Tag: small business

PRESS CONFERENCE – AUSTRALIAN PARLIAMENT HOUSE, ACT – 22/03/2020

THE HON. JOSH FRYDENBERG MP, TREASURER:  Since the government announced its first stimulus package just over a week ago, the global and the domestic economic environment has deteriorated. We now expect the economic shock to be deeper, wider, and longer. Every arm of government and industry is working to keep Australians in jobs and businesses in business, and to build a bridge to recovery on the other side.

Today, the government is announcing a second package, $66 billion dollars to cushion the blow to households as a result of the coronavirus and to support businesses, and we are enhancing in an unprecedented way Australia’s safety net. This package is consistent with our principles. The initiatives are targeted, are temporary, are proportionate, are scalable, and are using our existing systems. Today, this package, together with the other initiatives that have been announced, sees the government’s support for our Australian economy, announced over the last 10 days, at $189 billion dollars or as the Prime Minister said, around 10 per cent of GDP.

Today’s package has three parts involving 10 separate initiatives. The package will support households, including casuals, sole traders, retirees and those on income support. It will provide assistance for businesses to keep people in a job and it will provide regulatory protection and financial support for businesses to stay in business.

Today, the government is announcing:-

The doubling of the Jobseeker Allowance, formerly known as Newstart, through the introduction of a temporary coronavirus supplement.
The government will also waive the assets test and waiting periods for the Jobseeker Allowance, allowing more Australians to more quickly access the support that they need. The coronavirus supplement will provide an additional $550 a fortnight on top of the existing jobseeker or Newstart payment and will be available to sole traders and casual workers who meet the income test. This means anyone eligible for the maximum jobseeker payment will now receive more than $1,100 a fortnight, effectively doubling the jobseeker allowance.

In the first package on the 12th of March, we announced a $750 payment for Australians on income support. Today, we announce that from July 13, a further $750 payment to those on income support that are not eligible for the coronavirus supplement. This includes those receiving the age pension, the carer’s allowance, family tax benefits and the Commonwealth Seniors Health Card. In total, 5.2 million Australians. We are also reducing the deeming rates by a further quarter of a per cent to reflect the recent Reserve Bank interest rate cut. Over 900,000 thousand social security recipients on income tested support will now benefit.

Our economic response will allow those Australians who are in financial stress as a result of the Corona virus to access more of their own money in superannuation. From April, those affected will gain access to their superannuation capped at $10,000 this financial year, and a further $10,000 next financial year. These withdrawals will be tax free. I repeat, these withdrawals will be tax free and available to those who are eligible for the coronavirus supplement, as well as sole traders who have seen their hours worked or income fall by 20 per cent or more as a result of the coronavirus. So if you’re a sole trader or you’re a casual and you’ve seen your income or your hours worked fall by 20 per cent or more as a result of the coronavirus, you will be able to get early access to your superannuation. Applications will be made online through a simple declaration to the tax office. This initiative builds on existing provisions that allow early access to super in the event of hardship or on compassionate grounds, and it is estimated to put up to $27 billion dollars of superannuation back into the pockets of hardworking Australians. This comprises less than 1 per cent of the 3 trillion dollars in superannuation today. APRA, the prudential regulator, has advised the government that they do not expect this initiative to have a significant impact on the industry overall.

The government is also giving retirees more flexibility over their superannuation. Currently, retirees are required to draw down a minimum of 4 percent a year from their superannuation, a number that increases with their age. The government is halving this requirement to 2 per cent for this year and for next year, to give retirees more discretion over the management of their assets.

The second part of our package sees a massive scaling up of support for small and medium sized businesses across the country. We are increasing cash payments to SME’s to boost their cash flow and to keep their workers employed. All employing businesses will receive at least $20,000. All employing small businesses will receive at least $20,000 and some of the larger SME’s will receive up to one hundred thousand dollars. And we are extending this measure to around 30,000 not for profit organisations, which have an annual turnover of less than $50 million dollars. This will be a lifeline for hundreds of thousands of employers like the local hairdresser, the local cafe, the local mechanic whose income has been significantly reduced over this difficult period. This is the single largest measure in this second package, and together with the first initiative in the first package for small businesses is worth $31.9 billion dollars in total. This payment will be automatically paid through the tax system largely over the next six months with the first payment after 28 of April. No new forms will be required from Australian small and medium sized businesses.

