[00:00:00] Host – Grace Jennings-Edquist: What if the biggest threat to your business is already unfolding and you can’t see it yet? And what do you need to be thinking about ahead of tax time? In this episode, we hear two expert perspectives on getting ahead of small problems before they become serious ones. First, executive coach Chris Power explains why leadership inflection points can become dangerous moments for organizations, and how strong leaders recognize early warning signs before performance stalls. Then, dual qualified solicitor and chartered accountant Adam Ahmed shares practical advice on staying tax compliant in a fast changing landscape, including the risks around crypto, digital payments and poor planning. From SoundCartel, I’m Grace Jennings-Edquist and this is Business Essentials.
Why the most dangerous moment for any company is its leadership “inflection point” and how strong leaders recognise it before performance stalls
Businesses today are facing constant disruption from AI and geopolitical uncertainty to shift in customer expectations and economic pressure. Executive coach and leadership team coach Chris Power says these moments of major change or inflection points can become dangerous turning points if leaders fail to recognize the warning signs early. She’s recently published a white paper outlining why leadership matters during inflection points, and how leaders can prepare their organizations before performance starts to stall. But first, what does Chris mean exactly by the term inflection points in the business context?
[00:01:33] Chris Power: It’s language that I’ve been using for a little while, and I’m really starting to hear it coming out now in popular discourse and business discourse. When I talk about inflection point, it’s a moment of significant change. When that change is here or may occur. It’s a turning point for businesses. It’s a turning point in society, actually.
[00:01:54] Host – Grace Jennings-Edquist: And so how do inflection points differ between growth phases versus crisis or disruption, or is there some overlap there?
[00:02:02] Chris Power: Absolutely overlap, I guess. And the clue is that it’s about a significant change. And sometimes that might be because of growth. If we’ve gone in and made multiple acquisitions or a business that has won a major contract, suddenly that’s a big turning point because how they do business shifts, how they structure to do business is going to shift. And it requires a lot of different kinds of decisions to be made externally. I would say right now we are facing one of the biggest inflection points any of us have ever known geopolitically, technologically, demographically. And it’s not our first, you know, Covid actually presented us with one of the biggest inflection points, and it required some decisions to be made. And yes, it’s crisis. Yes, it’s potentially growth. There were a lot of businesses that grew during Covid. It’s about how we respond and whether we are flexible in a way to respond, both as leaders and then leading a whole business in that moment of inflection.
[00:03:08] Host – Grace Jennings-Edquist: I wonder, what are some of the early warning signs of a big inflection point coming that leaders should be looking for? But before perhaps the numbers tell the story and make it more obvious?
[00:03:19] Chris Power: Yeah, I think it’s about looking at a whole system view and then saying, so what do we actually think is coming our way, starting with our customer? You know, what are our customers experiencing? What is the market actually telling us? What is this sector experiencing and suppliers and then also our own people. So for example, we’ve just experienced a fuel price increase. Now that’s a really interesting one because people who are actually looking at the geopolitical situation probably actually had that pegged, that that was likely to come our way. And so they’d be thinking about, okay, so what might happen here if there are fuel shortages and the price increases and I’m in construction, what does that mean for the price of doing business? The price of goods. If I’m in food manufacturing, what does that mean for getting our raw produce in? If I’m in neither of those, what does that mean for my customer? Is there going to be an impact on customer and where they’ll spend their money? And is what I’m selling something that is a nice to have or a must have? And what does that mean? So and then what does it mean for my people? For example, fuel again, if there’s a fuel shortage, what does that mean for the people who work in my business in terms of how they get to work, whether they want to come to work, the culture that we’ve set up around flexibility, for example.
[00:04:46] Host – Grace Jennings-Edquist: You did mention sometimes you could be taking cues from what your customers are talking about or concerned about. I mean, obviously, you’d hope that business leaders are also tuned in broadly to the news and major geopolitical issues. But could it be the case that sometimes you’re noticing as a business leader that your customers are saying, I’m worried about this time and time again. Is that sort of the sort of thing you mean that to be clued into these kind of signals that an inflection point is coming?
[00:05:10] Chris Power: Absolutely. Cost of living, for example, has been something that has been spoken about. And it’s always hard to judge. Is it being spoken about in the media that’s reflecting where people are at, or is it, I guess, a self-fulfilling prophecy that is ended up being created? So listening to what the customer is saying is really important, taking into account what’s happening locally, politically, you know, are there policy shifts coming? There’s been a lot of policy change around aged care. Now, if that’s your business, what might that mean for your business, for technology that you actually have to implement for governance that you have to implement, which will be costly, which might require teams to be re-ordered and restructured? Is there an opportunity to maximize that rather than just having to go, oh gosh, what are we going to do if this hits when this comes? Obviously, the big one that everyone’s really thinking about right now is AI. There’s so much chat about AI and you know, it’s been reflected. I read something the other day that it’s AI turns up as the top five challenges that businesses are experiencing or that they see that they have coming for 2026. They’re all related to AI. So that’s data straight away. What does that mean for how we show up for. Do we even understand how we might make use of it? For example? That’s a massive one. I could do a whole podcast on that one.
