CHRISTMAS GIFTS THAT KEEP ON COMING

Acknowledgement- copied from "Fundsource" Website

Every year it seems to get harder and harder to find the right gifts. A lot of us don’t like to simply give cash, but a lot of the time a “financial” gift can be just the answer, especially for someone who struggles in this area. And the benefits of helping someone out in this way last a lot longer than you may realise. Here are five ideas, some bigger than others, and the benefits they offer beyond what you realise.


1. Paying off a Credit Card or other Debt
This is a gift that can be large or small, but the ultimate benefits are much bigger than what it costs you. For example, if you paid $50 of someone’s credit card debt, not only are you helping them pay off the debt, but you are also reducing their interest charges, even if only by a little bit. Because credit card interest compounds, over one year you will save them another $10 in interest charges if they are paying the typical 19.95% and over two years this will grow to $24 in interest savings.

2. Units in a Managed Fund
This gift will probably be a pretty generous one, as the minimum investment in a fund is usually $1,000 although you can get funds where the minimum is $500. That said, another way to approach it could be to offer them a deal – for instance, you’ll contribute a certain amount if they come up with the rest of the minimum investment. Once again, this is a gift that has the potential to be a lot bigger than what you spend on it. If the fund you invest in earns 7% p.a. (after taxes and fees) for the next ten years, the gift of $500 would grow to $983.

3. Education and Tools
There is an enormous array of books on financial matters, and they are all suited to people in different situations. You can find books on paying off your mortgage, making and sticking to a budget, investing, teaching kids about money – just about anything you can think of. Books aren’t the only option either – for grown-ups there is software than can help you manage your finances, and for kids toys and games can help them to learn about money. Helping someone get in control of their financial destiny is a gift they’ll benefit from for years to come.

4. Vouchers
If you know what someone really needs is cash, but you are worried cash might just get frittered away, then why not use vouchers to ensure it goes on something you feel is useful? You can get vouchers for all manner of necessities, such as petrol, groceries and pharmacies. Even better, with many credit cards you can redeem your points for vouchers, and if this is the case for you, the voucher costs you nothing!

5. Charity
For the person who has everything, why not make a donation to a charity in their name? Many charities have a lot on their plate around Christmas, and a donation could put a smile on the face of someone who needs it. Of course, a cash donation in the name of the person concerned could get them a tax deduction too! But you could also contribute items to food banks, buy animal food for the SPCA or buy toys or books for children who otherwise wouldn’t receive anything.

As you can see, there are lots of options for gifts that keep on giving. While they might not be exciting or glamorous, they are gifts that show how much you care about the wellbeing of the people around you.

TAKING YOUR BUSINESS TO THE NEXT LEVEL IN 2006

You have probably heard the saying, “Do what you have always done, and get what you have always gotten.” This statement is true in all areas of life, including business. If you have hit the five to seven year mark in your business, you will be facing new challenges before you enjoy the fruits of your labour. To date, you have become aware of the selling cycle in your industry, you have interacted with different kinds of people, you have done 95 percent of the work yourself, and you have overcome some major challenges of staying focused and breaking through serious roadblocks when those close to you have questioned your goals.  If you've been accustomed to running your business solo and are looking to move to the next level, you need to re-structure your thinking. Some tips and suggestions include:

1. Update your Business Plan
Make sure you know where you are going so you don't get lost or side-tracked. Are you looking to hire full-time employees? If so, how many? How much will they get paid? What will their jobs look like? What do you expect your company to make in six, 12 and 18 months from now? How will you measure the results to assess whether you are on the right track? Visualise where you want to be at a particular point in time. Record everything in print.

2. Change your Habits
One of the hardest things to do is to change what you're used to doing. Why? Because this is human nature. As an entrepreneur, you've been accustomed to doing everything yourself. Letting go of certain responsibilities and delegating tasks is one thing. Knowing who will perform effectively is another. This is one of the challenges of moving to the next level, but it can be done. Others have done it. So can you. One of the pluses is to get others to do what you've always disliked. Your business will become more effective as a result.

3. Motivating your Staff
If you have become so used to relying on yourself to get to a certain level of success, teach your staff the value of self-motivation. You should also praise them for their hard work, dedication, creativity and enthusiasm. This will serve everyone well over time. Learn to trust yourself and the decisions you make when hiring certain individuals. At first, your judgment might be poor. As time passes, you will learn from your mistakes and assess people more effectively. Always get your staff to open up and tell you their concerns and challenges. Never assume all is well when it might not be. You were once the doer. Become the observer.

