This year a Temporary Flood and Cyclone Reconstruction Levy (flood levy) will apply to employees with an income over $50,000 for the 2011/12 year only.  The levy has been incorporated into the PAYG Withholding tax tables you use to withhold amounts from their salary or wage.

There are some exemptions for those that were unfortunate enough to be affected by a disaster or received the Australian Disaster Recovery Payment, so if you believe you may fall under the exemption please check the ATO web site.

How is the Flood Levy Calculated?

For every $5,000 over $50,000 an employee earns - they will be charged $25 flood levy for the year - which is withheld during each pay period (weekly, fortnightly or monthly).

For example, Wayne is on a salary of $65,000 so will be charged an annual flood levy of $125.  He is paid weekly, so will pay a weekly flood levy of $2.40 per week.

Or to explain another way, $65,000 - $50,000 = $15,000 over the flood levy base wage level.  $15,000 divided by $5,000 = 3 x $25 per year.  This gives us the annual flood levy total of $125, when divided by the number of pay runs in the year (Wayne is paid weekly, so there are 52) so he will be levied $2.40 per week.

Of course, if this is making your brain hurt just use the calculator provided on the ATO web site.

Accounts HQ is Perth, Western Australia's leading outsourced accounts and bookkeeping service. Our friendly team of bookkeepers are experienced in Xero, Paycycle, MYOB and Quicken and can help to make sure you get the most out of your financials.

The beginning of a financial year brings those of us in business many great things - new energy to make this year better than the previous, and a chance to review the previous year and reflect on our successes and learnings (we don't like to call them mistakes).

It also brings with it the first of the end of year compliance dates - Payment Summaries (previously called Group Certificates) for your employees are due to be issued by the 14th July. 

The new PAYG Withholding schedules for 2011/2012 have been released by the Australian Taxation Office.

If you're using accounting or bookkeeping software, such as MYOB or Quickbooks and pay employees, please don't forget to update your software prior to your first pay run for the 2011/2012 year.

Paycycle subscribers on the other hand can sit back and relax knowing that the 2011/12 tax tables have already been updated for them, at no extra charge - it is all part of their awesome cloud based payroll service.

And if you're still calculating youremployee pays in a wages book and using your brains instead of a computer, then you can find the new tax tables here.

Accounts HQ is Perth, Western Australia's leading outsourced accounts and bookkeeping service. Our friendly team of bookkeepers are experienced in Xero, Paycycle, MYOB and Quicken and can help to make sure you get the most out of your financials.

Yesterday one of our fabulous clients, Sharlene from Circles of Subiaco, was interviewed by the West Australian on the issues she is facing recruiting and retaining apprentices for her busy hair salon.

You can check out her article here.

What do you think? 

Australia’s first Paid Parental Leave scheme starts on the 1 January 2011, however participation in the scheme will remain voluntary until the 30 June 2011 for employers.  The Parental Leave Pay is funded by the Australian government (phew I hear you say) and will apply to most working parents, including full-time, part-time, self-employed, casual, contract and seasonal employees provided they meet the eligibility criteria.

The Parental Leave Pay will be paid to the employee for a maximum of 18 weeks at the National Minimum wage – which is currently $570 before tax per week.  The child will need to be born or adopted on or after 1 January 2011 for the employee to be eligible.

So how does it work?  If the press is to be believed it will be a simple case of the government paying the employer the funds, then the employer paying the employee with a little paperwork in between.  How easy this will be in practice is yet to be seen, but is discussing with your bookkeeper for the 2011/2012 financial year.

For more information on what your obligations are as an employer, or to find out who is eligible please visit the Paid Parental Leave web site.

A huge congratulations to our superstar Accounts Officer, Anne Greville, who qualified as a Xero Certified Advisor today. We're really committed to ensuring we are the best Xero bookkeeping team in Perth - and with us now being the proud home to two Xero Certified Advisors we are well on the way.

A new financial year is rapidly approaching - and along with that comes the gearing up for payment summaries to be issued and the new PAYG schedules for the 2010/11 year being released by the Australian Taxation Office. If you are using bookkeeping software such as MYOB or Quickbooks and pay employees, please don't forget to update your software prior to your first pay run for the 2010/2011 year. If you calculate your wages and salaries the old fashioned way, then you can find the new tax tables here.

From 1 March 2010, new legislation known as the Tax Agent Services Act 2009 took effect. The laws have seen the introduction of a national Tax Practitioners Board who, among other things, oversee and regulate the supply of BAS Services to the public. Only bookkeepers who have applied to the Board for registration as a BAS Agent are permitted to render BAS services to their clients. The laws impose a range of civil penalties ranging from $5,500 to $137,500 (per offence) for bookkeepers illegally providing BAS services. BAS Agents under the new system are subject to a Code of Professional Conduct which imposes a range of obligations, one of which is the compulsion to hold Professional Indemnity Insurance to a Board-specified level. BAS Agents are also subject to a range of administrative sanctions and civil penalties. Clients of BAS Agents benefit from so-called safe harbour provisions which provide relief from penalties in the case of error or late lodgement by the BAS Agent. In order to become registered as a BAS Agent under the Tax Agent Services Act, a bookkeeper must satisfy the Board that they meet certain criteria. Firstly, the applicant must be a “fit and proper person”. Secondly, the applicant must satisfy an educational criterion, which at a minimum requires the attainment of a Certificate IV Financial Services (Accounting) or Certificate IV Financial Services (Bookkeeping). Thirdly, the applicant must demonstrate a required number of hours of “relevant experience” in the past three years. Transitional Regulations are also in place to offer bookkeepers a reasonable period of time to meet all of these requirements.

Where does Accounts HQ currently stand and what does it mean for you?

I am pleased to advise that I will be seeking registration as a BAS Agent under the Tax Agent Services Act 2009 as an individual and for Accounts HQ as a company. I have already submitted my application to the Tax Practitioners Board and await their approval. In the meantime, I am considered to be a BAS Agent by virtue of the Transitional Regulations. This is because, prior to the introduction of the new laws, I was legally providing BAS Services as a member of a Recognised Professional Association. From your perspective, you can take comfort from the knowledge that your BAS Services are being provided by a registered and competent professional who is operating at a higher level than a standard bookkeeper.

In addition to offering the full range of traditional bookkeeping and accounts services, Accounts HQ are pleased to announce that we are also Certified Partners of Xero – a simple, smart and secure online accounting system, designed for small businesses. Here's 10 reasons we're excited about Xero:
 

1. Automated daily bank feeds
2. Fast, simple and customised invoicing
3. Available anytime you’re online
4. Real-time collaboration with us, as well as your accountant
5. Safe and secure data
6. Quick and easy GST returns
7. Cashflow clarity
8. Fantastic dashboards and graphical insights
9. No installation, upgrades or maintenance
10. Clear, informative financial management reports

If you'd like more information on Xero and what it can do for your business, visit www.xero.com or give us a call on 08 6240 2222 for a free demonstration.