Over the course of the last week, $105 billion dollars is being injected into the financial system by the government and the Reserve Bank of Australia, the purpose of which was to lower the cost and increase the availability of credit, particularly to smaller, medium sized businesses. Today, the government is going one step further and is guaranteeing in a 50/50 partnership with the banks and other lenders, more lending to Australia’s small and medium sized businesses. This $40 billion scheme, which will start in early April, will provide loans of up to $250,000 for up to 3 years for a business with a turnover of less than $50 million dollars. No repayments will be required for the first six months. These will be unsecured loans and they will help build a bridge for small and medium sized businesses to the other side of the coronavirus, and I urge small businesses to go and talk to their bank about these new opportunities that are available. These funds will provide hope and confidence to a vitally important sector and together with the red tape reduction for SME lending announced on Friday, more credit will be coming their way.

The third part of our package will provide a regulatory shield for what are otherwise profitable and viable businesses that find themselves under severe financial pressure as a result of the coronavirus. Now is the time for more flexibility in insolvency and bankruptcy laws to keep these businesses alive and to trade through this period. The government is proposing to increase the threshold at which a creditor can take action to initiate insolvency or bankruptcy from as low as $2,000 today to $20,000 and giving companies and individuals 6 months instead of 21 days to respond. We will also provide relief from directors, from personal liability, where the company is trading while insolvent. This relief will be provided over the next 6 months and will be vital to helping companies get through this period. As a result of the health related restrictions being put in place to reduce the impact of the coronavirus, it will not be possible for many companies to comply with their obligations under the Corporations Act, for example, holding general meetings in person. A temporary 6 month power will be provided to me as the Treasurer to deal with these situations as they arise

These extraordinary times require extraordinary measures and we face a global challenge like we have never faced before. But by working together, we will get to the other side and we will bounce back stronger. Today’s announcement will provide hope and support for millions of Australians at a time when they need it most. We know that there is more to do and we will continue to do what it takes.

https://www.pm.gov.au/media/press-conference-australian-parliament-house-act-22march

Single Touch Payroll (STP) Have you missed the deadline?

If you missed the 30 September Single Touch Payroll (STP) reporting date, it’s not too late! Make the move and get started by following one of three pathways: 

Start reporting now  
If you already use accounting or payroll software, you need to check whether it offers STP reporting. If it does, you need to enable the STP function and start reporting straight away. If you’re looking for software or need to upgrade, we have a list of providers that offer STP reporting products. 

Apply for a reporting concession  
Depending on your circumstances you may be eligible for a reporting concession. This means you may be able to report less often (usually quarterly) if you meet certain criteria. 

Ask for more time  
If you’re not ready to report through STP, or you can’t because of your location and access to services, you can ask us for more time by applying for a deferral or exemption. 
 
Whichever option you choose will depend on your circumstances but it’s important to engage with the ATO as soon as possible.

SINGLE TOUCH PAYROLL

1 July Employers with less than 20 employees should start transition to Single Touch Payroll (STP)

Single Touch Payroll (STP) is a new way of reporting tax and super information to the ATO.

If you are using a solution that offers STP reporting, such as payroll or accounting software, you will send your employees’ tax and super information to the ATO each time you run your payroll and pay your employees.

The information is sent to the ATO either directly from your software, or through a third party – such as a sending service provider.

If you have a software provider, they can tell you more about the type of STP solution they offer. For a list of available STP solutions visit the https://api.gov.au/productregister/

There will also be a number of options available for employers who do not use payroll software, such as http://No-cost and low-cost Single Touch Payroll solutions.

