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Tax Season: How To Look At A Company's Financials · She's On The Money

• 0:00
  Speaker 1: Hello.
• 0:01
  Speaker 2: My name's Santasha Nabananga Bamblet. I'm a proud yr the
• 0:05
  Speaker 2: Order Kerni Whoalbury and a waddery woman. And before we
• 0:08
  Speaker 2: get started on She's on the Money podcast, I would
• 0:11
  Speaker 2: like to acknowledge the traditional custodians of the land of
• 0:14
  Speaker 2: which this podcast is recorded on a wondery country, acknowledging
• 0:18
  Speaker 2: the elders, the ancestors and the next generation coming through
• 0:23
  Speaker 2: as this podcast is about connecting, empowering, knowledge sharing and
• 0:27
  Speaker 2: the storytelling of you to make a difference for today
• 0:31
  Speaker 2: and lasting impact for tomorrow.
• 0:33
  Speaker 1: Let's get into it.
• 0:34
  Speaker 3: She's on the Money. She's on the Money.
• 0:57
  Speaker 4: Hello, and welcome Money the podcast for millennials who want
• 1:02
  Speaker 4: financial freedom. My name is Georgia King, and joining me
• 1:05
  Speaker 4: as she always does, is Victoria Define. Actually, you weren't
• 1:09
  Speaker 4: here last week, so I can't say that you can't.
• 1:11
  Speaker 1: I was so sick last week. Laryng Idis really throws
• 1:15
  Speaker 1: you under a bus.
• 1:16
  Speaker 4: Are you feeling better?
• 1:16
  Speaker 1: I'm feeling so much better. Can you hear my voice?
• 1:18
  Speaker 1: I feel like there's like a slight pang of illness still. Okay,
• 1:22
  Speaker 1: you know that kind where you like, here is someone
• 1:24
  Speaker 1: and you just don't want to be in the same
• 1:25
  Speaker 1: room as them that you are.
• 1:27
  Speaker 4: They're locked in for the day already, guys. It is
• 1:29
  Speaker 4: officially reporting season. So today we're going to discuss how
• 1:33
  Speaker 4: to read a dividend statement, how to report any income
• 1:36
  Speaker 4: from shares, and what exactly you should be looking for
• 1:38
  Speaker 4: in a company's financials.
• 1:40
  Speaker 1: That's overwhelming, g it is overwhelming, straight into the hard stuff.
• 1:44
  Speaker 1: But before we get there, what the devil is reporting season?
• 1:48
  Speaker 1: Oh you don't know? Well, I feel like I get
• 1:50
  Speaker 1: the gist, But for anyone who's listening, it is like
• 1:53
  Speaker 1: g in Layman's terms, it's basically when companies let all
• 1:56
  Speaker 1: of their investors know how their business is going. Let's
• 1:59
  Speaker 1: comeanes who outperform do a little bit of a victory
• 2:02
  Speaker 1: lap around the office. Well, CEOs that miss expectations, they
• 2:05
  Speaker 1: have to face the music. So it's a time of
• 2:07
  Speaker 1: the year where everything kind of just like comes to
• 2:10
  Speaker 1: a peak. We're talking about it. It does coincide with
• 2:12
  Speaker 1: end of financial year because all of the finances have
• 2:15
  Speaker 1: come through, and it's basically a time when a lot
• 2:17
  Speaker 1: of financial advisors having a relook at people's portfolios to
• 2:21
  Speaker 1: see if we should be rebalancing or taking some stuff
• 2:24
  Speaker 1: out or putting some stuff in. It's just it's a
• 2:26
  Speaker 1: time where you just have a lot of fresh data.
• 2:29
  Speaker 1: Really obviously, you could do that at any point during
• 2:32
  Speaker 1: the year and go, oh, well, I'll read their annual report.
• 2:34
  Speaker 1: But it's basically when all the information is super fresh
• 2:36
  Speaker 1: and super new, and it's when a lot of people
• 2:38
  Speaker 1: are making a lot of decisions.
• 2:39
  Speaker 4: So is this when they put out their annual reports?
• 2:42
  Speaker 4: That is that what it is?
• 2:43
  Speaker 1: Yes, it is. Obviously companies can put out their annual
• 2:45
  Speaker 1: reports whenever they want to, but end of financial year
• 2:48
  Speaker 1: is pretty traditional when it comes to you know, reporting
• 2:51
  Speaker 1: on business financials kind of makes sense.
• 2:53
  Speaker 4: So when exactly is reporting season, V's like a week
• 2:57
  Speaker 4: at the end of the financial year? Is it a day?
• 3:00
  Speaker 1: Look like? So it's kind of like a whole season.
• 3:02
  Speaker 1: So almost every company that is on the ASX is
• 3:05
  Speaker 1: going to report they're half year financials. Keeping in mind
• 3:08
  Speaker 1: half year is in of half financial year, not in
• 3:11
  Speaker 1: a real year. So that's actually late January early February,
• 3:15
  Speaker 1: and then their full year results are going to come
• 3:16
  Speaker 1: out late August. And that's basically because in June thirty
• 3:20
  Speaker 1: they have all of July and August to do some
• 3:22
  Speaker 1: reporting and some analysis and then get it out to investors.
• 3:25
  Speaker 1: So I think a lot of people actually expect it
• 3:27
  Speaker 1: on June thirty. They're like, well, where's my income statement
• 3:30
  Speaker 1: or where's my dividend statement, or you know, when can
• 3:32
  Speaker 1: I download the tax report from my investor portal? And
• 3:35
  Speaker 1: they're offended that it's not available on July the first,
• 3:38
  Speaker 1: and it's like, well, actually, they need time to pull
• 3:40
  Speaker 1: this stuff together and actually have those end of financial
• 3:44
  Speaker 1: year numbers so that then they can run their report.
• 3:46
  Speaker 1: So it does take a little bit longer than you
• 3:48
  Speaker 1: would anticipate, which is why we're talking about it now,
• 3:51
  Speaker 1: because people's expectations might be, Hey, I want it, it's
• 3:54
  Speaker 1: going to be July really soon, and it's not actually
• 3:57
  Speaker 1: that common to get your financial report. What's on the
• 4:01
  Speaker 1: thirtieth of June, Okay if that makes sense, Yeah, yeah,
• 4:03
  Speaker 1: because that's when the numbers are finally cut, right, Like
• 4:06
  Speaker 1: that's the last day of reporting and they need to
• 4:08
  Speaker 1: analyze it. It's kind of like you're not able to
• 4:10
  Speaker 1: do the union assignment until you have all the information,
• 4:12
  Speaker 1: and you only get the information on the thirty of
• 4:14
  Speaker 1: the June.
• 4:14
  Speaker 4: G A perfect analogy. But now we have covered this before,
• 4:18
  Speaker 4: but we're gonna start with the basics today. Can you
• 4:21
  Speaker 4: please run us through once again what a dividend is.
• 4:24
  Speaker 1: A dividend g is sexy. It's sexy, it's a sexy thing.
• 4:28
  Speaker 1: It's essentially when a company gives you a small portion
• 4:31
  Speaker 1: of their profit. Like if you're a shareholder and you
• 4:33
  Speaker 1: own a share you are entitled to one that tiny
• 4:37
  Speaker 1: portion of that company, but also that tiny portion of
• 4:39
  Speaker 1: that company's profit. So that's when you get your little profit.
