Dollars & Sense

Parents should ‘keep their receipts’ for education expenses in light of the proposed commencement of the Education Tax Refund from 1 July 2008. Under the ETR, eligible families will be able to claim:

? a 50 per cent refundable tax offset every year for up to $750 for each child undertaking primary school, (that is, a refund of up to $375 per child, per year);

? a 50 per cent refundable tax offset every year for up to $1,500 for each child undertaking secondary school (that is, a refund of up to $750 per child, per year).

Generally, you are entitled to the ETR if you get Family Tax Benefit (Part A) for the child you wish to claim for. Also, eligibility is extended to parents who would be entitled to FTB Part A but for the fact the child receives other payments such as Youth Allowance. 

The refundable tax offset will apply to expenses incurred from 1 July 2008 and will be claimed upon lodgement of a 2008–09 income tax return.

Eligible families will be able to recoup the cost of purchases including:

·         laptops;

·         home computers and associated costs;

·         home internet connection;

·         printers;

·         education software;

·         trade tools for use at school;

·         school text books; and stationery.

Eligible expenses are for items that support a child during school and improve the quality of education.

You can download an ETR Fact Sheet from the Treasury website at this page or simply email me (christie at lewistaxation.com.au) and I’ll email one off to you.

The Tax Office is currently experiencing delays in processing tax returns (especially amendments) due to “a greater number of income tax returns than usual for this time of year.” Unfortunately, calling to check the progress of returns only contributes to further delays in processing. At this time the ATO are assuring taxpayers they are working on them as fast as they can and ask for your patience and understanding if you are waiting on a return.

In addition, the ATO have announced it will shutdown all IT and communication systems and applications from 24 December until at least 5 January. The systems and services affected include the tax agent portal, business portal, electronic lodgment service, e-tax lodgment service, call centres, telephone services, the Tax Office website and internal business systems.

If you think you will need to contact the ATO over this period, it’s best to get in before 24 December.

Your credit card probably charges the highest rate of interest of any of your loans. If that’s true for you, then paying off your card should be your number one priority.

As Centrelink gears up to deliver $8.7b in bonus payments, many families swamped in debt are sure to benefit from the Lump Sum Economic Security Strategy payments. A smart plan for this money is to pay it directly off your credit card balance. This is especially important if your card has been working extra hard in preparation for Christmas.

If that’s not realistic for you at this time, then make a New Year resolution to pay more than the minimum repayments for 2009 and stick to that amount. You’ll be surprised at the difference a consistent extra payment amount can make.

It seems a lot of construction workers are unaware of their entitlements when it comes to long service leave. 

 Building industry workers are entitled to long service leave from the Construction Industry Long Service Leave Board. To qualify, you need to ensure that you are properly registered and submit the appropriate annual forms.

You can find more information and download a registration form online from www.lspc.nsw.gov.au.

State and territory tourism offices from around Australia have come together to help produce an online tutorial kit. The Tourism e-kit  is a comprehensive series of easy to consume tutorials about online marketing for tourism operators.

Tutorials covered by the Tourism e-kit include:

• internet: planning my success
• registering a domain name 101
• critical components of optimising a website
• blogging
• online booking systems 101.

The e-kit can be downloaded as one complete document, or you can choose which tutorials you are most interested in and download them separately.

To download a copy of the e-kit, or for more information, visit the Australian Tourism Data Warehouse website.

Are you a manufacturing small or medium sized enterprise (SME) looking to develop your business further?

The online self-assessment tool has been provided to identify your business’ capabilities and highlight areas that may be in need of improvement.

The tool is a free resource provided by Enterprise Connect.

You should allow 30-45 minutes to complete the assessment, which will ask you to prioritise and rate different areas of your business. Afterward you will be provided with a summary of your business capabilities which you can then use to develop an action plan to improve your business’ performance.

 To access the tool or for any other assistance, visit the Enterprise Connect website.

With Christmas just around the corner the Tax Office is reminding employers to consider FBT obligations when organising office Christmas parties and gifts for employees.

The Tax Office has developed a fact sheet Fringe benefits tax and Christmas parties to help explain the FBT implications of your Christmas celebrations.

The fact sheet contains useful information on the minor benefit exemption threshold of $300 per employee. In most cases this means employers can spend up to $300 per employee (including on Christmas parties) without being subject to FBT.

The Fringe benefits and Christmas parties fact sheet, along with more information on FBT, is available from the Tax Office website: www.ato.gov.au/fbt.

The Tax Office today reminded people who received an income tax bill for 2007-08 that payments begin to fall due from Friday 21 November 2008.

The Tax Commissioner has advised people to check their notice of assessment and pay any amount owing by the due date to avoid penalties for late payment.

“Due dates vary, so check your notice of assessment to ensure you don’t miss your payment deadline.

“If you think you may not be able to pay your income tax bill by the due date, contact the Tax Office on 13 11 42 as soon as possible to discuss your situation,” he said.

People who haven’t lodged their tax returns yet should do so as soon as they can.

The Tax Office is assuring residents affected by recent severe storm activity in Brisbane, the Gold Coast, Central Queensland and surrounding areas they don’t need to worry about their tax at this time.

Tax Commissioner Michael D’Ascenzo said this is a difficult time for many residents in the storm affected areas.

“Anyone having problems meeting their tax obligations because of the storms, or who has recently received a letter or notice from the Tax Office, should call us on 13 11 42 to make arrangements that meet their particular circumstances.

The Tax Office can help people by:

• fast tracking refunds
• giving people extra time to pay debts – without interest charges
• giving more time to meet BAS and other lodgement obligations – without penalties, and
• helping reconstruct tax records where documents have been destroyed.

Tax Commissioner Michael D’Ascenzo today issued two taxpayer alerts warning foreign residents selling indirect holdings in Australian real property about arrangements that attempt to avoid Australian capital gains tax.

The alerts cover arrangements that attempt to circumvent indirect holding rules through staggered sell down arrangements and manipulation of the value of assets.

Tax Commissioner Michael D’Ascenzo said in the current economic environment he is concerned foreign resident vendors may be tempted to try to avoid their Australian capital gains tax obligations.

“The Tax Office closely monitors disposals of real property by foreign residents using information from Australia and overseas agencies and has identified several suspect arrangements that attempt to avoid capital gains tax,” Mr D’Ascenzo said.

“Anyone thinking about entering into such arrangements should carefully consider whether a capital gain arises, as we will be actively looking at such arrangements if they prove to be ineffective.

“Taxpayers who are unsure of their tax obligations should seek independent advice from a person not trying to market such a scheme or contact us so that we can help them understand and comply.

“If they are genuinely uncertain they can ask for a free private ruling from us.

“If taxpayers who have entered into such an arrangement come to us before we contact them for an audit, they will be entitled to a reduction in any penalties that may apply.”