Archives
July 2022 Practice Update - ATO's small business focus for 2022 income year
The ATO announced that it will be focussing on the following matters for small business tax returns for the 2021/22 year...
June 2022 Practice Update - ATO priorities this tax time
The ATO has announced four key areas that it will be focusing on for Tax Time 2022:
- Record-keeping
- Work-related expenses
- Rental property income and deductions
- Capital gains from crypto assets, property and shares.
May 2022 Practice Update - Disclosure of business tax debts
The ATO is in the process of writing to taxpayers that may be eligible to have their tax debts disclosed to credit reporting bureaus (‘CRBs’).
April 2022 Practice Update - Cents per kilometre deduction for car expenses – 2023 income year
The ATO has proposed for individual taxpayers that use the cents per kilometre method when calculating tax deductions for their work-related car expenses, that the rate per kilometre for the income year starting 1 July 2022 (the 2023 income year) will be 75 cents per kilometre...
March 2022 Practice Update - Tax deductibility of COVID-19 test expenses
After much speculation, the Government announced that COVID-19 tests, including Polymerase Chain Reaction (‘PCR’) and Rapid Antigen Tests (‘RATs’), will be both:
❑ tax-deductible; and
❑ exempt from FBT...
January/February 2022 Practice Update - COVID-19 vaccination incentives and rewards
The ATO has reminded employers to consider their tax and super obligations when employees are provided with incentives or rewards for getting their COVID-19 vaccination...
December 2021 Practice Update - Super is now following new employees
The ATO is reminding employers that, as of 1 November 2021, there is an extra step they may need to take to comply with the choice of super fund rules. If a new employee does not choose a super fund, most employers will need to request the employee's 'stapled super fund' details from the ATO to avoid penalties...
November 2021 Practice Update - Preparing for the new Director ID regime
As part of its Digital Business Plan, the Government announced the full implementation of the 'Modernising Business Registers' program.
This included recently enacted legislation introducing the new director identification number ('Director ID') regime. The director ID is a unique identifier that a director will need to apply for once and will keep forever...
October 2021 Practice Update - Extra super step when hiring new employees
From 1 November 2021, if a new employee does not choose a specific fund, their employer may need to request the employee’s ‘stapled super fund’ details from the ATO...
September 2021 Practice Update - ATO wars property investors about common tax traps
In 2019/20, over 1.8 million Australians owned rental properties and claimed $38 billion in deductions, so the ATO is reminding property investors to beware of common tax traps that can delay refunds or lead to an audit costing taxpayers time and money...
August 2021 Practice Update - Maximum contributions base for super guarantee
For the 2022 financial year, the maximum contributions base has increased to $58,920 (up from $57,090)...
July 2021 Practice Update - Rent or lease payment changes due to COVID-19
The ATO has provided updates regarding the tax implications when a landlord gives, or a tenant receives, rent concessions (such as waivers or deferrals of rent) as a result of COVID-19...
June 2021 Practice Update - Cryptocurrency under the microscope this time
The ATO is concerned that many taxpayers believe their cryptocurrency gains are tax-free, or only taxable when the holdings are cashed back into Australian dollars...
May 2021 Practice Update - ATO "keeping JobKeeper payment fair"
The ATO is using its compliance resources to maintain the integrity of the JobKeeper measure.
While most businesses and employees have done the right thing, the ATO has identified concerning and fraudulent behaviour as well as claims by a small number of organisations and employees, and will actively pursue these claims.
Some of the concerning behaviours the ATO is currently examining include:
April 2021 Practice Update - JobKeeper comes to an end
The ATO has advised that the final JobKeeper payment will be processed in April 2021.
Enrolled businesses do not have to do anything when the program closes, although they will need to complete their final March monthly business declaration by 14 April 2021.
Also, once a business is no longer claiming JobKeeper Payments, it may start to be eligible to receive the JobMaker Hiring Credit for any additional employees that started employment on or after 7 October 2020.
March 2021 Practice Update - New measures applying from 1 January 2021
Major reforms to Australia’s foreign investment framework take effect, with new requirements for foreign investors.