• 4:43
  Speaker 1: On the side, you get paid for being a little
• 4:45
  Speaker 1: share owner.
• 4:46
  Speaker 4: Stunning.
• 4:46
  Speaker 1: I think it's stunning. So common shareholders of dividend paying
• 4:49
  Speaker 1: companies are typically eligible as long as they own the
• 4:52
  Speaker 1: stock before the ex dividend date. So you could technically
• 4:54
  Speaker 1: go and purchase a dividend stock tomorrow G and have
• 4:57
  Speaker 1: it pay a dividend for the next day, which is
• 4:59
  Speaker 1: a bit of a money win. And why some people
• 5:01
  Speaker 1: really I won't call it timing the market, because we
• 5:04
  Speaker 1: all know we can't time the market, but some people
• 5:07
  Speaker 1: time their purchasers with when dividend payouts are going to be,
• 5:11
  Speaker 1: so you don't really want to go, oh, a dividend
• 5:13
  Speaker 1: payout is going to happen in July, and then you're
• 5:14
  Speaker 1: buying the share in August and have to wait nearly
• 5:16
  Speaker 1: a full twelve months to get another dividend payout like
• 5:20
  Speaker 1: that wouldn't make a lot of sense in the grand
• 5:22
  Speaker 1: scheme of things. We don't often time it that way,
• 5:24
  Speaker 1: but some people do want to take it into consideration.
• 5:27
  Speaker 1: And dividends can either be paid out in cash, so
• 5:30
  Speaker 1: it would be money that ends up back in your
• 5:32
  Speaker 1: trading account, or it could be paid out in extra stock.
• 5:35
  Speaker 1: So if you've got a dividend reinvestment plan ticked when
• 5:38
  Speaker 1: you signed up, it would automatically mean that you would
• 5:41
  Speaker 1: just be reissued a small amount of stock instead of
• 5:43
  Speaker 1: some cash.
• 5:45
  Speaker 4: And not all shares paid dividends, so right, no.
• 5:47
  Speaker 1: C gee, they are not all created equal. And that's
• 5:50
  Speaker 1: why when we are putting together an investing strategy, we
• 5:53
  Speaker 1: really need to think about whether we want dividends or
• 5:55
  Speaker 1: we're after capital growth. There are lots of different reasons
• 5:58
  Speaker 1: why we would pick a particular shit, and actually, you
• 6:01
  Speaker 1: know progress that into our portfolios. Some of us actually
• 6:05
  Speaker 1: really want dividend shares more often than not. If you're
• 6:08
  Speaker 1: a really conservative investor, that's probably what you're chasing, and
• 6:12
  Speaker 1: dividend shares are. They're kind of like the Holy Grail, right,
• 6:15
  Speaker 1: like you own something, it increases in value over time
• 6:17
  Speaker 1: and it pays you like what a money win. So
• 6:20
  Speaker 1: a lot of people want that. But you'll note that
• 6:23
  Speaker 1: those good, consistent, trusty dividend shares are usually relatively expensive.
• 6:28
  Speaker 1: So you're looking at a suite of shares that are
• 6:30
  Speaker 1: usually referred to as blue chip stocks. So you've probably
• 6:33
  Speaker 1: heard this before, and a blue chip stock is basically
• 6:36
  Speaker 1: just a very conservative stock. It is tried and true
• 6:40
  Speaker 1: in the market. It is a very large business that
• 6:43
  Speaker 1: is very unlikely to go under, and they are usually
• 6:46
  Speaker 1: commodities or banks or things like iron ore where you're
• 6:49
  Speaker 1: going to you know what doesn't matter when this isn't
• 6:52
  Speaker 1: an ethical argument. If you want to go and listen
• 6:54
  Speaker 1: to one of our ethical podcasts, absolutely do. But we
• 6:57
  Speaker 1: know Australia is going to continue to produce that because
• 7:00
  Speaker 1: it's a very big commodity that comes out of Australia,
• 7:02
  Speaker 1: and we know that that share is going to consistently
• 7:04
  Speaker 1: perform because we know that that resource is not limited
• 7:07
  Speaker 1: here in Australia. So for me, when I look at
• 7:10
  Speaker 1: the portfolio, or I look at what I'm doing with
• 7:13
  Speaker 1: a client's share portfolio and whether I want capital growth
• 7:16
  Speaker 1: or dividend yield. It actually goes back to risk profile.
• 7:19
  Speaker 1: And you know when we were talking ages ago on
• 7:21
  Speaker 1: another episode about risk profile, it's really like, gee, do
• 7:25
  Speaker 1: you want to take more risk or do you just
• 7:26
  Speaker 1: want the tried and true and steady steed that like
• 7:29
  Speaker 1: it's going to pay their dividend. Like if you look
• 7:31
  Speaker 1: at a NAB share, I'm not saying go and buy NAB.
• 7:34
  Speaker 1: This is not a recommendation. It's just an example because
• 7:37
  Speaker 1: I was writing another chapter of my book last week
• 7:39
  Speaker 1: and I was talking about dividend yield and I was
• 7:41
  Speaker 1: talking about how it works, and I was like, how
• 7:43
  Speaker 1: can I do this? I'm just going to pick NAB YEP.
• 7:46
  Speaker 1: It was the first one that came to mind. And
• 7:48
  Speaker 1: they have not not paid a dividend since like nineteen
• 7:52
  Speaker 1: sixty four or something.
• 7:53
  Speaker 4: That's ridiculous.
• 7:54
  Speaker 1: So every single quarter they are paying their investors a dividend,
• 7:58
  Speaker 1: whether it is big or small. They are just consistent.
• 8:02
  Speaker 1: And that's why a lot of people just want to
• 8:04
  Speaker 1: hold things like NAB and like Blue Scope Steel in
• 8:08
  Speaker 1: their portfolios. Because they're like, do you know what. It
• 8:10
  Speaker 1: might not rise in value significantly over time, but what
• 8:13
  Speaker 1: I will do is start to generate an income. And
• 8:16
  Speaker 1: a lot of people will really value income in a
• 8:19
  Speaker 1: portfolio because they're like, well, that is the thing that
• 8:22
  Speaker 1: I'm chasing anyway, Does that make sense?
• 8:24
  Speaker 4: It does make sense. But you said that in your
• 8:26
  Speaker 4: hypothetical that NAB might pay them quarterly their dividends. Is
• 8:30
  Speaker 4: that like the standard if you are getting no okay, So.
• 8:33
  Speaker 1: Everybody does it differently. NAB pays once every six months
• 8:37
  Speaker 1: or so. Sometimes they'll have a special dividend distribution, like
• 8:40
  Speaker 1: if they've had a really big profit or there's been
• 8:42
  Speaker 1: a really big event in the world and they want
• 8:44
  Speaker 1: to distribute money to some investors, they will do what's
• 8:47
  Speaker 1: called a special dividend run and they will then pay
• 8:50
  Speaker 1: that out. Not very common, but important to know it exists.
• 8:53
  Speaker 1: But usually it's either every six months or every year.
• 8:57
  Speaker 1: Some companies do pay quarterly. That's why it's important to
• 9:00
  Speaker 1: keep an eye on your share trading account and just
• 9:02
  Speaker 1: see what's coming in and what's coming out, and if
• 9:04
  Speaker 1: you are an individual share investor, knowing when that's going
• 9:08
  Speaker 1: to happen is important because in the long run, that's
• 9:10
  Speaker 1: actually going to become your income, like in the future.
