Join us on Sunday 12 May 2024  for a luxurious Mother’s Day High Tea located at The William Inglis Hotel. Upon arrival, you will be greeted with your choice of sparkling wine, orange juice or mineral water, followed by unlimited tea and coffee, and centerpieces filled with sandwiches, pastries and sweet treats to share.

Let’s not forget about the little ones! Children under 12 will receive their own high tea filled with kid friendly favourites.

To make the day even more special, a portion of your tickets will also be donated to Liverpool Hospital’s Nursing and Midwifery Ward. Celebrate with live music and market stalls of goodies available for purchase.

Event: Mother’s Day High Tea

Venue: The William Inglis Hotel

2 Sessions Available:

Morning Tea: 10:00 AM – 12:00 PM

Afternoon Tea: 2:00 PM – 4:00 PM

Tickets:

$75.00 per adult
$45.00 per child

Book Your Tickets Here

By Jack Qi

This article was first published in Startup Daily

(Note: the following are general observations only and do not constitute tax advice)

News of Macquarie Bank writing off its $46m investment into software company Plutora brought to light the devastating impact that denied Research and Development (R&D) tax incentive claims can have on a startup. Whilst the exact circumstances of Plutora’s situation is not known to members of the general public, articles in the news quote the founder as attributing the recent disruption to Plutora’s operations as having been triggered by the Australian Taxation Office unexpectedly denying the refundability of the company’s past R&D tax incentive claims.

The point of contention

At first glance, the apparent trigger for the ATO challenging Plutora’s prior year R&D tax incentives is not actually to do with the merits of its R&D activities. It seems that it has to do with a little understood tax concept called ‘aggregated turnover’, and whether Plutora’s figure was less than $20m.

Essentially, the tax rules say that only companies with revenues of less than $20m are entitled to the refundable version of the R&D tax incentive. For other companies, their R&D incentive is non-refundable i.e. its only use to the company is reducing its tax liabilities, which is cold comfort for loss-making tech startups who don’t have a tax liability in the first place.

Whilst it is usually fairly easy for a startup to determine whether its revenues are less than $20m, this issue gets much murkier for companies with major shareholders who either have significant revenues themselves or own significant stakes in other companies with significant revenues.

Without getting overly technical, the aggregation of revenues occurs where there is a common 40 % direct or indirect ownership interest. Making this issue even more tricky is the fact that ownership interest in this context could mean dividend rights, capital rights or voting rights. So, it is theoretically possible for a startup to have multiple related parties whose revenues are aggregated together with the startup.

A rule of thumb for startup founders and CFOs is that whenever a shareholder’s interest reaches 40 %– and this includes the founder – tax advice should be sought on how the shareholder’s revenues and other investments affect the startup’s R&D tax incentive.

Why is tax even relevant?

“Startups usually make losses, so why is tax even relevant to the R&D claim?” I hear you say. The reason why tax has a profound impact here lies in the name, the R&D tax incentive. The relevant rules are mostly found in the Tax Act, which means a company’s tax affairs affect its R&D rebate, and its R&D rebate affects its tax. Put simply, a startup should never consider the R&D tax incentive in isolation whilst ignoring tax issues.

Other common pitfalls

‘Aggregated turnover’ is joined by a lengthy list of other common landmines when a startup makes an R&D tax incentive claim. Here are a handful of common ones, in no particular order:

• For R&D expenses incurred to related parties, an R&D rebate only arises if the expenses have been paid before the end of the financial year as opposed to merely being owed to the related entity
  
  
• R&D expenses already reimbursed by another government grant, such as the Accelerating Commercialisation grant that was recently rebranded to the Industry Growth Fund, and the MVP Grant, cannot be claimed again for the R&D tax incentive
  
  
• Where a startup’s development work is done by an Australian contractor, but the actual work is performed overseas, there this generally no eligibility for the R&D tax incentive unless an ’Overseas Finding’ is obtained before the end of the financial year. Such findings are generally very difficult to obtain for software development work. Unfortunately, many startups do not ask their contract developer the right questions and get caught out
  
  
• Where a startup has a group of companies, if the companies are not structured correctly for tax purposes then R&D eligibility will suffer
  
  
• Poor substantiation of expenses is one of the most common reasons for R&D claims being struck down. In an ATO review or audit, you can be assured that the ATO will ask for timesheets for the wages component of the R&D expenses. Remember, timesheets are ‘Boring but important.’

