⏰⏰⏰ The ugly truth about TIMESHEETS – what old school accountants don’t want you to know about how they charge when they bill you by the hour ??
You may not realise this but ‘Old School’ Accountants charge by the minute.
They are driven by timesheets.
What’s the problem with your accountant charging you using timesheets?
The problem is this…
If the accountant wanted to make more money out of you, what does he need to do?
“Take longer,” you say?
And you would be correct … he could take longer.
But the ugly reality that I’ve seen is this –
“an accountant who does timesheets could either take longer to make more money out of you, or he could just “SAY” he took longer.”
It’s like a dirty Donald Trump locker room secret that most accountants don’t want you to know about – a practice called “TIMESHEET PADDING.”
I’m guilty. I’ve fabricated some pretty spectacular timesheets in my time.
But I was expected to by my employer in order to ‘meet budget’.
That’s why I went out on my own to start INSPIRE CA and why we price our jobs UPFRONT and GUARANTEE that your investment in our fees will pay for themselves many times over in tax saved.
So next time you receive a bill from your Accountant ask him or her if they use timesheets to charge and if instead, they could move you to a fixed price or upfront fee so that you know exactly how much your bill will be.
Got a burning question about using Business Structures to save tax and create a family vault?
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How To Stay Motivated & Achieve Your BIG Goals
It’s Monday morning; you’ve just finished a fantastic weekend. You’ve played the sports with the kids. You’ve gone to the beach, had a beautiful meal, and it’s just been wonderful. When you wake up, and it’s Monday morning, you check your emails, and you’ve got a hundred new emails that have come in over the weekend. On top of that, you have received a ‘big problem’ email from that annoying client that we always have has there’s a big problem with one of those emails. All you think about is, “Man, I just want to go back into bed, and I just don’t want to face the world.”
It’s now crunch time to be clear about your goals for business & life and stay motivated to achieve them!
The first question to ask yourself is thinking about my audience, the people that I get out of bed to help and serve, whether they are already existing clients or prospective clients, why do I want to serve them, what is the impact that I get out of bed to impact to impact in their lives.
For us, we help young families who are in small business achieve big goals.
Every day, when we get out of bed, our whole team thinks about what are the great outcomes we can achieve for this group, and so too for you.
Is it the holidays you can help those clients achieve?
Is it the peace of mind?
Is it the time you’re giving back in their life?
Is that feeling of satisfaction in the service that you’re providing to them?
These are all the motivating factors, these things that get you out of bed every morning that is going to help to remind you of why you’re here in the first place.
The second questions you need to think about is who are the mentors that inspire you?
Now, we live in a beautiful world these days, when you can have mentors. They might be friends. They might be family members. They might be co-worker or bosses that you’ve had in the past. What’s also amazing is that we’ve got this world of YouTube, and podcast, and the internet, where we can get access to some of the world’s most beautiful minds. Think about the second question.
Who are the mentors that inspire you, and how would you go and hang out with them?
If they’re local and if they’re in contact, could you call them up and have a coffee? Could we go out and have some lunch together? Could you give them a call, like a lifeline, to say, “Hey look, I’m really struggling with something? Can you help me with this challenge?”
“What I do every morning is I spend every morning with a global mentor that really inspires me. This morning, for example, I signed up to a podcast, and I listened to Tony Robbins. We had 45 minutes together and walked along the river. When I’ve come into work today, I felt amazing because I spent an hour with Tony Robbins. Who gets to do that?”
The third question to think about is what is the environment that best inspires and motivates you?
If you work from home, I encourage you to get out of your pajamas and get into some clothes that make you feel that you’re in control, make you feel like you’re a boss. Also, don’t sit in your bed and sit in the lounge and have the laptop on your lap. Go into a dedicated space, whether it be a study area, or to a dining room table, make that your space. Also, think about the visual cues that are around you. Can you have flowers? Can you have cool music that’s playing? Can you have inspirational quotes that are on the wall that can give you that inspiration to get you in the right space?
Another great tool that’s available these days for small business owners is co-working spaces.
There’re some brilliant spaces around that have all of these environment factors in place. Plus, the best thing about them is other people who are on a roll. They can give you motivation because you see them making phone calls. You see them getting work done. That whole environment around you will help keep you motivated.
