What does the Federal Budget mean for SMSF advice?

Author: Jason Roccasalvo, Partner, TAG Financial Services

Although the Federal Budget was subdued in terms of superannuation announcements, the references to super will create change within the industry.

The announcements centred around responding to the Hayne Royal Commission’s recommendations of improving fund performance and transparency.

How are funds likely to react?

Funds operating a MySuper option (generally industry super funds) will be under pressure to not underperform. This may mean fund Trustees:

  • Take extra investment risk to try to outperform
  • Take a more conservative investment approach so they reduce the chances of a really poor return
  • Ensure their portfolios align with market indexes to ensure they never appear to underperform, but will most certainly never outperform

Some items of note from our vantage point:

  • Industry super funds already hold direct property and infrastructure assets that are not valued by the market – rather by the Trustees, there by distorting real returns
  • Industry super funds may spend less on advertising and political donations once the extent of these expenses is disclosed. These expenses are after-all deducted from the returns of members

Most MySuper options are the standard “balanced” investment option, but what one fund calls “balanced” is different to another.  Industry funds may adjust how they invest within the “balanced” option, which may mean super members end up taking on more or less risk than they intended. We discussed this is our recent Industry Funds blog.

So be careful which fund and investment option you select.  It may be a wolf in sheep’s clothing. 

What does it mean for Self-Managed Super? 

These budget announcements, although insignificant in terms of complex client strategy, will ensure Trustees (including SMSF Trustees) are more accountable for the long-term interest of the members.

The ATO have already been making significant noise about “lazy” Self-Managed Super Funds, i.e. that are inactive, retain large amounts of cash, or hold investments that are underperforming. Expect this to ramp up over coming years.

One of the most common reasons people choose a SMSF is to provide investment control. Taking control and actively managing your retirement wealth means different things to different people. There is no one size fits all in terms of appropriate investment.

Trustees must:

  • Understand their retirement goals – and how they will attempt to achieve them.
  • Be able to articulate and show a plan, to achieve the desired outcome
  • As advisers, we need to ensure trustees treat their investment strategy as more than an “obligation” to satisfy an auditor.

SMSF Trustees have the control – so make sure they take advantage.

As always, if you have any questions, please contact us on 03 9886 0800 or via email.

Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686).

What does the Federal Budget mean for your Self-Managed Super?

Author: Jason Roccasalvo, Partner, TAG Financial Services

In terms of superannuation, Tuesday’s Federal Budget responded to the recommendations of the Hayne Royal Commission (2018)  around poor performance and fund transparency, announcing that from 1 July 2021:

  • An existing superannuation account will be ‘stapled’ to a member (follow you) to avoid the creation of a new account when that person changes employers.

  • An online YourSuper comparison tool will be created to help members decide which super product best suits their needs.

  • MySuper products will be undergo an annual performance test. Funds that underperform will need to inform their members. Funds that fail two consecutive performance tests will not be permitted to accept new members until their performance improves. Other funds will be subject to this test from July 2022.

For Self-Managed Superannuation Funds, the ATO have already been making significant noise about “lazy” funds, i.e. that are inactive, retain large amounts of cash, or hold investments that are underperforming. Expect this to ramp up over coming years.

One of the most common reasons people choose SMSFs is to provide investment control. Taking control and actively managing your retirement wealth means different things to different people. There is no one size fits all in terms of appropriate investment.

What should be non-negotiable is understanding your retirement goals – and how will you attempt to achieve them.

Without a plan – what have you really got control over and is it working for you? 

If you can’t articulate and show your plan, then how will you ever be able to achieve your desired outcome.  

SMSF Trustees have the control – so make sure you use it.

As always, if you have any questions, please contact us on 03 9886 0800 or via email.

What Should You Do Now?


Become Money Smart
Build your financial knowledge and join our online community where you will receive TAG updates and invites to our Information Sessions.

Meet with us
If you would like to discuss your financial options, we offer a 1 hour no obligation, complimentary consultation with one of our advisers to discuss your situation. Contact us to arrange a time.

Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686).

The 7 worst money moves during a recession

A market downturn during a global pandemic is more than enough to have people questioning where they go from here with their investments and financial situations. Read our 7 money moves to avoid during a recession to ensure you avoid any critical or costly errors.

