RBizz Corporate Accountants - Resources , Compliance

Calculated Growth: Why Your "Ordinary Time Earnings" Are Changing

Wed, 06 May 2026 14:42:26 +1000

Calculated Growth: Why Your "Ordinary Time Earnings" Are Changing

As we move through May 2026, the ATO is preparing for a technical but critical shift in how superannuation is calculated. 1 July 2026, the focus moves away from "Ordinary Time Earnings" (OTE) toward a new standard: Qualifying Earnings (QE).

What are Qualifying Earnings?

For years, employers calculated the 12% super guarantee based on OTE. Payday Super regime, the base for calculation is being refined to Qualifying Earnings. This change is designed to simplify calculations for diverse pay structures—including bonuses, commissions, and certain allowances—ensuring they are captured more consistently across all payroll software.

The "7-Day" Compliance Window

It’s not just about how much you pay, but how fast it arrives. Along with the shift to QE, the ATO is strictly enforcing the arrival window. 7 business days of their payday.

What Happens if You Miss the Window?

The penalties in 2026 are becoming more automated. If a payment is late:

The SGC Charge: Unlike the old system, the new Superannuation Guarantee Charge (SGC) will compound daily at the General Interest Charge rate.
Administrative Uplift: Businesses with a history of late payments may face an additional "administrative uplift" penalty of up to 50% of the unpaid amount.

Division 296: Does It Affect You?

Tue, 05 May 2026 12:58:12 +1000

Division 296: Does It Affect You?

From 1 July 2026, a new tax (Division 296) will be introduced to reduce concessional tax rates on superannuation earnings above $3 million. But how does Division 296 work, and are you affected?

What is Division 296?

Currently, income earned on superannuation balances is generally taxed at a headline rate of up to 15%. However, from 1 July 2026, individuals who have a total superannuation balance above $3 million will be subject to a higher tax rate on earnings in their superannuation accounts.

Broadly:

Superannuation balances between $3 million and $10 million will be taxed at 30% on the percentage of earnings between $3 million and $10 million; and
Superannuation balances above $10 million will be taxed at 40% on the percentage of earnings that exceeds $10 million.

The ATO will notify any individuals who are liable to pay any Division 296 tax, with those taxpayers given the option to either pay the tax directly or release the appropriate amount from their super fund. Remember, as Division 296 only applies from 1 July 2026, the first notices of assessment aren’t likely to be issued until the 2027-28 financial year.

So, Division 296 won’t apply to everyone?

In short, no. This new measure is expected to affect less than 0.5% of Australians with superannuation accounts in 2026-27; with the higher 40% rate for balances above $10 million estimated to affect less than 0.1% of Australians with superannuation accounts.

Importantly, this means that those with super balances lower than $3 million will keep being taxed on their super earnings at the current concessional rate of 15% (i.e. there is no change to current tax arrangements).

What happens if my super grows over time?

Both the $3 million and $10 million thresholds will now be indexed to the Consumer Price Index (CPI) each year. This means the application of Division 296 should remain relatively limited, even if your superannuation balance increases.

What if I am affected by the changes?

If you’re in scope of Division 296, or expect to have a super balance above $3 million in the near future, there are a few actions you can take ahead of 1 July. For one, you may want to speak to a qualified financial adviser to review your investment mix. You might also consider modeling how Division 296 is expected to impact your super balance over the long term.

For a more bespoke chat about your options, book some time in with our team today – we’d be happy to help.

The "Payday Super" Countdown: What You Need to Know

Mon, 04 May 2026 11:11:34 +1000

The "Payday Super" Countdown: What You Need to Know

From 1 July 2026, the way Australian employers pay superannuation is fundamentally changing. The Federal Government’s "Payday Super" reform means that Superannuation Guarantee (SG) contributions must be paid at the same time as salary and wages, rather than the current quarterly system.

Why the Change?

The shift aims to ensure employees receive their entitlements faster and to help them track their super more easily. It also prevents the "super gap" that occurs when businesses fall behind on quarterly payments.

What This Means for Your Business

Cashflow Timing: Instead of a large lump sum every three months, your cashflow will need to accommodate super payments every pay cycle (weekly, fortnightly, or monthly).
Compliance Deadlines: Contributions must reach the employee's fund within 7 business days of payday.
Software Updates: You must ensure your payroll software is configured to handle these automated, frequent transfers well before the July deadline.

