing the advice: respectively they deal with the disclosure of ‘risks’ and ‘costs’ to trustees and the members of SMSFs.

Summaries of the above-referenced Information Sheets are attached below: for full details – and for related reading on the ASIC website, refer to the following links: INFO205 and INFO206.

All of the matters covered by these Information Sheets from ASIC are able to be dealt with by a comprehensively – licenced financial planner and/ or by an Accountant holding a limited financial planning licence: the Accountants’ exemption will not allow the provision of such advice by an unlicensed Accountant.

Review of your SMSF decision

If you have been considering either –

  • moving your superannuation accumulations into a self-managed environment, or
  • wanting to review the wisdom of continuing with your SMSF,

John Siemon, is a director of SmartChoice: he is qualified and holds a limited advice licence. John is supported by Susan Stainwald, who is currently undertaking the requisite licensing process. Under this arrangement, investment advice is often referred to financial planning specialists as appropriate to the circumstances of each SMSF.

Call our office on 1300 366 316 to make an appointment to meet with John to gather the information necessary to formulate advice on the matter:

Eric is a Director and Financial Planner at Continuum Financial Planners Pty Ltd: their website has articles on superannuation matters and SMSF particularly – click the link to access these.


DISCLAIMER: The information contained in this article is general in nature and does not take into account personal circumstances, financial needs or objectives. Before acting on any information, you should consider the appropriateness of it and any relevant product having regard to your objectives, financial situation and needs. In particular, you should seek appropriate financial advice and read relevant Product Disclosure Statements or other offer documents prior to acquiring any financial product.



Trust account operations in management rights.


Trust account operations in management rights.


Real Estate Trust Account Licensees not only handle money on behalf of property owners but also need to remain compliant under the Act on daily basis.
The Property Occupations Act commenced in December 2014, since then we have observed a number of common contraventions licensees have trouble with. This month we cover some of these areas and provide some tips for you to avoid potential contravention and penalties.

  • Licensee owning a property in the complex and running it through the trust account
  • Correct details not on the trust account receipts
  • Finalising end of month before the actual end of month


Licensee owning a property in the complex and running it through the trust account
When a licensee owns a property in the complex they manage and rent it out, some of the time the manager will utilise the trust account and software package to manage rent receipts for their unit.  This practice is prohibited under the Act.
Licensee’s Trust accounts should only contain transactions on behalf of an owner with a signed appointment. The transactions of the licensee owned unit is considered non-trust money. To avoid contraventions the licensee should operate all transactions for their unit through an account other than your trust account and remove this ledger from your software package operation.
Act Reference – Section 18 of the Agents Financial Administration Act 2014 – full Act:

Correct details not on the trust account receipts
The Trust Account Receipt form must be used when receipting trust money.  With the new legislation there have been some additions to these forms licensees should be aware of.  Any system auto-generated forms should be reviewed to ensure correct details are on the receipt form.  Older versions of trust account software will not have these changes and in most cases an update to your software will be required.
Regulation 9 of the Agents Financial Administration Regulation 2014 listed out the requirements in the trust account receipt form. You can follow this link for full Act:

Below are some mistakes we commonly observed:

  • Agent’s licence number not correctly shown;
  • The date –
    • the trust money was received not shown; and
    • the process date of the receipt not shown;
  • The name of the person completing the receipt form not shown.

Finalising end of month before the actual end of month
When it comes to end of month, licensees should always include all transactions on the last day of the calendar month, then perform the EOM procedure within the first five days of the following calendar month.
Even if the last date of month falls on a public holiday or non-business day, and it is unlikely there will be further transactions in the trust account, licensees must still perform the EOM within five days after the end of the month.
Act Reference – Regulation 17 of the Agents Financial Administration Regulation 2014 – full Act:

To find out more, please contact our office or your audit team member.

There has been a lot of discussion about China lately


There has been a lot of discussion about China lately .

Courtesy of The Knowledge Shop
Free Trade Agreements, financial stability and growth and the impact on the Australian economy, and Chinese investment in Australia.  With the help of our international contacts, we explore the impact of China on Australia and give some context to the debate.
According to Austrade, one in every three Australian export dollars earned is from sales of goods and services to China.  On top of that, 80 per cent of the value of Australia’s export growth in 2013-14 was from trade with China.  It’s not surprising then that we have a fixation with the welfare and continued consumption of Australian goods and services by China and China’s rising influence on the Australian economy.

Chinese growth – an insider’s view
China’s economic growth has been spectacular: until recently growing at around 10 per cent per annum from a low economic base to arguably the leading global economy.  While construction and infrastructure projects were the primary drivers of growth, the opening of the Chinese economy to foreign investment in the late 1970s saw it become the ‘factory of the world.’  The fuel to drive this growth was a massive growth in Chinese consumption of resources – steel, iron ore, copper – you name it China needed it.  You can see this consumption growth reflected in Australia’s export statistics.
With an increase in wealth came an increase in consumerism with a growing middle class.  And, with a growing middle class came a property boom with many Chinese able to afford better housing.
Demand for housing escalated and development after development was launched, many snapped up within hours of launching.
The cost of this success was a rapid increase in the cost of living, high property prices fuelled by speculators, and corruption.
With the global financial crisis, demand for China’s goods started to decline creating excess capacity, factory and company closures, and staff lay-offs.  Banks were then asked to reduce their loan exposure and Government projects scaled back.  Starved of funds some companies sought funding from underground banks – shadow funding – paying extreme rates of interest that further aggravated the slow down and excess capacity.

Looking forward
The People’s Bank of China recently reported that it expects economic growth to be 6 – 7 per cent over the next three to five years – although businesses on the ground will tell you it’s lower than this at about 5.8 per cent.  Interest rates were cut for the sixth time in 12 months in late October to try and hit growth targets.