In addition to the ATO, startups must also satisfy the requirements of AusIndustry, the government body that assesses the R&D claim from a technical/scientific perspective. AusIndustry has the power to direct the ATO to deny R&D claims where it finds any of the following common deficiencies:

• The R&D hypothesis is weak or too general
  
  
• The R&D is focused on something commercial in nature as opposed to technical, for example, if the R&D is on whether your customer will like your product, it could easily be rejected by AusIndustry
  
  
• The R&D ’Core activity’ is focused on marketing, mining, social sciences, reverse engineering or complying with statutory standards. You may think ‘None of these apply to me’, but as an example, last year we were asked to help a fintech company whose self-prepared R&D claim got denied by AusIndustry because instead of focussing on software development the claim was focused on financial market behaviour and therefore economics, which is a social science that is not eligible.

Quality is key

A common misconception is that once a startup receives the R&D incentive in its bank account, it must all be okay. It then comes as a rude shock to learn that the ATO generally has 4 years, and sometimes more, to challenge an R&D claim. There is no secret to avoiding all this trouble, take the time and prepare the best R&D claim that you can, don’t be afraid to ask uncomfortable questions and make doubly sure that your R&D advisor understands your tax.

If you believe your company may need help with the R&D tax incentive, now is the time to speak to your local William Buck tax specialist.

Find out more

By Nicholas Mirarchi

In the dynamic world of manufacturing, where innovation, efficiency and collaboration are paramount, the significance of fostering a motivated and engaged workforce cannot be underestimated.

We find that corporates may not consider certain tools that exist to help align the interests of employees with the long-term success of a business. One of these tools is the employee share scheme (ESS), which can be relevant for start-ups and mature companies.

An effective and well-crafted employee share scheme is a powerful tool for recognising, retaining and rewarding talent, whilst engaging a culture of ownership and commitment. Having an advisor with a sound and commercial understanding of these tools, and the needs of your business, is crucial when embarking on a journey looking to implement an ESS.

An employee share scheme can come in a variety of forms, each with its own tax implications for the employee. The financial outcomes for the employee need to be modelled so that they understand the value proposition.

An option plan

One common type of ESS is the option plan, where employees are granted options to acquire shares at a predetermined price after a specified time, or once performance conditions are satisfied. Typically, the taxation of these plans occurs at the time the options are exercised, but depending on how the plan is drafted, this may also be deferred until an exit event such as a share buy-out.

Our experience is that option plans are particularly effective in closely held companies, as they help in retaining key staff over the long term and maintaining their commitment to the underlying business. An effective option plan is one that goes hand in hand with an overarching remuneration strategy.

For option plans, the employee is taxed on the difference between the market value of the shares at exercise and the exercise price. We find a key factor in obtaining employee buy-in is whether the option plan has been appropriately modelled and communicated. There are also tax concessions available in specific circumstances that further bolster the value of the plan and provide significant tax benefits to employees.

A share plan

Alternatively, the popularity of the share plan, where the employee is granted shares outright but with certain restrictions such as vesting periods or performance goals like an option plan, is on the rise. Share plans are generally taxable at the time they are granted but it is sometimes possible to defer this tax when the plan is offered to a broad number of employees and certain restrictions exist on vesting. These plans are most effective when coupled with a sound shareholder agreement.

Like option plans, the market value of the shares is treated as taxable to the employee, reduced by any amount that the employee paid to acquire the shares.

Only one tool in the remuneration strategy

An ESS is only one tool in demonstrating a company’s commitment to recognising and rewarding the contributions of its workforce. By providing employees with a stake in the company’s performance, businesses can foster a sense of ownership and accountability, driving productivity and innovation. The potential financial benefits of participating in these schemes can also enhance employee determination and satisfaction, leading to higher levels of loyalty.