• 9:14
  Speaker 1: That's the point of investing. It's not to save up
• 9:16
  Speaker 1: two million dollars George and go, oh my gosh, now
• 9:19
  Speaker 1: I have a portfolio worth two million dollars. I'm going
• 9:21
  Speaker 1: to start spending it and drawing it down, Like, that's
• 9:24
  Speaker 1: not the point. The point is to keep that money invested.
• 9:27
  Speaker 1: And if you have two million dollars invested and you
• 9:31
  Speaker 1: are going off a five percent yield, and you go,
• 9:33
  Speaker 1: I would hope to get five percent every year, you
• 9:36
  Speaker 1: actually have one hundred thousand dollars in dividends coming in
• 9:39
  Speaker 1: every single year. So like that sounds like the dream.
• 9:42
  Speaker 1: Obviously that's a very large example, and that's not achievable
• 9:45
  Speaker 1: for a lot of people. But if you created a
• 9:47
  Speaker 1: two million dollar investment portfolio, you'd have one hundred grand
• 9:50
  Speaker 1: a year coming in in dividends, and that would become
• 9:53
  Speaker 1: your income, so you didn't have to go to work anymore,
• 9:55
  Speaker 1: your passive income.
• 9:56
  Speaker 4: You're learning on a little bit here Via it's tax time.
• 10:03
  Speaker 4: I'm a new investor and I've just received my first
• 10:05
  Speaker 4: ever dividend statement.
• 10:07
  Speaker 1: Congratulations, Thank you so much.
• 10:09
  Speaker 4: Break it down for me though, what does it tell me?
• 10:11
  Speaker 4: What does it mean? Talk me through it.
• 10:13
  Speaker 1: So, if an Australian company pays or credits you with
• 10:16
  Speaker 1: a dividend or a non shared dividend, the company must
• 10:19
  Speaker 1: also send you a dividend statement or a distribution statement.
• 10:21
  Speaker 1: This is going to tell you a number of things.
• 10:23
  Speaker 1: So it could tell you the name of the entity
• 10:25
  Speaker 1: that is making the distribution, the date, the amount of
• 10:27
  Speaker 1: the distribution, any amount of franking credits. So franking credits
• 10:31
  Speaker 1: we can dive into a little bit later, but they
• 10:33
  Speaker 1: are a massive money win and one of my favorite
• 10:35
  Speaker 1: things about the super environment. We'll come back to that.
• 10:38
  Speaker 1: They will tell you where the distribution is unfranked and
• 10:41
  Speaker 1: a statement to that effect, and they will tell you
• 10:43
  Speaker 1: the amount of tax that was withheld if you didn't
• 10:45
  Speaker 1: give them your TFN. So it look there's a lot
• 10:48
  Speaker 1: of information on these statements and regardless of whether you
• 10:51
  Speaker 1: have been issued with a profit or not, you will
• 10:53
  Speaker 1: get one to let you know how your shares are performing.
• 10:57
  Speaker 1: I also think it's important to point out here because
• 10:59
  Speaker 1: I'm talking a lot about distribution of dividends that's not
• 11:03
  Speaker 1: a given. Like a lot of companies and As we
• 11:06
  Speaker 1: said before, NAB was a good example of a consistent
• 11:09
  Speaker 1: dividend yielding share that's expensive to buy. That doesn't mean
• 11:14
  Speaker 1: that every single other share that is classified as a
• 11:17
  Speaker 1: dividend share is always going to pay you a dividend.
• 11:20
  Speaker 1: Like if the company's not doing well, like you're not
• 11:22
  Speaker 1: going to get some of their profit g because there's
• 11:24
  Speaker 1: no profit to be shared. If they've just broken even,
• 11:27
  Speaker 1: they might go, well, we don't have, you know, enough
• 11:30
  Speaker 1: leftover to give to shareholders. Sometimes in smaller, like more
• 11:34
  Speaker 1: growing companies, So you think about shares like, you know
• 11:36
  Speaker 1: how last year our community were going wild for after paid.
• 11:40
  Speaker 1: They were like, oh my god, after pay shares are
• 11:42
  Speaker 1: so good. They've increased by xyz. Great, But they never
• 11:45
  Speaker 1: paid a dividend and they didn't pay a dividend because
• 11:48
  Speaker 1: that company is relatively new. And because they are relatively new,
• 11:52
  Speaker 1: every single dollar in profit that they were making they
• 11:54
  Speaker 1: were reinvesting back into the business to grow the business,
• 11:57
  Speaker 1: which is why they had such good capital growth, both
• 12:00
  Speaker 1: because they were able to reinvest in the business. So
• 12:02
  Speaker 1: you've got to know the underlying strategy of the business
• 12:05
  Speaker 1: that you're putting in your portfolio. Because a lot of
• 12:08
  Speaker 1: people made a mistake when they looked at it and said,
• 12:10
  Speaker 1: oh my god, but I'll put after paying my portfolio
• 12:12
  Speaker 1: because they're performing so much better than something else. But
• 12:14
  Speaker 1: they didn't take into consideration the dividend yield or the
• 12:18
  Speaker 1: amount of passive income they'd make from that share all
• 12:21
  Speaker 1: they got with an after pay share, not to throw
• 12:23
  Speaker 1: them under of us, like we're not talking about the
• 12:25
  Speaker 1: actual business here. No, no, no, we're not talking about
• 12:28
  Speaker 1: the actual business here. We're talking about the share they
• 12:30
  Speaker 1: would buy it. It would increase in value, but you
• 12:34
  Speaker 1: only actually get to crystallize that value if you sell
• 12:36
  Speaker 1: your share. And if we are you know, shees on
• 12:39
  Speaker 1: the money investors and we are long term investors, why
• 12:41
  Speaker 1: are you selling your share so quickly after buying it?
• 12:44
  Speaker 1: So I think it's about buy and hold strategies from
• 12:47
  Speaker 1: my perspective, because as you guys know, I don't ever
• 12:50
  Speaker 1: want you to invest for a short period of time
• 12:52
  Speaker 1: because it's just too risky and a lot of things
• 12:55
  Speaker 1: could happen. And do you know what did happen during
• 12:57
  Speaker 1: that period of time where people were going a bit
• 12:59
  Speaker 1: ham on after they were like, oh my god, I
• 13:01
  Speaker 1: bought it, and then I sold it for X they
• 13:03
  Speaker 1: didn't take into consideration capital gains tax, and you get
• 13:07
  Speaker 1: taxed at fifty percent. If you sell your share or
• 13:10
  Speaker 1: your asset within the first twelve months, you have to
• 13:13
  Speaker 1: hold it longer than twelve months to get your CGT discount.
• 13:16
  Speaker 1: And if you didn't do that and you bought it
• 13:18
  Speaker 1: and then you sold it and you thought you made
• 13:20
  Speaker 1: this big profit, come June thirty, when tax time comes,
• 13:23
  Speaker 1: the taxman comes knocking on your door and says, hey, gee,
• 13:26
  Speaker 1: you actually bought and sold an asset, didn't hold it
• 13:28
  Speaker 1: more than twelve months. You actually owe us some additional tax.
• 13:32
  Speaker 1: And you go, what that's not.