Client Focus – Little Kickers

Client Focus – Little Kickers Qld 

  • Have you got young kids and would like them to play  soccer?
  • Has your child a birthday coming up and you would like something different to do?
  • The holidays are coming up – Why not think about enrolling your young kids in a holiday course.


Little Kickers provides fun and safe soccer classes for boys and girls aged 18 months up to 7th Birthday, in venues around Brisbane, Gold Coast and Sunshine Coast (free trial classes are available). They also offer day care programmes, holiday courses and birthday parties. Their motto is play not push and we are proud to offer this fantastic programme which has been created to get kids interested in sport by way of imaginative play.
Contact Name: Karen Tannoch-Bland
Phone: 07 3299 3361

Staff Training

Are you doing enough staff training?

Staff Training McAdam Siemon

Source: Kate Groom, Smart Franchise

Staff training is the responsibility of every business owner. But many people we meet don’t seem that interested in it. And their business pays the price!

As a business owner or manager, you’re responsible for your staff doing things the way you want them to. If you’re not happy with what they’re doing it’s up to you to change it.

Better skilled and trained people are more productive. They are more efficient in their tasks and capable of dealing with more complex issues.

If you have any questions, comments, suggestions, please don’t hesitate to contact us at any time. We look forward to hearing from you.

Welcome to our new responsive and interactive website

Welcome to new web practice - McAdam Siemon Accountants Web Practice

We’re thrilled to announce the launch of our new responsive and interactive ‘web practice’ at http:/

While our former site served us well, it was important to deliver a better user experience to you, bringing more intuitive navigation and a more simplified way to discover the products and services that we can offer to you. Your feedback is both welcomed and encouraged.

Our new home has a fresh and modern appearance with a user-friendly browsing experience. Our aim is to keep you up to date on matters affecting your business and family life. You can now access information on any of your electronic devices.

We have made improvements throughout site and put a greater emphasis on our breadth and depth of services, across all our business areas.

Our new site enables us to lead the way in how we communicate with you, through regular updates that demonstrate our expertise and experience across industry sectors.

Commencing next week, we will share brief but valuable insights in our McAdam Siemon newsletters to help you keep in touch with interesting business news, information from the ATO, ASIC etc, fun things we are up to as a firm and perhaps the occasional massive, personal challenge that one of our team take on.

Please like and follow us on your favourite social media sites, Facebook,Twitter and LinkedIn – We will be posting interesting facts each Monday to Friday.

If you have any questions, comments, suggestions, please don’t hesitate to contact us at any time. We look forward to hearing from you.

Yours sincerely

Rob McAdam
Brisbane: 07 3421 3421

Sunshine Coast: 07 5474 8955 

Bookkeeping Solutions








McAdam Siemon would like to welcome a new member of staff, Samantha O’Rielley.

Samantha is CPA qualified and is vastly experienced in providing Bookkeeping solutions to small and medium sized business and has previously owned her own bookkeeping business.

Sam has joined our team to provide a bookkeeping service at bookkeeping rates.  The service includes the implementation and training on cloud based software such as Xero & MYOB.

In short, cloud software allows the business owner to have advisors [usually Accountants and Bookkeepers] to have live access to your books.  At McAdam Siemon we are finding a rapid demand for clients to convert from their current software program across to cloud software and for those starting up their business, its simply the goto solution for Bookkeeping requirements.

If you want to know more about converting your business to cloud software, give Samantha a call 07 5474 8955, or contact us to make an appointment..  Samantha can provide you with a recommendation on what product best suits your business.

In addition to this, Samantha can also map out what is needed to make the switch to cloud software, prepare your cloud file to be ready for use and to organise for any immediate training or ongoing bookkeeping support services.  Fees will be fixed and quoted upfront, to provide you with certainty.

CPA Xero MYOB Quickbooks Accounting Software

Accelerate your cashflow

In a typical business your cash cycle looks something like this.

Accelerate your cashflow diagram

While this can vary slightly from business to business the difference would usually only be in the addition or subtraction of one piece of this cycle. In our model you start your business by investing cash, firstly in your plant and equipment, and then into stock. Next you make some sales, converting your stock into debtors. Once you are paid by your debtors it turns back into cash and the cycle begins again.

The more you can accelerate your cash cycle the faster you turn your profits into cash and the easier it is to manage your liquidity position.

Here are some tips to manage cash flow:

  • Plant & Equipment – don’t have too much money tied up here. Avoid surplus plant and don’t invest in plant that is significantly in excess of your capacity requirements. Sometimes it is a good idea to lease plant rather than having a lot of your capital tied up in this area. If you have surplus plant to your requirements consider selling it and turning the asset back into cash.
  • Stock – be careful about how much capital you have tied up in stock. Generally the more times you can turn your stock over in a year the more efficient and profitable you will be. Also avoid holding obsolete or slow moving stock. You should be aiming to have your stock levels as low as possible without impacting on the efficiency of your business.
  • Debtors – this is an area where lots of businesses have their cash tied up. You need to be on constant alert here and really police this area. Once you have agreed trading terms with a customer, ensure they stay within them. If you allow them to drift out not only are you incurring additional costs but you are also risking a bad debt – and that can really be costly to your business.

