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The 101 for First Home Buyers - Part 2

 

Buying your very first home can be a very exciting process, but also an expensive one.  It's very important to fully understand what you are getting into before making what is likely to be your most expensive purchase so far in your life.  Here are some helpful hints that may make the process a little more stress free.

Building your dream home?

From the 1st of July 2017, the Andrew's government will double the First Home Owners Grant (FHOG) from $10,000 to $20,000, payable when a contract is signed for a newly established home. First home buyers may also eligible to receive 50 – 100% off their stamp duty on the purchase of their land. Lenders will take these amounts into consideration when calculating the required deposit for a home loan.

For example, a $200,000 property could be bought with a $20,000 cash deposit and the $20,000 FHOG – a total deposit of $40,000 or 20%. Such a situation might save you from having to pay Lenders Mortgage Insurance, as the deposited amount is 20% or more of the property. This is a huge saving to first home buyers as more funds may be available to put towards to the property build.

This is expected to help over 6,000 Victorians purchase their first home and to build and live in their local communities. Note: the grant is only available to first home buyers building new homes valued up to $750,000 in regional areas (ie. not Melbourne).

Buying Established Home?

As of the 1st of July 2017, the Andrews's Government will axe Stamp Duty for First Home Buyers on both new and established homes under $600,000. First home buyers purchasing a property between $600,000 and $750,000 will receive a tapered discount.  For example, stamp Duty on a $300,000 home will drop from $5,685 to NIL for first home buyers – this gives first home buyers the advantage of being able to put more money into their new property.

What is Stamp Duty?

 Stamp duty is a charge which is applied by the state governments in relation to the transfer of land or property. As such, each state has its own rules - here we have discussed those which apply in Victoria.

Low Deposit Home Loans

Financial institutions generally required deposits to be around 20% of the property value. This is to provide confirmation to your lender that you have the ability to save and are able to meet your monthly mortgage repayments.  In an ideal world you would be a banks model candidate. Depending of the price of the property, first home buyers may not be able to afford the 20%, and that's okay because there may be more options available to you.

Lenders will often allow individuals to borrow above 80% of the property value to own their dream home faster. They do this by adding a one off payment to the loan - lenders mortgage insurance (LMI). The aim of this payment is to protect the lender (not the borrower). The lower the deposit on your property, the higher the risk you become to the bank. This payment is a once off premium, with the payable amount entirely depending on the amount being borrowed. Some lenders may allow the borrower to add the cost of their premium to their monthly loan repayments, - meaning no upfront cost.

Other factors to Consider

Its getting harder and harder for Australian's to save for their first home. These few changes have made it somewhat easier although we still need to consider the underestimated additional costs.

 Items such as home and contents insurance, legal fees, moving costs, inspection reports, council rates and transfer fees need to be well-thought-out. It's important that these additional costs are taken into consideration, as well as knowing exactly how you will make the monthly repayments on you property. 

It is important to shop around; each lender will have different packages to attend to your needs and financial capabilities. Lastly, ask questions, this is so important! It's not everyday that individuals go and purchase homes and it isn't something which you will naturally understand the process of. As such, there is no such thing as a silly question!

If you are interested to learn more about this topic and how it may affect you, you can call or book an appointment on (03) 5032 9422.

The 101 for First Home Buyers - Part 1

Who wants to own their very first home?

Buying your very first home is the Great Australian Dream. It can be a very exciting process, but for some, especially first home buyers and lower income households, it's getting much harder for this dream to become a reality.

Did anyone take note of the 2017/18 federal budget overview? 

No ?

Well here is what's relevant to you!

First Home Super Saver Scheme – 2017-18 Financial Budget

In the 2017/18 financial year budget, the Federal Government have imposed that first home buyers will be able to save for a deposit through superannuation:

-          As of the 1st of July 2017 you can make voluntary super contributions of up to $15,000 per year (or $30,000 in total), to help you save for that deposit on your dream home.