Key management staff play a crucial role in shaping the strategic direction and success of manufacturing businesses. Along with a sound remuneration plan, an ESS can be particularly effective in attracting and retaining top talent for the long term. By offering non-cash incentives tied to performance goals and company objectives, businesses can incentivise management to drive growth and profitability, while simultaneously reinforcing a culture of collaboration and teamwork.

A well-designed ESS can represent a strategic tool for manufacturing businesses looking to thrive in today’s competitive landscape. It must always address the unique needs of the company. By tapping into the skill and knowledge of an experienced advisor to help model, implement and execute a tailored plan, companies can unlock the full potential of their workforce.

The takeaway for manufacturers

An ESS can be particularly beneficial to manufacturers in the following circumstances:

• Attracting board level expertise where there is a desire to grow the business over the long term into new markets or product offerings. We have found in these circumstances an ESS helps provide certainty to both parties of what success will look like and ensures a sense of continuity in key expertise around the board table.
  
  
• Attracting or retaining key technical expertise where there is a skill shortage for a particular technical skill. This has been common within the post-covid period and we have found an ESS to provide a point of difference in remuneration packages, with the potential for more upside for the individual over the long term as compared to a bonus-based structure.
  
  
• Achieving key business performance indicators where the success of the business, or a new product offering, is dependent on the collaboration of one or more technical staff members. Having an ESS in place can ensure a cohesive and collaborative environment and allow staff to participate in the upside of their success.
  
  
• Succession planning in family operated businesses is where an ESS can serve as another alternative within a manufacturing business. By enabling staff to gradually acquire ownership stakes in the company over time, businesses can cultivate a pipeline of future leaders. This helps strengthen the fabric of the company culture, a sense of camaraderie and a shared purpose at all levels.

If you are interested in understanding how an employee share scheme could apply to you or want to discuss the effectiveness of your overarching remuneration strategy, William Buck’s advisory team will be more than happy to discuss your needs and become part of your journey.

Find out more

By Paul Copeland

As a practice owner, it can be hard to know when to sell your practice. The reality is that there may never actually be a ‘perfect’ time to sell. As such, waiting for that optimal point may just be holding you back from the next phase of your life. Having been involved with many practice sales, we have developed a process to maximise your outcome as a seller and ensure a smooth transition for your practice, staff and patients.

This process includes the following steps:

• Plan early and understand the process of a sale
• Understand what you want and the outcome you are seeking
• Know the value of your practice
• Identify your potential and preferred buyers
• Approach the buyers or appoint a marketing agent
• Negotiate the sale
• Sell and settle, and
• Post sale.

In this article, the second in our series on succession planning, we look at planning an exit from ownership.

Your Practice

Planning for a sale varies for different types of practices.

An owner of a small general practice or sole specialist practice may find the process of selling or even passing on their practice to another practitioner difficult. According to the RACGP’s ‘Health of the Nation’ report, released in late 2023, 29% of GPs plan to retire within the next five years. This and the fact that there are a decreasing number of graduates opting for a career in general practice might mean it is sometimes more challenging to find a buyer for a practice. As such, planning for succession may take considerably more time than you first expected.

If you are an owner or part owner of a larger general practice, dental practice or specialist group practice, your ownership interest may be easier to pass on. Dental practices and larger general practices are highly sought after by both practitioners and investors. Specialist group practices, unless being sold as a whole, tend to see a sale made to an incoming practitioner in the same field.

Consider who your buyer might be

When talking to clients about selling their practice, one of the first questions we ask is ‘Who do you think your practice would appeal to?’ A common first answer is ‘Anyone that wants to buy it!’ However, considering who you’d like to sell your practice to can help with shaping the transaction and ensuring your legacy with the practice.

An example of this is:

We worked with Dr Jim, the owner of a large general practice with over 15 doctors working from the premises. He knew the practice had assumed the practice was too big for a doctor to purchase and therefore had resigned himself to the idea of selling to a larger corporate player in the market. Numerous corporate medical centre operators approached him but he was never comfortable with their ownership models or the terms and conditions in their sale agreements.

On the flip side, there were three younger doctors in his practice interested in ownership but uncertain of the large financial commitment and the unknown nature of operating a practice from a business perspective.