• 13:34
  Speaker 4: Thought you've been clever.
• 13:35
  Speaker 1: You thought you'd being clever, but we got you. Yeah.
• 13:37
  Speaker 1: And in the same thing happened with bitcoin because so
• 13:39
  Speaker 1: many people burned and churned through bitcoin that they were like,
• 13:42
  Speaker 1: oh my god, I made so much money and then
• 13:44
  Speaker 1: they had to like lose half of their profit to tax. Yeah,
• 13:47
  Speaker 1: so people forget about TAT sucks. That sucks. That's why
• 13:50
  Speaker 1: we're talking about it. That's why we're like, oh, let's
• 13:52
  Speaker 1: talk about reporting season.
• 13:53
  Speaker 4: That's why we're here.
• 13:53
  Speaker 1: Because Victoria thinks it's really sexy.
• 13:55
  Speaker 4: So on the tax theme. B I think I know
• 13:58
  Speaker 4: the answer to this. But when it comes to dividends,
• 14:00
  Speaker 4: they're technically a form of income. They are a form
• 14:03
  Speaker 4: of income, So I'm assuming we need to pay tax
• 14:05
  Speaker 4: on them. Yes, you do so, magical cotes.
• 14:07
  Speaker 1: So it depends on how you're holding your shares. Let's
• 14:10
  Speaker 1: just say you're a salary and way journing employee. You
• 14:13
  Speaker 1: have a few thousand dollars worth of shares. You are
• 14:15
  Speaker 1: going to pay tax on that income at your marginal
• 14:18
  Speaker 1: tax rate. So are they's thirty two and a half
• 14:20
  Speaker 1: cents on the dollar or not, It doesn't matter. It
• 14:22
  Speaker 1: will just be at your marginal tax rate. In saying that,
• 14:27
  Speaker 1: that's a good thing. Like a lot of people are like,
• 14:29
  Speaker 1: oh my god, I don't know if I want to
• 14:31
  Speaker 1: invest because I just don't want the tax implications. My friends,
• 14:34
  Speaker 1: if you are paying tax, you are making money. We
• 14:37
  Speaker 1: just need to plan for it. Yeah, we just need
• 14:39
  Speaker 1: to plan for it. And I get a bit frustrated
• 14:42
  Speaker 1: about tax And I've been having this conversation with a
• 14:45
  Speaker 1: few people in our community recently because they're so quote
• 14:47
  Speaker 1: frustrated or annoyed by the tax system and how much
• 14:50
  Speaker 1: money they lose like that money was never yours, Like
• 14:53
  Speaker 1: the entire time you have ever worked here in Australia,
• 14:56
  Speaker 1: if you are listening to this podcast, you have paid
• 14:59
  Speaker 1: some form of tax and we have note about it.
• 15:01
  Speaker 1: Like if you say, G, I earn eighty grand a year,
• 15:04
  Speaker 1: No you don't. That is your pre tax income. Let's
• 15:07
  Speaker 1: just look at post tax, because I think too many
• 15:09
  Speaker 1: times people get so caught up on oh but I
• 15:12
  Speaker 1: had to pay this, No, like that was a given.
• 15:14
  Speaker 1: We've always had to pay tax. It is a privilege
• 15:16
  Speaker 1: to live in a country where we pay tax and
• 15:19
  Speaker 1: have the support system and the infrastructure around us that
• 15:22
  Speaker 1: enables us to live in such a free country. I'm
• 15:25
  Speaker 1: a bit triggered by it this week, G because I
• 15:27
  Speaker 1: do genuinely want to change people's mindsets around paying tax
• 15:31
  Speaker 1: and see it as a privilege. We just need to
• 15:33
  Speaker 1: full plan for it. And that just means having a
• 15:36
  Speaker 1: good banking system in place. That just means putting money
• 15:38
  Speaker 1: aside when it comes in and not going, oh my gosh,
• 15:41
  Speaker 1: I got paid twenty dollars in dividends and then twenty
• 15:43
  Speaker 1: dollars go straight out, Like we do need to make
• 15:45
  Speaker 1: sure that we're putting some money aside for tax and
• 15:48
  Speaker 1: being smart about it, because I think we get the
• 15:50
  Speaker 1: most frustrated with tax when it pops up at tax
• 15:52
  Speaker 1: time and you just forgotten. It's really exaustrating, and we
• 15:55
  Speaker 1: can actually avoid that with some good planning.
• 15:57
  Speaker 4: Yeah, so when you have to pay that bulk sum,
• 15:58
  Speaker 4: it's much more intimidating. Yeah, plugging away as you go exactly.
• 16:01
  Speaker 4: But you mentioned before franked difends. They're the sexiest kind
• 16:06
  Speaker 4: of dividends. G tell me why, because every time it
• 16:09
  Speaker 4: comes up for some reason, I just I never remember.
• 16:11
  Speaker 4: All I can think of is like a frankfurt That's
• 16:13
  Speaker 4: literally what is in my brain is like a mini sausage.
• 16:16
  Speaker 1: That's all any sausage.
• 16:17
  Speaker 4: I never remember what they are.
• 16:18
  Speaker 1: Growing up, My mum used to call them little boys. Yeah, okay,
• 16:22
  Speaker 1: I just should we put that on the podcast? I
• 16:24
  Speaker 1: don't know. Now I think about that, and it's twenty
• 16:26
  Speaker 1: twenty two. I'm like, that's suspicious. That is not okay. Also,
• 16:31
  Speaker 1: what are they made of?
• 16:32
  Speaker 4: I don't think we want to know.
• 16:33
  Speaker 1: I don't think, like, how are they so read on
• 16:35
  Speaker 1: the outside? I don't at I don't know nothing like
• 16:38
  Speaker 1: a frank dividend, though, tell me about those. So, a
• 16:41
  Speaker 1: franked dividend is an arrangement that was introduced into Australia
• 16:44
  Speaker 1: to eliminate double tax. It means that you're not g
• 16:47
  Speaker 1: going to have to pay double tax. It means it's
• 16:49
  Speaker 1: kind of like you get given you a dividend and
• 16:51
  Speaker 1: it has a little flag on it that says, hey, ge,
• 16:53
  Speaker 1: I've already paid tax, Please don't tax me again. And
• 16:56
  Speaker 1: you get to put that on your tax return so
• 16:58
  Speaker 1: that you don't end up having to pay the tax
• 17:00
  Speaker 1: that was paid on that share. And that tax is
• 17:04
  Speaker 1: paid at thirty percent usually because that is business tax.
• 17:08
  Speaker 1: So you get a little bit of a refund, which
• 17:10
  Speaker 1: is a bit of a money in And as I
• 17:12
  Speaker 1: said before, I love it in Super. And do you
• 17:14
  Speaker 1: know why I love it in Super? Because Gee, stop
• 17:18
  Speaker 1: looking at me like you have no idea what I'm
• 17:20
  Speaker 1: talking about. I talk about Super all the time. What's
• 17:22
  Speaker 1: the tax rate in Super?
• 17:23
  Speaker 4: I don't know the exifteen. I'm going to say that
• 17:27
  Speaker 4: it's just comparis myself. But I should have back no no,
• 17:29
  Speaker 4: no self gift.