-          Voluntary super contributions can be deductible or non-deductible in your individual tax return. Deductible contributions reduce your individual taxable income, and will be taxed at 15% in the super fund when they are deposited. All future earnings within super on the amounts deposited are also taxed at 15%. This gives the potential to save you up to $5000 in income tax, depending on your circumstances.

-          After the  1st of July 2018, these contributions can be withdrawn for a first home deposit only. Deductible contributions and earnings that are withdrawn will be taxed individually at the marginal rate less 30% offset.

The first home super saver scheme can potentially boost savings to put towards a deposit by at least 30%, as opposed to a standard deposit account. This is due to the concessional tax treatment and higher rate of earnings realised within superannuation.

This may be a huge benefit for home buyers, particularly in regional areas where $30,000 is seen to be a sufficient amount for deposit on a new home. This incentive provides first home buyers the chance to build their savings more quickly and purchase a home that they are happy with. The $30,000 contribution limit is per person, so couples will be able to both access the scheme and combine their savings for a single deposit.

The ATO has assumed the responsibility of administering the First Home Super Saver Scheme. They therefore are responsible for determining the eligibility of the person seeking a release of funds, and to approve the released amounts based on the information provided by the applicant and superannuation fund.

The ATO will also administer compliance mechanisms to ensure that people purchase their first home after they release monies from the superannuation fund. This means the amount withdrawn is not allowed for personal use, it is designed entirely for a home loan deposit. 

If you are interested to know more about this topic or how it may affect you, you can call or book an appointment on (03) 5032 9422.



If you haven't noticed over the last few years, metropolitan and suburban football has been struggling.  Small community football clubs all across the land are folding or merging, as they can no longer support escalating player payments along with dwindling volunteer help.

However, 2017 marks the first year for the Community Club Sustainability -Player Payment Rules. Put in place to maintain support and grow Australian Football at Community Level, while ensuring competitions are evenly matched and clubs financially viable.

From this season all player payments (match payments, cash incentives, bonuses, travel allowances, finals appearances and payments for other non playing roles) will be reported to the AFL before the season starts as a budget. Payments that have actually been made will then be lodged and reported to the AFL at the end of the season, post finals.

The 'salary cap' has been introduced in to stop financially stronger clubs being able to obtain an unfairly large proportion of the best players at the expense of the financially weaker clubs. Its aim will also be to boost memberships at all clubs, due to the more-even competition, which hopefully produces more volunteers.

Customarily, in the past, all or part of player match payments may have been 'cash' with the other portion being an actual 'wage' or 'travel allowance' and possibly appearing on a PAYG Summary.

'Cash' payments require no reporting on the clubs behalf and they do not form part of your taxable income. 

If you have received a wage or allowance from football you would have received a PAYG Summary and it would form part of your taxable income (treated exactly the same as a PAYG Summary you received from other employers). You would need to keep record of this for when you lodged your Income Tax Return.

With the new Salary Cap and player contracts in place in the 2017 season -  all match payments, cash incentives and bonuses will have to be reported by your football club to the AFL and also the Australian Taxation Office (ATO). This means you will receive a PAYG Summary and the Income you receive from Football will be taxable income.

The AFL have put in place severe sanctions for both Clubs and Individual Players if Player Payment Rules are not adhered to, which range from monetary sanctions, clubs forfeiting the right to register specific players, players forfeiting the right to register for a specific club or league, relegation of clubs and loss of or ineligibility of Premiership Points for past, current or future years.

So what does this mean for you as a Footballer?

Well to put it simply, you are now recognized as an 'employee' of your respective football club if they pay you in any way, shape or form. Any income received will have to be declared, but footballers may also be able to claim deductions against this income for football related expenses.

As well as this, players may also be entitled to Super Guarantee Contributions of 9.5% of their earnings from their employer, the football club.

