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During the pandemic, the ATO deliberately shifted its focus away from firmer debt collection action to help and assist businesses and the community experiencing financial challenges because of the pandemic. It took a softly-softly approach, acknowledging the financial hardship that the virus wrought on business and individuals alike. However, with the economy now opening back up, business as usual on the ATO debt collection front, has now largely resumed.
The July issue delves further into last minute trust distributions and record keeping, Super guarantee rises, and other tax news as we enter a new fiscal year.
As we move towards the end of the 2021/22 financial year, there are a number of year-end income tax planning opportunities that may be available to optimise your tax position.
Read more tax planning news in the June edition of the HSPlus newsletter relating to:
Temporary full expensing
Superannuation is an investment vehicle specifically designed to help you save for retirement - this is one of the key reasons why you should take an interest in your superannuation. Whether you’re employed, self-employed or even nearing retirement, it’s never too late to build up your superannuation to boost your retirement savings.
Learn more in our May newsletter.
March 31 marks the end of the 2021/2022 fringe benefits tax (FBT) year which commenced 1 April 2021. It’s time now for employers and their advisors to turn their attention to instances where non-cash benefits have been provided to employees, and also where private expenses have been paid on their behalf.
On-boarding new employees. With Australia now opening back up after the COVID restrictions, unemployment is tipped to fall to the lowest rate in just over 50 years – down to under 4%. If over the coming period you hire new staff, there are certain steps you should follow to cover off on your tax, workplace, and superannuation obligations. Read more in our March 2022 Newsletter.
In the May 2019 Federal Budget, the Government announced that Single Touch Payroll (STP) would be expanded to include additional information, building on the first stage of STP which was made compulsory for most employers from 1 July 2019. For background, the STP regime is a government initiative which is designed to reduce an employer’s burden when reporting to Government agencies such as the ATO. Under the regime, employers report employee payroll information to the ATO each time they are paid via STP-enabled software.
Have you obtained your director ID? Make sure you do. The director identification number (director ID) regime is now in place with Australia’s newest company directors having to comply first. Director IDs are a unique 15-digit identifier that a director will apply for once and will keep forever, similar to a tax file number (TFN). A director can only have one director ID and they must use it for all relevant entities.
A new law will level up the playing field for divorcing couples to ensure both partners have fair and equitable access to superannuation, particularly during acrimonious family court proceedings.
For many Australians, superannuation is their second biggest asset aside from the family home. In a divorce situation, it’s important that both partners, including those with lower superannuation balances who may have taken time out of the workforce to care for children, get their fair share of available super.
Superannuation fund trustees who receive compensation from financial institutions and insurance providers must consider how receipt of these payments may impact a member’s contribution caps.
A superannuation fund may have a right to seek compensation if it entered into a legal contract or agreement with a financial services provider or insurance provider, paid the fees or premiums from the fund’s assets, allocated the cost to the members, and:
■ the financial service or advice was not provided
■ the advice was deficient, or
■ the insurance premiums for death or disability insurance cover were overcharged.
On the road: How to treat work-related travel and living away from home costs. The ATO has released new guidance to help clarify the tax treatment of costs and allowances incurred when an employee travels – or spends time living away from home – for work.
Recent legislative reforms to the superannuation arena are set to change the retirement savings landscape for many Australians. The Federal Government says the Your Future, Your Super reforms will help ensure superannuation works in the best financial interests of all Australians by removing unnecessary waste, increasing accountability and transparency, and providing more flexibility for families and individuals.
As we enter tax season, millions of Australians begin to prepare their tax return before the end of October. Each year, however, countless returns are lodged incorrectly – either accidentally or intentionally by people looking to maximise their refund. As the ATO’s data matching and forensic capabilities increase, Australians need to ensure their return is lodged correctly to avoid unnecessary hassle or even criminal charges.