[00:06:39] Host – Grace Jennings-Edquist: Oh, and it’s a fascinating one. Absolutely. And with all of this happening sort of around us in this world, I think many leaders will want to be getting on the front foot. And I believe you’ve said elsewhere that leaders need to get on the front foot. What does that look like practically in a boardroom or executive team meeting? What kind of conversations or other processes, I suppose might be useful to get on the front foot?
[00:07:01] Chris Power: I guess it’s continuing. You know, just what I’ve been talking about. It’s having knowledge and then creating space around the exec table to have a conversation about what is coming, what are we experiencing? I think one of the potential issues is that a lot of businesses and a lot of leaders that I’m talking to right now, they are working really hard. They are absolutely flat out, and they’re all in it, and they’re all involved in all of the doing, and they’re not actually creating space to get up and talk about, you know, get up on the balcony and go, what is going on here in the system in which we’re operating? What is coming our way? Do we know? Do we have the right people sitting around the table to actually have these kinds of conversations? And for the leaders then to create space, to reflect and to start shifting, tweaking, thinking about the strategy that they’ve got in place, what might need to change. So for me, it’s definitely about creating space, getting out of the doing and then saying, you know what is required of us right now. What are we noticing? What are the conversations we’re having?
[00:08:07] Host – Grace Jennings-Edquist: That was Chris Power, executive and team leadership coach. And if you’d like a copy of that white paper, it’s free to download on the front page of her website at Chris power.edu.
What business leaders should be thinking about now to stay tax-compliant
Now to another timely topic. With the end of the financial year approaching, tax planning is firmly back in focus. Adam Ahmed is a dual qualified solicitor and chartered accountant specializing in tax and contracts. And in this conversation, he shares practical insights from his Sydney based practice on navigating today’s increasingly complex tax landscape. Adam argues that effective tax planning should happen well before end of financial year, encouraging accountants and business owners to think strategically about major decisions and transactions rather than relying on last minute fixes. He also highlights the growing compliance risks around digital assets, online payments and lifestyle mismatches that can attract scrutiny in today’s data driven audit environment. To begin, Adam tells me how far ahead business owners should plan their tax strategy and which areas deserve the closest attention.
[00:09:14] Adam Ahmed: I think you have to have a loose plan for a couple of years. It’s loose. You know, like that’s more general direction. But most of tax planning comes from an event because tax is a mathematical formula. And basically it takes the choices that you make and it spits out an outcome. So I’ll give you an example. If you said to me, hey, I really want to make this long term investment and I’m not going to touch it for 30 years or something. I’d say if you had a self-managed super fund, I’d say, why not make the investment through self-managed super fund instead? Because that has the same effect. But the self-managed super fund has a much lower tax rate, like it pays only 15% tax on its earnings, whereas you might pay more. And then when you deposit money into the super fund, you get a tax deduction too. So it can kind of work out a bit better. You sort of achieve the same outcome, which is having a long term investment. And you do it in a way that makes more sense. And like that’s sort of what you do. Like you look at all of your individual choices and you just pick what’s the best way. If you were going to start a business where you’re going to do research and development, you’d want to use a company because if you use a company, you get a grant. And if you don’t use a company, you don’t, you know. So you sort of take it more based on like the situation. And then you have like a loose sort of longer term goal that you sort of have a general framework. So that’s what I would say. And that’s the key area. So the key area is not really a particular type of thing. The key area is more what are you doing? Like every time you are doing something, you’ve got to think about, okay, what different options does the tax law give me to do this? And what is the outcome for me from those different options? And that among other factors, which one is the best thing for me to choose?
[00:11:12] Host – Grace Jennings-Edquist: That makes sense. And also what’s coming through is you’re definitely not saying get to two weeks before the end of the financial year and then suddenly retrofit it all like it’s kind of, you’d like to see a bit more advanced planning than a last minute scramble is what it sounds like.
[00:11:26] Adam Ahmed: You have to. Yeah, a lot of people get burned by that. I mean, there’d be so many people who, I reckon do their taxes and afterwards go, oh, if I’d known that, I would have done something different. And this is basically like that. But instead of regretting it, you actually know it in advance, so you don’t regret it later.
[00:11:43] Host – Grace Jennings-Edquist: I want to ask about some of these emerging areas like digital payments, online sales, and crypto. With the rise of these kind of things, what new tax mistakes are you seeing?