Here are a few ideas to help accelerate your cash flow cycle:

  • Buy stock on a consignment basis
  • Arrange with your suppliers to hold stock for you with the capability to deliver within a day or so of order
  • Keep good records on your stock position so you know exactly when you need to order replacement stock
  • If you have seasonal stock then be prepared to adjust your price toward the end of the season to avoid having to hold over the surplus stock
  • Unless there are significant quantity discounts for buying volume stock only purchase what you know you will need within the immediate future
  • Encourage customers to pay cash on delivery (COD) rather than operate on an account
  • Offer settlement discounts for account customers who will pay you within seven days
  • Avoid opening accounts for small customers or those who only buy from you on an occasional basis
  • Allow your customers to buy from you using their credit card
  • Always issue your invoice immediately on completion of the job
  • Be prepared to stop supply if a customer does not pay you within agreed trading terms
  • Always complete credit checks when you are opening new customer accounts

Call or Contact us us if you would like some more information.

Brisbane: 07 3421 3421 (Rob & Sam)

Sunshine Coast: 07 54748955 (John)



Why discounting can be a dirty word


The single most overused marketing strategy to bring customers through the door is discounting.

While this can be an effective strategy, for some businesses it generates a price war that they cannot afford to sustain.

Take the entrance of a new retailer in a shopping centre.  They specialise in one type of product that is also sold as part of the range of a major retailer also located in the shopping centre.  The new retailer opens at a discount to attract customers into the shop.  The major retailer not only matches but further discounts to prevent loosing customers.  For many, this is the start of a pricing war that the small retailer is unlikely to win.

Then there is the example of a business where the volume of sales drops off.  The automatic response is to drop the price of the stock to attract customers.

There is nothing wrong with discounting strategies if that’s what fits your business.  If you are using it as a strategy to bring in cash flow – be careful. If you don’t understand its effect then you can cause a disaster in your business and its profitability.  This is because discounting creates a leverage impact on profits.  Essentially by discounting you are giving some or all of profits away.  The key is to understand the impact and just how far you can go.

Consider the following example – a business with a 30% gross profit margin who offers a 25% discount (certainly nothing unusual about that in today’s market) requires a 500% increase in sales volume just to maintain its same position – and in almost all cases that’s just not going to happen.  The result generally is the business trading below its break even point and generating losses.

While discounting can be a short term strategy it should be used carefully and with as part of an overall marketing strategy.

Call or Contact us us if you would like some more information.

Brisbane: 07 3421 3421 (Rob & Sam)

Sunshine Coast: 07 54748955 (John)

Rob starts Kokoda Trail

The Kokoda Trail (96km) is one of the world’s great treks.
Educational and


It is rated the hardest sea level walk in the world and I now know why.


You measure the days in number of hours up or down not the kilometres walked.Each day presents it’s own challenges both physically and mentally.Having walked the track over 8 days, from Kokoda to Owens Gate, I would rate it the hardest challenge I have attempted.

I was with a group of 6 other trekkers and our fearless team leader (Dan). While we did not know each other at the beginning, by the end of the trek we were a close team prepared to help each other on the track, share a story and laugh at the end of a hard days walking, and listen with awe at the story of the WW2 battle as told by our leader.

If at any time you felt tired or sorry for yourself, we all just remembered what the diggers and Fuzzy Wuzzy Angels dealt with in WW2.

Otti my Porter, was a 20 year old local who probably weighed slightly more than my 2 legs combined, and he did not leave my side the whole trip, saving me from countless falls in the slippy  and uneven ground.

He has walked the track 4 times.

The porter and locals are an amazing group of people, very quite, happy and we were treated

to their beautiful singing at night.

The highlights of the trip for me were:

My fellow trekkers and the porters

The amazing country we walked through

The service we held at Brigade Hill were approximately 45 diggers died in a battle to hold their position against over whelming odds;

Meeting the last living Fuzzy Wuzzy Angel and seeing Dan stand to attention and salute him.


I came off the track 6kg lighter but in awe of what the diggers had done those many years ago.

Would I do it again – unlikely

Was it worth it – every step up and every step down.




Do you own a residential or commercial investment property?

If so, are you claiming all the tax deductions that you are entitled to?

In a recent article (Issue 36, 2014) published by BMT Tax Quantity Surveyors and a recent release by the tax department, that2.5m property investors claimed deductions relating to their rental property in the 2011 – 2012 income year.

Of these, just over 1 million claimed an average capital works deduction of $2,029; whilst just over 1.7 million claimed an average deduction for plant and equipment of $1,139.

Based on their data from the BMT Tax depreciation schedules, the average claim in the first year is $10,100, and then $7,350 per year on average over the first 10 years of owning a property.

When we are preparing your tax returns and you have a rental property, we will be checking that you are firstly able to claim a capital works deduction (building) or plant and equipment depreciation (hot water system, carpets).

If nothing has been claimed previously in your returns, we will discuss your options.

BMT deduction assessment
Purchase price First year deductions Five year cumulative Average annual cash return*
New unit $450,000 $12,800 $55,040 $4,073
Old unit (1970) $450,000 $6,900 $28,980 $2,145
New 3 BR house $600,000 $11,200 $48,160 $3,564
Old 3 BR house (1970) $500,000 $6,000 $25,200 $1,865

Significant deductions are usually available despite a property’s age.

*(First five years, calculated on a 37% tax rate).

The average annual cash return will vary depending on your tax rate in a particular year.

When we are preparing your tax returns and you have a rental property we will be checking that you are firstly able to claim a capital works deduction (building)or plant and equipment deprecation (hot water system, carpets), and if nothing has been claimed previously discussing your options.

Call or Contact us us if you would like some more information.

Brisbane: 07 3421 3421 (Rob & Sam)

Sunshine Coast: 07 54748955 (John)c

Are you interested in Self Managed Super Funds (SMSF’s)?

Our licensee, SMSF Advice, is a subsidiary of the AMP Group and in partnering with them we are able to draw on in-depth knowledge of the financial services industry. We can leverage a wide range of plans, tools and training to ensure we deliver the best possible .


