July E News 2025
- WD Nicholls Chartered Accountants
- Aug 1
- 14 min read
Welcome to this edition of your accounting update. This issue covers key financial insights for investors, including a deep dive into CBA's current valuation. We also highlight essential ATO guidance for new businesses, crucial Super Guarantee changes, a free webinar for aspiring entrepreneurs, and local community events. For a detailed review of these important topics, please explore the content below.
For investors focused on stable income and long-term growth, CBA's current valuation presents a challenge. Despite its strong market position, the disconnect between its surging share price and more modest earnings growth suggests future returns may be limited. CBA's elevated Price-to-Earnings (P/E) ratio, far exceeding peers, indicates optimism is largely priced in. With potential RBA rate cuts expected into late 2025 and subdued lending growth, profit margins could face pressure, making it hard for earnings to catch up. This highlights the need for diversified portfolios and a cautious, fundamentals-driven approach. Ready for the full picture? See Tony Marshall's comprehensive analysis below.
Starting a new business is an exciting venture, but understanding your registration, reporting, and record-keeping responsibilities from day one is crucial to avoid common pitfalls. Whether your passion project has become profitable or you're launching a completely new enterprise, correctly setting up your business will ensure you meet your tax and superannuation obligations with ease. The ATO's "Ready for business" information offers essential guidance, covering everything from digital tools and accurate record-keeping to choosing the right business structure, understanding tax deductions, and fulfilling employer responsibilities like Single Touch Payroll (STP) and PAYG instalments. By staying organised and adhering to these guidelines, your business will not only avoid penalties but also build resilience for long-term success.
Employers now face two crucial Super Guarantee (SG) considerations: the 28 July deadline for your April-June quarter contributions and the SG rate increase to 12% effective from 1 July 2025. It's vital to ensure all eligible workers' super is paid in full, on time, and to the correct fund, remembering to factor in clearing house processing times. Critically, the new 12% rate applies to all salary and wages paid on or after 1 July, even if the pay period started earlier. Read on for key details to ensure compliance and avoid potential penalties.
Join a FREE webinar on Thursday, 21 August, 2025, from 1:00 pm to 3:00 pm (AEST), designed for aspiring and new small business owners across the Illawarra, South East & Tablelands, and Riverina Murray regions. Led by Lisa LaMaitre, an entrepreneur with 30 years of experience, this event will guide you through launching a business using the powerful Business Model Canvas to create a financially sustainable model. Discover how to avoid common pitfalls, improve decision-making, and embrace a holistic approach that aligns your business and personal goals. Spaces are limited to 50 attendees, so register now to gain the confidence needed to build a thriving business.
The Northern Rivers holds regular Community Events. See what's on and keep up to date on all the fantastic opportunities available and help to support local. There is plenty to do.
A reminder, there are some important lodgement dates to note this month.
The WD Nicholls Team
As many of you know, we’ve been keeping an eye on the Commonwealth Bank of Australia (CBA) over the past 12 months. It’s a company that holds a special place in many Australian portfolios — particularly for retirees, SMSFs, and long-term investors who value stability, income, and blue-chip reputation.
In recent months, CBA’s share price has surged, attracting headlines and attention. At first glance, it’s easy to assume that this rise reflects stronger business performance. But in reality, the situation is more nuanced. Let’s unpack what’s really been driving this growth — and what it means for your investments.
A Price Surge Without the Profit Surge
CBA’s share price has climbed dramatically — rising from around $100 to $191 in the past 12–18 months. That’s a gain of nearly 55%, far outpacing the broader ASX 200 index, which rose by only 13% over the same period.
But here’s the important detail: CBA’s earnings (its profits) have not grown at the same pace. In fact, earnings growth has been quite modest. So why has the share price gone up so much?
The answer lies in something called valuation expansion. In simple terms, investors are now willing to pay significantly more for each dollar of CBA’s earnings than they were before. That’s fine for a while — but it doesn’t necessarily mean the company is performing better. It just means sentiment has shifted.
Why Has This Happened?