[00:11:54] Adam Ahmed: I think the biggest thing with that is these platforms actually are built to do things really efficiently and conveniently and fast. And they were great for those things, but they’re not very good when it comes to their reporting. So if you want to get like a report from a cryptocurrency exchange or from like these online payment platforms and things like getting those reports, which has the data that you need to do your taxes properly is really hard. You know, like it just produces something and their paperwork as well tends to be pretty jumbled. You know, like it tends to be very basic. So because our tax law requires very specific things and they’re different to like the way Americans do things because most of this stuff starts off from an American, it doesn’t produce just the information that you need. And some of the documents, to the extent there are produce outcomes that are weird for tax law, like there’s these platforms that lend you money against your cryptocurrency, right? So the whole idea is, okay, instead of me selling my currency, why don’t I like use it as collateral and borrow against it. And many people do that and they think that’s great. But some of the platforms in their fine print describe the way you give your collateral in such a way that it’s like you sold your crypto for Australian tax law purposes. You think you’re not selling your crypto when you’re borrowing against it, and you actually inadvertently are, and it’s in the fine print. So this is the most common type of mistake I see.
[00:13:27] Host – Grace Jennings-Edquist: Is there anything else business leaders should know today to navigate the new tax challenges presented by crypto NFTs and other digital assets?
[00:13:35] Adam Ahmed: I think with crypto and these digital assets, because they are new, the tax law hasn’t really caught up to their practical use and the tax law always lags. Like I use these examples, fringe benefits tax came in after people for many years were paying wages and stuff to people by buying things for them instead of giving them money. Capital gains tax came in later as well. They introduced this tax for foreign exchange transactions after somebody was able to do a transaction without paying tax on it, using a foreign currency. Then they introduced taxation of financial arrangements just in time for the GFC global financial crisis. And they had the mining tax, which they introduced after the mining boom. So they always the tax law always takes a while to catch up to what’s going on. But what that means is that when it comes to cryptocurrency and these types of things, like it can split either way, you have to fit it within the tax law. But it also means that like you get quite a bit of choice and like the choice that you make creates a vastly different outcome.
[00:14:42] Adam Ahmed: So if you’re accepting payments, for example, you might say, okay, what’s the best way for me to do that? Maybe a company is is better to use because the company can trade and it’s got a certain tax rate. If I do it in my individual name, like it’s going to be more difficult because, you know, you don’t get CGT discount and so on. And so you start with what am I actually doing? And you work backwards from there. And then you sort of get crypto and whatever to then squeeze into the current rules to get to do that. So and that’s important because you can get really bad outcomes and you can get really good outcomes. And if you sort of do nothing, it’s sort of like leaving it to chance. And generally speaking, when you leave it to chance, you get a bad outcome. You know, like nine times out of ten, I’ve seen people who leave it to chance, like get burned in some way or another, and they always regret it.
[00:15:37] Host – Grace Jennings-Edquist: Taking a slight sidestep here, are there areas business leaders often overlook that could cost them in audits or disputes? And this could be, you know, to do with any of these emerging or digital assets we’ve been talking about, but also more broadly.
[00:15:49] Adam Ahmed: Yeah, there is I think the most common one is this that it’s that connection between the person and their business, but specifically the person’s wealth, right? So the tax office sees everything that you own. Like they can see what property you own. They can see if you own a car, um, they can see how often you travel overseas. They’ve got access to your bank account so they know how much you spend and all that. And so they have a picture of, okay, this is this person’s lifestyle. And for them to have this lifestyle, they need this much money, right? And when you compare that against the person’s tax return, if they’re like reporting a tax return, where they’re making like 10 or 20 grand a year, but their lifestyle looks like they need 80 grand, that’s a big problem because then they look at the business and they say, well, your money comes from this business, and then it has to make sense. And so sometimes people will, for example, they might just have cash business and they won’t report their cash. Okay. So the tax office sees that, um, this business is making no money and the owner is making no money, but the owner just bought this really expensive car And it’s that whole element that I think is the thing that people who run a business overlook. They don’t realize the importance of everything has to make sense. You know, if it doesn’t make sense, it’s probably there’s probably a reason why it doesn’t make sense and it’s probably not a good reason.
[00:17:17] Host – Grace Jennings-Edquist: That was Adam Ahmed, solicitor and chartered accountant. Thanks for joining us for this week’s episode. Follow Business Essentials Podcast across social media and head to www.BusinessEssentialsPodcast.au for more. Business Essentials is a SoundCartel podcast. Producers are Nick Schildberger, Nicole Goodman and myself. Technical production is by Pete Letts. I’m Grace Jennings-Edquist thanks for listening. We’ll bring you more business essentials next week.