4 key tools for successful business management


These are the four things every business should have!

Operating budget

You need to know what the year is going to look like. How much profit you will make, when you will be making your profit and how your income and expenses are likely to move about. Without this you will be under prepared for the year and need to manage by gut instinct or reaction to events as they occur. Get your budgets in place and then you can track performance against expectation.

Capital expenditure budget

This is about understanding and identifying how much you are likely to need for capital purchases throughout the year. This might be replacements or new plant or equipment required because of business growth or change.  Most businesses have capital expenditure requirements but many don’t plan for them.  When they occur they can disrupt your cash flow. Plan ahead. They are an essential part of your cash flow budget.

Cash flow budget

You absolutely need this. Cash is king and there is plenty of evidence that the Australian Taxation Office and large suppliers are taking a tougher approach on collections. Your cash flow budget needs to flow on from your operating and capital expenditure budgets.  You need to forecast the timing of money flowing in and out of the business.  Make sure you include things like tax payments, loan repayments and dividends.  And, plan around the cycles that can occur with BAS payments. If you are going to be tight for cash at some time in the year, talk to your bank early up.

KPIs (Key Performance Indicators)

These are a great way to manage the business. What are the key indicators that show your business is on track? It might be the number of enquiries, machine hours for a production business, on time delivery, customer complaints, or staff turnover. For most businesses you can measure performance around six KPIs. They are the key influencers of your business’s operating performance and should be capable of being easily tracked and managed. If you haven’t used them before give it a try.

For assistance to get your business running at its strategic best this financial year, please contact either myself, John or Sam today to arrange a time for us to work with you on your business’s budget and KPI planning.

Rob McAdam

Does your business measure up?


Knowing where your business is up to day to day is an essential piece of management information. Too many business owners get caught out believing that their business is doing ok or getting by, only to find out that the reality is a different story.

Good measurement systems are not difficult to establish and the start of the financial year is a good time to put in place or fine tune your existing systems to deliver reliable and useful information.  Where it gets hard is when you are trying to play catch up, finding out where all the pieces are and trying to build them into your system when you need them. Your measurement systems need to provide you with both financial tracking and management information.

Here are the key elements of a good system:

  • Operating budgets and cash flow forecasts to map out what you expect to happen over the coming year.
  • Track your actual position and measure it against your expectations. To achieve this you need to have in place an accounting system that tracks your operating performance and tells you whether you are making profits or losses.
  • Track your cash flow position. The maturity of your business and its growth cycle will determine how often you need to track information.For example, in a start up business or a business growing quickly, the general rule is to track cash daily and profits monthly.

Once your systems are in place to track the numbers the key then is to know what to look for.   Don’t fall into the trap of tracking the numbers in absolute terms. You should be tracking them against your expectations. As an example, it is not uncommon for a high growth business to make losses and have negative cash flow.  These results are not necessarily bad news.  If they are following the forecasts that you previously signed off on, then this is ok.  What you are looking for is variance from the forecasts and trends against forecasts.  You need to be concerned where there are significant adverse departures from your forecasts.

From a financial perspective these systems will provide a foundation level of information; but what about some effective business or management information?

Every business should be managed around some key performance indicators (KPIs). These provide fast and reliable guides on business performance.  As an example, if you are a retailer you can reliably predict business performance around customer traffic and conversion rates. So a KPI for you could be the number of people coming into the shop each day and the conversion rate on those customers.

The strength of KPIs is that they are easy to access, reliable in their predictive results and can be produced in quick time. They give you instant access to what is happening in your business.

Most SME businesses can be tracked and managed effectively on six KPIs.  More doesn’t mean better.  The key is to identify the areas of your business which are most likely to impact business performance.  So, a part of the question is what are the key fundamentals to your business? What are the key business drivers and what are your critical success factors? Work through these and the KPIs will quickly identify themselves.

Once you have your financial management system in place and your business performance measurement system in place you have access to both financial and non financial information that will not only tell you where your business is up to but where it is heading.  This type of information separates businesses that are well managed from those that hope they will make it.

For advice and assistance on managing your information systems, contact us today.


Top Things To Do and Review Before 30 June

Here’s our list of the top things you need to do and review before 30 June arrives:

1. Write-off bad debts. To be a bad debt, you need to have brought the income to account as assessable income, and given up all attempts to recover the debt. It needs to be written off your debtors’ ledger by 30 June. If you don’t maintain a debtors’ ledger, a director’s minute confirming the write-off is a good idea.

2. Trading Stock. Write off any stock that is damaged or obsolete. Complete a stock take (if you are not using the simplified trading stock rules) and remember that stock can be valued at the lower of cost, replacement, or net realisable value. You can use different methods for different stock items.

3. Review your asset register and scrap any obsolete plant. Check to see if obsolete plant and equipment is sitting on your depreciation schedule. Rather than depreciating a small amount each year, if the plant has become obsolete, scrap it and write it off before 30 June. Small Business Entities can choose to pool their assets and claim one deduction for each pool. This means you only have to do one calculation for the pool rather than for each asset. It also allows you to claim an immediate deduction for depreciating assets that are bought for less than $1,000.

4. Repairs, consumables (office stationery etc), trade gifts or donations. To claim a deduction for the 2014/2015 financial year, consider paying for any required repairs, replenishing consumable supplies, trade gifts or donations before 30 June.

5. Pay June quarter employee super contributions if you want to claim a tax deduction in the current year. The next quarterly superannuation guarantee payment is due on 28 July 2015. However, some employers choose to make the payment early to bring forward the tax deduction instead of waiting another 12 months.