To find out more information on what you may have to declare and what you may be able to claim as a footballer, call us on (03) 5032 9422

 

Donating Blood - B Positive

I had always liked the thought of donating blood but like everyone life gets busy and there are things you don't get around to doing. So I finally got around to it when our office manager Bev (who makes regular donations) decided to book in some of the GMG staff that were interested. Read more…

Relay For Life 2015

Last Friday night, the GMG team 'The Number Crunchers' took part in the local Relay for Life at Riverside Park.  The Number Crunchers team consisting of all the GMG staff along with their partners and kids all got together to have some fun and to raise some money.

Relay for Life is held to raise vital funds for the Cancer Council used in research, prevention, information and support services.  The event is also to recognise and celebrate local cancer survivors, sufferers, their carers and to remember those lost.

With some glorious weather on the Friday night and then some much needed rain on the Saturday morning, the team kept walking right the way through to the very end.

Matt Lenton entertained a crowd with his musical talents and still managed to do a double shift in the early hours of Saturday morning.

It was great to see the local community come together and pull on their purple jumpers to raise money for this worthy event. This years Relay for Life for Swan Hill raised approximately $41,000, with the Number Crunchers coming 8th in the donation tally.

If you want to know more about this event or read some of the inspirational stories visit Relay For Life's Website

Congratulations and thank you to everyone for your participation and effort.

Until next year.

As the world evolves & technology becomes a major part of this, here in the country we are forever behind the 8 ball due to a lack of internet speed.

I hear the frustrations from not only the employees here at GMG but from our clients, children and friends alike.

So with the news yesterday that the "Sky Muster" has been launched (a rocket carrying a ½ a billion dollar NBN satellite) will it be what we all hope?

With most software programs now being cloud based will the mid 2016 promise deliver?

Here at GMG we have learnt that if you don't accept change & progress with technology you get left behind.

If you don't want to get left behind and are looking for a more efficient & effective cloud based solution can you really afford not to contact us?

 

Check out the satellite – Looks more like a bug!

Crunching Numbers on the netball court.

Last year I decided to put together a GMG Accounting mixed netball team. I had a great response from staff and partners. The GMG Number Crunchers took to the court for the 2014 Spring competition and proved that your accountant has a few other skills away from the calculator.

Last season we finished second on the ladder and our own Shaun Lawry took out Best Fairest for the Mixed Netball League. We also ran our own in house Best & Fairest, votes taken down each week. Nonie Domaille won Best & Fairest easily, while both Justin Toomey and Shaun Lawry shared runner up. Tom Pepin won coaches award and Tamara Paull won most improved.   

After such a great season and good end of season break up everyone couldn't wait to get back to the court this year. There was plenty of encouragement and talk around the office as the 2015 Winter Competition grew closer to starting. The GMG Number Crunchers lost a few big names but managed to pick up a few key players too. I was approached to take on coaching again, which I accepted. After some intense pre season training and new crisp bibs the GMG Number Crunchers were ready to hit the court.

The 2015 season started mid-April with a great start by the GMG Number Crunchers. Currently the GMG Number Crunchers sit 3rd on the ladder with 3 wins and 3 loses to their name.

There is usually a good office vibe on a Wednesday afternoon when the team's weekly press release is issued including the line up for that night. Key players to keep an eye on this season are new recruit Andrew Halligan, husband and wife shooting duo Justin & Krystle Toomey and laying low stealing a few votes are Jess White and myself.

We have a really good fan base and some great supporters there every week which we really appreciate.  The GMG Number Crunchers play every Wednesday at 6pm at the Swan Hill Basketball Stadium. With still 12 games to go anything could happen.

See you on the court.

Pressure on Independent Retailers

If any readers have visited GMG Accounting's Swan Hill offices over the past few months or picked up the local paper anytime over the past couple of years, I'm sure you will be aware of a certain hardware chain putting up shop in Swan Hill.

The opportunities a store like Bunnings creates for local workers, local charities and community groups (through community partnerships and sausage sizzles) is not lost on me. The only qualm I hold with Swan Hill welcoming big business is that the lion's share of any store profit will likely find its way into a Wesfarmers shareholder's pocket to be spent in shops thousands of kilometres away.