Jan/Feb 2021 Practice Update - New measures applying from 1 January 2021
Major reforms to Australia’s foreign investment framework take effect, with new requirements for foreign investors.
December 2020 Practice Update - Jobkeeper Hiring Credit passed
The government has passed legislation to establish the JobMaker Hiring Credit, which is part of the government’s economic response to the COVID-19 pandemic.
November 2020 Practice Update - Tax relief for businesses
Businesses with a turnover of up to $5 billion are now able to immediately deduct the full cost of eligible depreciable assets as long as they are first used or installed by 30 June 2022.
October 2020 Practice Update - Tax treatment of Jobkeeper payments
Broadly, JobKeeper Payments received by an employer are assessable income to the employer.
September 2020 Practice Update - Superannuation guarantee rate increase update
Recently, arguments both for and against increasing the rate of compulsory superannuation guarantee ('SG') have continued to be tossed around!
August 2020 Practice Update - Extension of the JobKeeper Payment
Sadly, many Australian businesses are a long way from trending back to 'normal' as we approach 27 September 2020, the original date that JobKeeper was set to end. Thankfully the government has announced an extension of the JobKeeper Payment, with additional turnover qualifications.
June 2020 Practice Update - Jobkeeper declaration due 14 June
Businesses that have enrolled in the JobKeeper Scheme and identified their eligible employees are reminded that they will need to make a monthly declaration to the ATO to ensure they continue to receive JobKeeper payments.
April 2020 Practice Update - New laws can make directors personally liable for GST
The government recently passed new legislation designed to strengthen laws to "crack down on illegal phoenixing activity by dodgy business operators who try to avoid their obligations to their customers, employees and creditors."
March 2020 Practice Update - SMS scam targeting natural disaster victims
The ATO is warning the community about a new SMS scam which promises an 8% bonus on 2020 tax returns to victims of recent natural disasters.
Jan/Feb 2020 Practice Update - Lifestyle assets continue to be an ATO audit target
The ATO has revealed it will request a further five years’ worth of policy information from over 30 insurance companies about taxpayers who own marine vessels, thoroughbred horses, fine art, high-value motor vehicles and aircraft. The ATO expects to receive information about assets owned by around 350,000 taxpayers from 2016 to 2020 as part of its data-matching program.
December 2019 Practice Update - ATO November 2019 bushfire assistance
Following the devastating bushfires across large parts of NSW and Queensland in November, the ATO has offered ongoing support.
In particular, a specific helpline (1800 806 218) has been established that can be used by those impacted to seek assistance.
November 2019 Practice Update - Super guarantee opt-out for high income earners now law
From 1 January 2020, eligible individuals with multiple employers can apply to opt out of receiving super guarantee ('SG') from some of their employers, to help them avoid unintentionally going over the concessional contributions cap.
If appropriate for them, they should submit the relevant ATO form to apply for an SG employer shortfall exemption certificate, which releases one or more of their employers from their SG obligations for up to four quarters in one financial year.
October 2019 Practice Update - ATO impersonation scam update
Editor: Unbelievably, scammers are still successfully bilking Australians out of tens of thousands of dollars, as a recent ATO scam report shows.
According to the July 2019 ATO impersonation scam report:
- 6,179 online scam reports were received in the first month of their new online reporting form going live;
- 6,645 phone scam reports were officially recorded, and 465 phishing scam emails were reported to reportemailfraud@ato.gov.au;
- 520 taxpayers provided scammers with their personal identifying information including date of birth, tax file number, driver's licence number and notice of assessment details; and
- $197,057 was reported as being paid to scammers, mostly by iTunes and Google Play.
September 2019 Practice Update - ATO watching for foreign income this Tax Time
The ATO is urging taxpayers who receive any foreign income from investments, family members or working overseas to make sure they report it this tax time.
New international data sharing agreements allow the ATO to track money across borders and identify individuals not meeting their obligations.