6. Superannuation. Don’t forget yourself. Superannuation can be a great way to get tax relief and still build your wealth position. Your personal or company sponsored contributions need to be received by the fund before June 30 to ensure deductibility.

7. Capital gains and losses. Neutralise the tax effect of any capital gains you have made during the year by realising any capital losses that you have. These need to be genuine transactions in order to be effective for tax purposes. It may be possible to contribute assets with unrealised losses to superannuation in order to do this.

8. Directors’ fees and bonuses. Declare them before 30 June and providing the company is absolutely committed to them, you are entitled to the deduction even if they have not been paid. Again, a director’s minute is a good idea. The directors and employees only need to declare this income in the year of receipt although they need to be formally notified of their entitlements by 30 June.

9. Management fees. Where management fees are being charged between related entities, make sure that the charges have been raised by June 30. Where management charges are used, make sure they are commercially reasonable and there is documentation to support this position. If any transactions are being undertaken with international related parties then the transfer pricing rules need to be considered and the ATO’s expectations in relation to documentation will be much greater. This is an area that the ATO are placing under greater scrutiny.

For Your Business

Trustees must make a decision on distributions by 1 July

Trustees need to decide on distributions of trust income by 30 June (at the latest) to ensure that beneficiaries are presently entitled to trust income for tax purposes. Trustees used to have until 31 August to make a decision but this administrative concession has been removed. If the ATO is not satisfied that the resolutions have been made in time then the risk is that the trustee or default beneficiary will be taxed on all of the trust income.

Defer your income

If possible, defer your income until the new financial year. In particular this can work for service based businesses or where you are billing your clients on a progress payment basis. Make sure that you can manage any cash flow effects that come with this one.

Manage your capital gains and losses

Remember that capital gains trigger on the date of the contract not the date of payment. Also, capital losses can only be written off against capital gains. So, if you are selling assets that will trigger a capital gain try and delay the contract until 1 July unless you have some capital losses that you are able to offset against.

Please contact either John, Rob or Sam, if you would like further information.

Minimise year end opportunities and minimise risks

The end of the financial year will be here before you know it.

In this end of financial year update, we have summarised some of the key ways you can minimise your tax and reduce your tax risks prior to 30 June.

Plus, to ensure you are prepared for the new financial year, we’ve outlined some of the key issues you should be aware of.

Key Dates

Key Dates

Your End of Financial Year Obligations

Consider this Financial ‘house-keeping’:


Before rolling over your accounting software for the new financial year, make sure you:

  • Prepare your financial year end accounts. This way, any problems can be rectified and you have a ‘clean slate’ for the 1025/2016 year. Once rolled over, the software cannot be amended.
  • Do not perform a Payroll Year End function until you are sure that your payment summaries are correct and printed. Always perform a payroll back-up before you roll over the year.

PAYG Payment Summaries

You need to provide all of your staff with their PAYG Payment Summary on or before 14 July 2015. This includes any staff that left your employment during the 2014/2015 financial year.

The ATO imposes penalties for the late lodgement of their PAYG Summary Statements with penalties of up to $2,750.

The annual PAYG Summary Statement for the year ending 30 June 2015 needs to be lodged with the ATO on or before 14 August 2015.

Reportable Fringe Benefits on PAYG Payment Summaries

Where you have provided fringe benefits to your employees in excess of $2,000, you need to report the FBT grossed-up amount on their PAYG Payment Summary. This is referred to as a “Reportable Fringe Benefit”(RFB) amount and you will notice that a label is included on the PAYG Payment Summary for this purpose.

You might not need to do a stocktake – using the simplified trading stock rules

Small Business Entities (operational businesses with an aggregated turnover below $2 million) have access to a range of tax concessions. One of these concessions is the simplified trading stock rules. Under these rules, you can choose not to conduct a stocktake for tax purposes if there is a difference of less than $5,000 between the opening value of your trading stock and a reasonable estimate of the closing value of trading stock at the end of the income year. You will need to record how you determined the value of trading stock on hand.

If you would like to take advantage of the simplified trading stock rules, call us today to make sure you are eligible to use the simplified rules and to talk through how to use them properly.

Are you interested in Self Managed Super Funds (SMSF)?

SMSF Strategic Advice

We are excited to announce that McAdam Siemon is expanding its service offering and are now able to provide a much wider range of advice, including SMSF advice.

To date our SMSF advice offer (via Smart Choice SMSF Administrators) has been structured to provide administration and accounting services to our clients. This is largely a compliance service to ensure your fund is established correctly and meets all the legal requirements. Due to Government regulatory changes accountants are now required to be licensed to provide any SMSF advice. (via Smart Choice SMSF Strategies Pty Ltd)

As we are always looking for a way to improve our service offering, we have decided to become fully licensed. This will not only enable us to provide SMSF advice but expand our advice services more generally.

So what does this mean for you?

This will be different for every client, dependant on your individual needs and circumstances. It essentially means we now have a wider range of services we can offer you. This doesn’t mean we will be selling you financial advice products, it simply means we now have the ability and expertise to provide strategic advice if it’s of interest to you.

We have included a table of how our services will be structured in future. You might notice some services previously provided by the accounting business have moved across to the advice area. This enables us to provide more comprehensive advice and ensures we are compliant with any legal requirements.

As part of the regulatory change we were required to either hold the license ourselves or become authorised with another license holder, we chose to affiliate ourselves with SMSF Advice, a leading licensee in the market.

Our licensee, SMSF Advice, is a subsidiary of the AMP Group and in partnering with them we are able to draw on in-depth knowledge of the financial services industry. We can leverage a wide range of plans, tools and training to ensure we deliver the best possible advice to you in the most efficient way.