• 17:31
  Speaker 1: You have been listening to my rants for so long,
• 17:34
  Speaker 1: arguably longer than anybody else on the podcast. So the
• 17:37
  Speaker 1: tax rate inside superannuation is fifteen percent. But if a
• 17:40
  Speaker 1: company has paid tax on a particular share at thirty percent,
• 17:46
  Speaker 1: that's a different rate. You should have only been paid fifteen.
• 17:48
  Speaker 1: So what do you get. You get a fifteen percent
• 17:50
  Speaker 1: tax rebate, which means that share is already profiting more
• 17:54
  Speaker 1: and above and beyond what it would have been profiting
• 17:57
  Speaker 1: if it went into your back pocket at your marginal tax.
• 18:00
  Speaker 2: Right.
• 18:00
  Speaker 1: So that's why I think that the power of franked
• 18:03
  Speaker 1: dividends is actually in superinuation because it kind of compounds
• 18:07
  Speaker 1: over time, and it's kind of like even if that
• 18:09
  Speaker 1: company only returned to like one or two percent, it
• 18:11
  Speaker 1: instantly goes even higher because you actually get franking credits
• 18:16
  Speaker 1: back and you end up making money that way as well.
• 18:18
  Speaker 1: So I think it's important to know those things. But
• 18:21
  Speaker 1: essentially it is a bit of a money win. It
• 18:23
  Speaker 1: is a really good system to make sure that you
• 18:25
  Speaker 1: don't pay tax on a share that's already had its
• 18:27
  Speaker 1: tax paid for it.
• 18:28
  Speaker 4: So what then, is an unfranked dividend fee? And how
• 18:32
  Speaker 4: do we handle that at tax time?
• 18:33
  Speaker 1: My friend, an unfranked dividend is a dividend that doesn't
• 18:36
  Speaker 1: have a tax credit attached to it, so it doesn't
• 18:38
  Speaker 1: come with its little flag, and unfranked dividends mean that
• 18:41
  Speaker 1: you are possibly going to have to pay some tax
• 18:44
  Speaker 1: on it and make sure you declare it on your
• 18:46
  Speaker 1: tax return. So it's not actually a bad thing. It's
• 18:48
  Speaker 1: just about doing the right thing and knowing whether you're
• 18:50
  Speaker 1: getting franked or unfranked dividends and how that actually plays
• 18:55
  Speaker 1: into your portfolio and how you do your tax And
• 18:58
  Speaker 1: it sounds very confusing, but when you have a good
• 19:02
  Speaker 1: investing platform, that'll all be on yours so it's really clear. Yeah,
• 19:05
  Speaker 1: it is really clear. It sounds not clear, and it
• 19:08
  Speaker 1: sounds like you're going to have to do some backflips
• 19:10
  Speaker 1: and work out what's franked and what's unfranked and how
• 19:12
  Speaker 1: that works. But essentially, when you're putting your portfolio together
• 19:15
  Speaker 1: and you're actually constructing it for the first time, that's
• 19:17
  Speaker 1: when i'd be like, oh, let's have a look, gee,
• 19:19
  Speaker 1: have you got a good amount of unfranked and frank dividends?
• 19:22
  Speaker 1: Like are we actually really comfy with this? Yes or no?
• 19:25
  Speaker 1: And then it'll all be on your reports. Like, honestly,
• 19:27
  Speaker 1: it's twenty twenty two. Everything is super easy. All we
• 19:30
  Speaker 1: have to do is make sure we know in the
• 19:32
  Speaker 1: background what our obligations are. And you don't have to
• 19:35
  Speaker 1: stress about your superannuation either, because it will all be
• 19:38
  Speaker 1: done inside super. Anyway, last question here v before we
• 19:42
  Speaker 1: head to a little break cute, I need a coffee.
• 19:44
  Speaker 1: What happens if I sell my shares?
• 19:46
  Speaker 4: Do I pay tax?
• 19:47
  Speaker 1: Then?
• 19:48
  Speaker 2: Yes?
• 19:48
  Speaker 1: Yes, yes, because if you own an asset, I mean
• 19:51
  Speaker 1: you'll only have to pay tax on something you made
• 19:54
  Speaker 1: money on. Let's remember that, like, there's not going to
• 19:57
  Speaker 1: be some kind of tax consequence if you are losing money. Well,
• 20:00
  Speaker 1: actually there will be. It'll mean that you probably get
• 20:03
  Speaker 1: a bit of a refund.
• 20:04
  Speaker 4: Nice.
• 20:04
  Speaker 1: But it's called capital gains tax, and that's the tax
• 20:07
  Speaker 1: you pay on profits from selling an asset. So it
• 20:10
  Speaker 1: could be property or shares, hot tip or not hot tip,
• 20:14
  Speaker 1: but interesting points complete tangent here. I was talking to
• 20:19
  Speaker 1: somebody the other day and we were talking about CGT
• 20:21
  Speaker 1: and what it means. So essentially, capital gains tax is
• 20:24
  Speaker 1: a tax you pay when you make money on an asset.
• 20:26
  Speaker 1: So you can't just go all right, well I just
• 20:29
  Speaker 1: bought this house. It increased in value by five hundred
• 20:31
  Speaker 1: thousand dollars. I'm going to sell it, and that five
• 20:33
  Speaker 1: hundred thousand dollars is clean mine. No, it is not,
• 20:36
  Speaker 1: because you earned money from that, so therefore you need
• 20:38
  Speaker 1: to pay tax because it was like your income. Right.
• 20:40
  Speaker 1: I got a new client the other day. Shout out
• 20:42
  Speaker 1: to my new client. Not going to call you by
• 20:44
  Speaker 1: name because that would be wildly inappropriate. But they collect
• 20:47
  Speaker 1: vintage and like, you know, quite expensive cars.
• 20:50
  Speaker 2: Do you know what?
• 20:50
  Speaker 1: You don't pay capital gains tax on cars?
• 20:53
  Speaker 4: Are you joking?
• 20:54
  Speaker 1: Yeah? So he is buying and selling cars and they
• 20:57
  Speaker 1: just don't have capital gains tax associated with them. It's
• 21:00
  Speaker 1: not me saying go and invest in cars, because you
• 21:02
  Speaker 1: do actually have to get to a level where you're
• 21:04
  Speaker 1: buying very expensive cars that then increase significantly in value.
• 21:10
  Speaker 1: And you know, he is like a professional at what
• 21:12
  Speaker 1: he does, because he actually is like in automtori engineering,
• 21:15
  Speaker 1: and like he buys these cars and flips them and
• 21:17
  Speaker 1: updates them and then sells them. But like CGT exempt
• 21:20
  Speaker 1: what because I actually don't know about that. No, so
• 21:24
  Speaker 1: I'm only talking about it because it's you know, just
• 21:27
  Speaker 1: interesting hot tip and something to take away. But cars
• 21:30
  Speaker 1: are exempt. And I was like, what I did know that,
• 21:33
  Speaker 1: but I'd never run into someone who, you know, was
• 21:36
  Speaker 1: at a wealth status where they were buying and selling
• 21:38
  Speaker 1: like half a million dollar cars and walking away clean
• 21:41
  Speaker 1: of the profits.
• 21:41
  Speaker 4: That's weird.
• 21:42
  Speaker 1: It's kind of weird, but it's also kind of interesting
• 21:45
  Speaker 1: how all of that works and how wealth seems to
• 21:47
  Speaker 1: start benefiting the wealthy to that level.
• 21:52
  Speaker 4: Yeah, like I'm mad about that. Look, females are flipping cars.
