When running your own agency, you need to pay your staff wages and superannuation along with withholding tax. It’s all in the name of running a business.

It’s surprising how many mistakes are made from Licensees incorrectly paying their staff and issues with reimbursements, super and tax payments.

So let’s help you set it up correctly from the start so you are aware of all your employer obligations.

Wages, Super, Tax and Reporting

  1. Car allowances

    If a staff member uses their car, they must get a car allowance.

  2. Award wages

    Award wages change the first full pay period after the 1st July of any financial year. To check the relevant award, keep this handy Real Estate Industry Award Resource in your bookmarks.

  3. Commission-only staff

    For your commission-only staff, check they meet the Minimum Income ThresholdAmount (MITA).

    The award now states employees engaged on a commission-only basis must, in any single 12 month period over the past 3 years, have been paid an annual amount (excluding commission or bonus payments) that is at least equal to:
    – the minimum annual rate for their classification under the award
    – an extra 25%
    This amount doesn’t include superannuation payments.

    Even if staff have resigned, you are required to pay their commissions upon receipt of the commission from the Trust Account.

  4. Weekend work

    If a staff member works a Saturday, they must have a weekday off.

  5. Award rates

    An important consideration as a boss – even though Award rates are set for the industry, this doesn’t mean that’s all you should pay staff. It is really set as the minimum wage. If you want to foster and retain a good team, you need to pay above the award. Think about other ways you can add value and relieve their costs. Perhaps covering their licence fees or CPD costs? These can also then be claimed as tax deductions.

  6. Taxes

    As per any other business, you are required to pay tax for your employees. As an employer, you have four main record-keeping obligations when it comes to your employees:
    1. Records for payments made to employees – including salaries and wages, bonuses, leave, allowances and work hours.
    2. Records for super contributions for employees – amounts paid to super and calculations and salary sacrifices.
    3. Records for super fund choice for your employees – proof you have offered employees fund of choice.
    4. Records for pay as you go withholding (PAYGW) – keep calculations of PAYG instalment amounts as well as payment receipts or bank statements for payments of your business activity statement (BAS) or instalment notice.
    5. Records for fringe benefits – keep all records relating to the fringe benefits you provide, including how you calculated the taxable value of benefits.

    Records must be kept for a period of five years.

  7. Instalment Activity Notice

    We recommend paying your Instalment Activity Notice (IAS) monthly, even if you don’t need to. This will help with your cash flow. It will save you from being lumped with a big tax bill in one lump sum. No one wants that.

    Divvying it up into smaller amounts will help keep your cash flow in a good place.

  8. Superannuation

    Pay super monthly even though you don’t need to. Again this will help with your positive cash flow.

  9. BAS

    For quarterly BAS reporting, your BAS is due on the 28th day of the following month. For example, for the July, August, September period, your BAS is due on the 28th October.

    Using a BAS agent can also allow you an extension on your due dates.

    We advise setting up a savings account. Put 15% of your income into this account every time you disburse from the Trust. Also, put in your staff wages and Super into this account every pay run so you can effectively manage your cash flow.

Jane Morgan is the Director of End of Month Angels, a consultancy firm specialising in Trust Accounting. Jane knows the legislative requirements of running a successful Real Estate office through her 23 years’ industry experience. Don’t trust just anyone with your trust accounting. Book an appointment with an End of Month Angel today.