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New Shutdown Rules For Awards

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Fair Work Australia has advised that as of May 1, 2023, there are new rules regarding shutdowns in many awards.  

A business shutdown refers to the temporary closure, during festive periods such as Christmas and New Year. For additional information please refer to the Direction to take annual leave during shutdown.

Under the new regulations, the following conditions apply: 

  • Employees have the authority to mandate that employees use their paid annual leave during the temporary shutdown. 
  • Employers are obligated to provide written notice of the temporary shutdown period to all employees who are effected, allowing a minimum of 28 days’ notice. 
  • The requirement for employees to take annual leave must be reasonable.  
  • The notice period can be shortened if an agreement is reached between the employer and the majority of impacted employees 
  • If an employee lacks sufficient annual paid leave to cover the entire shutdown period, alternative arrangements can be through an agreement with the employer. These options include: 
  • Using accrued time off; 
  • Taking annual leave in advance, or; 
  • Opting for leave without pay 

During the shutdown period, if any public holidays coincide with the employee’s regular working days, the will receive compensation for those holidays. 

Who the changes apply to: 

These revised regulations are applicable to employers who fall under the scope of the affected awards. 

The Fair Work Australia website contains the updated details regarding the guidelines for taking annual leave during a shutdown. This information encompasses various industries and awards, such as: 

  • Building and construction 
  • Hair and beauty  
  • Hospitality (e.g. fast food and restaurants  
  • Real estate  

Access your industry via the Direction to take annual leave during shutdown webpage. 

Which awards are changing? 

The following list of award are changing: 

Use the 3-step Find my award tool to figure out what you are covered by. If you already know your award, you can access a copy directly from the List of awards page.  

For more information about these measures click here.

Introducing Payday Super 

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The Government plans to introducea reform mandating the payment of superannuation on payday, which it believes will have a positive impact on the retirement incomes of millions of Australians. 

As of July 1, 2026, employers will need to pay their employees’ super at the same time as they are paid. By doing so, they believe it will strengthen Australia’s superannuation system and enable a more dignified retirement for more workers in Australia. 

For example, if a 25-year-old, with a median income were to switch to payday super, while receiving both their super alongside their wages, they could be $6,000 or 1.5% better off than when they reach retirement age. 

It is claimed employers will experience a smoother payroll management with fewer accumulated liabilities on their records as a result of the more frequent super payments. 

It will not only simplify the process of monitoring and managing superannuation payments for employees but also enhance protection against potential exploitation by disreputable employers. 

According to the estimates of the Australian Taxation Office (ATO), approximately $3.4 billion worth of super went unpaid in years 2019-20, despite the majority of employers fulfilling their obligations.  

The Government has allocated additional resources to the ATO to further strengthen the system and help detect unpaid super payments at an early stage. Furthermore, the Government plans to establish higher targets for the ATO in terms of recovering outstanding superannuation payments. 

In the second half of 2023, the Treasury and the ATO will engage in close consultation with both industry representatives and stakeholders, regarding these proposed changes.  

With the start date being July 1, 2026, this will hopefully allow employers, superannuation funds, payroll providers, and other parts of the superannuation system time to adequately prepare for the implementation of the reform.  

For more information about these measures click here.  

Super Contribution caps remain unchanged in 2023/24

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The IFPA have announced that the government will keep Super contribution caps unchanged for the 2023/24 financial year.

Since the average weekly ordinary time earnings (AWOTE) figure for the December 2022 quarter was unable to meet the required threshold for indexing, the concessional cap will remain unchanged at $27,500 in 2023/23. As a result, the non-concessional contributions (NCC) cap for 2023/24 will also remain unchanged at $110,000, which is four times the concessional cap.

With the general transfer balance cap set to increase to $1.9 million on 1 July, 2023, this means the NCC bring forward the thresholds for 2023/24 are as follows:

Total super balance on 30 June 2023Maximum NCC capBring forward period 
Less than $1.68m$330,0003 years
$1.68m but less than $1.79m$220,0002 years
$1.79m but less than $1.9m$110,000Nil
$1.9m or moreNilNil

For more information about this measure click here.

Working from home deductions 2022-23

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There have been some new working from home deduction changes for 2022/23 and so the following is a summary of those changes. 

