Building Blocks for a Successful Family Business
Building and managing a successful family business is hard work! Doing this during a pandemic such as COVID-19 is even harder work! There are unique challenges with a family business, particularly when it comes to making tough decisions in difficult times. The current health and economic crises are testing the resilience of businesses, and over the last six months we have seen many family businesses going ok, some are doing it tough and others are diversifying.
Being a family business can be a real strength, as the business can rely on family members and their commitment to the business when help is needed. Family businesses are usually agile and can make big decisions very quickly, which is proving to be a real asset during the current economic climate. Whether you have been in business for one year or many generations, you need to have solid foundations and a clear vision for the future to allow for successful growth or succession.
There are typical patterns to be recognised in family business evolution and we can refer to the sequence of these as the operating cycle of a family business. These businesses generally start with the entrepreneur, a sole owner who makes all the decisions for the business. As the business evolves families tend to pass ownership on to the next generation(s) and then, as the business matures, it becomes larger and more complex; at this point non-family members are often required to supplement the skills and expertise of the family, adding a new paradigm to managing the business. Each stage within a family business comes with its own challenges and with a good team and advisors, most are able to be predicted, planned and managed. Understanding where your business is on its growth journey can help you manage that growth in the best way.
In this month’s newsletter, we focus on ensuring your family business is set up for success and by having the foundations in place, will help avoid some of the most common issues we see when working with family businesses. Building a successful family business is hard work, and it can also be incredibly rewarding. We understand the many challenges that you face as an owner, and we are here to support you.
Last week saw the release of arguably the most important budget in Australia’s history, see our executive summary and the full budget report here if you missed it last week.
Also, in this newsletter, read why marketing is arguably more important than ever in these post-COVID times. There’s an offer of a free marketing brainstorm, so if you’re thinking about how best to get new business and approach new markets this will give you a chance to talk those ideas through.
Next month we will be hosting a Lunch & Learn online event, ‘Accelerating innovation in a new world economy’, and encourage you to join us. This will be held on Wednesday 18th November 2020 and will focus on how to identify innovative ideas, understanding the market and how to grow your business and develop a culture of innovation in today’s new world economy. If you’re interested in attending, please register here.
Accelerating Innovation for a New World Economy
When: 18th November 2020, 12.30pm – 1.30pm
Why do we need to accelerate innovation? What is the new world economy, and why does it require us to innovate faster?
Today we live in an era of disruption, with emerging economies, the rapid spread of digital technologies and the growing challenges to globalisation. These and other global trends offer new opportunities for businesses to navigate that may require new ways of thinking.
Join us for our next Lunch & Learn online event as we answer these topical questions in today’s ever-changing market.
Register HERE today!
Advivo Accountants and Advisors specialise in working with a family business and explain how to strike the right balance.
Click here to find out more.
Ever Thought of Setting up a Board?
Advivo explains why a board is one of the most powerful tools to ensure the longevity of a family business.
Read the full blog here.
Advivo shares what to consider when assessing what a family business will need to grow and succeed.
Read more here.
Advivo explains why succession planning is important and beneficial for your business in the long term.
Read how to properly protect your assets.
Advivo’s Charity of the Month!
Advivo’s commitment to the community includes our monthly charitable donation! Last month we donated to TRACTION. A great charity that provides an opportunity to make a meaningful difference to young people’s lives.
Have your say – HERE, to help us choose a local charity to support and we will announce the winner in next month’s newsletter
Don’t forget if you would like us to include a charity of your choice, just drop us a line at firstname.lastname@example.org
Key Events / Dates:
- 21 October:
– Pay annual PAYG instalment notice (Form N). Lodge only if you vary the instalment amount or use the rate method to calculate the instalment.- Lodge and pay quarter 1, 2020-21 PAYG instalment activity statement for head companies of consolidated groups.- Lodge and pay September 2020 monthly business activity statement.
- 28 October:
– Lodge and pay quarter 1, 2020-21 activity statement if electing to receive and lodge by paper and not
- Make super guarantee contributions for quarter 1, 2020–21 to funds by this date.Employers who do not pay minimum super contributions for quarter 1 by this date must pay the super guarantee charge and lodge a Superannuation guarantee charge statement – quarterly (NAT 9599) by 28 November 2020.Note: The super guarantee charge is not tax deductible.
- Lodge and pay annual activity statement for TFN withholding for closely held trusts where a trustee withheld amounts from payments to beneficiaries during the 2019–20 income year.
- 31 October:
- Final date to add new clients to your client list to ensure their 2020 tax return is covered by the lodgment program.Note: The lodgment program is a concession to registered agents. We can ask for documents to be lodged earlier than the concessional due dates.
- Lodge tax returns for all entities if one or more prior year returns were outstanding as at 30 June 2020.Note: This means all prior year returns must be lodged, not just the immediate prior year.If all outstanding prior year returns have been lodged by 31 October 2020, the lodgment program due dates will apply to the 2020 tax return.SMSFs in this category must lodge their complete Self-managed superannuation fund annual return by this date.
- Lodge and pay Self-managed superannuation fund annual return (NAT 71226) for (taxable and non-taxable) new registrant SMSF if we have advised the SMSF that the first year return has a 31 October 2020 due date.
- Lodge tax return for all entities prosecuted for non-lodgment of prior year returns and advised of a lodgment due date of 31 October 2020:
- Some prosecuted clients may have a different lodgment due date – refer to the letter you received for the applicable due date.
- Payment (if required) for individuals and trusts in this category is due as advised in their notice of assessment.
- Payment (if required) for companies and super funds in this category is due on 1 December 2020.SMSFs in this category must lodge their complete Self-managed superannuation fund annual return (NAT 71226) by this date.
- Lodge Annual investment income report (AIIR).
- Lodge Departing Australia superannuation payments (DASP) annual report.
- Lodge Franking account tax return when both the:
- return is a disclosure only (no amount payable)
- taxpayer is a 30 June balancer.
- Lodge PAYG withholding annual report no ABN withholding (NAT 3448).
- Lodge PAYG withholding from interest, dividend and royalty payments paid to non-residents – annual report (NAT 7187). This report advises amounts withheld from payments to foreign residents for:
- interest and unfranked dividend payments that are not reported on an Annual investment income report (AIIR)
- Royalty payments.
- Lodge PAYG withholding annual report – payments to foreign residents (NAT 12413). This report advises amounts withheld from payments to foreign residents for:
- entertainment and sports activities
- construction and related activities
- arranging casino gaming junket activities.
- Lodge lost members report for the period 1 January – 30 June 2020.
- Lodge TFN report for closely held trusts for TFNs quoted to a trustee by beneficiaries in quarter 1, 2020–21.
Thinking About Marketing?
With the current status of the world, changes in job-keeper and Government support and the closing down of some businesses (hence potentially some of your customers), now is the most important time to drive your marketing and get your brand out there.
Whilst the way your business operates day to day may have changed dramatically, the fundamentals of business development and marketing have not. In fact, marketing is even more important now, than ever before. If you don’t ensure that your business is actively engaging your target market your competitors will do so first.
If you would like to explore the best way to build your business, Outsource2us are offering Advivo clients a free Zoom based marketing brainstorm. Click here for more information.[/fancy-ul]