We hope you will find our Client Information Newsletter a useful addition to our services. This monthly update of tax and superannuation outlines topical issues and provides relevant information on a wide variety of subjects.
Articles each month build on information that is of interest to small businesses, sole traders, individuals and families. While summarising the general thrust of each topic, readers who require more information on any of the topics raised in this newsletter should feel free to contact this office.
Not every retiree has heard of the government’s Pension Loan Scheme, but it’s about time more people did. And with Tax Time now upon us, we run over some tips for your tax return.
An integrity measure that businesses need to keep a close eye on, called Division 7A, is given the once over, as are the possible deductions available for insurance premiums, and we also provide a brush-up on partnerships in the form of a quick quiz.
Download Link: July 2018 Tax and Super News
It’s not uncommon for taxpayers to be in dispute with the ATO from time to time, and although the Tax Commissioner may seem invincible, this is not always the case. We look at the best approach to better your outcome.
At some stage, SMSF trustees will need to get their heads around the proportioning rule, so we run over the way this works. Also covered are the building and construction Taxable payments annual report, which is soon to be expanded to more industries, and a brush-up on statute barred debts.
Download Link: June 2018 Tax and Super News
May Federal Budget 2018
Undoubtedly the headline item from tonight is tax relief for individuals by lifting the 32.5% tax bracket to $90,000 from 1 July 2018 and the Government’s announcement of its intention abolish the 37% tax bracket in 2024-25. In the 2022-23 financial year we will also see the Low Income Tax Offset increased to $645 and the 19% tax rate from $37,000 to $41,000.
Health & aged care was a key focus for this announcement. In the build up to the budget, we heard that there will be no increase to the Medicare levy, as the National Disability Insurance Scheme (NDIS) has been funded from other sources of revenue. Whilst we do not know the exact details of where this extra money has been found, the abandonment of this proposed increase is certainly welcomed. The Medicare rebate is increasing by 55¢ for a visit to the GP after a four year freeze and the Royal Flying Doctors Service given an additional $84 million to expand its services.
The Government is also tackling the sin taxes in this year’s budget. After crackdowns in recent times on the black economy, the Government’s next project to recoup lost revenue is to establish a tobacco taskforce – expected to raise an additional $3.6 billion in additional revenue – to crack down on the “chop-chop” tobacco trade. With regards to alcohol, the excise charged on craft beer kegs over eight litres will be equalised. This is intended to level the competition between small craft breweries and large multinational beer producers.
Download Link: May Budget 2018 Tax and Super News
Interest expenses on money borrowed to buy business assets can be deductible. However, there are also circumstances, allowed under tax law, where deductions are still available after the relevant asset is disposed of. We run over the details.
We also look at the “work test” required for super contributions to be made for those over the age of 65. In this issue of the newsletter, we also deal with tax and franchising, the basics of testamentary trusts, and have a quick quiz (with answers) on business deductions.
Download Link: May 2018 Tax and Super News
There’s been a lot of buzz about bitcoin lately, so we thought it timely to run over the ins and outs of cryptocurrencies. Another phenomenon of the modern marketplace is the sharing economy, but care needs to be taken when dealing with businesses carried on via sharing platforms to ensure there are no hidden tax traps. We use Airbnb as an example.
Back on more familiar territory, we also run over the many rules and requirements when making commutation requests for your retirement income. And as buying online from overseas is so prevalent these days, we also take a quick look at related costs such as customs duties.
Download Link: April 2018 Tax and Super News
There’s a hidden danger lurking within the FBT rules that business owners should keep an eye on. Where a third party supplier is generous enough to include your employees, there’s a very real possibility that this could trigger a tax liability for that business. We run over this and other quirks of the FBT regime.
We also look at the need for valuations for SMSF assets, the looming Single Touch Payroll requirements, as well as when or if a business can use simplified trading stock rules.
Download Link: March 2018 Tax and Super News
For a business owner, the issue of bad debts can be bittersweet — yes you’ve missed out on revenue, but at least there’s some tax relief. We look at the conditions necessary to access such consolation. On another financing matter, we touch on the particular considerations necessary when refinancing a partnership.
Property investors have recently lost eligibility to certain deductions, so we run over what’s changed. And also in the real estate arena, consideration is given to property development undertaken via an SMSF, as well as retention of the main residence CGT exemption where the land on which a primary residence sits expands through acquisition.
Download Link: February 2018 Tax and Super News
Recent legislative changes mean that SMSF trustees need more than ever to stay aware of the value of assets, and makes the forced unwinding of an LRBA a more real possibility for many. We run over the practical aspects.
We also look at the top 10 tax mistakes that rental property owners can make, pick apart where car expenses stand in relation to novated leases, and clarify when (and where) the concept of “entertainment” sits with regard to the deductibility of certain events to a business.
Download Link: December 2017 Tax and Super News
As it’s getting ever closer to the festive end of the year, we thought it prudent to run over the rules regarding Christmas parties and FBT. And borrowing money from a private company, even if it is your own business, can have serious pitfalls if not carried out correctly, so we look at the dangers of “Division 7A”.
There’s also an important distinction you may need to know between a travel allowance and the living-away-from-home allowance. We also look at how Australians are taxed on income that comes in from overseas.
Download Link: November 2017 Tax and Super News
There were a couple of housing-based superannuation contribution proposals contained in this year’s Federal Budget, for which draft legislation has finally been tabled. We run over the finer details that have been revealed.
And if you or anyone you know has considered driving an Uber car to earn some extra income, we have some essential information that you need to understand. However if you are already a higher income earner, note that a certain income threshold has recently dropped (by $50,000!) that may catch a lot of taxpayers unexpectedly.
We also look at immediate deductions for start-up businesses, and go over the car parking FBT exemptions for small business.
Download Link: October 2017 Tax and Super News
The small business CGT concessions can be extremely valuable, but sometimes the complexity of the details can be confusing. We clear up some of the more obscure factors.
The rules around LRBAs for SMSF trustees have been fiddled with again, and necessitate (again) a look at the fine print. There is also a new statistical report on SMSFs that trustees should be glad to read.
Also dealt with are the differences between investment returns being on revenue or capital account, and what to do if you need to lodge your next tax return early.
Download Link: September 2017 Tax and Super News
Making claims for travel allowances is a handy deduction for many employees, especially as the ATO has seen fit to make an exception to substantiate these claims in many circumstances. However this consideration comes with a warning — get it right, or lose that exception. We run over the particulars.
Did you know that there are deductions that are specific to SMSFs? As usual however, there are conditions. We also look at deductions available for financing rental properties, the interaction between the new super transfer balance cap and child recipients of death benefits, and a tax break available for life policy bonuses held for a certain time.
Download Link: August 2017 Tax and Super News
The ATO is on the warpath over incorrect deductions that many taxpayers try to claim for holiday rental properties, so we take a look at the issues that have been grinding the taxman’s gears.
And if you’re going to soon make an appointment to complete your tax return, we’ve made a general checklist of things to prepare. By the way, you might also be able to claim the travel costs for travelling to see us — we share the particulars for eligibility.
Mobile, home phone and internet costs may be claimed under some circumstances, so we run over the substantiation that the ATO will accept to successfully make these deductions. We also present an overview of streaming trust capital gains and franked distributions.
Download Link: July 2017 Tax and Super News