The pandemic has changed the way we work, with many people in Australia and around the world now working remotely from home. This has led to changes in tax deductions for expenses incurred while working from home. 

The proposed changes to the working from home fixed rate method has now been finalised and the ATO’s Practical Compliance Guide 2023/1 is now available. 

From the 2022/23 income year, the methods available to assist in calculating the work from home deductions include a revised fixed rate method and an actual cost method. 

The revised fixed rate method is an alternative method for calculating home office expenses. The revised fix rate method has been updated to make calculating expenses easier and avoid any time-consuming apportionment calculations. Therefore, creating better contemporary arrangements when working from home. 

Under this method, taxpayers can now claim an increased fixed rate of 67 cents per hour for home office expenses, regardless of the actual amount spent. The fixed rate calculates the claim for expenses such as electricity and gas. Individuals will no longer need to have a dedicated workspace, such as a home office, that is used exclusively for work purposes during the tax year.  

To claim the fixed rate method you must keep records of the hours worked from home, such as timesheets or diary entries. 

This also includes the evidence of all paid expenses you have incurred that are covered by the fixed rate method (such as phone or electricity bills). You must also have record of all the equipment you had bought in order to work from home, such as technology and/or furniture, which must also require the supplier, cost and date acquired.  

Taxpayers still have the option to use the actual cost method of claiming other work-related expenses as opposed to using the revised fixed rate method.   

For more information about these measures click here. 

Instant Asset Write Off Deadline

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A recent article written by Belinda Crowley, a tax principal at RSM Australia, has advised small businesses to act promptly in order to meet the deadline for the instant asset-write-off (IAW) scheme, otherwise, they may face significant bureaucratic hurdles once the stricter regulations are reinstated.

She stated that numerous small business and medium-sized enterprises (SMEs) would be caught off guard by the deadline and would be required to depreciate any asset worth over $1,000 after 30th June 2023.

This could be a significant time and financial burden, particularly for small businesses. Even if their accountants manage it on their behalf, it would still be an extra cost for them.

IAW has been a feature for small businesses since 2015. The government had introduced temporary full expensing as part of its support program for businesses of all sizes during the pandemic. These initiatives encourage business owners to invest in their enterprises. However, both schemes are now ending.

Accounting for occasional high-value assets of, say, $ 30,000, and doing the same for any asset valued over $1,000 (or $100 for larger businesses) created one of the most significant challenges. Crowley also suggested that SME’s that don’t require an asset write-off in the current financial year should save the depreciation for when it’s necessary.

Business owners must exercise caution and seek professional assistance before making a decision, if they are currently experiencing a challenging period and do not need the deduction to reduce their tax bill. It is also worth noting that supply chain disruptions mean that even if a business wants to buy an instant write-off asset, as the asset must be installed and ready for use before 30th June, 2023, or it will not be eligible to be claimed. Therefore, it is critical to be certain that the asset will be available and operational on the site before the 30th of June.

Although the government has announced initiatives such as the skills and training boost and technology investment boost, they are unlikely to have the same impact as the instant asset write-off.

SME’s should take advantage of the new 20% uplift deduction, which was highlighted a priority in the federal budget for areas such as environment, digitalization, and training. This deduction allows businesses to receive a $120 deduction for spending $100 on training or digitisation, with the incentive backdated to March 29, 2020. This benefit is very specific and only applicable to training conducted with registered training organizations, making it difficult for SME’s to access. Additionally, access to write-offs is limited to businesses with an aggregated turnover below $50 million, and the training boost expires on  June 30, 2024, while technology scheme only lasts until the end of this financial year. The uplift deduction would not be consistently beneficial across sectors, as some industries , such as agriculture, rely more on-the-job training than formal accredited courses.

If you need to discuss how you can utilize the IAW measures for your business please contact us. To read more detail about these measures please click here.

New Paid Family and Domestic Violence Leave

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Fair Work Australia has released on their website that they will soon be amending the Fair Work Act to introduce paid family and domestic violence leave. This blog summarises the key points of this new leave entitlement as outlined by Fair Work Australia.