1 – Panic selling

Seeing your investment portfolio value decreasing can be upsetting- but remember, you do not lose money during a recession until you have sold your investments at a loss.

The stock market will likely go up and down during a recession. Making decisions out of fear or panic can be a big mistake and you should try to remain calm instead of quickly selling off your investments. It is important to focus on the long-term and stay the course, and more importantly resist the temptation of following the herd.

It is also equally problematic to try and time the “bottom of the market” to get back in.  Timing the markets is a gambling game and an extremely risky investment move.

It is valuable to chat to a financial advisor before making major changes to your portfolio.

2 – Stop investing

It is a good idea right now to make an investment plan. Choose an appropriate investment strategy and stick with the plan unless something changes in your life. Despite being a very unpleasant part of investing, market losses don’t count as a change in your life.

A common misstep among investors of all ages is to panic about the market downturn and press pause on investing, including on recurring contributions to savings and retirement plans. While you might hesitate in parting with your hard-earned cash as the market falls, hoarding your money instead of investing might be a move you end up regretting.

Many choose to re-direct any savings to their home loan.  Often during a recession, interest rates fall to stimulate the economy and reducing you home loan with an interest rate (at present) of say 3% is not a good long-term use of funds, when long term share market returns are historically 8-9%.  

3 – Not having an emergency fund

We recommend having at least 6 months of living expenses stashed away in case of emergency situations, and 2 years for retirees.

Don’t have this in a savings account as they are paying almost no interest at the moment. Alternatively, put the money against your home loan (with redraw facility) or in your home loan’s offset account.  This has the effect of saving you anywhere between 2.5 – 3.5% interest on your loan (you can’t even get that on a Term Deposit at the moment). Also check out the interest you are paying on your loan – if you are paying more than 3% you need to shop around. A quick and easy way to check out what is available is by using TAG Finance and Loans Compare N Save website.

4 – Eliminating your insurances

Often when things get financially tight, people start reviewing their expenses. One such expense is personal insurance – life, total and permanent disability, trauma or critical illness and income protection (this cost can be a little hidden in the annual superannuation statement).

Although insurance is an easy expense to cut back on, you need to beware that it can cost you dearly in the long run and that it does provide a parachute when things go wrong.

Read our recent blog – Should you cancel your insurance cover?

5 – Raiding your nest egg

Taking out money out of superannuation before retirement means losing the benefit of compound interest over several years. Depending on how old you are, withdrawing money now could see you miss out on more than double that amount by the time you retire.

When your circumstances change, emptying your retirement accounts is often the first option when you don’t have an emergency fund. This should be a last resort. Weigh up all your options like financial assistance options and cutting discretionary spending before dipping into your retirement saving.

6 – Forget to learn from history

It is important to remember that market downturns are a normal part of investing. The chart below shows the rebound of markets (US share market) 150 days after the initial on-set of a significant negative market event.

It is normal to feel a twinge of panic during a recession, but it is essential that you make financial moves based on knowledge, not emotion.

7 – Not seeking assistance

Most people that are financially content and successful don’t do it on their own, they get professional advice. If you have the right adviser that takes an interest in you and your family’s needs and provides you quality advice, then your chances of achieving financial security increases dramatically. TAG is here to support you and your family.

Should you have any questions, please contact us on 03 9886 0800 or via email.

What Should You Do Now?


Become Money Smart
Build your financial knowledge and join our online community where you will receive TAG updates and invites to our Information Sessions.

Meet with us
If you would like to discuss your financial options, we offer a 1 hour no obligation, complimentary consultation with one of our advisers to discuss your situation. Contact us to arrange a time.

Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686).

2020 Budget – What’s in it for you and your business?

Author: Tony Rule, Partner, TAG Financial Services

The 2020 Federal Budget is a combination of the Old and the New.  Perennial favourites such as asset write offs, apprentice and trainee subsidies, individual tax cuts and infrastructure spending projects are supplemented by fresh initiatives including temporary recoupment of company tax losses and the scrapping of recently introduced laws around responsible lending to free up credit for small and medium business owners.    

The Government clearly wants us to spend our way out of the recession and they are leading the way with the biggest spending budget in living history.