The fourth question you need to ask yourself is how clearly can I see the goals that I’m achieving towards, that I’m striving towards, and have them motivate you.
It’s a really cool strategy that I learned. Every morning, I have these cue cards. I’ve gone through a process of writing down my top 10 goals or things that I’m working towards in business and life.
With daily habits, a really good thing I’ve learned is to associate them with things that happen every day.
I know that every day I get a coffee, so that’s my cue to go down and think about the goals that I’ve set. Having them, tangible means that I can have a moment to think about the fact that I’m so happy and grateful now that I’m surrounded by a strong group of friends and family. I’m so happy and grateful now that I’ve got a buddy like Sonny Bill Williams. These are the types of motivations that we would need to keep front and foremost.
Now if you’re not the paper kind of person, what I encourage is to take things another level, and have pictures, have images that represent the goals that you’re striving towards. As you know, we always have our mobile phones on us. Save a little album on your phone with all the photos that inspire or represent all the goals that you’re working towards.
Every day, whether it’s when you have your coffee or whether you’re having breakfast, or you’re driving into work, have a flick through and think about what are the things that motivate you, why you’re here in the first place, trying to achieve these goals, and working so hard.
We hope you have been Inspired and motivated today! At Inspire we help young families use their Small Business’ to achieve big goals and are here to help in any way!
Book in, to TEST DRIVE AN ACCOUNTANT – a 15 min rapid fire Q & A session with an Inspirational Accountant.
How To Set Company Goals That Your Whole Team Will Buy Into
Learn how to set a big goal for your company and have your team actually buy into it and not just roll their eyes like every other time you’ve said this.
It’s really important that we engage our team from the start with our new ideas and business aspirations. This is, so they can catch the enthusiasm and jump on board with this new company goal. On the other hand, if we fail to capture the team from the start we will not only have a disengaged team, but the company will have no chance of achieving that new exciting goal.
You may have read a book, or you’ve gone to a weekend conference or a retreat, maybe it was the partners who went to the managers or just the executive team. What are the other team members back in the office thinking? They’re thinking, “Oh my gosh, he’s read another book or he’s gone to another conference. We’re going to have this big change off, and he’s seen the light and all we need to do is to hang out for the next two weeks while that initial desire burns off.” This is a common situation in businesses who love to continue their professional development and are always learning.
The question is, how do we get our team members really excited and on board about new initiatives and new goals for that business?
Step number one:
Understanding where your employees are coming from.
Yes, you’ve read this book. Yes, you’ve gone to the conference, but only you were there during that experience. Here’s where you are and here’s where they are. You absolutely have to, before you go out and buy twenty-seven copies of that book and insist that the whole team go ahead and read it, you need to slow things down and talk to them one on one. There’s a brilliant book called, Crucial Conversations, and it talks about talking from the heart. Being able to have an opportunity to understand what are the motivations of your team members? What drives them?
What you need to remember, while we may be busy running our own businesses and feeling the pressures of owning a business, our team members actually want to do a good job. They want to succeed in their job. They want to be able to ring the bell, and they want to be able to hit and exceed their KPIs. We need to have a conversation with them to connect the ideas about what your new goals are, what the new strategies are that you’ve learned and what are the motivations and goals of the team members and find out how we can connect them.
Now, unfortunately as busy business owners, we are indeed that, very busy, but we need to prioritize the time to one on one, talk with these team members and connect their goals and motivations with where we want to head as a business.
Step number two
Set aside time to workshop the goal with the team.
You had a time, one on one with your team members to understand their own goals and aspirations. Now it’s time to help get your team up to speed with whatever it is that you’ve learned in this workshop or in this book, to be able to help the team get behind this project. This takes time again, to be able to explain to them the context around whatever it is this business or company goal or process is, and ask for input or get their input into how we can actually achieve this together as a team.
Need some help with passing on those frustrating ‘time taker tasks’ so you can focus on the big impact projects?
Book in to TEST DRIVE AN ACCOUNTANT – a 15 min rapid fire Q & A session with an Inspirational Accountant who created Inspire to help you achieve your big goals!
4 Game-Changing tips on ‘How To Maintain Focus’
Focus, focus, focus. Learn how to stay focused, laser-sharp focus on your goals and stick to your priorities.
How to maintain focus?