Options will depend on your number of employees:

  • Large employers with 20 or more employees should now be reporting through STP, or have applied to the ATO for a later start date.
  • Small employers with 19 or less employees will need to report through STP from 1 July 2019. This is a gradual transition, and the ATO is providing flexible options.
    • If you’re an employer with four or less employees you will have additional options.

Update – Instant Asset Write-off Changes now Legislated

In the Budget on Tuesday, the Government announced that it would increase the instant asset write-off threshold to $30,000 and extend it to medium sized businesses (those with an aggregated annual turnover of less than $50 million).

This, and the earlier change announced in January (to extend the write-off threshold to $25,000) passed both Houses of Parliament yesterday and is now law (subject to the formality of Royal Assent).

The amendments mean there will be three tiers in the 2018/2019 financial year:

1.     $20,000 threshold for depreciable assets that are acquired and installed ready for use before 29 January 2019. Only available for businesses with an aggregated turnover less than $10 million.

2.     $25,000 threshold for assets first used or installed between 29 January 2019 and 2 April 2019. Only available for businesses with an aggregated turnover less than $10 million.

3.     $30,000 threshold for assets first used and installed after the 2 April budget announcement and before 1 July 2020. Available for businesses with a turnover of less than $50 million.

Going forward, all businesses with a turnover under $50 million are now eligible for a write-off of $30,000. This will be available under 30 June 2020.

To get the taxation benefit of this in the current financial year, you will need to have the asset installed ready for use on or before 30 June 2019.

Legislation Update 26/02/2019

The first sitting of Parliament for 2019 wrapped up last week. While legislation to extend the Single Touch Payroll reporting regime to all employers passed into law (just awaiting Royal Assent), there are a couple of other measures that remain unlegislated which could impact your business. With the full Parliament only expected to sit for three more days (April 2 – 4) until an Election is called, there are now serious doubts surrounding whether these measures will pass into law. In view of this, we put forward the following suggested approach in the meantime: 

  1. Superannuation Amnesty 

The legislation to enact this measure is still before the Senate. To recap, the Superannuation Guarantee Amnesty was to be available for the 12-month period from 24 May 2018 to 23 May 2019. To get the benefits of the Amnesty (set out below) employers must during this 12-month period voluntarily disclose any Superannuation Guarantee underpayments that exist in the past (going back to when Superannuation Guarantee commenced in 1992). 

For an employer, the tax benefits of the Amnesty are: 

* The administration component of the Superannuation Guarantee Charge (SGG) is not payable (this is a $20 per employee, per quarter, for whom there is an SG Shortfall) 

*  Part 7 penalties will not be applied. This can be up to 200% of the SG Charge that is payable (note that SG Charge includes the SG Shortfall that you owe to employees) 

* All catch-up payments that you make during the 12-month Amnesty period will be tax deductible. 

By contrast, under the current law, when superannuation has been underpaid or paid late Superannuation Guarantee Charge that must paid to the ATO is not deductible, and late contributions that an employer has made to an employee’s superannuation and has elected to offset against their SG Charge liability are also not deductible. 

If an employer is contemplating disclosing past superannuation shortfalls specifically to get the benefits of the Amnesty (including claiming a deduction for your late contributions) then it may be prudent to hold off until such time that the Amnesty actually becomes law (if at all). We will keep you apprised of the passage of the legislation through Parliament. However, with only a few sitting days remaining for this Parliament, and with the Opposition opposed to this measure, there are serious doubts about it becoming law. 

Irrespective of the Amnesty however, all employers should consider coming forward to disclose and pay past shortfalls to get their Superannuation Guarantee affairs in order. The Government is committing more resources to this area – including requiring Superannuation Funds to report more regularly to the ATO (at least once each month) – therefore non-complying employers may be more easily detected going forward. 