Preparing for the Shift

To avoid penalties and administrative stress, businesses should use the remainder of 2026 to audit their payroll processes. Your cash reserves now to reflect "real-time" super obligations will make the transition in July 2026 much smoother.

The "Right to Disconnect": What It Means for Your Small Business

Fri, 24 Apr 2026 13:53:54 +1000

The "Right to Disconnect": What It Means for Your Small Business

Starting 26 August 2026, a significant change to Australian workplace laws will apply to small businesses: the Right to Disconnect.

What is the Right to Disconnect?

Under the new laws, employees have the legal right to refuse to monitor, read, or respond to contact from their employer (or a third party, like a client) outside of their working hours, unless that refusal is "unreasonable."

This doesn't mean you can't send an email at 8:00 PM; it means your employee generally doesn't have to look at it until they clock back in.

What is "Unreasonable" Refusal?

The law recognizes that some after-hours contact is necessary. Whether a refusal is unreasonable depends on several factors:

The Reason for Contact: Is it a genuine emergency or a routine update?
The Employee’s Role: Does their seniority or pay level imply an expectation of being "on-call"?
Compensation: Are they being paid an on-call allowance or a salary that compensates for additional hours?
Personal Circumstances: Does the employee have caring responsibilities that make after-hours contact particularly disruptive?

Practical Steps to Stay Compliant

Review Employment Contracts: Check if your current contracts clearly define "reasonable additional hours" and whether compensation for after-hours contact is already built-in.

Set Clear Communication Boundaries: Encourage managers and business owners to use "Delay Delivery" on emails so they land in staff inboxes during business hours.

Update Your Internal Policies: Draft a simple "Communication Policy" that outlines when after-hours contact is expected (e.g., emergency site issues) and when it is not.

Talk to Your Clients: If your business is client-facing (like a trade or consultancy), manage their expectations regarding response times after 5:00 PM to protect your staff.

We’re Here to Help You Navigate the Change

Transitioning to these new rules might feel like a hurdle, but it’s also an opportunity to improve team morale and prevent burnout. If you’re unsure how the Right to Disconnect affects your specific industry or payroll setup, come and have a chat with our team—we’ll help you get your policies in order.

Sustainability Reporting: New ASIC Training

Mon, 13 Apr 2026 12:58:03 +1000

Sustainability Reporting: New ASIC Training

“We recognise many smaller companies may be concerned about what the sustainability reporting requirements mean for them. ASIC is committed to helping industry build the capability required to meet these important obligations.”

ASIC Commissioner Kate O’Rourke

ASIC has partnered with the Australian Accounting Standards Board (AASB) to release a set of educational materials aimed at providing training on sustainability reporting.

These training modules will help your smaller company understand and apply the foundational concepts underpinning Australia's new sustainability reporting requirements.

What modules are available through ASIC?

If you’re new to mandatory sustainability reporting, the requirements can seem daunting. The goal of ASIC’s training is to give you, or your report preparer, a good foundational understanding of the basics of reporting and meeting your ESG compliance requirements.

Here’s what the modules include:

Module 1 sets out how stakeholders should engage with the materials and introduces the basics of the new sustainability reporting requirements in the Corporations Act.
Module 2 covers the basics of climate change.
Module 3 covers climate-related physical risks and how they may affect an entity.
Module 4 focuses on explaining climate-related transition risks and how they may affect an entity.
Module 5 introduces climate-related opportunities and shows how they may apply to an entity through practical examples.
Module 6 introduces emissions accounting and provides foundational knowledge on Scope 1, 2 and 3 greenhouse gas emissions.
Module 7 focuses on the process of climate-related scenario analysis.
Module 8 provides an overview of how entities might integrate climate risks and opportunities into governance and risk-management processes.

Supporting your sustainability reporting requirements

You can find out more about the available training modules on ASIC’s sustainability reporting website. If you’re unsure about the sustainability reporting rules for your business, please come and have a chat with our team – we can run you through the compliance requirements.

Is Your Business "Cyber-Fit" for 2026?

Fri, 10 Apr 2026 02:20:30 +1000

Is Your Business "Cyber-Fit" for 2026?

As we move further into 2026, cybersecurity is no longer just a technical checkbox for IT departments; it has become a critical pillar of customer trust. With the Australian government tightening data privacy regulations and the ATO increasing its digital monitoring, small businesses are now prime targets for sophisticated deepfake fraud and ransomware. Being "cyber-fit" means moving beyond simple passwords to a proactive culture of digital resilience.