Several forces — none of which relate to CBA’s underlying business performance — have contributed to this surge:
1. Index Investing and Passive Fund Flows
CBA is the largest company on the Australian stock exchange, making up around 12% of the ASX 200. That means super funds and index-tracking funds (like those run by Vanguard or Betashares) have to buy more CBA to reflect the index. This automatic buying pushes the share price higher — regardless of company performance.
2. A Loyal Shareholder Base
Many CBA shareholders are long-term retail investors (everyday Australians) who rarely sell. With fewer shares hitting the market, demand can outstrip supply — pushing prices up even further.
3. A Self-Reinforcing Cycle
As the price rises, CBA’s weight in the index increases, leading to more buying by passive funds. This creates a feedback loop, where price momentum builds on itself. It’s a bit like a snowball rolling downhill — growing in size regardless of what’s underneath.
The Risks of Overvaluation
Here’s where caution is needed. CBA is now trading at a price-to-earnings (P/E) ratio of over 30x — meaning investors are paying more than 30 times what the company earns annually. That’s twice as expensive as its global peers like JPMorgan and Bank of America, and well above the Australian average for bank stocks, which sits around 15–16x.
Even fellow Australian banks like Westpac, NAB, and ANZ — which operate in the same market with similar products — are trading on much more modest valuations.
So what’s the problem with a high valuation?
Eventually, reality has to catch up. Either:
CBA grows its profits rapidly to “justify” the high price (unlikely in the short term), or
The share price flattens or even falls, allowing earnings to catch up and bring the valuation back to a more reasonable level.
This concept is called "mean reversion" — and history shows us that the higher the price moves above its earnings, the sharper the correction often is.
Earnings May Be Under Pressure
Looking ahead, we expect some challenges for CBA’s earnings:
Interest rates may fall, putting pressure on bank profit margins.
Lending growth is slow, with housing markets softening and businesses cautious.
Competition remains strong, with little pricing power among the big banks — borrowers often choose based on interest rates, not brand loyalty.
In short, it’s hard to see how CBA will grow earnings fast enough to keep up with the current price.
That means gains from here may be limited, and a pullback is always possible.
On the markets front tariffs have again been the topic of conversation with the 90 day 10% tariff ending. It seems most countries are paying higher than 10% but markets don’t seem too concerned by this:
New businesses sometimes make mistakes with their registration, reporting and record keeping responsibilities. It’s important new business owners understand their obligations to ensure they're getting it right from the start.
If your hobby has turned into a profit-making business, you are responsible for your tax, super and registration obligations. Setting up your business correctly from the start will make it easier to meet these obligations.
How to get it right
If you're planning on starting, or have recently started a new business, the ATO have Ready for business information to help you navigate your obligations.
Here are the top 7 things you need to know when starting a business.
Use digital tools and maintain accurate records to help you manage daily activities and cash flow. Explore the ATO's key rules and free resources to strengthen your business practices.
There are some registrations you will need to complete when you start a business, for example registering for an ABN or a business name.
You can claim a tax deduction for most business expenses if they are directly related to earning your income. Remember to keep records and only claim the business portion of mixed-use expenses.
The type of business structure you set up will affect your tax and registration requirements. It's important to choose the right business structure and understand your obligations.
If you're an employer, it's important you know you have extra responsibilities and obligations.
You need to lodge and pay your taxes on time. You can prepay your estimated income tax liability, through pay as you go (PAYG) instalments. You can voluntarily enter PAYG instalments to help you smooth out your cashflow and avoid a large tax bill when you lodge your tax return.
Businesses that maintain accurate records, lodge and pay on time and avoid errors not only steer clear of penalties and general interest charge but also become more resilient when facing challenges.
Example: Barry’s photography hobby takes flight
Barry works an office job Monday to Friday and enjoys taking photos of birds in his spare time. Barry has become well known by members of his local community as a talented photographer.
Over the past 12 months Barry has been approached to photograph local events and demand for his skills is increasing. Barry charges a fee for each event and is now earning money from his photos.
With the growing interest, Barry cuts back on his office work and starts to invest more time into photography. Barry sets up a website, sets up a booking system and starts advertising his services online. He also buys more photography equipment to improve his production quality, so he can earn more from each event.