The 2020 Budget is providing business owners with some great opportunities – if you are in a strong enough position to take advantage of what’s on offer.  The Coronavirus handouts will come to an end and businesses will be motivated through the provision of incentives to invest in people and assets.  Here are the key points for business owners:

JobKeeper – there have been no new announcements in relation to JobKeeper and so the previously announced reductions in JobKeeper from October 2020 and January 2021 remain in place with JobKeeper ceasing in March 2021.

JobMaker – from Budget night for a period of 12 months, employers will receive $200 per week (up to $10,400) if they hire an employee for more than 20 hours per week under the age of 30 who was receiving JobSeeker, Youth Allowance or Parenting Pay prior to employment.  A payment of $100 per week will be paid for a new employee aged between 30 and 35 years.

Asset Purchases – from budget night to 30 June 2022, all businesses will get a full tax deduction for new depreciable asset purchases (and the costs of improvements to existing eligible assets) in the year they are first used or ready for use.   Businesses with turnover less than $50m will be able to deduct the full cost of second hand assets through this period. 

Recoupment of Taxes Paid – companies will be able to offset tax losses incurred in the years ended 30 June 2020, 30 June 2021 and/or 30 June 2022 against profits made in the year ended 30 June 2019 or later.  This offset should result in a refund of taxes paid when the 2021 and/or 2022 tax returns are lodged.  This refund of taxes paid includes the situation where a company makes a tax loss as a result of the write off of one or more asset purchases as noted above.  The loss amount carried back should not be able to exceed the earlier taxed profits or generate a franking deficit.

Business Grants – announced for Victorian Businesses after 13 September and paid before 30 June 2021 will be non-assessable.

Research & Development – from 1 July 2021, the Research and Development Tax Incentive for companies turning over less than $20m will increase the refundable R&D tax offset to 18.5 percentage points above the claimant’s company tax rate and there will be no $4m cap on annual cash refunds.

Fringe Benefits Tax – The record keeping rules around FBT will be simplified from 1 April 2021 to allow employers to use existing records of the business rather than requiring employee declarations to prove (say) living away from home declarations or a travel diary where the business already has an appropriate level of records.   Where an employer retrains an employee that is being made redundant, that training cost will no longer be subject to FBT.

Personal Tax Cuts – from 1 July 2020, income tax rates for individuals have been reduced.  Low and middle income earners will receive tax relief of up to $1,042 per year ($20 per week) and high income earners over $120,000 will receive up to $2,392 per year ($46 per week) based on tax rates that were applicable up to 30 June 2020. The government has also increased the low income offset from $445 to $700 from 1 July 2020.

Responsible Lending Rules – established following the subprime loan crisis in 2009 will be dropped to reduce onerous credit rules for lenders and encourage the flow of loans to boost the economic recovery.  Whilst improving lending conditions, there will be a shift from “lender beware” back to “borrower beware” which will need to be monitored.

More Access to Tax Concessions – businesses with turnover less than $50m can now access small business tax concessions (previously available for small businesses up to $10m) providing tax relief and reducing red tape in the following areas:

From 1 July 2020:

  • immediate deductions for eligible start-up expenses
  • immediate deductions for eligible prepaid expenditure

From 1 April 2021:

  • exemption from fringe benefits tax on car parking provided to employees
  • exemption from fringe benefits tax on multiple work-related portable electronic devices (e.g. phones or laptops) provided to employees

From 1 July 2021:

  • simplified trading stock rules
  • remit pay as you go instalments based on GDP
  • adjusted notional tax for PAYG Instalments.
  • settle excise duty monthly on eligible goods
  • settle excise-equivalent customs duty monthly on eligible goods
  • two-year amendment period for income tax assessments for income years starting from this date
  • the Commissioner of Taxation will have the power to create a simplified accounting method determination for GST purposes for these businesses

There’s always devil in the detail and we will keep you posted as more information rolls out.

If you have any questions in relation to the 2020 Budget and how it will affect you and your business, please do not hesitate to contact us on 03 9886 0800 or via email.

Meet With Us
If you would like to discuss your business situation, we offer a 1 hour no obligation, complimentary consultation with one of our advisers to discuss your situation. Contact us to arrange a time.


Become Money Smart
Build your financial knowledge by joining our online community, where you will receive TAG updates and invites to our information sessions.


Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686). Copyright 2020. Please do not reproduce without the expressed written consent of the author.

Meet the TAG Team – Emma Partenza

TAG is excited in introduce our newest Manager in our Superannuation Advisory & Audit team – Emma Partenza.