  1. Enhancing the Instant Asset Write-Off 

Legislation to expand and extend the Small Business Instant Asset Write-Off is still before the House of Representatives. This Bill seeks to extend the write-off by 12 months until 30 June 2020 (currently set to expire on 30 June 2019) and increase the threshold by $5,000 to $25,000; with the increase backdated to 29 January 2019. If passed into law, this would mean that there would be two thresholds for 2018/2019 as follows: 

* $20,000 (for assets installed ready for use between 1 July 2018 and 28 January 2019), and 

* $25,000 (for assets installed ready for use between 29 January 2019 and 30 June 2019. 

Irrespective of the whether the legislation passes into law, it is important to have perspective. You are only getting back the tax rate on the asset, not the full value of the asset. This is the same as the old law where the write-off threshold was $1,000  You don’t get any extra cash than you would otherwise have received under the old rules – you simply get it sooner. Consequently, you should not let tax distort or blur your commercial instincts – as you don’t get any extra cash than you would otherwise have under the old rules, you should continue to only buy assets that fit within your business plan. 

#News Flash# Single Touch Payroll Legislation Passes Parliament

Smaller employers (those with 19 or less employees) must commence reporting via Single Touch Payroll (STP) from 1 July 2019 after legislation passed Parliament this morning (12/02/2019).  

The STP regime revolutionises the way employers report payroll information to the ATO. In essence, STP is a new reporting mechanism whereby employers report employee payments (such as salary and wages, allowances etc.) and PAYG withholding to the ATO directly through their STP solution (e.g. upgraded Standard Business Reporting-enabled software) at the same time they pay their employees. To be clear, no additional reporting is required – just a new method of reporting.

Standard business reporting-enabled software (SBR-enabled software) is essential to reporting under STP. Employers must adopt an STP solution by the due date. Solutions will vary depending on an employer’s current payroll processes.

  •  Accountant or Bookkeeper – Employers who use an Accountant or Bookkeeper to process their pays will simply rely on them to provide an STP solution (SBR-enabled software) by the deadline. Even where an Accountant or Bookkeeper does not process employer payroll, employers may turn to them for advice around how they can become STP-compliant.
  • Software Upgrades – If an employer uses commercial payroll software, then they should contact their software provider as the deadline nears and ensure that they offer an updated Standard Business Reporting-enabled version of the software. Major software houses have this software available.
  • In-House Method – If an employer uses an in-house method of payroll or manual method (such as paying employees by EFT and manually providing them with pay-slips and Payment Summaries)…then they will likely need to adopt STP-compliant payroll software. Such employers may lean heavily on their Bookkeeper or Accountant when installing this software, and may need upfront training. Alternatively, they may choose to outsource their payroll to a payroll service provider such as a payroll bureau, or an Accountant or Bookkeeper.

The ATO is acknowledging that there are a significant number of smaller employers who do not use any type of payroll software when processing the pays each week/fortnight etc. Consequently, micro businesses (employers with 1 to 4 employees) will not be required to adopt/buy payroll software in order to comply with Single Touch Payroll (STP) reporting. Whilst for most employers their STP solution will be adopting STP-compliant software, micro-businesses will according to the ATO be provided with different STP compliance options. Speaking on a recent ATO webcast, ATO Assistant Commissioner, John Shepherd confirmed this:

“You won’t need to buy payroll software, that’s why we’re looking for those alternate solutions- some of which might be an app, something that’s fit for purpose to get the STP information in but is easy to use, doesn’t take much time and doesn’t cost that business money to do so ,” said Mr Shepherd.

“We’ve spoken to some different banks and the possibilities around as people pay staff through internet banking being able to submit the single touch pay run information at the same time and we expect that to be part of the list of options that come forward over the next 12 months.

“There are obviously lots of other benefits from using payroll software but we’re not saying for STP that you need to go out and buy a product to do STP.”

MYOB and Xero and other major software houses have already developed these low cost STP-solutions for micro-business. You should contact your Accountant or Bookkeeper for further guidance in this area.