Are you interested in Self Managed Super Funds (SMSF's)?

What’s next?

If you have any specific questions or would simply like to know more about the options available to you, please contact the Partner or Client Manager who looks after you for a confidential discussion regarding your needs.

Do you own a residential or commercial investment property?

If so, are you claiming all the tax deductions that you are entitled to?

In a recent article (Issue 36, 2014) published by BMT Tax Quantity Surveyors and a recent release by the tax department, that2.5m property investors claimed deductions relating to their rental property in the 2011 – 2012 income year.

Of these, just over 1 million claimed an average capital works deduction of $2,029; whilst just over 1.7 million claimed an average deduction for plant and equipment of $1,139.
Based on their data from the BMT Tax depreciation schedules, the average claim in the first year is $10,100, and then $7,350 per year on average over the first 10 years of owning a property.

When we are preparing your tax returns and you have a rental property, we will be checking that you are firstly able to claim a capital works deduction (building)or plant and equipment depreciation (hot water system, carpets).If nothing has been claimed previously in your returns, we will discuss your options.

Do you own a residential or commercial investment property?

When we are preparing your tax returns and you have a rental property we will be checking that you are firstly able to claim a capital works deduction (building)or plant and equipment deprecation (hot water system, carpets), and if nothing has been claimed previously discussing your options.

The average annual cash return will vary depending on your tax rate in a particular year.

If you have any questions, please contact us.

CEO Training Day

On Tuesday 5 August, we organised a CEO training day for a group of eight clients to come together and discuss some of the key issues that they were dealing with, within their businesses.

Some of the issued covered were –

  • Determining Key Performance Indicators and setting up meaningful reporting for senior management
  • Budgeting and cash flow
  • Looking at marketing from a strategic (or Why) perspective.

We were also extremely lucky to be given the opportunity to be taught how to combat shoot and then be run through some scenarios to test out our skills.

The tie back to business was Striving for Excellence. The problem is not making a mistake but learning and correcting the mistake – so you are a little closer to perfection.

We also learnt there was a pain penalty for getting it wrong on the day.

As one of the participants emailed me:

 To Dave and Neil, thanks for allowing us to participate in this training that is usually restricted to professional people that protect our country. You guys very obviously do a great job in training them and I particularly like the way you relate a lot of the training scenarios to our everyday battles in business, it puts an intense perspective on reasons to strive for perfection, thanks.

As part of the day $700 was donated to Tewantin Rotary club – Kids Breakfast program.

Sam and I would like to thank all the participants for their openness and contribution on the day and to Dave and Neil for allowing to participate in the unique experience.

Tax Audits are on the increase are you prepared?

We are noticing an increase in tax office audit activity over the last 6 months.

The area’s most likely to be audited are:

  • Cash economy businesses
  • Businesses with continued losses
  • People who have things missing, such as;
    • Documents lodged that are incomplete
    • Non-lodgement of documents
    • Non-remittance of payments
  • Super funds that continuously report breaches when audited.
  • Mismatches between reported data and third party data.

The ATO uses benchmarking and data matching when determining which business are to be audited.

Benchmarks such as key financial ratios are used to compare businesses against each other. They are updated annually and are a method of risk assessment for audit selection.  The benchmarking results are published on the tax department website.

The ATO uses data matching to identify any anomalies. Such data matching includes merchant data, motor vehicles (expensive cars vs affordability based on disclosed income), real estate, PayPal/eBay, gambling (government organisation reports) and offshore transfers.

The ATO does recognises that audits can be very expensive and disruptive for a client this however does not necessarily mean that you will not be audited. The costs generally blow out if your paper work is not easily accessible or ties back to key issues. In our experience they also impose tight timeframes to forward requested information back to them.

There are two types of audits:

  • Desk audits
  • Field audit

Desk audits are of a limited scope and short turnaround time, generally dealing with lodgement risks. We generally see these with BAS lodgements and a refund or payment is generated that is outside the normal  BAS reported. These audits are often conducted by compliance staff who generally follow set procedures.

Field audits are more complex, whereby the organisation will receive a questionnaire for completion prior to a meeting. It is recommended that both clients and their accountants be proactive and deal with any issues they identify following completion of the questionnaire. An interim report is generally issued following a field audit which provides an opportunity for the client to raise issues with conclusions reached by the ATO. These issues are considered and a final report is issued.

How to prevent an audit:

  • Make sure you are not attractive audit candidates
  • We will advise you if we believe your business is outside of benchmarks / business norms
  • Maintain proper records

How to prepare for an audit:

  • Have consistent processing for handling your records
  • Proper documentation – instill good habits in your business
  • Businesses are individual – there are often explanations for how each business is run, so make sure that these are documented
  • Keep on top of lodgements and debt
  • Should you receive an audit letter don’t ignore hoping it will go away – it won’t.  Much better to be proactive rather than reactive.

The proper management of audits can significantly reduce the long term financial impact on clients.

Should we receive an audit notification we will help you deal with the tax department in a proactive manner and try to identify any areas of risk on a year by year basis as we prepare your financials and tax returns to ensure you have the documentation to support the position taken.

I encourage you to read more about our Benchmarking Services.

Please view the ATO Small Business Benchmarks

Some highlights for the new financial year

Overseas assets & income? Why the ATO wants you!

The ATO is heavily targeting individuals that have assets and income from overseas. A month ago, the ATO announced an amnesty, called Project DO IT, that allows people to declare unreported assets and income they have received from overseas. These voluntary disclosures have already raised over $13 million in back taxes.

Now, the ATO are backing up that amnesty with a new datamatching program to target those who have not voluntarily declared foreign income. The data matching program will troll through information from overseas tax authorities on Australians with offshore investments and bank accounts; information from Australian and foreign banks on fund flows, interest and account balances; information from informants about offshore accounts, and money transfers to and from offshore bank accounts.