Emma brings extensive Self-Managed Super Funds knowledge to our team having specialised in superannuation for over 13 years. She is passionate about going above and beyond to provide the best superannuation solutions for clients. Her ‘hands on’ approach is respected by both clients and advisors alike.

“I am passionate about SMSFs and enjoy identifying opportunities and highlighting strategies that client’s may not have considered in respect to their superannuation. It’s extremely satisfying when I’ve helped secure a client’s financial future.”

Skillset

  • Identifying opportunities for SMSF members
  • Demystifying technical jargon for trustees
  • Tax planning and opportunities
  • Estate planning strategies
  • Rectifying complex issues

Qualifications

  • Bachelor of Commerce
  • Bachelor of Computing
  • CPA
  • SSA (Superannuation Specialist Advisor)

If you would like to discuss your superannuation planning options and getting the best out of your SMSF, you can contact Emma at emmap@tagfinancial.com.au or phone 03 9886 0800.

Should you cancel your insurance cover?

Author: Susanne Maas, Manager – Financial Advice, TAG Financial Services

Often when things get financially tight, people start reviewing their expenses. One such expense is personal insurance – life, total and permanent disability, trauma or critical illness and income protection (this cost can be a little hidden in the annual superannuation statement).

Although insurance is an easy expense to cut back on, you need to beware that it can cost you dearly in the long run and that it does provide a parachute when things go wrong. Here’s a message we recently received from a client:


In 2018, I sat down with Michelle Griffiths from TAG to review my personal insurances, and after weighing up her recommendations, I took out trauma insurance for the first time, recognising that I’m not quite as “bullet proof” as I once was….well we never know “what’s around the corner” because a couple of months ago, I was diagnosed with low-level, non-aggressive prostate cancer.

After getting over the initial shock, I contacted TAG, not really knowing whether my situation was serious enough to warrant a claim. Susanne Maas from TAG took complete ownership of my claim, sent me the relevant forms and submitted them on my behalf…within a couple of weeks, my claim was approved for the full amount insured, and the money was in my account. Whilst insurance premiums can be a drag, I now have quite a tidy sum available to invest or cover potential future medical expenses….a very pleasant silver lining to a difficult few months.  


When reviewing insurance, we often find policies that have been in place for some time are no longer as competitive or offer fewer benefits. By having your insurance cover arranged by TAG, you will also have someone to stand by your side should there ever be the need to make a claim.

It does not cost more to get insurance through an adviser with a reputable insurer than if you go to the insurer directly. The Australian Prudential Regulatory Authority (APRA) issued a report in June 2019 showing that the percentage of successful claims where higher for policies acquired via an adviser.

If you are considering making changes, here are a few tips:

1. Talk through the options with your adviser. At TAG, this is complimentary and part of our annual service.

2. Have a full medical before you reduce or cancel cover. We have several examples where this has resulted in people changing their minds.

3. Look at your options to reduce cover rather than cancelling the lot.

4. Consider the average age for a claim, from one of Australia’s leading insurers:
Death – age 57
Trauma or Critical Illness – age 51
Total and Permanent Disability – age 49
Income Protection – age 46  

If you have any questions, please contact Susanne Maas via email or call us on (03) 9886 0800.

Insurance Review
If you would like a professional insurance review of your cover and costs, contact us to set up a time.


Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686). Copyright 2020. Please do not reproduce without the expressed written consent of the author.

How REAL is the Victorian Government Stimulus Package

Author: Tony Rule, Partner, TAG Financial Services

After a good start at helping businesses get through this virus-based recession, it appears that the politicians have gone back to what they do best – playing politics and selling spin.  Oh well – it was good while it lasted!

Over the last week arguments and bickering have broken out between the federal government and the states, between the Coalition and Labour parties and even within political parties over re-opening the borders, what constitutes a special case and the appropriateness of Victoria’s “Road to Recovery” program.

Yesterday, one week after Premier Dan Andrews announced his “Road to Recovery” plan (which basically meant that ordinary businesses would not be able to resume for another six weeks) and two weeks before stage one of the JobKeeper program ceases, the Victorian State Government released their “Business Survival and Adaptation Package” costed at $3b. 