Barry wants to know if his photography side hustle is a business. He looks at all his activities together and determines he is running a business because he:
intends to make a profit to supplement his salary and wage income
set up a regular schedule for these activities
operates in a business-like way (he has a plan and system for making a profit).
End of example
Know your responsibilities as an employer
Whether you're hiring your first worker, or you're an experienced employer, it's important you understand and meet your employer obligations. This includes:
reporting tax and super information to us through Single Touch Payroll (STP) enabled software each time you make a payment to your workers
withholding a portion of your workers' pay for tax (PAYG withholding) and paying it to the ATO
paying the right amount of super guarantee (SG) on time and to the right fund
reporting and paying your fringe benefits tax (FBT) on time.
Source and credit: ATO.gov.au
If you hire staff, you need to pay your eligible workers’ super guarantee (SG) in full, on time and to the right fund by 28 July, 2025.
You need to allow extra time for the payments to reach your employees’ super funds if you’re using a commercial clearing house. Payments are only considered ‘paid’ when the super fund receives them.
The SG rate increased from 11.5% to 12% on 1 July 2025. For the quarter ending 30 June, apply the 11.5% SG rate for payments made before 1 July.
You'll need to apply the 12% rate for all salary and wages paid to eligible workers on and after 1 July. This is even if some or all of the pay period it relates to is before 1 July.
Check: if you haven't paid on time
If you haven't paid on time, make sure you:
calculate the SGC
lodge the SGC statement and pay the SGC by the due date
the SGC and statement due dates are:
Quarter 1 – 28 November
Quarter 2 – 28 February
Quarter 3 – 28 May
Quarter 4 – 28 August
provide full information for each worker, to ensure the allocated SG entitlements are paid to the correct worker's super fund, including their:
full legal name
tax file number
date of birth
last known address.
Use the SGC statement instructions when completing this form. It's important to take the time to get this right to ensure the ATO can accept your SGC statement. The earlier you lodge correctly and pay your overdue super, the less interest and charges you will pay.
If you need help, you can contact the ATO or a tax professional.
Source and credit: ATO.gov.au
FREE WEBINAR Thursday 21 August 2025, 1:00 PM - 3:00 PM (AEST)
Where
Online.
When
Thursday 21 August 2025, 1:00 pm - 3:00 pm (AEST).
The Presenter
Lisa LaMaitre - Lisa has 30 years of business expertise from developing, building, and operating four businesses across the sectors of IT, healthcare, retail/rental, and events. Additionally, she has 35+ years of retail experience, 30+ years of staff management and training, and has operated a business as a franchisee.
About this event
Starting a business is an exciting yet challenging journey that requires a solid foundation and a clear vision. This webinar will guide you through the essential steps of launching a business with a focus on a holistic approach. We will utilise the "business model canvas" to help you understand and develop your business model, ensuring that every aspect of your business is aligned with your goals and vision.
This webinar is aimed at small businesses throughout Illawarra, South East & Tablelands and Riverina Murray who have just started or are looking to start a business. This webinar has the capacity to host up to 50 people.
Learning Objectives
Achieve holistic business alignment - understand how aligning business goals with "personal objectives" family needs and your support network is essential for a "successful" financially self-sufficient and sustainable business.
Establish a clear vision and objectives - discover the critical importance of having a well-defined value proposition and key customer segments for your business. Learn how these guide your decisions and help you stay focused on your goals.
Utilise practical tools - gain hands-on experience using the Enterprise Plus "business model canvas" template and that will support you in creating a comprehensive and effective business model.
Learning Outcomes
Avoid pitfalls - equip yourself with the knowledge to anticipate and avoid common surprises and pitfalls that many face during the transition to self-employment or business ownership.
Enhanced decision-making - learn how adhering to your vision and key objectives simplifies decision-making and ensures you stay on track toward your business goals.
Holistic business development - develop the capacity and confidence to ask the right questions and seek the necessary support. Embrace a holistic approach to creating your business that considers all aspects of your personal and professional life.