This new entitlement will be available as of February 1, 2023, for employees of non-small business employers. This enables small businesses an extra six months to adjust to the change, before the start date August 1, 2023, for the remaining employees.

All part-time and casual employees within the Fair Work System, will be able to access 10 days of paid family and domestic violence leave in a 12-month period. This will then replace the current entitlement to 5 days of unpaid family and domestic leave under the National Employment Standards.

Employees can claim the full 10 days upfront, which means they will not need to accumulate it over time. However, the leave will not accumulate from year to year if it has not been used.

Currently, employees can claim 5 days of unpaid family and domestic violence leave until the new paid leave entitlement is accessible. For more information about these measures’ unpaid family and domestic violence leave click here.

Continue reading for more information regarding how this new leave entitlement will come into effect.

How the leave renews?

The leave is renewed every year on each employees work anniversary – marks an employee’s first day of the job. However, it does not accumulate from year to year if you do not use it.

Employees will have access to the full 10 days, depending on whether they start on or after the date of this new paid leave entitlement. This leave balance will be renewed on their work anniversary.

For employees who were employed prior to the starting date of the new paid leave entitlement, they can access the full 10 days on the relevant start date. However, the leave will renew on their work anniversary, not on the anniversary of the relevant start date.

Taking family and domestic violence leave

All part-time and casual employees can claim this paid family and domestic violence leave, if is unpractical for them to do so during their work hours or if they need to take further action to deal with the family and domestic violence situation.

This may include, but is not limited to the employee:

  • Accessing police services
  • Attending appointments (medical, financial or legal)
  • Attending counselling
  • Relocating or making safer arrangements for themselves and/or others

Meaning of family and domestic violence

Family and domestic violence refers to the violent acts and/or other threatening behaviours that generally occur between close relatives, a current or former partner or member/s of their household that both coerce and/or seek fear from another.

A close relative can refer to:

  • An employee’s
    • Spouse or former spouse
    • De factor partner or former de facto partner
    • Child
    • Parent
    • Grandparent
    • Grandchild
    • Sibling
  • A child, parent, grandparent, grandchild or sibling of an employee’s current or former spouse or de fact partner, or
  • A person related to the employee according to Aboriginal and Torres Strait Islander kinship rules

Payment for leave

Paid family and domestic violence leave for full-time and part-time employees will be paid at their full pay rate for the hours they would have worked that week.

Casual employees will also be paid at their full pay rate for the hours they were essentially rostered to work for that period they booked their leave.

An employees full pay rate includes their base rate plus others, such as: incentive-based payments and bonuses, loadings, monetary allowances, overtime or penalty rates and any other separately identifiable amounts.

Interaction with other paid leave

Employees are able to use paid family and domestic violence leave even during the period of paid personal/carer’s or annual leave. In this case, will then take paid family and domestic violence leave instead of the other ford or paid leave. The employee is required to notify their employer and supply the necessary evidence to support their claim.

Notice and evidence requirements

If an employee takes paid family and domestic violence leave, they must let their employer know as soon as possible. An employer will request evidence from their employee to show that their employee needs to take further action to deal with family and domestic violence, especially if its not practical for them to do outside their work hours.

An employer can only use this information to satisfy themselves that their employee is entitled to family and domestic violence leave, only if:

  • The employee consents
  • The employers deals with the information by law or
  • If its necessary to protect the safety of the employee or another person involved.

The employer cannot act against the employee or use the information for other purposes.

All the previous rules about notice and evidence under the previous unpaid family and domestic violence leave will continue for the new entitlement.

Find out more about the current rules regarding notice and evidence for family and domestic violence leave.

Support services

Confidential information, counselling and support for people impacted by family and domestic violence can access the 1800 RESPECT website, for further counselling services.

For information about these measure click here.

Switch to eInvoicing

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What is eInvoicing? 

EInvoicing is a government initiative designed to make the exchange of electronic invoices more efficient via your accounting software. Once the sender generates the invoice within their software, the information will be directly sent to the receiver, ready to be approved and paid for.  