The Rising Threat of Deepfake Fraud

One of the most significant shifts this year is the accessibility of AI-driven fraud. Scammers can now convincingly mimic the voice or face of a business owner or supplier to authorize fraudulent payments. To counter this, "gut feeling" is no longer enough. Businesses must implement multi-person verification steps for any unusual financial requests, especially those involving changes to banking details or urgent wire transfers.

Data Residency: Where Does Your Info Live?

In 2026, where your data is stored matters as much as how it’s protected. Australian consumers and regulators are increasingly wary of "bargain" offshore cloud tools. Choosing vendors with Australian-based data centers ensures compliance with local privacy laws and builds a "sovereign" layer of security that protects your intellectual property and client list from international data breaches.

Simple Habits for Maximum Protection

You don’t need a massive budget to be secure. Most breaches occur through human error, not technical failure. Implementing "cyber hygiene" habits—such as mandatory Multi-Factor Authentication (MFA) on all accounts, using a team-wide password manager, and conducting regular "spot checks" on system backups—can block over 90% of common attacks.

Cybersecurity as a Competitive Edge

When you can prove to your clients that their data is handled with the highest level of integrity, it becomes a powerful marketing tool. In an era of "digital skepticism," being a privacy-first business helps you win bigger contracts and retain loyal customers who value their security as much as your service.

Talk to Us About Your Digital Safety

Not sure if your current systems are up to 2026 standards? Our team can help you conduct a lightweight "Cyber Health Check" to identify your biggest risks. We’ll help you implement simple, cost-effective protections that keep your data safe and your reputation intact—get in touch today to get started.

Taking Steps to Stay Compliant with ATO Rules

Tue, 24 Mar 2026 20:03:15 +1100

Taking Steps to Stay Compliant with ATO Rules

“Every year we see small businesses run into avoidable issues because they haven’t kept accurate records, reported all their income or managed their cashflow effectively”

Angela Allen, ATO Assistant Commissioner

The Australian Taxation Office (ATO) is encouraging Aussie small businesses to stay compliant. By doing so, you avoid the problems, penalties and fines that can occur when your business fails to follow the rules and compliance duties set out by the ATO.

What can you do to improve your overall tax compliance position?

ere are 5 key ways you can ensure your business stays in the ATO’s good books.

1. Stay on top of your ATO debts

The ATO wants you to proactively manage your tax debts. If you can engage early with the ATO, whether that’s to set up a payment plan or even make a prepayment, this makes the debt easier to manage and removes the need for stronger enforcement.

2. Separate accounts for separate obligations

Make sure you have dedicated bank accounts for GST and PAYG withholding. This protects your essential cashflow and stops cash from being used for operational expenses, so you always have funds available for BAS lodgements and other contributions.

3. Good records, good business

Keeping accurate records is a legal requirement for a small business. The ATO is keen for businesses to transition from manual ‘shoebox’ methods to digital systems and ATO online services. This minimises errors and helps you provide all your tax information in a digital format.

4. Prepare for Payday Super

Starting 1 July 2026, Payday Super will come into force, making it mandatory for employers to pay Superannuation Guarantee contributions on each payday. Review your payroll systems now to make sure they can manage more frequent reporting and payment requirements.

5. Closing or winding down a business

If you’re closing down your business and exiting the market, you must meet your final obligations, including cancelling ABNs and lodging your final tax returns. This prevents future compliance issues and ensures all employee entitlements are settled.

ATO Advice

The ATO advises businesses to work with registered tax practitioners. Working with a qualified tax adviser from the Tax Practitioners Board keeps you in line with all current tax laws.

Talk to our tax team and let’s make sure you’re 100% compliant with ATO rules.

Using business money and assets for personal use or benefit?

Tue, 24 Mar 2026 20:02:36 +1100

Using business money and assets for personal use or benefit?

The Australian Taxation Office (ATO) regularly publishes focus areas for small businesses. One of the top areas where the ATO regularly sees errors is where a private company shareholder uses business money and assets for personal use or benefit, which can lead to Division 7A issues.

What is Division 7A?

Division 7A is an anti-avoidance rule designed to stop the profits or assets of a private company from being provided to its shareholders or their associates tax free. Think of a small business shareholder using a company credit card to pay for their child’s school fees, or using company money to pay for a holiday.

