5 tax tips from Five Ways – Day 3

Wednesday always makes me think of the tax treatment of cars. As a tax geek that’s how I roll.

“I’m looking at buying a car, should I lease, hire purchase or Chattel mortgage?”

Great question this, often comes up. A lot of time is spent analysing the benefits. I think that at the end of the day it’s a personal preference. Chattel mortgage and Hire purchase (for tax) have similar treatments. Some agreements that say “lease” on the front page are actually hire purchase when you read the detail. Get your accountant to check it out, or better still call your accountant before you get the finance.

Here is a brief matrix of the two:

Currently getting the finance is the struggle. Whatever way you can finance an asset will be better than paying cash.

And my answer to the Lease/HP question – simple is good, so Lease is good.

Keep your comments coming; tweets are great or follow us on Facebook. The feedback will be used to make the blog more usable for everyone.

Paul Meissner – Director, Five Ways Chartered

5 tax tips from Five Ways – Day 2

I hope yesterday’s HECS question helped some people. I’m back today with a classic question:

“If I put a work sticker on my car, can I deduct 100% of my car expenses?”

This is my favourite question. Simply – No. The more detailed answer is that your deductions are based on 4 different methods.

The methods are:

• cents per kilometre (limited to 5,000 business kms per year);
• 12% of original value (can be used if you travelled more than 5,000 business kms per year);
• one-third of actual expenses (can be used if you travelled more than 5,000 business kms per year);
• logbook method (requires a logbook to be kept over a 12 continuous period and a logbook can last for 5 years as long as it still represents the continued use of the car).

None of the methods above include an allowance for the number of stickers on your car or how pretty they look. The business use of a car is the purpose of the kms travelled. Home to work or work to home aren’t deductible. Attending meetings, running business errands etc are deductible. Log books are good if you do a lot of business kms, for everyone else, don’t worry about what you can claim and speak with your accountant at the end of the year. There are always some business kms to claim at a set rate or one of the other methods to use. It’s often not worth the hassle keeping a logbook.

Keep your comments coming, tweets are great or follow us on Facebook. The feedback will be used to make the blog more usable for everyone.

Also, download our iPhone app – it has a useful guide to motor vehicle expenses as well as other handy tax tips.

Paul Meissner – Director, Five Ways Chartered

5 tax tips from Five Ways

Every year clients, friends and family sound me out on the latest ‘tax tip’ they have heard around the traps (or in most cases misheard). What I wanted to do is give people the answers to some of the myths that are around about tax.

This week I will blog about one tax tip every day. I have affectionately called it ‘Tax Tip Week’.

For those of you that have our iPhone app reading the blog can be done easily at any time.

Let’s start the week with a question I get a lot:

“Why do I pay HECS in my tax return when my employer withholds HECS and pays it for me?”

The simple explanation to this is that your employer doesn’t pay anything off your HECS debt. Forget what’s shown on your payslip. The extra amount withheld by your pay lady is just extra tax and isn’t split between tax, Hecs or any other type. Your HECS repayment is calculated in your tax return and the full amount of the withholding (on your payment summary) is a credit against your tax and HECS amounts.

Please feel free to comment here, tweet or follow us on Facebook. The feedback will be used to make the blog more usable for everyone.

For other tips & tricks in your pocket, download our iPhone app from iTunes.

Paul Meissner – Director, Five Ways Chartered

‘Hell has frozen over!’

A client said to me last month, hell will freeze over before an Accounting firm has an iPhone app. Well ladies and gentlemen, Five Ways Chartered Accountants & Business Advisory are happy to announce the launch of the first Australian accounting firm iPhone app.

In developing the app, we wanted something that everyone could use. With our app we hope to:

• Keep our clients informed about tax deadlines with our calendar;
• Give clients the ability to book meetings with us and submit tax questions;
• Become an accessible source of relevant links to tax, accounting and banking websites;
• Provide business owners and other tax payers access to relevant information that they might not be getting from their existing accountant including tips & tricks, tax rates in your pocket & Key Performance Ratio’s to consider adopting in your business.

We are very excited to launch this. We would love your feed back. Follow us on Twitter & Facebook.

Five Ways Chartered are 100% Xero and Paycycle

Download now from iTunes

Welcome to our blog

Hi & welcome to the first Five Ways blog, a source of relevant information, opinions and insights for small business owners.

Through our website we will be blogging about issues that we think are relevant to small business owners; ideas involving the smart use of technology in business; and personal insights from our own journey as business owners.

Every business utilises technology in some aspect of ‘doing what we do’ – and as technology becomes more accessible, your own business will evolve and embrace technology to an even greater extent to increase efficiency and in the process making your life easier.

With this smart use of technology we want to show you the benefits of partnering with an online accounting firm fully embracing the web and cloud computing.

Ask yourself, as a business owner do you feel that you and your accountant are on two different sides of a busy highway?

Sure, Accountants have never been regarded as thought leaders – they sit at their desks in brown suites and cardigans completing compliance documents and tax returns that you are charged by the minute for – however, that same brown-suited Accountant has amazing knowledge and insight into your business locked up – They just don’t have the time, or the tools to part with it.

The world is changing, the way people communicate is changing, the way people do business is changing. So why have accounting firms never evolved? I mean seriously, small business owners need advice and assistance from people that are changing with them. Twitter, Facebook, LinkedIn, GoogleAds, these are the tools that small businesses are turning to for their business.

Shouldn’t their Accountant understand these tools??

So what do small business owners do about it? What’s out there for them?

Five Ways Chartered Accountants & Business Advisory. Its the way Accounting should be.

• Package up the services YOU want;
• Agreed price;
• Pay by the month;
• No surprise invoices;
• While still getting a personalized service;
• Proactive business advice.

Our name and our service focus on the 5 needs of small business:

• Grow your Business
• Create more Profits
• Manage Cashflow
• Protect your Assets
• Plan for the Future

Utilising fully online Accounting software we streamline the compliance function so more time can be spend helping your business.

The business world has changed, isn’t it time you changed the way you got your accounting service?

Launch of our new website

We are proud to announce the launch of our new website. In this section, we will post regular updates on our firm.