August 2019 Practice Update - ATO "puts the brakes" on dodgy car claims
The ATO is making work-related car expenses a key focus again during Tax Time 2019.
Assistant Commissioner Karen Foat said over 3.6 million people made a work-related car expense claim in 2017/18, totalling more than $7.2 billion.
“We are still concerned that some taxpayers aren’t getting the message that over-claiming will be detected and if it is deliberate, penalties will apply,” she said.
July 2019 Practice Update - ‘Cash in hand’ payments to workers no longer tax deductible
The ATO has reminded employers that any ‘cash in hand’ payments made to workers from 1 July 2019 will not be tax deductible.
‘Cash in hand’ refers to cash payments to employees that do not comply with pay as you go ('PAYG') withholding obligations.
June 2019 Practice Update - Single Touch Payroll Update
Employers with 19 or fewer employees are required to start reporting through Single Touch Payroll (‘STP’) from 1 July 2019.
The ATO will be working with employers to support them as they transition to STP, including allowing small employers to start reporting any time from 1 July to 30 September (and the ATO will also be "generous" in granting deferrals to small employers who need more time to start STP reporting).
May 2019 Practice Update - Federal Election called!
The Federal Election has been called for Saturday 18 May 2019, and the Governor-General has 'prorogued' the Parliament from 11 April 2019 until 18 May 2019, and dissolved the House of Representatives.
April 2019 Practice Update - Common errors with new GST withholding rules
The ATO have noticed some common errors made in activity statements since the introduction of "GST at settlement" on 1 July 2018.
March 2019 Practice Update - Changes to the small business instant asset write-off
On 29 January 2019, the Prime Minister announced that legislation will be introduced to:
- extend the small business instant asset write-off by 12 months to 30 June 2020; and
- increase the write-off threshold from less than $20,000 to less than $25,000 (effective immediately).
The current threshold of $20,000 has applied since 7.30pm AEST on 12 May 2015 and was due to revert to $1,000 on 1 July 2019.
Jan/Feb 2019 Practice Update - Division 293 Assessments
The ATO has been issuing ‘Additional tax on concessional contributions (Division 293) assessments’ with respect to liabilities relating to the 2018 income year.
Division 293 imposes an additional 15% tax on certain concessional (i.e. taxable) superannuation contributions.
December 2018 Practice Update - Company loans to shareholders under review
The Government has released a consultation paper outlining proposed reforms to ‘simplify’ the loan agreements that are generally required when a shareholder (or their associate) borrows funds (or receives a payment) from a related company.
Christmas Parties & Gifts 2018 - Year-end (and other) staff parties
Editor: With the well earned December/January holiday season on the way, many employers will be planning to reward staff with a celebratory party or event. However, there are important issues to consider, including the possible FBT and income tax implications of providing 'entertainment' (including Christmas parties) to staff and clients.
November 2018 Practice Update - Scammers impersonating tax agents
The ATO has received increasing reports of a new take on the ‘fake tax debt’ scam, whereby scammers are now impersonating registered tax agents to lend legitimacy to their phone call.
The fraudsters do this by coercing the victim into revealing their agent’s name and then initiating a three-way phone conversation between the scammer, the victim, and another scammer impersonating the victim’s registered tax agent or someone from the agent’s practice.
October 2018 Practice Update - Increased scrutiny of home office claims
Last year, 6.7 million taxpayers claimed a record $7.9 billion in deductions for ‘other work-related expenses’, which includes home office expenses.
Reportedly, due to a high number of mistakes, errors and questionable claims for home office expenses, the ATO has recently advised that it will be increasing attention, scrutiny and education on these claims this tax time.
September 2018 Practice Update - The Company Tax Rate Saga
In the last week of the August Parliamentary sittings, the controversial corporate tax cut plan for the big end of town (i.e. companies with an aggregated turnover of over $50 million) was defeated.