It’s a great headline and whilst all assistance is welcome, this announcement does little to put cash into businesses to help cover costs right now.  The key benefits for most businesses will be a $20,000 handout and a deferral (but not a reduction) of payroll tax for the full year ended 30 June 2021.  The announcement is light on detail, but here is what we know so far…

Business Survival

The business survival components of the package include a third round of support to business owners, but this time for a larger amount and to a much wider group of businesses (up from $10,000 in the last round to $20,000 and up from payroll of less than $650k to payroll less than $10m).  There is also survival assistance to specific industries and groups including:

  • Licensed Hospitality Businesses can apply for a grant up to $30,000 based on venue capacity and location.
  • A competitive grants program to support metropolitan and regional business chambers and trader groups so that they, in turn, can support their member businesses.
  • Grants of up to $20,000 to help alpine businesses pay their service charge to Alpine Resort Management Boards

Business Adaptation

Additional funding, tools and resources have been announced to help businesses to adapt and prepare for opening under “COVID normal” settings including:

  • A voucher program (not cash) to assist sole traders and small businesses to build digital capability
  • Assistance to Victorian exporters to get products to market and establish new trade channels
  • Expansion of the “Click for Vic” campaign to help Victorians to support local businesses

Waivers and Deferrals

Whilst this part of the announcement was called Waivers and Deferrals, the announcements are mainly deferrals including:

  • Payroll tax deferral for the 2021 financial year,
  • Bring forward of 50% stamp duty discount for commercial and industrial property in regional Victoria
  • A six month deferral of the planned increase in the landfill levy
  • 25% of this year’s congestion levy to be waived with the balance to be deferred
  • Liquor licence fees to be waived for 2021
  • Vacant Residential Land Tax for vacant properties to be waived for 2020

“Roadmaps” and “Packages” are great for grabbing headlines (and politicians will keep doing what politicians will do), but there has been little good news out of Victoria on a business front for many weeks.  In the absence of political leadership, business owners need to take control of their business destiny as soon as possible and look to make the necessary improvements each and every day.

If you need any assistance with moving you or your business forward during these different times, please contact us on 03 9886 0800 or via email.

Meet With Us
If you would like to discuss your business situation, we offer a 1 hour no obligation, complimentary consultation with one of our advisers to discuss your situation. Contact us to arrange a time.

Become Money Smart
Build your financial knowledge by joining our online community, where you will receive TAG updates and invites to our information sessions.


Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686). Copyright 2020. Please do not reproduce without the expressed written consent of the author.

Never let a good crisis go to waste

Author: Tony Rule, Partner, TAG Financial Services

Winston Churchill’s words seem just as appropriate today as they did in the midst of World War 2.  Business owners are being tested from all sides during the Covid-19 epidemic.  And whilst it might be a bit too dramatic to compare the devastation and loss of war to our current situation, the sentiment is just as important now as it was 75 years ago.

Business ownership is about mindset and competition.  It is about having the persistence to improve your business just a little bit each day so that you can be better than the next guy.  If you are not improving – your business is going backwards.  And whilst I acknowledge that various businesses and industries have been hit to varying degrees by the latest round of shutdowns, the more work you can do now to improve your plight, the better your business will be in the future.

Focus Points

So, what is that you will be achieving over the remaining lockdown?  Here are some ideas to focus your energy…

  1. Strategy
    Will your industry and your business be the same when things get back to “normal”?  What can you do now to jump ahead of the pack?  Is this the right niche in the right industry or is it time to adopt a new position – and how will move be accomplished?  Take some time now to think about what your business should look like in three years’ time.

  2. Technology
    How has your technology held up over the last five months?  Have your clients moved to purchasing online – with you or with your competitors?  Are there manual processes that should be automated to improve your gross and net profit margins?  What development is going to make you better than your competitors – either internally or in the field?

  3. Team
    What is it about your team that you can fix during this downturn?  Is there training or mentoring that should now be done?  Are each of the team in their right places and if not – when is the right time to act (now or when JobKeeper ends)?  What will your next recruit look like?

  4. Customers
    Ring each of your customers and make sure that they are ok – not a sales call, just a “how are you going?” call.  What information do you have that can help your customers at the moment?  How can you show them that you are thinking about their situation?  What can you learn from them that will make your business better?

  5. Marketing
    Make sure your marketing information and databases are up to date.  Do you have a plan to reach your prospects when we are out of lock down?  What is your new value proposition?  Should you change your target market?  Are there new products or delivery mechanisms that you should be providing?  Is it status quo or innovation that will win the day?