The June 2021 issue discusses the superannuation guarantee to the unique tax treatment regarding cryptocurrency, and the expertise a Barrister can provide in certain situations. As we are coming into a new financial year, this is a timely reminder to our clients who may be reviewing staff salaries: the superannuation guarantee rate will increase from 9.5% to 10% on 1 July 2021. Be sure to not overlook the superannuation increase and factor this into the total cost of the salary package of your staff.
Our first issue of 2021 covers the JobMaker Hiring credit, single touch payroll, and other updates from the ATO. The JobMaker Hiring Credit scheme was passed into law in mid November 2020. JobMaker was part of the 2020-21 Federal Budget, and will operate until 6 October 2021. It is designed to improve the prospects of young individuals getting employment, by incentivising employers to hire them, following the devastating impact of COVID-19 on the labour market.
The last Federal Budget carried with it a number of tax changes that were designed to assist the Australian economy recover from the impact of the COVID-19 pandemic. Among the changes announced was the temporary re-introduction of the loss carry back rules for corporate tax entities (it was previously briefly in force for 2012-13). The ability to carry a loss backwards simply means that a loss incurred in one year can be, effectively, claimed as a tax deduction in a prior year when tax was paid.
The Federal Budget measure of allowing businesses to fully write-off eligible assets is a boon to Australian businesses, even though the measure is temporary. Businesses with aggregated annual turnover of less than $5 billion will be able to deduct the full cost of eligible capital assets acquired from 7:30pm AEDT on 6 October 2020 (Budget night) and first used or installed by 30 June 2022. Please contact us for clarification, or further advice, regarding any of the topics covered in this newsletter.
Payments such as JobKeeper and the cash flow boost are measures welcomed by many, however they can also bring with them some unique taxation issues. We run over what to look for. Also tackled are claiming tax losses, where vehicles stand in relation to the boosted instant asset write off, the question of liquidity and trusts under COVID-19 conditions, and how SMSFs can best cope with the outcomes from rental relief support measures. Please contact us for clarification, or further advice, regarding any of the topics covered in this newsletter.
The JobKeeper payment, which was originally due to run until 27 September, will now continue to be available until 28 March 2021. There will however be some changes to eligibility, as well as a tightening of payment rates. We run through the details. We also reveal a largely unforeseen danger for insurance cover in the early release of super scheme, and look at the unfamiliar territory, from a tax point of view, that COVID-19 has put property investors. Please contact us for clarification, or further advice, regarding any of the topics covered in this newsletter.
Despite the current COVID-19 constraints, completing your tax return remains a task we can help achieve to your best advantage. We look at some tax tips for the current tax lodgement period. There is also some good news on the instant asset write-off, and a timely reminder about the importance of being covered against cyber crime. The requirement for corporate entities to hold general meetings has been helped along by allowing this to be completed remotely, and we also remind relevant taxpayers that varying of instalments, if need be, can help you out of a tight spot. Please contact us for clarification, or further advice, regarding any of the topics covered in this newsletter.
The COVID-19 period in everyone’s life continues, and as time goes by more issues keep arising regarding certain tax matters. One such issue, which the ATO has realised may be a concern, is the changed rental property market, and the deductions for expenses that are and are not available. We also consider the issue of passive income and where this figures when qualifying for JobKeeper. There has also been a temporary change made to bankruptcy laws because of the economic fall-out of COVID-19. Also, as tax time does not simply disappear because of a certain virus, we offer some end-of-financial-year last minute tax tips, a warning on issues stemming from property development undertaken by SMSFs, and how resident or non-resident status affects tax outcomes. Please contact us for clarification, or further advice, regarding any of the topics covered in this newsletter.
The dominating factor in all our lives at the moment is of course COVID-19. We look at issues that may change the normal deductions taxpayers can make for working from home, plus examine details of the new JobKeeper scheme that both employers and employees will need to know. There is also the early release from superannuation option that may help many people get through this difficult period, and the temporary changes to the instant asset write-off rules, as well as accelerated depreciation, that are available now. Please contact us for clarification, or further advice, regarding any of the topics covered in this newsletter.