EInvoicing enables better control over your invoicing by: 

  • Automatically appearing in your software to reduce the need to manually enter the invoices 
  • Using the ABN (Australian Business Number) of your trading partner as well as validating key details before the eInvoices are sent. This then removes the need to follow up the invoices that were incorrectly addressed or lost.  
  • Removing the manual entry of invoices to eliminate the time-consuming and costly errors  
  • Delivering the invoices with real-time information that can be accessed in your accounting software 
  • Limiting the fake or compromised invoices as well as other false billing scams 
  • Allowing you to seamlessly trade with other eInvoicing-enabled businesses across Australia and worldwide. 

This process can be implemented easy and efficiently. For more information about these measures ask your accounting software provider or click here. However, if you do not currently use an accounting software, there are several free and low-cost options available.  

How does Xero incorporate eInvoicing? 

EInvoicing software is similar to Xero as it allows the eInvoices to be exchanged efficiently and safely amongst the government and other businesses. Hence why we highly recommend Xero as your go to accounting software. 

Get started with eInvoicing with Xero within a few steps.  

  • Within Xero, you can register via the Peppol network by using your ABN and it’s a free service. 
  • In Xero enter your ABN, then enter your chosen customer’s ABN to ensure they are registered within the Peppol Network.
  • The eInvoices will be received automatically from the supplier which reduces the risk of misdirected emails or letters. This also means there is no need to manually enter the data into the invoice. These eInvoices can be viewed as draft bills via the Xero app or on your laptop, ready to be approved and paid for. 

For more details on how it works in Xero check out the following Xhelp guide: Register to receive eInvoices – Xero Central 

Removing the $450 monthly threshold for super guarantee eligibility

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On 11 May 2021, the Australian Government announced that the $450 monthly threshold will be removed to enhance the super guarantee coverage for eligible employees, regardless of their monthly earnings.

Provided that their employees still meet the super guarantee eligibility criteria, employers will be required to make super contributions into their eligible employee’s super fund, starting 1 July 2022.Employers will also be required to review their updated payroll and accounting systems to ensure that any super payments made after 1 July 2022 are accurately calculated into their employee’s super guarantee entitlement.

From 1 July 2022, online tools and calculators will be available to assist in implementing this change.
For more information about these measures, click here.

Affected by Floods? Discover Disaster Support for your Business!

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If you have been affected by recent floods and rainfall, a range of support is available for you and your business.  

It is encouraged that businesses follow Business Queensland on Facebook or check their website to stay up to date on available assistance. You may also contact the business hotline on 1300 654 687. 

What support can you receive? 

 

1. Small Business Disaster HUB 

The Small Business Disaster Hub website offers resources and information to businesses that help them respond and recover following a natural disaster. This can include: 

 

2. Financial Assistance

Eligible flood-affected communities are available for financial assistance. 

  • Emergency Hardship Assistance Grants are available to support those who were directly impacted by a disaster and are unable to meet their essential needs for food, clothing & accommodation. Eligible applicants can receive $180 per person up to $900 for a family of five or more. For more information visit www.qld.gov.au/community/disasters-emergencies. 
  • Essential Household Content Grants of up to $1765 for single adults and up to $5,300 for couples/ families. This is available for uninsured people. Eligible applicants may receive financial assistance towards replacing and repairing essential household contents. E.g., beds, linen, and white goods. 

Australian Government Disaster Recovery Payment is a single payment for eligible people who were adversely affected by the Southeast Queensland floods. 

Disaster Recovery Allowance is a short-term payment to help people who have lost income as a direct result of the floods in Southeast Queensland.  

 

3. Legal Aid Queensland  

The Legal Aid Natural Disaster Helpline (1300 527 700) is something that businesses can call to get help with issues they may face when a property has been damaged by a natural disaster. Legal Aid has a range of resources available to support businesses that have been impacted by flooding on leased or commercial properties.  

4. Mental Health Support 

The Queensland and Australian Governments have developed a range of mental health and wellbeing resources to help support small business owners. 

 

5. Natural Disasters Business Survey  

The Natural Disaster Business Survey was opened by the Department of Employment, Small Business, and Training, to understand the impact of rainfall and flooding on businesses in Southeast Queensland.  

This is a long-term plan designed to assist businesses. Responses received from this process are used to inform potential joint State and Federal government disaster recovery assistance for small businesses. 

 

For any further information click here.