 

 

Tax Relief on Changing Business Structures

Whilst the ability for a small business to change their legal structure without attracting a tax liability has been available for a little over 15 months, it may be one of those areas that small business and tax practitioners are still coming to terms with. This tax tip considers:
The eligibility criteria;

  • How the provisions work; and
  • What are the impacts. 

Is My Business Eligible 

To be eligible and to gain access to the rollover provisions, a number of tests must be satisfied as follows: 

  1. Both the transferor and the transferee must be small businesses 

This means that both the transferor and the transferee must be businesses each with an aggregated turnover of less than $10 Million.  Note that this aggregated turnover not only relates to the subject entity, but also to entities that may be affiliated or connected with the subject entity. Care is required in determining the applicability of this test as the affiliated or connected with test can be quite complex. 

  1. The restructure must be part of a genuine restructure and not part of a tax driven scheme 

Whether or not a restructure is “genuine” will depend on the specific circumstances surrounding the restructure. The guidelines that accompanied the restructure legislation provide some details on what may be considered a “genuine restructure” and include:

  • A bona fide commercial arrangement has been undertaken to enhance business efficiency;
  • The business continues to operate following the transfer, through a different entity structure;
  • Transferred assets continue to be used in the new business structure;
  • The new structure that has been adopted has taken professional advice when setting up the business;
  • The restructure is not artificial or unduly tax driven; and
  • The restructure is not a divestment of assets or a preliminary step to facilitate the disposal of assets outside the business. 
  1. Ultimate economic ownership must be maintained before and after the restructure 

The ultimate economic owners of an asset are the individuals who, directly or indirectly, own an asset. Where there is more than one individual with ultimate economic ownership, there is an additional requirement that each individual’s share of ultimate economic ownership be maintained. Where a discretionary trust is involved, this means that there is no practical change to the individual beneficiaries who ultimately benefit from the assets before and after the transfer. 

How The Provisions Work 

A business can be operating either as a sole trader, a partnership, a company or as a trust. There may be a time when the business owners believe that they have “outgrown” their current trading structure and that the structure no longer meets their needs. This could involve asset protection issues, commercial requirements, public perception, etc.  The Rollover Provisions provide opportunities for a business to restructure from one legal entity to another without incurring a range of tax liabilities that would normally arise when such a transaction is performed. 
It is important to note however that the rollover provisions only apply to certain “active assets” of a business. Such assets are normally CGT assets, depreciating assets, trading stock and other assets that form part of the operating business being restructured.  The rollover does not apply to certain assets such as shareholder or beneficiary loans or  passive assets held in a structure. 

What Are The Impacts 

There are a number of impacts that you should consider before applying the restructure rollover measures including:

  • Assets are taken to be transferred at their tax cost and as such will not result in an income tax liability to either the transferor or the transferee.
  • There is no requirement for any consideration (market value or otherwise) to be provided by the transferee in exchange for those assets.
  • In relation to specific asset classes, the following should be considered:
  • Pre-CGT assets retain their pre-CGT status.
  • Post-CGT assets are taken to be acquired by the transferee at the date of transfer for their cost at that time. This means that to be eligible to claim the CGT discount on any subsequent sale from the new structure, you will need to wait at least 12 months.
  • Access to the 15 year exemption however as part of  the small business CGT concessions is not affected as the transferee will be taken to have acquired the asset when the transferor acquired it (different to the CGT discount).
  • Trading stock can either be transferred at the transferor’s cost or at the market value of that stock held by the transferor at the start of an income year.
  • Revenue assets take the cost which will result in no profit or loss to the transferee.
  • Depreciating assets will be transferred at the written down value of those assets at the date of the transfer and then continue to depreciated using the same method and effective life that the transferor was using. 
  • There may also be issues to consider in relation to GST or stamp duty on the restructure so professional advice should be sought when utilising the rollover measures. 
  • The restructure provisions can have a very positive outcome for small businesses looking to restructure their affairs, but ensure you seek appropriate professional advice as there may also be some other implications that result in unwanted outcomes..