That’s exactly what I think about when I think of focus, is a magnifying glass. You probably did this when you were a kid, you have an A4 piece of paper and you can only see so much, but if you put a magnifying glass over there it will reveal so much more. You can see the detail of the paper, if there’s writing on it, it becomes so close. However, if you get the force of something, of nature behind you, whether it be, say the sun, then that piece of paper literally catches on fire, and that is the power of focus. You can magnify your efforts and intensity into your goals and literally set them on fire. Here are some tips on how to do that in your life.
Focus tip number one, you’ve got to define SMART goals.
S stands for specific, these goals have to be really specific, they’ve got a clear start and end date, and also visual about what you want them to look like.
M stands for measurable, so you can measure your progress as you go and you can also measure what complete and finish looks like.
A is my favorite one, this is assignable. This is when you’re able to help enlist the help of other people around you, whether they be team members or mentors or partners that you work with to jump onboard and help get these things done.
R stands for Realistic, They need to be realistic. You can’t be over-aspirational about what you think you and your team can achieve if it’s not within the reality of the world.
T stands for time-measurable, it needs to be able to be measured in time. We want to have some really clear definitions about when to start and when to finish, and make sure everybody’s on top of what these time expectations are.
Tip 2: “Please do not disturb.”
Now, your time is precious and you need to let everybody around you know that it’s precious, because focus is going to give you the ability to literally set your goals on fire. What are some strategies that you can use to give everybody the message about do not disturb? One thing that I recommend as a business owner is to try and get your first biggest priority done before you even get in the office. You all know what it’s like when you get in there employees go, “Hey, can I get this or can I get your perspective on that?” Knowing that that’s going to be the case, try and get something done before you even get into that environment.
Having a system about what a ‘closed door’ and ‘open door’ means is super powerful! You might be able to communicate that type of message to your team. For those of you who work in an open environment like I do, and those who work in coworking spaces, a good message about Do Not Disturb could relate to having headphones on. I’ve never known some people to literally listen to music during the day, well sometimes they just leave their headphones on just to send the message that, “I’m not one to be disturb right now while I’ve got my headphones on.”
Tip 3: ‘A goal without a plan is just a wish’
You have to start your day with an intention about what you want to achieve, and this looks like having a daily prioritized to-do list. Now a good thing that I learned is to get a piece of paper, you fold it up in half, you fold it up in half again, you fold it up in half one more time, and whatever you can fit in that piece of paper is all you’re going to aim to achieve in one day. Now the next part of that is to prioritize them. Realistically you can probably fit about five, maybe six great things to be done today. Prioritize what those five are and have them, then you can have them in your pocket, you can always reference them throughout the day to make sure you’re on track with your priorities.
Tip 4: Focus is about prioritizing tasks.
Now we’ve already talked about the fact that your first hour of your day is the most valuable, that’s when you’re most optimistic, that’s when you got the most energy, and that’s before everyone’s come to borrow that energy off of you.
Focus on whatever your priority is.
Here’s the thing about us Business owners, our job is to be focused on prioritising big impact projects. What are the projects we can get behind that will have a lasting effect for many years to come? If you find yourself doing things that only have low impact, then you’re not going to be able to achieve these big goals in your business.
Focus on things that have big impact, massive return on investment, or that affect a number of people, whether it be team members of clients with one effort.
That might look like writing a blog article or recording a YouTube video that will forever be there and will impact hundreds and thousands of people who have actually watch these things. That’s the priorities that you need to focus on as business owners.
Need some help with passing on some frustrating time taker tasks so you can focus on why you went into business in the first place?
Book in to TEST DRIVE AN ACCOUNTANT – a 15 min rapid fire Q & A session with an Inspirational Accountant who created Inspire to help you achieve your big goals!
How To Create More Time In Your Day!
Feel like you don’t have enough time? I want to share with you 4 easy and powerful tips so you can create more time, even when you feel like you don’t have it.
Now, this is a really interesting one, because the challenge is we all have the same amount of time, so it’s not a case of not having enough time. You have the same 24 hours the Mother Theresa had, that Gandhi has, that Tony Robbins has. Let’s be clear, this is not a time issue. We all have 24 hours.
This is a challenge about priorities, and how we feel about the priorities that we achieve, and more importantly, sometimes, how we feel about the priorities that we don’t achieve.
Here’s four tips that I’d recommend in reading more time when you feel like you have none.