4. Maintaining your Focus
Whenever you hit unfamiliar territory things can appear quite scary. There is no way out of this. In order to move ahead you must apply what you have learned to date. As an entrepreneur you have maintained your focus to accomplish a certain level of success. As a business owner you can do the same thing by developing others. Take time to train your individual staff members and monitor their progress regularly. Your focus has changed, but you are still, if not more responsible to maintain it.

5. Defining and re-defining your Values
Ask yourself: why are you in business for yourself? Continue to keep asking yourself that same question over time. If you want to build a team of strong leaders who share the same mission and vision as you, you need to know exactly what that is. As you grow, your values might change. Make sure your team is in-tune with them.

The best way to grow is at a slow, steady pace. 

If you are to sustain anything, you must first learn to make room for it. Expand your mind and prepare for change before it happens. You won't know exactly what it will look like but at least you'll be able to handle it when it comes.

CALCULATING "ORDINARY WEEKLY PAY" AND "AVERAGE WEEKLY EARNINGS" IN RELATION TO HOLIDAY PAY

The Holidays Act 2003 came into effect on 1 April 2004, which affected the method of calculating holiday pay. 

Both “ordinary weekly pay” and “average weekly earnings” need to be calculated and the greater figure used for the employee's annual holiday pay.

Ordinary Weekly Pay

“Ordinary weekly pay” represents everything an employee is normally paid weekly, including:

Intermittent or one-off discretionary payments are not included in ordinary weekly pay.

For many people, ordinary weekly pay is quite clear because they are paid the same amount each week.

Where ordinary weekly pay is unclear for any reason, the Act provides an averaging formula for working it out. Ordinary weekly pay is established by:

Sometimes an employment agreement will include a specified ordinary weekly pay. If this is the case, the figure in the employment agreement should be compared with the actual ordinary weekly pay (as calculated under 1 or 2 above), and the greater of the two should be used as “ordinary weekly pay”.

Average Weekly Earnings

“Average weekly earnings” are determined by calculating gross earnings over the 12 months prior to the end of last payroll period before the annual holiday is taken, and dividing that figure by 52. The following payments make up gross earnings and should be included in the calculation:

Unless the employment agreement says otherwise, reimbursement payments and discretionary or ex-gratia payments (for example, genuinely discretionary bonuses) are not included in these calculations; nor are payments made by ACC or when an employee is on voluntary military service.

WHAT EMPLOYEE ALLOWANCES ARE TAX FREE

There are three types of allowances commonly paid: travelling, benefit and reimbursing.

Travelling Allowances

These are cash allowances paid to employees for travel between home and work, and may be tax-free.   The allowance will be tax-free if the amount reimburses an employee's additional transport costs and any of the following special circumstances exist:

For all these special circumstances, except lack of adequate public transport, the tax-free amount is the actual cost of travelling between home and work, less the employee's usual transport costs.   If you pay a travelling allowance because there is a lack of adequate public transport the first $5 of the daily travelling allowance is taxable and any additional amount is tax-free.

If you are registered for GST you can claim a GST credit for the reimbursement for your employee's actual expenses, provided normal GST requirements are met.

Benefit Allowances

These are payments made in addition to salaryand wages which benefit your employee.  A benefit allowance is taxed with your employee's wages.

Reimbursing Allowances

These payments are made to employees to compensate them for expenses they have had while doing their job- such as meal allowances, mileage allowances or tool money.

A employer may make a reasonable estimate of the expenditure incurred by an employeee and treat this as if it was the amount incurred by the employee.

Reimbursing allowances are not taxable.   However, if the payment is more tha the employment-related expenses or more than a reasonable estimate, the excess is taxable.

If your empoyee's allowance is taxable add the taxable value of the benefit to the empoyee's pay for each pay period, and deduct PAYE from the total.  

BUSINESS OBLIGATIONS WITH UNCLAIMED MONEY

Unclaimed money is funds left untouched for six or more consecutive years in financial institutions and businesses.

Most of the forgotten and abandoned money comes from deposits left in financial institutions such as insurance proceeds, and also includes unclaimed funds such as cheques or wages.

Initially it is the responsibility of the institution holding the funds to make every effort to locate the proper owner of the money. If they cannot locate the company or individual, under the Unclaimed Monies Act 1971 the funds are required to be paid to Inland Revenue.

The Act applies to all companies, banks, building societies, insurance offices, money-lenders, auctioneers, real estate agents, accountants, sharebrokers and motor vehicle dealers that hold defined classes of unclaimed money.

Companies need to consider if they have amounts that are unclaimed money and to ensure that systems are in place to pay the money to Inland Revenue at the appropriate time.