Important business changes coming into effect after 1 July 2022!
Seismic shifts are brewing across the Australian business landscape this year, and it would be prudent to get ahead of them.
From prescriptive changes like eInvoicing mandates, superannuation guarantees, and plastic bag bans – to less palpable shifts such as inflation and energy costs, you should be getting your business ready to tackle these obstacles and opportunities now.
Let’s do a quick round up of the business changes coming for you in the near future.
Changes to super
From 1 July 2022, the Super Guarantee (SG) is changing in two important ways for all Australian businesses.
- The rate of SG will rise from 10% to 10.5% – you’ll have to ensure your accounting or payroll software is updated and that you apply the new rate of 10.5%.
- The current SG eligibility threshold of $450 per month will be removed – there is no longer a minimum earning requirement for super and some employers may have to start paying super to some or all employees for the first time.
The federal government has rolled out mandatory eInvoicing for all government departments.
If you have any financial dealings or contracts with the federal government, as of 1 July 2022, you are required to invoice the government via eInvoicing.
State governments are also in the process of rolling out mandatory eInvoicing, with New South Wales having already made plans and the Queensland government announcing its intentions. Other states are yet to join the party but will likely follow suit in due course.
You can learn all about eInvoicing and its benefits here.
Plastic bag bans
If you’re in the retail space, or otherwise provide plastic bags as a part of your business activity, it’s increasingly important that you understand your states laws and timing for bag ban mandates.
The National Retail Association has been working with state governments for years to bring the ban into effect. You should check directly with them to understand your responsibilities and key dates for compliance. You’ll need a plan in place to offer alternatives and encourage customers to bring reusable bags.
Check your state requirements here.
Rising cost of doing business requires future planning
Businesses across the country are facing a set of fresh ‘post pandemic’ financial battles in 2022. It never rains but it pours right?
The key initiatives required to tackle these pressures are anticipation, preparation, budgeting, and business advice.
1) Petrol and power prices surge
The price of fuel and electricity have skyrocketed in 2022.
In terms of fuel, this will affect all businesses that rely on work vehicles. Even if you don’t use a work vehicle, adding this personal cost to your daily operating budget will put pressure on your ability to take home a decent income.
Even though we saw a halving of the fuel excise in March, this did little to reduce what you pay at the pump. Furthermore, this temporary reduction in excise is due to expire in September 2022, representing a cost which needs to be anticipated and budgeted for.
With respect to power prices, it’s hard to imagine a single business in the land that won’t feel the pinch of the recent increases.
Businesses need to work diligently on their budgeting and work toward building a rainy-day fund for unexpected price fluctuations. Meet with an advisor to ensure you receive every tax deduction that you’re eligible for. You can also consider how you can trim down on expenses.
2) Inflation and the price of goods continue to soar
Business owners are not only feeling the brunt of broader price jumps but at the same time, the effects of rampant inflation. In other words, despite the cost of goods increasing, our cash is worth less.
(According to the ABS, the consumer price index (inflation) has risen 5.1% over the last 12 months to the March quarter.)
On top of this, the RBA raised interest rates yet again in July 2022. Although interest rate rises are hoped to slow inflation, there is no guarantee. And further rate increases are expected to come this year.
Very prudent and conservative budgeting, on top of new strategies, will be required to mitigate all the factors at play. Indeed, as a business owner, increasing your prices may be unavoidable, but there also needs to be a concurrent understanding that consumers will have less available cash to spend this year.
Innovation and careful plotting will be required, such as fresh marketing plans and an increased attention to ROI.