• 21:56
  Speaker 4: Not many, I bit, not many many for me.
• 21:59
  Speaker 1: Yeah, you're a bit salted. Let's move on from that,
• 22:00
  Speaker 1: because I just thought it was a hot tip. But essentially,
• 22:02
  Speaker 1: if you have a capital gain, it will increase the
• 22:04
  Speaker 1: tax that you need to pay. You'll also need to
• 22:07
  Speaker 1: pay it if you have, like I've got a laundry list,
• 22:09
  Speaker 1: they'll go through. Because like, I'm still caught on how
• 22:11
  Speaker 1: triggered I am by the car thing. But if you
• 22:14
  Speaker 1: redeem units in a managed fund by switching them from
• 22:16
  Speaker 1: one fund to another, if you make an n species transfer,
• 22:19
  Speaker 1: so if you transfer your shareholding from one holding to
• 22:23
  Speaker 1: another holding, it's kind of like a selldown, like you
• 22:25
  Speaker 1: sold it and then you reborught it. So you need
• 22:27
  Speaker 1: to be really careful around that. So that's where I
• 22:30
  Speaker 1: always suggest, you know, talking to your share trading platform
• 22:33
  Speaker 1: or talking to your financial advisor when you're going to
• 22:36
  Speaker 1: make any serious changes to your portfolio, especially if you've
• 22:39
  Speaker 1: owned it for a few years, because you don't want
• 22:41
  Speaker 1: to end up going, oh my gosh, this makes so
• 22:43
  Speaker 1: much sense. I'm going to transfer all my shares over
• 22:45
  Speaker 1: to this brand new platform. This sounds really fun, this
• 22:47
  Speaker 1: sounds really sexy, and then you end up with a
• 22:49
  Speaker 1: tax obligation because of it, and you just didn't know
• 22:51
  Speaker 1: that's what was going to happen. There are a number
• 22:54
  Speaker 1: of them, but essentially, if you sell your shares or
• 22:55
  Speaker 1: you have some kind of CGT event occur, you need
• 22:58
  Speaker 1: to calculate your CGT and they're on your tax return.
• 23:01
  Speaker 1: And then remember you might be able to reduce your
• 23:04
  Speaker 1: CGT by literally fifty percent if you hold your shares
• 23:07
  Speaker 1: more than twelve months. It's just why we always talk
• 23:09
  Speaker 1: about long term investing strategies. Well, it's not actually why
• 23:12
  Speaker 1: we talk about it. I obviously believe very vehemently in
• 23:15
  Speaker 1: long term investing, but it's just not smart to buy
• 23:19
  Speaker 1: and sell shares within twelve months, which is really important
• 23:21
  Speaker 1: to remember as well. G Because I think so many
• 23:24
  Speaker 1: of us have been buying and selling and you know,
• 23:27
  Speaker 1: playing on like micro investing platforms. In a twelve month period,
• 23:31
  Speaker 1: you're like, you know, go and raise or go on
• 23:33
  Speaker 1: Spaceship or go on Clover or whatever you're downloading. Go
• 23:36
  Speaker 1: oh my god, my money is not doing anything and
• 23:38
  Speaker 1: rip it straight out within three or four months because
• 23:40
  Speaker 1: a quote wasn't performing, Like, guys, don't do that. Yeah,
• 23:43
  Speaker 1: I just want to shake you.
• 23:45
  Speaker 4: Okay, interesting, let's pop a pin in it their VD.
• 23:48
  Speaker 4: But on the other side of the break, we're going
• 23:50
  Speaker 4: to be talking about how to actually read these documents,
• 23:53
  Speaker 4: which I think will hopefully we I help these And
• 23:55
  Speaker 4: we're also going to chat about what happens if you
• 23:57
  Speaker 4: muck up your tax return? Will you go to jail?
• 24:00
  Speaker 4: We find out on the other side of.
• 24:01
  Speaker 1: The probably don't know, you won't know, you won't.
• 24:07
  Speaker 4: Alright, ev we are back, as we mentioned before, As
• 24:11
  Speaker 4: a shareholder, I am entitled sure for information from the company.
• 24:16
  Speaker 1: I feel like the little shareholders are entitled like well, right,
• 24:19
  Speaker 1: you know, just like telling people that their shareholders. Let's
• 24:23
  Speaker 1: talk about how to pick apart these documents because it
• 24:26
  Speaker 1: can get dense, especially for newbies like my good self.
• 24:30
  Speaker 1: Let's start with a profit and loss statement. Look, not
• 24:33
  Speaker 1: all of you are into spreadsheets in the way that
• 24:35
  Speaker 1: I am into spreadsheets. Surprise, because you know what most
• 24:38
  Speaker 1: people do. They just look at their profit and lost
• 24:40
  Speaker 1: statement that gets emailed to them as a PDF and
• 24:42
  Speaker 1: they don't open the PDF.
• 24:43
  Speaker 2: Me.
• 24:43
  Speaker 1: I'm like, oh, can that be converted to excel? I
• 24:45
  Speaker 1: wonder if I could have a look at XYS Like
• 24:47
  Speaker 1: I'm a psycho, but I don't expect other people to
• 24:50
  Speaker 1: be as psychotic as I am when looking at profit
• 24:53
  Speaker 1: and loss statements. But essentially, the profit and loss statement
• 24:56
  Speaker 1: is a financial statement that summarizes the revenue and how
• 24:58
  Speaker 1: much money they've made in the cop and expenses incurred
• 25:01
  Speaker 1: during a specific period of time. That could be a
• 25:04
  Speaker 1: couple of months if it was generated for that, it
• 25:06
  Speaker 1: could be an entire financial year. It could be the
• 25:08
  Speaker 1: entire history of the company. The profit and loss statement,
• 25:11
  Speaker 1: which is sometimes just called the P and L, is
• 25:13
  Speaker 1: one of three financial statements that every single public company
• 25:17
  Speaker 1: issues quarterly and annually, along with the balance sheet and
• 25:21
  Speaker 1: the cash flow statement. So these are three separate documents
• 25:24
  Speaker 1: that all work together, but all tell you different things.
• 25:27
  Speaker 1: And if you put them side by side, and you
• 25:29
  Speaker 1: are not a finance person, you'll be like, what on
• 25:31
  Speaker 1: earth and why am I looking at these? But it's
• 25:33
  Speaker 1: a super helpful financial statement in a business plan that
• 25:37
  Speaker 1: basically shows how much profit and loss was generated by
• 25:40
  Speaker 1: a business. And that's basically the P and L.
• 25:42
  Speaker 4: Look that sounds pretty simple.
• 25:44
  Speaker 1: P and L is profit and lost. Look it is,
• 25:46
  Speaker 1: and it's always broken down into two sections, just assets
• 25:50
  Speaker 1: and liabilities and what's outstanding. So basically it is just
• 25:53
  Speaker 1: literally the profit of the business and how much it's
• 25:56
  Speaker 1: potentially lost. Beautiful. Okay, let's move on now to balance sheets.
• 26:00
  Speaker 4: Soft What are they?
• 26:02
  Speaker 1: What is a balance sheet? Yes, think of it like
• 26:04
  Speaker 1: a balancing act. It's kind of like two sides of
• 26:06
  Speaker 1: a company where it has its assets, so the things
• 26:09
  Speaker 1: that it owns, and then its liabilities, so the things
• 26:12
  Speaker 1: that it owes and the things that it might have outstanding.