To register your interest click the link below.
Source and credit: Mybusiness.service.nsw.gov.au
We always like to support our locals! Here are some community events happening this month (in date order).
Bangalow Farmers Market dates on Saturday's, 2, 9, 16, 23 and 30 August | 7:00 AM to 11:00 AM
Discover the Heart of Local Food at Bangalow Farmers Market Every Saturday morning from 7:00 am - 11:00 am, the Bangalow Hotel carpark transforms into a vibrant hub of local food. Our farmers offer a bountiful harvest of fresh produce, artisan goods, and more. Meet the farmers, learn about sustainable practices, and support your local community. Visit Bangalow Farmers Market and experience the true essence of local food.
Location: Piccabeen Park, Cnr Deacon and Ashton Streets, Bangalow
Want to help in a disaster? Spontaneous Volunteering in Byron Shire date on Saturday, 2 August | 1:00 PM to 3:00 PM
Come and join us at one of three sessions to learn more about responding to disasters and how to be a spontaneous volunteer.
The sessions will cover:
Best practice
Safety
Who is who in the disaster recovery space.
There'll be presentations from:
Lead emergency agencies
Byron Shire Council
Volunteer organisations.
There will be information stalls and time for questions.
Guests include:
NSW SES
NSW Reconstruction Authority
Mullumbimby District and Neighbourhood Centre
local Community Resilience Team Volunteers.
All are welcome! No RSVP needed, just show up at any time during the session.
Pizza and snacks provided.
Location: Byron Bay CBD, Railway Park, Jonson Street, Byron Bay
Byron Bay Community Market next date is Sunday, 3 August | 8:00 AM to 2:00 PM
The Byron Bay Community market is held from 8:00 am to 2:00 pm on the 1st Sunday of every month.
The market hosts an eclectic collection of stalls that showcase what Byron has to offer.
From Sunday 6 July the market will be temporarily relocated to the Main Beach Foreshore, while drainage work is carried out.
Location: Main Beach Foreshore, Bay Street, Byron Bay
Service NSW Mobile Service Centre date on Wednesday, 6 August | 9:00 AM to 3:30 PM
Service NSW Mobile Service Centre visits our community to personally deliver access to essential
NSW Government services, including:
Drivers licence, photo card applications and renewals
Driver Knowledge Tests
Working With Children Check applications
NDIS Worker Check
Applying for birth, death and marriage certificates
Cost of Living service to access more than 70 government rebates and savings.
Service NSW Mobile Service Centres are fitted with a ramp for easier access for all members of the community.
Check the timetable and find out what you need to bring by visiting Mobile Service Centres.
Please check the website on the day for final confirmation of the Mobile Service Centre arrival or call 13 77 88.
Location: Ocean Shores Country Club - Car park, 113A Orana Road, Ocean Shores
Service NSW Mobile Service Centre date on Thursday, 7 August | 9:00 AM to 4:00 PM
Service NSW Mobile Service Centre visits our community to personally deliver access to essential NSW Government services, including:
Drivers licence, photo card applications and renewals
Driver Knowledge Tests
Working With Children Check applications
NDIS Worker Check
Applying for birth, death and marriage certificates
Cost of Living service to access more than 70 government rebates and savings.
Service NSW Mobile Service Centres are fitted with a ramp for easier access for all members of the community.
Check the timetable and find out what you need to bring by visiting Mobile Service Centres.
Please check the website on the day for final confirmation of the Mobile Service Centre arrival or call 13 77 88.
Location: Byron Bay RSL Club (Car park), 132 Jonson Street, Byron Bay
Byron Writers Festival 2025 dates on 8 - 10 August | 8:30 AM to 5:00 PM
The 2025 program presents a heavyweight line-up of Australian and international writers who will explore the important themes shaping our world.
From celebrated novelists, memoirists, poets and essayists to leading political commentators, academics and activists, the program promises bold and wide-ranging conversations spanning social justice, politics, the environment, crime, mortality and human connection.