  6. Finances
    How stable is the business at the moment?  What is your cash situation like?  When will you be forced to act?  What could you do now to buy another 2 or 3 months?  Is it time to negotiate with the landlord, suppliers and customers again?  Are you accessing all available business assistance grants and deferrals to get you through the lockdown?

  7. Personal
    Do you have your personal affairs in order?  Is it time to review your insurances to ensure premiums are minimised?  Is it time to refinance loans to ensure interest rates are as low as possible and to access spare equity?  Has the last six months damaged your retirement plans and is it time to update your wealth projection?  What is your exit plan for the business?

Rise Above
Every step that you can take during the pandemic counts for two steps at any other time.  If you can move forward while your competitors are trying to hold ground or are moving backwards – then that is a win.

The time for worrying about how the government (or others) have stuffed things up is over.  Accept what has happened and then adapt to take advantage of the situation.  What we have now is not good or bad – it is just different.  And we need to factor this difference into our future plans.

If you need any assistance with moving you or your business forward during these different times, please contact us on 03 9886 0800 or via email.

Meet With Us
If you would like to discuss your business situation, we offer a 1 hour no obligation, complimentary consultation with one of our advisers to discuss your situation. Contact us to arrange a time.

Become Money Smart
Build your financial knowledge by joining our online community, where you will receive TAG updates and invites to our information sessions.


Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686). Copyright 2020. Please do not reproduce without the expressed written consent of the author.

TAG – Still Open for Business!

Sunday’s state government ‘roadmap to recovery’ announcement has outlined a strict and lengthy pathway to re-opening. For TAG, this means our team will continue to work remotely. However, rest assured we will still remain virtually ‘open for business’!

Our team are available to be contacted as usual, and we will remain available to you to address any questions. Please do not hesitate to contact us with any concerns.

Here are some of the changes we have put in place to ensure that our client’s needs are still met:

Emails
We are actively monitoring and responding to all emails. If you can email us your query, please do so at team@tagfinancial.com.au.

Phone
Our office phone is being diverted to our friendly team and our business hours remain as normal (Monday to Friday, 9am to 5pm). If our phone does go to voicemail, please leave a message so we can get back to you.

Meetings
Scheduled meetings with clients and suppliers are being carried out either via telephone or video conference. Our friendly team are happy to help you set up for virtual meetings should you need any assistance.

Mail
We have limited access to mail during this time which will delay our response time. Please email where possible or contact us to discuss alternatives to mail.

Documentation
Please scan and email documents where possible instead of mailing. If you need any help with documents, please contact us.

Invoices
We ask that invoices are paid through our online portal, go to: https://www.tagfinancial.com.au/pay-my-invoice

We understand that these are challenging times for everyone. The actions we have taken will ensure we continue to deliver a great level of service to our highly valued clients, whilst also minimising any risk to the health and wellbeing of our team and clients.

We will continue to update you regarding our working arrangements in line with future government updates.

If you have any questions, please contact us on 03 9886 0800 or via email.

We wish everyone the best of health during this difficult time.

Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686). Copyright 2020. Please do not reproduce without the expressed written consent of the author.

BOAA Online Connection Session

Time to discuss positive solutions. Taking control is the way forward.

THURSDAY 10TH SEPTEMBER
1.00PM – 2.00PM
VIA ZOOM

At this BOAA event, hear from John Condilis –Co-Owner of Nobody Denim and his CEO Nick McPhee; how they turned their Denim business into a producer of PPE within days.

The panel will be covering different aspects of how to take positive steps forward to improve your business and your working life.

COVID-19 has provided a number of opportunities for many businesses;

• Being nimble and pivoting
• Alternative products / services
• Employing the best people
• Benefits around Mergers and Acquisitions
• Work life balance

Also joining the online session will be Ben Lethborg (Pitchers Partners), Jamie Sturgess (Macpherson Kelley) and Warren Otter (Otter & Associates).

Click here to register now.

Why on earth is the US sharemarket at an all time high?

Author: Leigh Jobling, Partner, TAG Financial Services

Here we are, sitting at home watching the news……

  • We are in a recession (no one has mentioned the “D” word yet, but that’s for another time)
  • Business collapsing
  • Our major airline carrier posting a $2 billion loss
  • A looming US Presidential election
  • House prices in decline  
  • Tension between China and “the West”
  • Oh, and I almost forgot…….the most significant world health crisis in over 100 years and the Coronavirus showing no signs of slowing down.