• 26:15
  Speaker 1: So it might have a number of different things. And
• 26:17
  Speaker 1: you might think liabilities is that just debt? Yes? But
• 26:20
  Speaker 1: did you know and a liability on a balance sheet
• 26:23
  Speaker 1: in a company's suite of financial reports actually includes all
• 26:28
  Speaker 1: of their outstanding annual leave for all of their employees. Really, yeah,
• 26:31
  Speaker 1: because they've got to pay it back if you leave me. Yeah,
• 26:34
  Speaker 1: so if you leave me, ge, I've got to pay
• 26:36
  Speaker 1: out all of your anual leave and that sits as
• 26:38
  Speaker 1: a liability on my balance sheet because at some point
• 26:40
  Speaker 1: I'm going to have to pay that, so we keep
• 26:42
  Speaker 1: track of it. So it's actually quite nitty gritty. It
• 26:45
  Speaker 1: essentially provides a snapshot of what a company owns and owes,
• 26:47
  Speaker 1: as well as the amount that is currently infested by shareholders.
• 26:50
  Speaker 1: So you can essentially get a snapshot of this company's
• 26:53
  Speaker 1: well being by using a number of ratios that can
• 26:55
  Speaker 1: be derived from the balance sheet, including a formula called
• 26:57
  Speaker 1: the debt to equity ratio and the acid tests ratio,
• 27:01
  Speaker 1: among a number of other things, and I won't go
• 27:03
  Speaker 1: into them, but essentially debt to equity ratio sounds confusing
• 27:06
  Speaker 1: when you say it really quickly, but it's basically how
• 27:07
  Speaker 1: much debt to how much stuff do you own? And
• 27:09
  Speaker 1: what does that ratio look like like? Is it positive?
• 27:13
  Speaker 1: Is it negative? What does that look like? How does
• 27:14
  Speaker 1: that impact me? I get really into this just because
• 27:17
  Speaker 1: I'm really excited, But move on to the next one
• 27:19
  Speaker 1: so we don't get too confused. Perfect, let's chat about
• 27:21
  Speaker 1: cash flow statements?
• 27:23
  Speaker 4: What are they?
• 27:23
  Speaker 1: What do you reckon? A cashlow statement? Is j a
• 27:25
  Speaker 1: statement of a company is cash flow? Right? Well, you
• 27:27
  Speaker 1: don't even need me, But what does it look like?
• 27:29
  Speaker 4: What does it tell us?
• 27:30
  Speaker 3: All Right?
• 27:30
  Speaker 1: So, the cashlow statement, or the CFS if you want
• 27:32
  Speaker 1: to be a fancy lady, summarizes the movement of cash
• 27:35
  Speaker 1: and cash equivalents that come in and out of a company.
• 27:39
  Speaker 1: So the CFS measures how well a company manages its
• 27:42
  Speaker 1: cash position, meaning how well a company generates cash to
• 27:45
  Speaker 1: pay its debt obligations and fund its operating expenses. So
• 27:48
  Speaker 1: if we break that down a little bit more, let's
• 27:50
  Speaker 1: look at she's on the money, Like, am I making
• 27:52
  Speaker 1: enough money each month to pay all of my rent
• 27:55
  Speaker 1: and to pay for this very fancy studio and to
• 27:58
  Speaker 1: pay YUG and to pay JEF and to pay everybody?
• 28:01
  Speaker 1: Or am I cutting it real fine? Does that make sense?
• 28:04
  Speaker 1: So like, do we have enough money in the bank
• 28:06
  Speaker 1: to make sure that things are consistently moving and we
• 28:08
  Speaker 1: can invest in the business and we can grow, Like
• 28:11
  Speaker 1: this is what's going to show you its ability to
• 28:14
  Speaker 1: you know, fund new purchases or make new investments. So essentially,
• 28:17
  Speaker 1: the main components of the cfs are cash from three
• 28:20
  Speaker 1: different areas, so operating activities, investing activities, and financing activities.
• 28:25
  Speaker 4: Does the CFO of a company put this together?
• 28:27
  Speaker 1: Yes? Actually, or an accountant, so for me, we want
• 28:30
  Speaker 1: to know about the finances if she's on the money.
• 28:32
  Speaker 1: We have a bookkeeper, Hi, Helen, love you. She does
• 28:36
  Speaker 1: everything for us every single month to make sure that
• 28:38
  Speaker 1: I'm on top of what's going on. And then we
• 28:40
  Speaker 1: have Louis who is our accountant, and he makes sure
• 28:43
  Speaker 1: that every single year all of my reporting comes in
• 28:46
  Speaker 1: so that I can look at the business as a whole.
• 28:48
  Speaker 1: So we do that on a monthly basis with a bookkeeper,
• 28:50
  Speaker 1: and then we do it with an accountant, and then
• 28:52
  Speaker 1: I would basically be the CFO because we're not big
• 28:55
  Speaker 1: enough to be able to afford that yet.
• 28:56
  Speaker 4: George kids, Okay, very good. We were talking about different
• 29:01
  Speaker 4: levels of investing a little while back. What sort of
• 29:04
  Speaker 4: reporting do the different methods and platforms actually provide me?
• 29:08
  Speaker 1: At tax? Oh my gosh, guys, I've said it before.
• 29:10
  Speaker 1: It's twenty twenty two. We can expect a lot, and
• 29:13
  Speaker 1: when it comes to picking a platform, I do think
• 29:15
  Speaker 1: reporting really should come into it because that's actually quite
• 29:18
  Speaker 1: a heavy task if you're not into it. So we've
• 29:20
  Speaker 1: talked about our friends from Sharess. They basically provide you
• 29:23
  Speaker 1: everything like they will just send you a statement. I
• 29:25
  Speaker 1: know Rays do the same thing. I know Spaceship, which
• 29:28
  Speaker 1: are both micro investing platforms that are very popular in
• 29:31
  Speaker 1: our community. They will send you your tax statement to
• 29:33
  Speaker 1: make sure that you've got everything you need to submit
• 29:35
  Speaker 1: to the ATO to make sure that you're doing your
• 29:37
  Speaker 1: tax properly. Six Park, which is the robo advice platform
• 29:40
  Speaker 1: we talk about a lot, and I have a very
• 29:42
  Speaker 1: big affiliation with Obviously, I need to disclaim it that
• 29:45
  Speaker 1: every time I talk about it, it's because I'm biased
• 29:47
  Speaker 1: because I love them, But that's okay. But they will
• 29:50
  Speaker 1: send you absolutely everything as well. And then if you're
• 29:53
  Speaker 1: an individual share investor across a number of different platforms,
• 29:56
  Speaker 1: it's very likely you're going to have to do that yourself.
• 29:58
  Speaker 1: So if you own a number different shares on a
• 30:00
  Speaker 1: lot of different smaller platforms, you're probably going to have
• 30:03
  Speaker 1: to pull it together. But most platforms these days have
• 30:05
  Speaker 1: some form of very clear tax reporting that you would
• 30:09
  Speaker 1: then take and input into your tax return. The other
• 30:12
  Speaker 1: thing that is I believe got sexy George is data feeds.