Step number one: Think about what are the things that are taking most of the time from you and taking those feelings of overwhelm from you too.
Most people have the habit of waking up, and what’s the first thing they do? They roll over to their bed and look at their phone, and check their notifications and scroll scroll scroll in e-mail, and scroll scroll scroll on Facebook. I read a brilliant book by Tim Ferris, The 4-Hour Work Week, where he recommends that we move away from constantly being involved in all of these things that are notifying us, and batch them into certain parts of the day. I aim for 10 A.M. and 2 P.M. as the two windows that I both check email and Facebook.
You may need to, on the other side of this, have a bit of expectation setting with your clients, where that looks like an out-of-office reply, but it means that you’re back in control of the priorities in your day, and therefore in your life, and you’ll feel much better about it.
Step number two: Is to schedule everything.
We’re business owners, so we’re in the habit of having meetings with clients. Now, we’re eventually going to move away from meeting our life away, but we can apply that same priority we give to meetings to our personal lives and to the things that are important to us. When you have your day’s priorities, schedule the amount of time that you think it will take to get them done, book it in your calendar, and just like you’d never show up to a meeting late, or you’d never not show up, let’s give the same priority to the projects and priorities that you scheduled for yourself throughout the day, whether these be personal things like going to the gym, or whether it be work-related things like putting that important report together.
Rule number three: Is measure everything.
From measurement, you can start managing. You’ve heard of that topic. What I recommend in this place is an application called RescueTime. It’s one you can install on your computer or your device, and it gives you awareness, over a week or over a day, about what you’re actually doing on your computer. If you’re in emails, it will measure that. If you’re on Facebook, it’ll measure that. If you’re in Zero, it’ll measure it. If you’re on YouTube, it will measure that. Sometimes, as business owners, it’s going to help to be aware about where we’re actually spending our time. An application like RescueTime can help give us that awareness. As you know, awareness is step one. Once we see it we go, “Wow,” and then from there we can start making change.
Rule number four: Is keeping yourself accountable.
One great habit you can get into as a team, this is fantastic for culture, is every morning when you get in, have a little huddle around the desk and say,
“What are the key priorities that we’re all going to achieve today?”
You as the business owner can be accountable to every other team member within the group, and same to, they can be accountable to each other. Think about your top three or four priorities, verbalize them to the rest of the team throughout the day, and either at the end of the day or the following day’s huddle, we can get accountability on how we went with what we said we were going to do.
If you’re in business, but you wouldn’t say that numbers is really your thing, I’d recommend downloading this E-book, The Five Numbers That All Business Owners Need to Know. This will give you insight into the five numbers that matter most in your business and in your life.
Need some help with passing on some of those frustrating time taker tasks?
Book in to TEST DRIVE AN ACCOUNTANT – a 15 min rapid fire Q & A session with an Inspirational Accountant who created Inspire to help you achieve your big goals!
How To Use Facebook Groups To Increase Referrals And Retain Your Best Clients
In this video, you’ll learn how to use Facebook groups to increase your referrals and retain your best clients.
Hi, I’m Harvee from Inspire and stay tuned.
How to use Facebook groups to grow your business and referrals, and retain your best clients? This is a really passionate subject of mine because I love Facebook and so too does the world. It’s probably one of the platforms that had the most active users on it, but it’s also about tribes. I love tribes, too, because we’re from New Zealand and everyone has a strong identity to the tribe they come from.
Now, in the world of small business, tribes relate to the people that you wish to do work with or the people that you want to hang out with, and in the Facebook world, this looks like groups. If you’re interested in any topic, if you love CrossFit, if you love cooking, if you love traveling to South America, then there’s definitely going to be a tribe or a Facebook group for you. Here’s some tips about how to maximize Facebook and groups to be able to return your best clients and to be able to grow your business.
4 networking tips to start your Facebook group today:
1. With Facebook groups, the first thing you need to do or I’d recommend is to start participating in other people’s groups.
In Facebook, you can do a search for groups and you can start putting in keywords for the types of things that you’re interested in. Let’s say I was interested in boxing. I could type in ‘boxing’ and see what type of groups there are around me. Once I find them, you can add yourself into the group.
2. Now that you found the groups that identify you and your likes or your business interests, the next step is to participate in these groups and there’s a unique way of doing it within the Facebook.