We proposed a model of a full sale and buyback to Dr Jim that would allow him to offer staged equity to the three younger doctors in the practice.

This model gave the younger doctors time to learn the ropes of operating a practice and pool the financial risk. It also allowed Dr Jim to sell to three younger doctors, with the comfort of knowing his practice and patients would be in good hands.

We chose this approach because it delivered a good financial outcome for the practice owner and importantly for them, a level of comfort that the sale of the practice was to the buyer they saw as the best fit for their patients and staff.

While this may not be the process for everyone, this example highlights that there are many options available to owners when considering a sale.

Stepping back from practice ownership is a process that needs to be managed effectively and planned well.

In this series, we also cover how you can take on a partner in your medical practice.

Contact your local William Buck Advisor in Australia or New Zealand to learn more about the advantages of succession planning and how it can benefit your business.

Find out more

You’re invited to join William Buck’s tax experts as they unpack the 2024-25 Federal Budget and its implications for middle-market businesses and individuals.

The government has already announced that this budget will include incentives for investment in the renewable energy sector and the addition of superannuation on paid parental leave.

What additional measures will Treasurer Jim Chalmers introduce for middle-market business owners, C-suite executives and working Australians?

Tax specialists Raffi Tenenbaum and Danielle Constantine will provide an insightful analysis of the Federal Budget the morning after it is handed down.

Our webinar will provide more than just a breakdown, helping you take practical steps to benefit from budget measures and prepare for any implications that may affect you or your business.

Register here

Have you caught yourself thinking about the recruitment market recently? Where are the candidates, what are their motivators and how can I best retain my staff? Look no further, Rarekind are giving you an inside look at the market.

Tech and IT

The world of tech is fast paced and forever changing. Candidates are becoming more readily available, looking to upskill, grow and develop in a new organisation. More experienced candidates are on the market. A lot of contracts haven’t been extended recently, so there’s more people searching, for permanent roles too. We recently advertised for an ICT Service Delivery Manager and received over 250 quality applications. We have an abundance of candidates, so, if you’re ready to make the move as a business in finding your next superstar, reach out.

Engineering

The engineering market is steady. We’re seeing a tighten in the candidate market due to large scale government, commercial and infrastructure projects. This is pushing up salaries and increasing demand for Engineers with experience across the energy and utilities sector.

We are seeing an influx of candidates across the FMCG industry. Skills shortages, lack of tradespeople and infrastructure projects are facilitating this demand and we continue to see this driving expectations across multi disciplines.

Corporate and Executive

The Corporate and Executive world is constantly changing.

We’ve seen an influx of Marketing candidates enter the market, from juniors to Marketing Managers and Executives. With their creative flair, they’re ready to transform businesses.

As we edge closer to end of financial year seeing an increase in Finance opportunities.

Naturally, with changes to IR laws in 2024, specialised HR, particularly WHS and risk management has been a hot topic and growth area for businesses.

A general downturn in Admin roles due to automation and outsourcing, however there has been an increase in specialised admin support and customer facing admin roles.

Recently we advertised a Customer Service role within 5 days we had over 400 applications. Look no further for your next professional Customer Service Officer.

Supply Chain, Industrial and Trades

The Candidate market in Western Sydney has changed significantly, particularly for trade-qualified individuals. Candidates who hold their trade qualifications now prefer permanent positions over temporary ones. Candidates are also more driven towards job security and culture over remuneration.

Get MOVE-ing this August and sign your workplace up to the Jeans for Genes workplace health and wellness challenge and be the top MOVE-ers in the Western Sydney Business Connection.

MOVE this August and challenge your team to be superheroes for the 1 in 20 kids who have cancer or other genetic diseases.

What is MOVE? You and your colleagues will commit to MOVE your own way, get active for 20 minutes a day and log your progress via the Jeans for Genes portal to compete with your colleagues to be the top MOVE-er!

The team at Novartis loved being superheroes for sick kids last year and Customer Operations Manager, Alex Sharpe, says: “We loved being able to get behind this very worthwhile cause and are already wondering how we can upscale for this year.”