The bottom line is that if you don’t declare income you receive from overseas that you should be paying tax on in Australia, and the ATO catch you, you can expect little mercy.  Don’t assume that just because your foreign income is genuinely not subject to tax overseas that it is not taxable in Australia.

If you suspect you might have a problem, talk to us today to assess your position and manage your approach.

Employers paying Superannuation Guarantee!

Employers can expect a renewed focus from the ATO on superannuation guarantee (SG) payments made to employees. With the increase in the SG rate from 9.25% to 9.5% on 1 July 2014, employers will need to make sure that payments are made on time and that the calculations are accurate. Just be aware that the increase in SG does not necessarily reduce the take home pay of employees. In many cases employee contracts are ‘base plus superannuation’. In this case, the employer absorbs the increased SG rate not the employee.

Are your contractors really employees?

The ATO continues to enjoy a high success rate challenging the treatment of contractors under the superannuation guarantee (SG) legislation.  Despite recent comments made by the Government that the ATO should ‘relax’ its approach to contractors, the ATO has no reason to simply walk away from such a potentially lucrative revenue stream – why would they when the law is on their side?

As there is no real time limit on the recovery of outstanding SG obligations, business owners need to take a proactive approach reviewing arrangements to ensure that the business is not exposed to material liabilities – the start of the new financial year is a great time to do this.

The underlying issue is often that employers take the contractor relationship at face value – that is, what the piece of paper describing the relationship actually says.  The reality is quite different as the law is based on the character of the relationship not what is stated in writing.  So, if your business has contractors (or you are a contractor) performing the same role as an employee, then it’s possible the ATO will classify them as employees for SG purposes.

A genuine independent contractor who is providing personal services will typically be:

  • Autonomous rather than subservient in their decision making;
  • Financially self-reliant rather than economically dependent upon the business of another; and
  • Chasing profit (that is a return on risk) rather than simply a payment for the time, skill and effort provided.

There are a number of tests that can apply to help determine the status of a contractor-such as control, whether the worker has been hired to produce a result, the ability for them to freely delegate work to someone else, risk exposure, ownership of tools and equipment, and the treatment of business expenses, etc.

Employers cannot contract out SG responsibilities by adding fail safe clauses in contracts; and there is no certainty that a contractor using an interposed entity (for example setting up a company and operating through it), is fool proof.

Clear out the old! New Year house keeping

Here is the essential checklist to prevent last year overflowing into this year:

  • Reconcile your GST control account.
  • Does the income declared in your BAS for the last year reconcile to your annual income?
  • Check that the minutes for all director and trustee resolutions pre June 30 are documented and signed off.
  • Make sure your stock take has been completed and documented.
  • If you have paid management fees to a related entity during the year, ensure that all of the tax invoices have been documented and that there is a reasonable commercial basis for the charges applied.
  • Where dividends have been declared to manage Division 7A loan payments, ensure that there are letters on instruction on the file that the dividend is to be credited against the loan account. Dividend statements will need to be completed.
  • If you have cross border related party transactions, make sure you have your transfer pricing file completed with all the requirements signed off.
  • Review all contractors for the year going forward to ensure they would not be deemed as employees.
  • Get your operating budget completed for the year.
  • Get your cash flow budget in place.
  • Check the adequacy of your funding arrangements with your bank.
  • Check that you meet any loan covenants that you have with the bank at June 30.

Please contact the team at McAdam Siemon if you would like further information.

Top 5 simple tax saving strategies

Planning on giving to charity?  Make a donation now and claim the deduction this year. If you donate monthly to charities, think about paying the full year’s worth of donations upfront and take the deduction now.

Operate through a company? If you operate through a company structure and the company has advanced you money during the year or paid expenses on your behalf, then work out whether you are going to repay the loans or put in place a complying loan arrangement. If you already have loan agreements in place from prior years, make sure that you make the minimum repayment (including interest) before June 30.  If the company normally declares a dividend to cover these loan repayments, make sure the dividend is declared and set-off against the loan balance before 30 June.

Are your salary sacrifice agreements still relevant? If you have existing salary sacrifice agreements in place, review them to make sure they are still viable. Also, if your taxable income is over $180,000, don’t forget about the debt tax (see the article, can you plan around the debt tax).

For business, if cash flow allows, now is the time to accelerate deductions by paying for any required repairs, replenishing consumable supplies, trade gifts or donations before 30 June.

Run a business? Don’t forget your super. Your personal or company sponsored contributions need to be received by the fund before 30 June to be deductible this year.   Don’t forget to make sure the paperwork is in place and that you don’t breach your concessional contribution caps.

Please contact the team at McAdam Siemon if you would like further information.

What will change from 1 July 2014


  • Temporary Budget Repair Levy. Adds 2% to the tax rate for every dollar of a taxpayer’s annual taxable income over $180,000
  • Increase in the Medicare Levy from 1.5% to 2%
  • Superannuation Guarantee charge increases from 9.25% to 9.5%.
  • Aged care reforms introduce new assets tests for resident’s accommodation and care fees

Temporary Budget Repair Levy

What is the tax and who will pay it?

The debt tax will apply from 1 July 2014 until 30 June 2017.   The tax is payable at a rate of 2% on every dollar of a taxpayer’s annual taxable income over $180,000.  In effect, the top marginal tax rate will become 49%.

Be aware that if you have a one-off spike in income after 1 July 2014, for example from the proceeds of a sale of business, the debt tax is likely to impact on this one-off increase in personal income.