If a shareholder uses company money for private purposes and doesn’t do anything to resolve the situation, then Division 7A can step in to treat those amounts as unfranked dividends, which are taxed in the shareholder’s personal tax return at their own marginal rate.

Common misunderstanding can lead to errors

One of the most common Division 7A errors the ATO sees is caused by shareholders and their associates not understanding that a company is a separate legal entity. This legal separation means that a company’s money and assets are its own, and should not be ‘dipped into’ by shareholders (and if they are, such amounts should be paid back within the relevant time).For this reason, it’s a good idea to have separate bank accounts or credit cards for private and company expenses, to make it easier to distinguish between private and business expenditure.

How to avoid Division 7A issues

Besides paying back the amount in full, another common way to avoid a Division 7A issue is to borrow the amount as part of a complying loan agreement.

There’s no set format to a complying loan agreement, but it should be in writing and contain at least:

Identitiy of the borrower and lender,
Loan amount,
The requirement to repay the loan,
Interest rate payable (no less than the Division 7A benchmark rate), and
Term of the loan (generally up to 7 years, unless the loan is secured by a registered mortgage over real property)
A complying loan agreement must be signed and dated before a company’s relevant lodgment day for the income year in which the loan was paid.

Don’t get caught out by Division 7A

Have questions about Division 7A? Come and speak to a member of our team. We can make sure that you’re meeting all Division 7A obligations, including meeting complying loan requirements.

Prepare for Payday Super: Employer Readiness Steps

Thu, 19 Mar 2026 14:28:26 +1100

Prepare for Payday Super: Employer Readiness Steps

From 1 July 2026, the way you pay your employees’ super is changing. Instead of making quarterly super payments to your employees’ funds, contributions will essentially need to be paid at the same time as salary and wages.

‘Payday Super’ marks a significant change for employers. To make sure your business isn’t caught out, make sure you’ve taken the following readiness steps, in line with ATO guidance.

Understand the new requirements

Under the new regime, super guarantee payments must reach your employees’ super funds within seven business days of payday, though longer deadlines apply in some cases, such as for new employees. The amount of contribution is calculated as 12% of an employee’s ‘qualifying earnings’ – a new term that incorporates and expands on the previous concept of ordinary time earnings.

If contributions are not made on time, in full and to the correct fund, the super guarantee charge (SGC) may apply.

Plan your transition

The ATO recommends that employers do the work now to plan and prepare for Payday Super. This includes:

Deciding when, exactly, your business will move to Payday Super (noting early adoption is perfectly fine).
Reviewing your cash flow position, to make sure your business can cope with a shift away from quarterly to ‘real-time’ super payments.
Checking your current payroll and business processes, such as confirming that super fund details for all eligible employees are up-to-date and complete.

Lock in plans

Once your business has determined when it will start using Payday Super, the next step is to make sure all relevant systems are ready for the change. That includes the payroll software you use, as well as any clearing houses or super fund portals you may use to make super guarantee contributions.

For any businesses that use the Small Business Superannuation Clearing House (SBSCH), remember that it will close permanently from 1 July 2026 as part of the Payday Super reforms.

Finally, take the time to troubleshoot any potential issues that might arise once Payday Super is live. For example, your business may need to implement a process quickly to correct any errors that might arise when paying employees’ super contributions.

Remember, from 1 July 2026…

…Payday Super is mandatory.

Any businesses that do not adapt to the new rules and continue to pay super quarterly run the risk of being on the receiving end of compliance action by the ATO.

If your business needs help preparing for Payday Super, feel free to reach out to a member of our team. We can walk you through the requirements of the new legislation and troubleshoot any potential pitfalls well ahead of 1 July.

The FBT Year Is Ending: What You Need to Do

Sun, 15 Mar 2026 17:32:05 +1100

The FBT Year Is Ending: What You Need to Do

While the standard financial year ends in June, the Fringe Benefits Tax (FBT) year actually ends on 31 March.

If your business provides benefits like company cars, gym memberships, or entertainment to employees, now is the time to gather your records. For those with company vehicles, please remember to take an odometer reading on 31 March.

We can help you work through the details and ensure you’re not paying more FBT than necessary.

Talk to Us About Your FBT Obligations

If your business provides employee benefits like company cars or entertainment, now is the time to review your records. Our team can help you prepare your FBT details and ensure you’re meeting your obligations while avoiding unnecessary tax costs.