The MOVE challenge focuses on educating your team on developing positive workplace health and wellness practices. Plus, research shows that regular exercise and self-care not only boosts productivity but also transforms workplace dynamics, increasing employee satisfaction and fostering a more engaged team. Moving can mean anything from going for a walk with colleagues, swimming, running, Pilates and yoga, to meditation and stretching. It’s up to your team how they MOVE 20 minutes per day throughout August.

Jeans for Genes provides everything to make this easy for your workplace to sign up! We provide interactive content, videos, collateral and resources promoting health and wellness in the workplace. We’ve thought of everything to make this fun and engaging for your team and will do the heavy lifting for you!

There are plenty of other ways to be a part of Jeans for Genes in your workplace. From baking, wearing jeans and skipping, contact our team and we will make it happen.

There are so many ways you can make a difference and we’re here to create, support and drive an amazing experience for your workplace this Jeans for Genes.

So please get in touch by filling out the expression of interest form or email us directly at partnerships@cmri.org.au

Jeans for Genes Day is 2 August. Find out more on our website.

Powerhouse Castle Hill welcomed thousands of visitors through its doors when it was officially opened by NSW Minister for Arts and Tourism John Graham on Saturday 23 March, 2024.

Image Credit: Sahlan Hayes

The two-day opening program included family-friendly workshops, artist talks, architectural tours and performances by musicians, DJs and dancers including First Nations group Jannawi Dance Clan, Western Sydney Youth Orchestra and one of Australia’s oldest lion and dragon dancing troupes, Jin Wu Koon.

Delivered in partnership with Create NSW and SW Public Works, Powerhouse Castle Hill is the new $44m state-of-the-art facility that is home to the storage, conservation and display of the Powerhouse Collection which includes more than 500,000 objects.

Image Credit: Rory Gardiner

Designed by Lahznimmo Architects and built by Taylor Construction, Powerhouse Castle Hill has been constructed to international museum standards and features a visible store, allowing public viewing into the 3,000 sqm Large Object storage area that stores the museum’s transport collection.

At more than 8,000 sqm, Powerhouse Castle Hill will house one of the southern hemisphere's largest photographic cycloramas that can carry objects up to 4 tonnes and will enable the ongoing digitisation of the collection.

It is the first time in the museum’s 140-year history that the collection will be stored in one location and co-located alongside conservation, curatorial and collection management staff.

The new building will provide public access for education programs, workshops, talks, exhibitions and other public events as well as working spaces for academic researchers, scientists and industry partners. The design of Powerhouse Castle Hill has already earned Lahznimmo Architects a nomination in the Australian Institute of Architects 2024 New South Wales Architecture Awards in the category of Public Architecture.

The new Powerhouse Castle Hill building sits alongside the Museums Discovery Centre, and both are open and free to the public every weekend. The expansion of Castle Hill is an integral piece of the $1.2 billion renewal of the Powerhouse which includes Powerhouse Parramatta, currently under construction, and the heritage revitalisation of the Powerhouse Museum in Ultimo.

Peter Ritchie, AO, is highly respected as the man who brought the McDonald's Empire to Australia. He started as an employee of McDonald's and rose to the position of CEO/Chairman for 32 years.

You're invited to join us for a delicious 3-course lunch, where Peter will take questions, and share business insights from his new book, ‘The Magic of McDonald’s: Bring it to Your Business’.

With a limit of 80 tickets, this intimate event offers exclusive access to Peter, a valuable networking opportunity with business peers, and the chance to learn from the wisdom and success of this iconic business for your organisation. You will have the opportunity to submit your questions before the event, and they will be addressed in the Q&A segment of the event.

Twenty exclusive VIP tickets are available, which include pre-drinks with Peter and an opportunity to raise your questions and business pain points directly with him and receive his tailored advice. (Please note that this will be held before the event, at 11am).

To RSVP, please reply directly, or contact events.gws@rmhc.org.au if you wish to be invoiced. Alternatively, you can purchase your tickets directly online here. RSVP date will close 16th May.

Details are as follows:

Date

Thursday 23rd May 2024

Venue ️

MISC. Parramatta

Byrnes Avenue, Parramatta Park 2150

Pricing

Individual Ticket $350

VIP Ticket $450