August 2018 Practice Update - ATO guide to the 5 most common Tax Time mistakes
As Tax Time 2018 has 'kicked off', the ATO has profiled the five most common mistakes they see, including taxpayers who are:
-
leaving out some of their income (e.g. forgetting a temp or cash job, capital gains on cryptocurrency, or money earned from the sharing economy)
July 2018 Practice Update - Personal Income Tax Cuts passed!
Parliament has passed the Government's Personal Income Tax plan, meaning that the first stage of the proposed income tax cuts will start to take effect from 1 July 2018.
According to the Prime Minister, taxes "will now be lower, fairer and simpler".
June 2018 Practice Update - 2018 Budget Update
The Government handed down the 2018/19 Federal Budget on Tuesday 8th May 2018.
May 2018 Practice Update - GST withholding measures now law
Legislation has been passed to “clamp down” on GST evasion in the property development sector. From 1 July 2018, purchasers of new residential
premises and new residential subdivisions will generally be required to withhold the GST on the purchase price at settlement and pay it directly to
the ATO.
April 2018 Practice Update - New superannuation rates and thresholds released
The ATO has published the key superannuation rates and thresholds for the 2018/19 income year.
- The Non-Concessional Contributions cap will remain at $100,000 (although transitional arrangements may apply), and the Concessional Contributions cap will remain at $25,000.
March 2018 Practice Update - ATO's focus on work-related expenses
This year, the ATO is paying close attention to what people are claiming as 'other' work-related expense deductions, so it's important when taxpayers claim these expenses that they have records to show:
- they spent the money themselves and were not reimbursed;
- the expense was directly related to earning their income; and
- they have a record to prove it.
If the expense is for work and private use, the
taxpayer can only claim a deduction for the work-related portion.
February 2018 Practice Update - Taskforce to help digitise small business
The Government has established a Small Business Digital Taskforce, to be headed by entrepreneur Mark Bouris AM, to ensure more Australian small businesses can thrive in an increasingly digital economy.
December 2017 Practice Update - Parliamentary update
Editor: The ongoing citizenship saga in Parliament has resulted in the Government losing its one-seat majority in the House of Representatives, thanks to the resignations of Barnaby Joyce and John Alexander.
By-elections have been scheduled in the relevant electorates and, in the meantime, some of the cross-benchers have guaranteed the Government's (current) survival by committing to vote with it on motions of no-confidence and supply.
November 2017 Practice Update - Can travel in an Uber be exempt from FBT?
Editor: The ATO has released a discussion paper to facilitate consultation regarding the definition of 'taxi' contained in the FBT Act, and the exemption from FBT for taxi travel undertaken to or from work or due to illness.
October 2017 Practice Update - No small business tax rate for passive investment companies
The Government has released draft tax legislation to clarify that passive investment companies cannot access the lower company tax rate for small businesses of 27.5%, but will still pay tax at 30%.
September 2017 Practice Update - Keeping ABN details up to date
The ATO finds that businesses tend to forget to update their Australian business number (ABN) details in the Australian Business Register (ABR) when their circumstances or details change, so they have asked that we contact our clients to help keep your ABN details up to date and reduce unnecessary contact from the ATO.
August 2017 Practice Update - New threshold for capital gains withholding
From 1 July 2017, where a foreign resident disposes of Australian real property with a market value of $750,000 or above, the purchaser will be required to withhold 12.5% of the purchase price and pay it to the ATO unless the seller provides a variation (this is referred to as 'foreign resident capital gains withholding').
July 2017 Practice Update - Simpler BAS is coming soon
The ATO is reducing the amount of information needed to be included in the business activity statement (or ‘BAS’) to simplify GST reporting.
From 1 July 2017, Simpler BAS will be the default GST reporting method for small businesses with a GST turnover of less than $10 million.
June 2017 Practice Update - Budget Update
The Government handed down the 2017/18 Federal Budget on Tuesday 9th May 2017.
The Budget proposes (amongst several other changes) to increase the Medicare Levy by 0.5% to 2.5% from 1 July 2019 (and tax and withholding rates that are linked to the highest marginal income tax (e.g., FBT) will also increase from 1 July 2019).