This social world means that we’re about adding value, so don’t sell when you get in there. When you jump in, tell your story, add value to other people around you. Quite often, the groups are around sharing tips and sharing ideas or helping a group of people solve a common problem. If you know the answer, if you’ve got some experience, feel free to add value and share that experience instead of putting yourself out there and say, “Buy this,” or “Align yourself with my service.” That won’t get you very far and, in fact, an admin might even remove you from the group if you’re in that sales mode.
3. Tip number 3 is, It is a good opportunity to test some ideas, so you’re not out there to sell and you’re not out there saying, “Buy this, buy that,” but you have the opportunity to put some ideas.
Let’s say you’re thinking about running a webinar, and you weren’t too sure which of the three topics you should do that webinar on. You could go into group and say, “Hey, guys, I represent this business and we are interested in achieving this outcome. We’re thinking about running a webinar on topic 1, 2, or 3. What do you think we should do?” In so doing, that’s give you the ability to, in a very soft and subtle way, have people start to engage or interact with your brand without you being able to say, “Buy my product or register for my webinar.”
4. Now, the 4th and final tip to remember is that a successful group is about a topic and not a brand.
You might be interested in CrossFit but the group isn’t necessarily about specific CrossFit gym. It’s about sharing ideas, about recipes, about workout tips, about the social things that are happening, but it’s not just about that company and that service offering. Once you’re confident with this, start exploring these groups, and “Here’s some great tips or great groups that I love.” There’s a topic or a group that exists called Google Apps for Work. I love the idea of Google Apps. In that group, we go in there to share different ideas about how to best use these applications.
Also, I know of another successful group called The 4 Blades and they’ve got a Facebook group in which those who use the thermomix are able to share recipes, share ideas, and brainstorm challenges that they’re all commonly facing. Once you go through and you become a bit of a Ninja at hanging out in Facebook groups, then and only then would I suggest you go and set up your own Facebook group.
Remember, it’s about what your business represents. It’s not necessarily about your business itself.
For Inspire, we represent an accounting firm but why we exist is helping young families in small business, and that’s exactly the name of our group, and we all talk about commonly occurring issues or ideas or suggestions that we have as a unique tribe hanging out in that safe environment.
Now Go For Gold! Make the most of the multitude of Facebook groups, and have FUN!
If you like what you learned in today’s video, feel free to start a conversation with us. Like this video. Put a comment up below. We keep an eye on them. Share your ideas. Share your stories. If you’ve got a question, you can ask us and we’ll answer it for you. You can also jump over to InspireCA’s facebook page to find out more about how we use our facebook groups to connect, educate and support other business’.
On another note, got a burning question about Tax, Your Accountant or Business Structures?
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Stop Procrastinating! 2 Quick Tips To Help You Stay On Task
You’ve been there before, you’re sitting on the computer, you’ve got your to-do list of things that are priority and important to do in your day, but you’re just sitting there scrolling and looking at Facebook, or you’re in your inbox. The worst thing is, you know you’re not really doing anything. You’re just farting around or what we like to call ‘faffing’ around!
So how do we stop procrastinating?
Well, the first step is to think about what are the things that are taking your attention away. This is a real challenge in the modern day because we’ve got so many notifications in our world and they’re so addictive. Before we go into the tips about procrastination, let me give you an understanding as to why these types of notifications are so addictive and how hard it is to break away from these habits.
How the human brain works is there are all sorts of chemicals that are going on. When you’re scrolling through Facebook for instance, and you see something that excites you, whether it’s a picture, whether it’s a bit of juicy gossip, or a bit of information, like wow, that sets off a chemical trigger in your brain called dopamine that says, “This information is good” which feeds the craving for wanting more and more. That’s why it’s so addictive for us to scroll continuously.
Have you ever had that feeling when you’re scrolling, and you stop to ask yourself, “What am I even doing? There’s nothing here; it’s boring.” They’re just saying the same stuff but yet we keep scrolling in the hope of feeding that same ‘feeling’ we got once. Then before we know it we are back at the same point we remembered looking at last night.
The reason is that your brain associates the fact that one time you saw that really cool information which set off that chemical reaction and made you feel good. So now you remember that feeling and are searching for it again, that’s why it’s addictively looking for that next fix.
It’s really important when it comes to procrastination to realize that fighting procrastination means actually going against our human biology.