• 30:16
  Speaker 1: So these days, if you have provided your TFN to
• 30:19
  Speaker 1: your investing platform, example here, you've given your TFN to Shares's,
• 30:24
  Speaker 1: Shares is then able to share that information with the ATO.
• 30:28
  Speaker 1: So it's very likely that you will be able to
• 30:30
  Speaker 1: log into your tax return portal. Then information's already there.
• 30:33
  Speaker 1: All you have to do is cross check it with
• 30:35
  Speaker 1: the financial reports that came into your email or came
• 30:38
  Speaker 1: into your mailbox, and you can go, all right, well
• 30:40
  Speaker 1: that's good, I'm going to submit that. So it makes
• 30:42
  Speaker 1: your life even easier. We love that v I've loved
• 30:45
  Speaker 1: today's chat. Have you no doubt? Oh you're a liar. Well,
• 30:49
  Speaker 1: it's been I'm just calling you for what it is.
• 30:51
  Speaker 1: A distance. It's made me feel a little bit dry.
• 30:54
  Speaker 1: But I guess what I wanted to ask you is
• 30:57
  Speaker 1: if there's a way that we can kind of simplify
• 30:59
  Speaker 1: all of this when it comes to tax time and
• 31:02
  Speaker 1: reporting my shares because I don't know, today's been a lot. Look,
• 31:06
  Speaker 1: if you have a shared trading platform, you are going
• 31:08
  Speaker 1: to be sent reports. I think it's important to understand
• 31:11
  Speaker 1: that it is as easy or as hard as you
• 31:13
  Speaker 1: want to make it. Understanding the report and where it
• 31:16
  Speaker 1: goes is probably the most important thing. Nowadays doing your
• 31:19
  Speaker 1: own tax is quite step by step, so it's quite
• 31:22
  Speaker 1: easy for you to do. I'm not saying go and
• 31:24
  Speaker 1: do it. Obviously, there are accountants that can do it
• 31:26
  Speaker 1: for you, so if you are overwhelmed by this, I
• 31:29
  Speaker 1: would be just going to your accountant and saying, what
• 31:30
  Speaker 1: do you need from me, and they will literally collect
• 31:32
  Speaker 1: all the information. But it's quite clear nowadays. I feel
• 31:36
  Speaker 1: like reporting has progressed significantly, even in the last five years,
• 31:40
  Speaker 1: from what I used to get and what I used
• 31:42
  Speaker 1: to have to calculate and workout. Now it's basically spoon fed,
• 31:46
  Speaker 1: and a lot of companies have blogs and resources that
• 31:51
  Speaker 1: you can go to. So let's say Chazy sends out
• 31:53
  Speaker 1: their reports and you haven't understood it. It's very likely that
• 31:56
  Speaker 1: there's an associated blog or website or something that goes
• 31:59
  Speaker 1: alongside that, so you can go I don't get it
• 32:01
  Speaker 1: like and have a bit of a look. So it's
• 32:03
  Speaker 1: quite easy in comparison to how hard it used to be.
• 32:06
  Speaker 4: Finally, V my last question for you today, what are
• 32:09
  Speaker 4: the implications if we do stuff this up?
• 32:12
  Speaker 1: Oh, you're going to jail. No, I feel like I
• 32:16
  Speaker 1: will go to jail. You're not going to go to jail.
• 32:18
  Speaker 1: You're not going to go to jail. There's obviously a
• 32:20
  Speaker 1: fair bit riding on it when it comes to tax
• 32:23
  Speaker 1: and if you do stuff it up, there could be
• 32:25
  Speaker 1: fines involved, like you could have a penalty to pay.
• 32:28
  Speaker 1: In saying that, I think it's always about being open
• 32:30
  Speaker 1: and honest and transparent and getting advice where you need it.
• 32:33
  Speaker 1: If you do have a more complex tax situation, I
• 32:35
  Speaker 1: would be reaching out to an accountant and finding someone
• 32:38
  Speaker 1: that you trust that can give you some advice, and
• 32:40
  Speaker 1: remembering that usually advice pays for itself in dividends. Nice.
• 32:45
  Speaker 4: Well, that's probably the perfect place to finish today's episode. B.
• 32:49
  Speaker 4: Although it does say play it VI's.
• 32:51
  Speaker 1: TikTok video about the ATO on our little shared dock here?
• 32:55
  Speaker 1: Does that mean? Oh, I did a ATO video a
• 32:57
  Speaker 1: couple of years ago, A couple years maybe twelve years ago,
• 32:59
  Speaker 1: maybe last year? Sure, not even a couple of years ago.
• 33:02
  Speaker 1: And it was just like me being a past Do
• 33:03
  Speaker 1: you want me to play it for you?
• 33:04
  Speaker 4: Here?
• 33:04
  Speaker 1: Go on, Hey, guys, I'm here to pay my taxes.
• 33:06
  Speaker 1: How much do I owe. Oh, I don't know. You'll
• 33:08
  Speaker 1: have to figure it out yourself, Like you don't know,
• 33:11
  Speaker 1: or you don't want to tell me. Oh, we don't know. Okay,
• 33:14
  Speaker 1: but what if I just don't pay my taxes this
• 33:17
  Speaker 1: year and we'll just issue you with a fine. It's fine,
• 33:19
  Speaker 1: But how would you know how much I owe? If
• 33:21
  Speaker 1: you just told me that you don't know what I owe? Oh,
• 33:24
  Speaker 1: we know how much you ow? Oh?
• 33:26
  Speaker 3: So you know how much I owe?
• 33:27
  Speaker 1: Can you tell me? No?
• 33:30
  Speaker 4: What that was? It was like a piece of butt, mate.
• 33:34
  Speaker 4: I love the language. Brilliant, She's a genius.
• 33:37
  Speaker 1: Yeah, I am the paid actor, all right. I think
• 33:41
  Speaker 1: that is enough from me and my very bland TikTok
• 33:44
  Speaker 1: Like I am definitely too old to be on TikTok,
• 33:46
  Speaker 1: But I'm not leaving. I came to that party and
• 33:48
  Speaker 1: I am staying for the dream.
• 33:50
  Speaker 4: I support you, doll. The advice sheed on she's on
• 33:52
  Speaker 4: the money is general in nature and does not consider
• 33:55
  Speaker 4: your individual circumstances. She's on the money exists purely for
• 33:59
  Speaker 4: educational per and should not be relied upon to make
• 34:02
  Speaker 4: an investment or a financial decision. And we promise Victoria
• 34:06
  Speaker 4: divine and she's on the Money are authorized representatives in
• 34:09
  Speaker 4: Focus Securities Australia Proprietary Limited ABN four seven zero ninety
• 34:14
  Speaker 4: seven seven nine seven zero four nine AFSL two three
• 34:17
  Speaker 4: six five two.
• 34:18
  Speaker 1: Three And as always, we would love it if you
• 34:21
  Speaker 1: joined our Facebook group where our community shares money tips
• 34:24
  Speaker 1: and tricks every single day of the week, free of judgment,
• 34:27
  Speaker 1: which is their best part. So She's on the Money
• 34:29
  Speaker 1: on Facebook and join us Facebook to thing. You can
• 34:32
  Speaker 1: find us on Instagram where She's on the Money a
• 34:34
  Speaker 1: US and as you heard just before, g also on TikTok,
• 34:38
  Speaker 1: but I do not recommend you check that out. See
• 34:40
  Speaker 1: you next week, guys, by guys,