Latest News
Key factors for rescuing a bad debt deduction
Unpaid debts owed to a business can have a significant impact on cash flow and the profitability of a business. In taxation the characterisation of a debt as either “doubtful” or “bad” is key as to whether or not the writing off of that debt would be deductible. (February 2018) Read more
Rental property owners lose some deductions
Legislation that came into law in the last half of 2017 makes certain measures that were first announced with the 2017 Federal Budget now a reality. (February 2018) Read more
When refinancing, loan interest can be deductible to a partnership
Partnerships are generally set up so that all partners are equally responsible for the management of the business, but each also has liability for the debts that business may incur. We explain the “refinancing principle”, and other partnership facts and foibles. (February 2018) Read more
Expanding the empire (and retaining the CGT main residence exemption)
A question that surfaces now and then in regard to capital gains is whether the main residence exemption extends to additional land acquired after the time of acquisition of the residence. (February 2018) Read more
Can an SMSF invest in property development?
Is property development an allowable investment for an SMSF? The short answer is yes, but be careful! The ATO has indicated this is one of the issues on its radar for 2018. What do you need to consider? (February 2018) Read more
ATO spells out its big FBT concerns
The FBT year is just around the corner, so to help taxpayers get it right the ATO has listed the FBT issues that attract its attention, such as aspects of the living-away-from-home allowance, carparking, employer provided vehicles & more. Discover the behaviours and characteristics that tend to raise a red flag. (February 2018) Read more
Tax and Christmas party planning
Celebrating the season can be team-building or just a bit of fun, but the well-prepared business owner will also know that a little tax planning can help make sure there’s no unforeseen tax problems. (December 2017) Read more
Beware Division 7A when borrowing from your business
Business owners of private companies often borrow money from their own companies for all sorts of reasons including situations in which private companies dole out money to those within a business, in a form other than salary or dividends, which needs to be understood by business owners. This is known as Division 7A. (December 2017) Read more
Stay alert for scams and fraud
Be aware of what you share! Up to the end of the last financial year, $2.7 million was handed over to fraudsters. It’s important to know the traps for tax scams and identity theft, and what to do if you believe you have received an illegitimate request. (December 2017) Read more
Understanding novated leases, FBT and claims for work-related car expenses
A novated lease is a popular way for employers to reward and incentivise their staff. However, employees should understand how FBT might apply to them and what they can do to minimise an FBT liability. How does a novated lease work? (December 2017) Read more
10 tips for rental property owners to avoid common tax mistakes
The ATO lists the 10 most common tax errors made by rental property investors, and says avoiding these tax mistakes will save taxpayers both time and money. (December 2017) Read more
Taxation of foreign income derived by Australian residents
Under Australia’s taxation regime, resident taxpayers are subject to income tax on both income derived in Australia and on foreign sourced income. As a general rule, where foreign income is derived by an Australian resident, the gross amount must be included as assessable income. (December 2017) Read more
The ins and outs of “entertainment” business deductions
Whether a business expense is “entertainment” will generally determine whether the cost is deductible. If the expense can be shown to be directly connected with the carrying on of a business, it should be deductible. We explore the ins and outs of this tax law. (December 2017) Read more
What the proposed housing based super contribution initiatives offer
The government has put to Parliament its proposed legislation around two of schemes: 1. "First Home Super Saver" scheme to assist first home buyers to save a deposit through their superannuation; and 2. "Contributing the proceeds of downsizing to superannuation" to assist retirees to use some of the money from downsizing their living arrangements for superannuation. This legislation is an attempt to bring into action proposals from the 2017 federal budget. Want to know more? (October 2017) Click here
High income earners: Beware of Division 293!
If your remuneration, including reportable fringe benefits and salary sacrificed super contributions, is more than $250,000pa you may have an additional tax liability over and above the normal income tax payable. (October 2017) Read more
Look before you leap: the small business CGT concessions
The CGT relief concessions available to small businesses can be very generous. However they can also be complex and confusing, so knowing a few of the finer details can go a long way to ensuring your small business can take best advantage of them. (October 2017) Read more
Treasury amends LRBA requirements for SMSFs – again
Treasury was concerned that some trustees would try to get around the $1.6 million transfer balance cap (TBC) through the ingenious use of a limited recourse borrowing arrangement (LRBA). Thankfully the new rules do not affect LRBAs entered into before 1 July 2017. In effect, the new rules ensure that a member of a fund is not able to manipulate arrangements to get around the TBC. We explain in plain English. (October 2017) Read more
Small business car parking FBT exemption
A business becomes liable for FBT where it provides a car parking facility for more than 4 hours on its premises to its employees, and is situated within 1 kilometre of a commercial car park where the minimum all day cost is more than the current parking fringe benefit threshold of $8.66 a day. (October 2017) Read more
Are those investment returns on revenue or capital account?