With the theme ‘Passion and Purpose’, the festival invites audiences to engage with more than 160 writers across three days of thought-provoking panels, in-depth discussions, debate and intimate conversations. In addition to the main program, the Byron Writers Festival will feature an array of workshops, a dedicated children’s program and special feature events.
For more information, visit the Byron Writer's Festival Website. Event supported by Byron Shire Council.
Traffic and transport
There will be possible delays expected around the Byron Writers Festival site at Bangalow Showground, Market Street, Bangalow.
For information about parking costs, free shuttle buses and other transport options visit Getting there- Byron Writers Festival website
Location: Bangalow Showgrounds, 1 Market Street, Bangalow
Farm Walk Mulcahy Macadamias date on Wednesday, 13 August | 9:30 AM to 11:30 AM
Come along to our free farm walk. Learn how agroecological principles are being applied to a regenerative macadamia orchard in Myocum.
Ros and Kevin Mulcahy along with our Agricultural Extension Officer, Mark Duncan will showcase some outcomes of the Byron Shire Regenerative Agriculture Small Grants Program.
The Mulcahy’s are heavily focused on increasing biodiversity above and below ground while working with nature to produce macadamias on their 15-hectare orchard at Myocum.
Register via Humanitix FARM WALK - Discover beneficial insects and agroecological approaches at Mulcahy Macadamia's
Location: 319 McCauleys Lane, Myocum
Council Planning Meeting next date is Thursday, 14 August | 9:00 AM to 5:00 PM
Council Planning meetings are held in the Chambers. Click here view Council Meetings and Agendas.
If you'd like to speak at a Council Meeting, register for Public Access by visiting Address a Council meeting.
A livestream is available to watch online.
Questions about the meeting?
Phone: 02 6626 7000
Email: council@byron.nsw.gov.au
Location: Byron Shire Council Chambers, 70 Station Street, Mullumbimby
Mullumbimby Community Market next date is Saturday, 16 August | 8:00 AM to 2:00 PM
The Mullumbimby Community Market is held on the third Saturday of each month from 8:00 am to 2:00 pm.
The market is a vibrant family-friendly festival held in Summers Park. Discover unique treasures among the diverse stalls offering artisan clothing, jewellery, homewares, plants, and more, all while enjoying live music and delicious food. With its warm, welcoming atmosphere and support for the local historical society museum, the Mullumbimby Community Market is a must-visit destination for both locals and visitors.
Location: Corner of Stuarts and Myocum Streets, Mullumbimby
Council Ordinary Meeting date on Thursday, 28 August | 3:00 PM to 9:00 PM
If you'd like to speak at a Council Meeting, register for Public Access by visiting Address a Council meeting.
A livestream is available to watch online.
Questions about the meeting?
Phone: 02 6626 7000
Email: council@byron.nsw.gov.au
Location: Byron Shire Council Chambers, 70 Station Street, Mullumbimby
Source and credit: Byron.nsw.gov.au/Recreation-Culture/Events-Venues/Whats-On
11 August
Activity statements
Quarter 4 (April–June) activity statements lodged electronically – final date for lodgment and payment
refer to Lodging your activity statements online for information on your eligibility for this later due date
finalising all your PAYG instalments before you lodge your tax return will ensure you receive the correct amount of credit in your income tax assessment.
14 August
PAYG withholding
2. PAYG withholding payment summary annual report – final date for lodgment
use this to summarise all payments to your employees and other payees and the amounts withheld from salary and wages and other payments
these amounts should have been reported at labels W1 and W2 on previous financial year activity statements.
Employee Share Scheme (ESS) annual report
ESS annual report – final day for lodgment.
21 August
Activity statements
July monthly activity statements – final date for lodgment and payment.
GST
Final date for eligible monthly GST reporters to elect to report GST annually.
28 August
Taxable payments annual report
3. Taxable payments annual report due for lodgment for:
Superannuation
Lodge and pay quarter 4 (1 April–30 June) Superannuation guarantee charge statement – quarterly if you did not pay your contributions on time.
You can choose to offset contributions you've paid late to a fund for each employee against the super guarantee charge for the quarter for those employees.
You cannot claim an income tax deduction for the super guarantee charge.
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