Payment Summaries Due 14 July 2017

With the end of financial year fast approaching, be mindful that Payment Summaries must be provided to employees by 14 July for 2016/2017. This date is not just a guideline but is actually stipulated by law (Section 16- 155 of the Tax Administration Act). Two of the most common errors made in preparing the Individual Non-Business Payment Summary for employees are:

 

  • Misstating reportable employer superannuation contributions – ensure that you exclude Superannuation Guarantee amounts from this label. Salary sacrificed superannuation amounts must however be included.

 

 

This year there are special rules for Working Holiday Makers. A reduced tax rate applies for employers who registered with the ATO from 1 January 2017 — 15% up to $37,000 and 32.5% from $37,001. For registered Working Holiday Makers who worked both before and after 1 January 2017, two Payment Summaries must be issued, with the two different tax rates applying to the gross payments, depending upon the time of payment.

 

On the other hand, employers who did not register with the ATO for the reduced tax rate and continued to withhold at the foreign resident rate of 32.5% are required to issue the standard single Payment Summary per employee.

 

The Payment Summary for 2016/2017 includes a new section for overseas workers. In the Gross Payments Type box you must now indicate a type – this will be either S (salary), or H (registered Working Holiday Makers).

 

 

 

ATO Debt Alert

From 1 July 2017 the ATO is cracking down on businesses with large debts owed. This could have far-reaching consequences for affected businesses. As a result, action may need to be take before this deadline.

BACKGROUND
The ATO is currently owed more than $19 billion in overdue tax. Of this, approximately two-thirds is owed by small businesses (those with a turnover of less than $2 million). This presents a delicate balance for the ATO and Government with the need to protect Government revenue coming up against the desire not to send businesses ‘to the wall’ and the flow-on costs that come with that (unemployed staff etc).
However, in the Mid-Year Economic and Fiscal Outlook (MYEFO) it would seem that the Government has had enough, announcing a rather dramatic debt measure that all business taxpayers should take note of.

DETAILS
In MYEFO,which is the Government’s mid-year Budget update in December, it was announced that where an entity meets the following criteria in relation to an ATO debt, the ATO will be permitted to disclose this debt to Credit Reporting Bureaus:
  • You or your business has an ABN
  • Your debt is more than $10,000
  • Your debt is more than 90 days old and
  • You have not engaged the ATO in respect of repaying the debt.

This is a big shift from current practice where the consequences of not paying ATO debt have no real tangible impact on your day-to-day operations other than the incurring of a General Interest Charge (currently 8.75% compounding daily) and the issuance of a Director Penalty Notice requiring company directors to personally pay outstanding PAYG Withholding and Superannuation Guarantee Charge. By contrast, the implementation of this new policy (which at the time of writing (March) is set to go ahead) could have profound effects for a small business. Credit default ‘black marks’ last for five years. In the worst of cases, support from financiers may be withdrawn and supplier credit stopped.

ACTION POINTS

This change does not require legislative passage through the Parliament. As such the ATO is free to implement this policy from 1 July without Parliamentary approval. Given the profund consequences of a 5-year credit ‘black mark’ on a business (potentially drying up finance) we would strongly recommend that businesses who meet the above criteria with respect to a current ATO debt either (a) repay the debt to at least below the $10,000 threshold or (b) enter into a payment arrangement with the ATO before 1 July 2017. Indeed, irrespective of whether the above conditions are met, it’s always best practice to engage with the ATO by entering into a payment arrangement. Having a record of cooperation and compliance can assist in future ATO dealings in respect of extensions/leniency etc.

The good news is that the ATO is very flexible with payment arrangements – they will generally make every effort to accommodate your requirements. The ATO can also offer interest-free repayment plans to some small businesses in relation to Activity Statement debt. To enter into a payment arrangement, you should phone the ATO on 13 28 66 or get your Accountant to contact them on your behalf.
The ATO provide further guidance on help with paying debts at https://www.ato.gov.au/general/paying-the-ato/help-with-paying/ 

To read this entire article log into the ATR members area here //mytaxsavers.com.au/wp/wp-login.php see Bi Monthly update May/June page 9.

https://www.ato.gov.au/general/new-legislation/in-detail/other-topics/improve-the-transparency-of-tax-debts/

WHATS HOT?