May 2017 Practice Update - Company tax cuts pass the Senate with amendments
Editor: After a marathon few days of extended sittings (the last before the Federal Budget in May), the Government finally managed to get its company tax cuts through the Senate, but it was not without compromise.
April 2017 Practice Update - Reduction in FBT rate from 1 April 2017
In conjunction with the introduction of the temporary budget repair levy (of 2%, payable by high income earners), the FBT rate was also increased from 47% to 49% for the 2016 and 2017 FBT years.
However, the FBT rate will revert back to 47% from 1 April 2017.
March 2017 Practice Update - Ride-sourcing is 'taxi travel'
In a recent case, the Federal Court has agreed with the ATO that 'ride-sourcing' (such as that provided using Uber) is 'taxi travel' within the meaning of the GST law.
February 2017 Practice Update - Changes to the backpacker tax
From 1 January 2017, tax rates changed for working holiday makers who are in Australia on a 417 or 462 visa (these rates are known as ‘working holiday maker tax rates').
December 2016 Practice Update - Personal income tax cuts are law!
Editor: The government has finally legislated the tax cuts originally announced in the May 2016 Budget, so that the marginal tax rate of 37% now starts at $87,000. The ATO has updated the tax tables and PAYG withholding tax schedules (and their online tax withheld calculator) to reflect these changes.
November 2016 Practice Update - ATO warning for the building & construction industry
The ATO has reported that the building and construction industry represents a disproportionate amount of its debt book, and has identified worrying trends that affect the industry. Clients in the industry are encouraged to contact their tax agents regarding outstanding debts, as the ATO may be able to offer a range of payment options to help them get back on track sooner and reduce any interest they may be liable for.
October 2016 Practice Update - GST on low-value imports
Goods imported in Australia - often by comsumers using the internet - which cost less than $1000 are currently GST-free. On May 3 2016 as part of its package of Budget Night announcements, the Federal government proposed that, as of 1 July 2017, this low-value threshold ('LVT') of $1000 will be abolished.
September 2016 Practice Update - ATO exposes dodgy deductions
With over eight million Australians claiming work-related expenses each year, the ATO is reminding people to make sure they get their deductions right this tax time.
Assistant Commissioner Graham Whyte said that, in 2014/15, the ATO conducted around 450,000 reviews and audits of individual taxpayers, leading to revenue adjustments of over $1.1 billion in income tax.
August 2016 Practice Update - Tax time is prime time for scams
The ATO is reminding Australians to be on the lookout for tax-related scams during tax time, as scammers are particularly active because of the large number of people lodging their tax returns.
July 2016 Practice Update - ATO focuses on rental property owners
With Tax Time 2016 just around the corner, the ATO has stated it will be paying close attention to excessive interest expense claims, and incorrect apportionment of rental income and expenses between owners.
2018/19 Budget Update : The Government handed down the 2018/19 Federal Budget on Tuesday 8th May 2018.
2017-18 Budget Update : The Government handed down the 2017/18 Federal Budget on Tuesday 9th May 2017.
2016-2017 Budget Update : Changes effective 7.30pm (AEST) Budget night 3rd May 2016
2015-2016 Budget Update : Changes effective 7.30pm (AEST) Budget night 12th May 2015
NTAA Newsletter No.2 : Claiming deductions for personal super contributions
A taxpayer must satisfy the ‘10% rule’ before they are entitled to claim a deduction for any of their personal superannuation contributions.
NTAA Advice: Retirement not according to plan
A recent survey performed by HSBC has painted a relatively bleak picture of retirement for Australians. The 16,000 person global study included responses from 1,000 Australians (just over 6% of the total sample) in which it found:
- 40 % find their income at retirement drops by half:
- only 60% regard their retirement income as adequate; and
- one in six working Australians believes he or she will never be in a position to fully retire.
Common mistakes made by the Coffee Shop industry:
The ATO has been reviewing records kept by businesses in the Coffee Shops industry for the past two years and would like to share some of the common mistakes they found. This may help you avoid making the same mistakes and meet your tax obligations.