We’re addicted to these notifications that are around us, and these are the things that have the tendency to distract us. So it all comes down to eradicating your notifications, so that have the tendency to distract you. Now that you understand this here are two tips to help you stop procrastinating and get you focused on your big task for the day.
It all comes down to eradicating your notifications that have the tendency to distract you.
Here’re two simple tips for eliminating procrastination from your life.
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First, you must Identify the Problem:
For me, this is my biggest distraction. I’m probably getting about 150-200 notifications or pings per day through Facebook and Instagram and also through emails.
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Then you can Find the Solution:
With Facebook, you can actually get an application that turns off your news feed. It’s called a news feed eradicator. That means if you have the tendency to, while you’re working you pull up another tab and you go to Facebook, it appears that there’s nothing there in your news feed and your brain goes, “Oh well, nothing here to see today,” and you close that, and you get back to work. That’s playing on the fact that you know that something’s going to be able to distract you.
Anytime that you want to have a hundred percent focus I recommend implementing this proven strategy:
Identify your trigger points and create new habits:
If you’re not at our computer, it is more likely than not that you will have your mobile devices on you, which I hate to say it, but it is an automatic magnet for distraction and procrastination!
If things become out of control and you really need something to change, I recommend you either log out of these applications, so it makes it harder to click back in or even delete them off your phone completely.
At the end of the workday or the end of the week, you might have to form a habit of removing those ‘procrastination apps’ from your phone.
The final BIG tip – Set up a reward system:
Set your phone to airplane mode! That means no phone calls will come through; no notifications will come through, and then you can reward yourself by turning it back on at the end of that job or end of that task and go, I wonder what happened in that last 20 minutes. What once caused you procrastination can be turned around and become your reward!
If you liked what you have learned in today’s video, feel free to start a conversation with us by commenting below. We keep an eye on it. Share your ideas, share your stories.
Got a burning question about using Business Structures to save tax and create a family vault?
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Are Coffee Meetings Tax Deductible?
Ever wondered if coffee meetings are tax deductible?
Anyone who knows me, knows that I’m a big coffee freak. I have about 3 or 4 cappuccinos every day. My favourite coffee shop is Bellissimo. You’ve got to try it. It’s around the corner from Inspire and there’s also one around one from my house. I get it everywhere.
I was down there meeting with a prospective client the other day. I shouted the coffees, of course. I went to pay for the coffees and the kind girl behind the desk asked me, “Would you like a tax invoice?” It made me think, why would I need a tax invoice? Are coffee meetings tax deductible? So I went back to Inspire and asked the accountants this very question:
“Are coffee meetings tax deductible? What about other meetings that include food, are they tax deductible too?”
Here’s what they told me:
You can claim meals while you’re traveling overnight.
If you’re an employee going off to a conference, and you’re away from your usual home, then you can claim that meal.
There’s guidance from the ATO, but budget for about a hundred dollars per night. That means you might be able to go to the coffee club and grab a Bolognese, but I wouldn’t really be going to Jamie’s Italian and getting a full course meal.
You can claim meals supplies as a working lunch.
Say you got a team, this happens quite regularly during tax time, we’re really busy and we tend to work late. We go out and buy Domino’s. That’s fine because that’s all part of keeping the progress going, with regards to our work. If it’s related to our team being able to continue working, then that’s okay.
You can claim meals supplied from an in-house canteen or café.
I know this really cool engineering business in West End, who have a chef in-house and they supply meals to their team, throughout the day. What a great place to work? These items would be tax deductible and exempt of FBT.
You can claim snacks on the road, while you’re going as a business owner.
As a business owner, you might be out and about, meeting with clients throughout the day. Grabbing a coffee and a muffin, here and there, while you’re doing your day-to-day work is A-okay. Again, you’ve got to be reasonable. The ATO isn’t stupid. If you’re putting through 7-course at a gas station lunches, instead of a coffee here and a muffin, it’s probably not going to go down so well.
So there you have it! The 4 rules, with regards to how to make coffee meetings and meals tax deductible.
To conclude, My advice to you, as a fellow business owner is to:
- Focus on whatever investment you make into your business, whether it’s a coffee meeting here or whether it’s a Facebook ad there.