So why on earth is the US sharemarket at an all time high? Why has the Australian Share market recovered about 2/3 of its dramatic fall in March 2020 – it would be 100% if not that a large part of our market includes the 4 big banks which are still well down from their February highs.

As we’ve said before, sharemarkets are predictors of the future.  They listen to the daily news too and sometimes react, but the value of a share in a company and the value of a country’s overall sharemarket is a product of the earnings outlook of the companies that made up that market.

In Australia, we are working our way through year end reporting.  Have you noticed a company announce a huge profit decline or even a loss and that same day their shares go up?  It’s because either the reported performance was not as bad as expected, OR, the company has provided an optimistic outlook for the year ahead.

The overarching reality is even with all the negative commentary, there is a global expectation that governments and world banks will provide world economies the stimulus necessary to get back on their feet while we wait for a vaccine to arrive.  It’s also interesting to observe the companies that have exceeded expectations and performed well during the Coronavirus pandemic – namely on-line retailers and technology companies.

This is the S & P 500 Index in the US – has recovered 100% of market correction       

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 This is a NASDAQ index in the US – up nearly 20% from pre correction high in late February

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It certainly feels like another DotCom bubble with companies like Apple, Amazon, Netflix, Microsoft, Google, Facebook and Tesla outperforming companies in more traditional industries.

We also have many companies that have never made a profit and don’t expect to for at least a few more years, but they are some of the most highly valued companies in Australia – again, expectation of their future profitability is high and the market is paying for the privilege to own those shares today.   

Our message to you

  • Beware the highly values tech stock.  There is no doubt opportunity within that sector, but proceed with caution – they’ve had an amazing run.
  • Stay strong to your long term strategy and ensure you have the necessary liquidity to ride out market volatility (you don’t want to have to sell during a market correction).
  • Timing the market sounds great and can increase your returns if you get both the sell and the buy timing right.  Ultimately it’s always a 50/50 bet and you are better off retaining exposure to the share markets even in times of uncertainty.

After all, even during these unprecedented and uncertain times, the share market can behave counter-intuitively to our expectations and appear dislocated from reality.  The sharemarket clearly likes the potential reality of tomorrow, more than we are enjoying our “stay at home” reality of today.

If you have any questions, please contact us on 03 9886 0800 or via email.

Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686). Copyright 2020. Please do not reproduce without the expressed written consent of the author.

Superannuation Guarantee Amnesty finishes 7 Sept 2020

Author: Emma Partenza, Manager, TAG Financial Services

Employers wishing to participate in the superannuation guarantee amnesty have until 7th September 2020 to apply to participate. So you need to act now!

As addressed in our earlier blog back in March, this one-off amnesty provides employers an opportunity to disclose and pay all previously unpaid super guarantee charges owing to their employees for any quarters from 1 July 1992 to 31 March 2018.

Superannuation Guarantee Charge (SGC) payments made before the deadline will be tax deductible to your business.

Business already having disclosed unpaid SGC to the ATO have no further requirement to apply again before 7 September 2020. However, business who have yet to come forward to disclose outstanding superannuation guarantee amounts need to do so and must register for the amnesty by 7 September 2020 with the ATO.

Employers taking advantage of the amnesty will benefit from not incurring the administration or penalty components of the SGC shortfall amount for its employees. A huge incentive to ensure superannuation obligations are up to date before the deadline.

The ATO will continue to conduct reviews and audits to identify employers not paying their employees SG. If they identify those employers before they came forward, those businesses would not be eligible for the benefits of the SG amnesty.

Impacted by COVID19?

For businesses impacted by COVID19 and wishing to apply for the SGC amnesty but may be concerned of their ability to pay the outstanding SGC liability are urged to still apply to participate in the amnesty by 7 September 2020.

The ATO have stated they are willing to work with businesses and enter into arrangements to establish flexible payment plans for the business to continue making payments. They could also consider extend payment of SGC liabilities beyond the deadline of 7 September.

Payments of SGC after the deadline will not be tax deductible to the business.

If you have any questions, please contact us on 03 9886 0800 or via email.

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Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686).