Already serviced by five general hardware stores and a number of more specialised hardware stores Swan Hill is arguably well catered for in this area. It can also be said that because there is an assortment of these stores in town that no true monopoly exists and that there is already enough competition present to keep prices in check. Although I am yet to venture inside the new Swan Hill store, having spent countless hours browsing through a number of different Bunnings stores in Melbourne it's easy to see that they carry a wide range of different makes and models of hand and power tools. I've noticed that they never seem to carry the more prestigious and specialist brands, those that are more desirable to tradesman such as Milwaukee and Snap-on. This I'm hoping is where the local stores can excel and fill the gaps.

Casting the new Bunnings store in an optimistic light, Swan Hill will hopefully be able to welcome new non-local shoppers to town. Consumers that might not have otherwise had a reason to travel to Swan Hill for their house and hardware needs. This being the case the extra foot traffic will no doubt benefit the wider business community around town.

Anybody who can be as selectively forgetful as myself and thinks that Swan Hill is losing part of its soul just because one large retailer is moving in to town only has to look a little further South on Beveridge St to find a couple of chain stores that have been in town as long as I have been alive. The days of the small Roberts & Martin's SSW style supermarket have undoubtedly ended.

Maybe my sentimentality is misplaced, maybe local owner operator hardware stores won't suffer with the introduction of a Bunnings store. I certainly hope so. Time will tell.

School Banking

As a mother of 3 girls, my husband and I thought it was very important that the girls learnt to have good saving habits from an early age, so we opened a CBA Youthsaver Account for each one.

We encouraged them to bank a minimum of 20% of their pocket money but they often banked more through the School Banking Program. As well as teaching the girls to save, the school received a commission on every deposit made and $5 for every Activated Account opened via the program. I see on television that CBA are still advertising the Youthsaver School Banking Program with Glen McGrath as the spokesman.

Today the children also receive a dollarmite token every time they make a deposit to their saving account regardless of the amount and once they have 10 tokens they can redeem them for a variety of rewards. Items including a hand ball, scented pencils, swimming bag etc. The rewards will vary from year to year.

We found this program a great stepping stone for our girls to start saving and 2 out of 3 are still very good savers but they all have the knowledge of how to save. The funds weren't saved to buy something they were designated as savings and once they had a thousand dollars they were then shown how to put the money into a manage fund which they still have today.

Saving is not often taught at school, it's something that parents needs to teach their children earlier rather than later.

The Wonderful World of Winter Sports

 
    Trent Collins, Reece Collins, Shaun Lawry

 
Around these parts, sport, in particular, football is an institution. Not in a Texas High School, Friday Night Lights kind of way, but we love our footy and netball here, and a few of us in the GMG office are no exception to the rule. Now I'm not going to bang on about arguably what many of us consider to be the best club on the planet - COLLINGWOOD, but I will tell you a little bit about my new club, Charlton.

The Charlton Football club is actually made up of the Charlton Football, Hockey & Netball Club and brings together a range of great characters from around the town and district. The club have been fantastic in welcoming myself, my wife Teagan & our 2 children into their community. My future brother in-law, Reece Collins is the coach of the senior football team, Leanne Gretgrix is the senior coach of the hockey team & Tessa Burton is the coach of the A grade netball team.

The first 2 rounds have seen this old boy kick a few goals before running out of steam, but that's just due to what I thought was a massive pre-season, but turns out the work rate might not be at where it used to be! The senior football , A grade netball & the senior hockey teams are all 2 wins from 2 games. All teams have had an even contribution right across the board but there's still a few areas that need improvement.

 

Have you ever been to Charlton?  Have you ever seen a hockey game played at the same place as football and netball? If you answered NO to any, or all of these, I have the solution for you…….. COME TO CHARLTON FOOTY!!!!!!!!!!!!!!!!!!!!

Charlton Football Club (inc Netball & Hockey Clubs) are holding a sponsorship and family day on the 4th of May, it is a home game VS Boort.  Come along & enjoy a great day out!

Dont forget to drop into GMG Accountings new office located in the main street of Charlton! Myself & Jess Round visit the office every Thursday!



 
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