This article examines some topical issues that taxpayers and employers should be aware of at this time. Areas covered include ATO compliance, the instant asset write-off, Airbnb tax consequences, and more.

NEW ATO RULES

The ATO is currently on the look-out for and taking action against employers who are not complying with two new regimes:

BACKPACKER TAX
Employers who employ workers in Australia on a 417 or 462 visa must now be withholding 15% tax from every dollar that they earn up to $37,000 (from the first dollar that they earn). These workers can no longer claim the tax-free threshold. Beyond $37,000, the normal tax rates apply.

Employers who currently have these workers on their books, must have registered online with the ATO by 31 January 2017 at www.ato.gov.au/twhm/ to be able to withhold at this new rate. Employers who won’t have this class of workers on their books until later in the year can register their business at that time. When you register with the ATO, you will typically not receive an acknowledgement, however the ATO advise that they will eventually include your registration information in your business’s ATO profile. To confirm that your registration has been successful, at this stage you will need to phone the ATO. Employers who cannot register online, can register with the ATO by phoning their business info line on 13 28 66. Employers with this type of worker on their books who do not register with the ATO will be required to withhold at the 32.5% rate and may be subject to ATO penalties.

SUPERSTREAM
Despite the deadline having passed months ago, SuperStream non-compliance among employers is still relatively high. By way of background, SuperStream is a Government initiative that aims to improve the efficiency of administering Australia’s superannuation system. The system requires employers to remit employee contributions (including Superannuation Guarantee) and other relevant data in an electronic, standardised format. The data is linked to the payment by a unique payment reference number. All employers are now required to be SuperStream compliant except for:
  • Contributions to your own SMSF (i.e. if you’re a related-party employer) – for example , if you’re an employee of your family business and your Superannuation Guarantee contributions go to your SMSF.
  • Personal Contributions – for example, if you’re a sole trader and you contribute to a superannuation fund for yourself.
Fines of up to $8,500 can now be imposed by the ATO on employers who are not SuperStream compliant. For more information on the SuperStream regime including compliance solutions, see the September/October edition of our publication which is available in the subscriber section of our website https://www.taxrmytaxsavers.com.aueporter.com.au

INSTANT ASSET WRITE-OFF

If you are a small business (aggregated turnover of less that $2 million) contemplating buying machinery or equipment, be aware that these are the final months of the $20,000 instant asset write-off.

With a sunset date of 30 June 2017, small businesses may wish to start considering bringing forward any planned asset investments to the next few months – particularly in this current low interest-rate environment. You can read more about the cashflow benefits of the instant asset write-off in the previous edition of our publication (January/February 2017 ). Note that legislation is currently before the Parliament to increase the turnover eligibility threshold from $2 million to $10 million (to be back dated to 1 July 2016) however at the time of writing this has not yes been passed into law. We will immediately notify subscribers via email if and when this increase becomes law.

RENTING OUT YOUR HOME

With the advent of Airbnb many more residential home owners are now landlords – renting out their entire house, or one or two rooms. The ATO is at the moment,is particularly targeting those that rent out part of their property via Airbnb.

Whether you are renting out your entire home or part of your home through Airbnb or just traditionally by advertising it or through a real estate agent…. the tax consequences are broadly the same as follows:
INCOME
Any rental income will be assessable. You should keep records of your rental income, even when it is paid by the tenant in cash.
RENTAL EXPENSES
Where your rental income is assessable, you are generally entitled to tax deductions for expenses incurred in deriving that income.For landlords these generally fall in 3 categories:

To read the complete article please see the ATR Bi Monthly update for Mar/Apr 2017 – this can be accessed via our exclusive ATR Members Area https://www.mytaxsavers.com.au/login

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