2. Ask yourself the question, ‘What is the return on investment you’re going to get from that?’ I always try to aim for 5 to 20 times our way. This is the focus point for you as a business owner, if it turns out to be tax deductible as a result, well bonus. If it isn’t, move on. There’s no point in trying to spend an hour trying to make a 20 cent tax savings on an orange mocha Frappuccino that you had on the weekend than risk that concern and anxiety that might come from being audited.
3. And most importantly, focus on the biggest bang for your buck!
Got a burning question about Tax, Your Accountant or Business Structures that can save you even more?
Book in to TEST DRIVE AN ACCOUNTANT – a 15 min rapid fire Q & A session with an Inspirational Accountant.
Increase your profit by mastering this little known economic principle…
Parkinson’s Law says is that if there’s an available resource, it will be used up.
For example with my uni assignments, if I’ve got three weeks to complete a uni assignment, I’ll take the three weeks to complete the uni assignment.
Realistically though, I’ll probably do nothing for the first two and a half weeks and then smash out the assignment in the last two and a half days but I’ll use up that entire period of time to work on that assignment.
This is the same sort of thing where money is involved.
That’s why we say that the traditional profit formula doesn’t really work because if your revenues are up here and your expenses are down here, Parkinson’s Law says that that available resource of revenue will be used up.
Ultimately you’ll start finding more expenses to occur to match your revenues.
I mean, that’s found in personal life as well.
People say all the time, you live to your means. If you’re earning $80,000 a year, you’ll live a lifestyle that meets the $80,000 a year that you’re earning.
We believe that Parkinson’s Law plays a big part in how businesses are run and how profits are made.
Instead of combating this, I guess, natural tendency to use up everything that we have available to us, the Cash Rich Business method teaches us to better manage our animal urges.
One of the main ways that we do that is by having business owners operate out of five key accounts, which is your IN account, which just means money comes into that account and that’s from where you distribute it.
Then throughout the month you distribute it to four other accounts which are essentially your four main purposes for money in a business.
First being profit, then owner’s pay, then tax and finally operational expenses.
That’s the Cash Rich Business method.
That’s how it works, that’s our thinking behind it.
Once we’ve gone through that workshop, we get to say to the business owners, okay, what we want you to implement is to set up your profit account, that’s the number one thing and then the next big step is to cut ten percent of the operational expenses.
We call this trimming the fat.
That’s our sort of key term.
The reason is that in order to find all the different fluctuations and stuff that’s going to be happening in your business by applying the Cash Rich Business method to your business, you’re going to need some room to move.
As a rule of thumb, we’ve said ten percent needs to go. This is the time when business owners often say, look I need money to make money. This isn’t going to work. I need to spend what I’m spending, every dollar is accounted for.
We’ve found time and time again that it really just isn’t the case always and so we give them two sort of key principles to, okay, how are we going to either cut your expenses entirely, just get rid of what you’re spending or negotiate it down?
There are two rules to cutting expenses:
1. Cut everything that doesn’t make you more efficient or keep your customers happy.
2. Negotiate everything else.
That’s probably one of the biggest feedback that we get from people that have gone through the workshop, is them saying, hey look, I was applying this the other day and I went to Optus or I went to Telstra, or I went to this provider with the competitor’s quote and they were able to match it or they were able to cut costs.
Simple things like that can save your business hundreds throughout the year!
Got a burning question about how to make your business Cash Rich?
Book in to TEST DRIVE AN ACCOUNTANT – a 15 min rapid fire Q & A session with an Inspirational
Negative Profit – why this is bad, and what to do about it?
What is negative profit?
| Imagine your business has ten thousand dollars a week coming in.A negative fifteen percent profit means that you are actually spending eleven thousand five hundred dollars.
One thousand five hundred more, than you should actually be spending. One thousand five hundred dollars more than you have. That’s what a negative profit percentage looks like. Why is negative profit bad?That’s one thousand five hundred dollars, because it is not coming from the business income, needs to come from outside sources.
Your days are numbered… Let’s say you had access to $15,000 in reserves (savings, credit cards and loans etc) And you’re spending fifteen hundred dollars a week more is coming in. This means you only have ten weeks in business remaining before it’s game over. How to turn a negative profit percentage, into a positive…If you have a negative profit percentage chances are, you are spending more money on your operational expenses than you should be. The way to fix a negative profit percentage is to start cutting expenses. |
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