It’s important for small business owners to surround themselves with people who are in the know, so they don’t miss out opportunities that could be helpful to the business.

The challenge for all business owners and budding entrepreneurs is, at the risk of sounding like Donald Rumsfeld, they don’t know what they don’t know. And the cost of this ignorance is even greater when you have governments flinging around stimulus handouts and other incentives.

The penny dropped for me earlier this year when I was asked to expose small business owners to what the Rudd Government had dangled in front of the sector as the global financial crisis (GFC) loomed.

The first assistance was a 20 per cent reduction on quarterly pay-as-you go tax installments for the December quarter. While the ‘discount’ had to be made up at financial year’s end, this was meant to be a cash flow cushion for businesses feeling the GFC pinch.
Feedback says many business owners pondered: “Why wasn’t I told about this?”

Many didn’t know what they didn’t know. Of course, if they had good accountants, these trusted advisers would have put out a notice to all of their clients, but as a profession these guys and girls can be very insular and uncommunicative.

The biggie was the so-called temporary investment tax break of 30 per cent for bigger small and medium enterprises (SMEs) and big business, which was ramped up to 50 per cent for those with turnovers less than $2 million. This did eventually capture the entrepreneurial imagination of SMEs, but it was driven by car-sellers and other retailers-to-business with throat-grabbing ads.
Even lateral thinking art sellers used the initiative to remind businesses that art can be a capital item that can generate business, just like a plasma TV.

Once again, many businesses were not aware that this tax deduction was on top of the normal depreciation allowance. This was mammon from Kevin but a lot of small business people, I know, still have not been shown the opportunity.

The small business marketing manager of Energy Australia, Peter Hickey, once showed me what the New South Wales government was doing to encourage better energy using practices.

Small businesses can get an energy audit for $50, which comes with a report, and if they implement one of the recommendations they can get a rebate up to $5,000.

Choice has a “Rebates for going green” page on their website — www.choice.com.au — which actually shows what the federal and state governments are giving away.

But wait there’s more. Peter Hickey also made the point that in purchasing alternative energy or smaller carbon footprint equipment, you could also get the 50 per cent temporary investment tax break. This has been extended until the end of 2010 but I wonder how many $2 million plus turnover businesses failed to think laterally and long-term and missed the opportunity to benefit from the 30 per cent tax break.

Not knowing what you don’t know and not having great advisers can be really costly for isolated small business owners who are working in and not on their business.

Tips

• Ensure you have a great accountant who lets you know about opportunities that can help your business grow.
• It’s important to try and work on your business, not in it. Surrounding yourself with experts can help with this.

By Peter Switzer

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