Investment returns can be on revenue or capital account. Similarly investment expenditure could also be on revenue or capital account. We help you understand the distinction between revenue and capital. (October 2017) Read more
ATO waves a red flag on deductions for holiday rentals
The ATO recently announced it is paying close attention to rental properties in popular holiday destinations, saying that last year it identified a large number of mistakes with deductions whereby it noted some people claiming deductions for holiday homes even where the property is not actually being rented out, or not “genuinely available” for rent. (August 2017) Read more
Streaming trust capital gains and franked distributions
The ATO has stated that a trust's capital gains and franked distributions can, if not prevented by the trust deed, be streamed to beneficiaries for tax purposes by making these beneficiaries “specifically entitled” to the amounts, allowing beneficiaries to offset capital gains with their capital losses, apply applicable discounts and, subject to certain integrity rules, get the benefit of any franking credits attached to a franked distribution. (August 2017) Read more
Accelerated depreciation for small business
In the 2015-16 federal budget, the government increased the small business immediate deductibility threshold from $1,000 to $20,000 to end at June 30, 2017. But a law amendment bill has recently been passed to extend this to June 30, 2018, after which the deductibility threshold will revert to $1,000. (August 2017) Read more
Substantiation for mobile, home phone and internet costs
The ATO has issued guidance on making claims for mobile phone use as well as home phone and internet expenses, and points out that use for both work and private matters will require you to work out the percentage that “reasonably relates” to work use. (August 2017) Read more
Travel allowances & proper use of the exception to substantiate claims
A travel allowance is a payment made to employees to cover accommodation, food, drink or incidental expenses incurred when travelling away from home. When claiming deductions you will be expected to be able to substantiate the expense and produce documentary evidence should the ATO request it. (August 2017) Read more
Child death benefit recipients and the transfer cap
The death of a parent is hard on all those involved, however there comes a time when you need to address financial matters. One of these issues can be what happens to any superannuation they have left. (August 2017) Read more
Tax deductions specifically for SMSFs
One overarching fundamental that SMSF trustees should ideally keep in mind is the sole purpose test — that is, every decision made and action taken is required to be seen as being undertaken for the sole purpose of providing retirement benefits for the fund’s members. (August 2017) Read more
Deductions for finance for a rental property
Interest can be claimed for the cost of funds borrowed to purchase a rental property and to meet maintenance costs or running expenses while the rental property is being (or is available) to be let under a commercial arrangement to generate assessable income. The deductibility of interest is determined from the purpose for borrowing and the use to which the funds are put. Here’s 3 examples that explain what is deductible. (August 2017) Read more
Life policy bonuses and tax
When a life insurance policy has been held by a taxpayer for 10 years or longer, reversionary bonuses received are generally tax-free. For policies held for less than 10 years, stipulated amounts are included in the taxpayer’s assessable income and a tax offset is available. (August 2017) Read more
The CGT implications of subdividing & building on the family property
A common question concerns the effects on the CGT main residence exemption where the owner decides to subdivide the land containing their principal place of residence to build residential units. We provide 3 typical scenarios. (June 2017) Read more
Selling up your business? Don't forget the "going concern" GST exemption
The concept of a "going concern" exemption for the purposes of GST does cause confusion when businesses are sold. What is a "going concern" and what are the requirements for the exemption? (June 2017) Read more
Business costs & the deductibility of interest expenses
If a business racks up an interest bill from borrowing funds to pay for the expenses of running the business, this expense is generally allowed as a tax deduction for the relevant year. What are the factors? (June 2017) Read more
Company tax franking implications
The recent cut to the tax rate to 27.5% for incorporated businesses that turnover less than $50 million a year can bring with it some important considerations when it comes to distributing franked dividends. The rate change will be staggered, starting with companies that turnover up to $10 million a year. (June 2017) Read more
End of year tax planning tips for business
The general rule is that you can claim deductions for expenses your business incurs — but there are also some less obvious options left available just before the end of the income year to further reduce your enterprise’s tax burden for the year. (May 2017) Read more
Disclaimer
All Client Newsletter Library material is of a general nature only and is not personal financial or investment advice. It does not take into account one individual’s particular objectives and circumstances. No person should act on the basis of this information without first obtaining and following the advice of a suitably qualified professional adviser. To the fullest extent permitted by law, no person involved in producing, distributing or providing the information through this service (including Tax & Super Australia Incorporated, each of its directors, councillors, employees and contractors and the editors or authors of the information) will be liable in any way for any loss or damage suffered by any person through the use of or access to this information.