  •  R&D incentive reduced. In the 2014/2015 Federal Budget, the Government announced that the Research & Development Tax Incentive will be reduced by 1.5% from 1 July 2014.  This means the refundable offset will be reduced to 43.5% while the non-refundable offset will be reduced to 38.5%.  While it is uncertain whether the legislation enacting this change will pass the current Parliament, businesses undertaking R&D activities this year may want to consider bringing forward expenditure to maximise their claim
  • Living away from home allowance (LAFHA) transitional period ends on 30 June 2014. Now, the main condition to be satisfied is that the employee must have a normal place of residence in Australia that is maintained for their “personal use and enjoyment” while they are living and working in another location. This means that the employee cannot rent out their usual residence while they are away.  In most cases, LAFHAs will also be time limited to 12 months.  For employees who have been receiving LAFHAs under the transitional rules, the 12 month period is deemed to have started on 1 October 2012.
  • If the employee is working on a fly-in- fly-out or drive-in drive-out basis the LAFHA is not subject to the 12 month limit.


  • New SMSF trustee penalties. From 1 July 2014 the ATO has greater powers to enforce the superannuation rules by levying financial penalties directly on trustees.
  • Concessional contribution cap changes. From 1 July 2014, the concessional contribution cap for taxpayers up to the age of 50 is $30,000. And for those 50 and above, the cap is $35,000.
  • Non-concessional cap changes. The non-concessional contributions cap from 1 July 2014 is $180,000 (up from $150,000) or $540,000 over 3 years.
  • Insurance inside an SMSF. From 1 July 2014, new insurance policies within a SMSF must be consistent with the death, terminal illness, and permanent and temporary incapacity conditions of release in the Superannuation Industry (Supervision) Act.

Please contact the team at McAdam Siemon if you would like further information.

Audits on the increase

We’re noticing an increased level of audits by the ATO and State regulators. Key audit areas include payroll tax and GST.

With payroll tax, the regulators are looking for those who understate or avoid their payroll tax obligations. A few of the problem areas are:

Contractors– just because you have a contract in place does not guarantee that the person is a contractor for payroll tax purposes (or the superannuation guarantee laws). The law looks at the character of the relationship. Don’t rely on what your contractor tells you. We cannot emphasise enough how big the problem of mischaracterising contractors is.

Grouping provisions– Often an entity by itself can be under the payroll tax threshold but when grouped, is drawn into the payroll tax net. Subsidiaries are a common example of a group but the definition can be very broad extending to shared employees and shared control. Where there is a group, the payroll tax threshold applies to the whole group.

Interstate wages– Generally, where you have interstate wages, the payroll tax threshold is determined as a portion of your payroll in the relevant State or Territory.

Miscalculating the payroll tax threshold– Calculating the payroll tax threshold is not as simple as just looking at your wages. Payroll tax captures Director fees, fringe benefits, bonuses and commissions etc. Also. for part years – for example where you are only in operation for part of the year in that State or Territory – are generally assessed on a pro-rata basis rather than actual payroll for the year.

If your business has underpaid its payroll tax obligations then you can also expect a call from the workers compensation people.

With GST audits, if you have a refund due, your business is more likely to be audited. The trigger for a GST audit is often large or abnormal refunds but can be as simple as not reconciling the quarterly activity statements.

It is worth remembering that every business is a potential audit target and even if you pass with flying colours, it will cost your business potentially thousands of dollars and even more if there is a problem. The best insurance is not to give the regulators any reason to come and visit but failing that, audit insurance is available to protect you against the inevitable cost to your business.

We can do a full compliance risk review for your business to protect you from the ATO and other regulatory bodies. GST and payroll tax are just two of the areas we cover.

Please contact the team at McAdam Siemon if you would like further information.

Superstream Update

Superstream update

SuperStream is a government reform aimed at improving the efficiency of the superannuation system.

Under SuperStream, employers must report super contributions on behalf of their employees by submitting data and payment details electronically in accordance with the SuperStream standard. All superannuation funds must receive contribution details electronically in accordance with this standard.

The new rules apply to employers that have 20 or more employees from 1 July, 2014.

Employers that have less than 20 employees have until 1 July, 2015 to comply with the new regulations.

It is the employers’ responsibility to collect the required information and ensure that their payroll software can cater for SuperStream.

Employers will have to:

  1. Make contributions electronically to employees’ nominated super funds, and
  2. Provide details of the payment transaction, e.g. employee name, TFN and super fund member number electronically to the relevant super fund via an electronic service address

Super funds will need to provide the below information to the employer:

  1. ABN
  2. Bank account details where the contributions should be paid to, and
  3. Electronic service address (ESA)
  4. Bank account details where the contributions should be paid to

Please contact the team at McAdam Siemon if you would like further information regarding Superstream.

New Superannuation contribution caps for the year ended 30 June 2015

From the 1 July the following changes have been made to the Concessional (tax deductible) and Non – Concessional (non tax deductible) Superannuation Contribution Caps …….

 Concessional Contribution rates for the year ended 30 June 2015

Under 50 $30,000
Aged 49 or over on June 2014 $35,000

 Non-Concessional Contributions Cap rates for the year ended 30 June 2015

  • $180,000 per person per annum
  • If you are aged under 65 you may be able to make a non-concessional contribution of up to three times the non-concessional contributions cap (i.e.$540,000) for the year. By doing this you activate the bring forward provisions and you will not be able to make another non-concessional contribution for 3 years.

Please note

  • If your employer pays life insurance premiums as part of your contribution to super, the payments could be included as part of the contributions caps.
  • The above caps are per person, per annum.  If you have more than one employer you need to ensure that the contributions caps are not going to be exceeded.

If you would like more information on how this might affect you, please contact us.