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Business & Tax Update - July 2019

Our first update for the new financial year is here:  Business and Tax Update July 2019

Topics covered include: 

Changes to Superannuation 1 July 2019

Single Touch Payroll for family members

Laundry claims being reviewed by the ATO

Who owns the assets in a Trust?



Don't Lodge Too Soon!

Don't Lodge Your Tax Return Too Soon!

The Australian Taxation Office has been flooded with 90,000 calls as tax cuts pass, according to ABC news.  The Federal Government's tax plan includes changes to the Low and Middle Income Tax Offset (LMITO), reducing the amount of tax low and middle income earners need to pay.  The Federal Government estimates that 4.5 million Australian taxpayers will be eligible for the full LMITO, and a further 5.6 million will receive a partial offset. 

This will encourage taxpayers to lodge their returns as soon as possible and while the ATO has said it would aim to process online tax returns within two weeks, has previously warned Australians not to lodge too early.   

Assistant Commissioner Karen Foat has asked taxpayers to wait until around August to lodge. "Most employers have until July 31 to finalise their employees' income statements so, we strongly encourage taxpayers to wait a few weeks before lodging their tax return," she said. "If you lodge your tax return before your income statement is tax ready, your employer might make changes, and you may need to lodge an amendment. In some cases, additional tax and interest may be payable." Waiting also allows more time for other information, such as from banks , health funds and government agencies to be reported to the ATO. 

The Government has increased the base and maximum amount of the LMITO to $255 (from $200) and $1,080 (from $530):

  • Less than $37,000 get $255
  • Between $37,001 and $48,000 get $255, plus 7.5 cents per dollar above $37,000
  • Between $48,001 and $90,000 get $1,080
  • Greater than $90,000, the offset decreases at a rate of 3 cents per dollar, ceasing at income of $126,000

Warning - if you owe the ATO money and are entitled to the new $1,080 offset, that entitlement will firstly be applied against your existing ATO debt before you receive the rest.

Read the ATO statement regarding the changes here ATO Statement on the Low and Middle Income Tax Offset







2018 Christmas Office Hours

The team at Davies, Thompson & Wright take this opportunity to thank all our valuable clients for your continued support throughout 2018. 

We wish you all a Merry Christmas and a safe and Happy New Year for 2019 - along with some much needed rain!

Our office will close at 5:00 pm Thursday 20 December 2018 and re-open 9:00 am Monday 7 January 2019.  

Business & Tax Update - December 2018

No tax deductions if you don't meet your tax obligations - New laws passed by parliament last month directly target the behaviour of taxpayers that don't meet their obligations.

Contractor or employee? A former Foodora Australia delivery rider, Joshua Klooger, recently won an unfair dismissal claim despite a service agreement that classified him as an independent contractor. We explore the implications of the case.

Are you in the cleaning services, road freight, IT or security, investigation or surveillance business?  The Taxable Payments Reporting system was introduced to stem the flow of cash payments to contractors and rampant under reporting of income.  Introduced to the Building and construction services industry back in 2012, this was extended to the cleaning services industry from 1 July 2018. The addition of road freight, IT or security, or investigation or surveillance services, from 1 July 2019, adds another layer.  For businesses providing mixed services, if 10% or more of your GST turnover is made up of affected services, then you will need to report the contractor payments to the ATO. 

All this and more are discussed in our Tax & Business Update - December 2018.

 Business and Tax Update December 2018

Business & Tax Update - November 2018

Accelerated tax rate reduction for small business - Small business is still a vote winner with the Government and Opposition teaming up to accelerate tax cuts for the sector by 5 years impacting on an estimated 3.3 million businesses.

The new rules for gift cards – what you need to know - In Australia, around 34 million gift cards are sold each year with an estimated value of $2.5 billion. On average, an estimated $70 million is lost because of expiry dates. What your business needs to do from 1 November 2019, and what happens if a business ignores the new rules.

Travelling to and from your investment property - From 1 July 2017, new rules came into effect that prevent taxpayers claiming a deduction for expenses they incur travelling to and from their residential investment property. We looks at the exceptions to the rules.

For further information on these topics and more read our November 2018 update.

 Business and Tax Update November 2018

Business & Tax Update - October 2018

Running a business from home? If your home is your principal place of business, you might be able to claim a range of expenses related to the portion of your home set aside for your business. What the ATO is looking for is an identifiable area of the home used for business.

Working from home? A lot of people do some sort of work from home. It might be simply answering emails on the couch or working from home a few days a week. So, what can you claim if you're putting in extra hours?

What does the China/US trade war mean to Australia? As the bilateral trade war between the US and China heats up, Australia is caught between its cultural and military ties to the US and its strong economic relationship with China.

These diverse topics and more are explored further in our Business & Tax Update for October 2018.

 Business and Tax Update October 2018

Business & Tax Update - April 2018

Featured in this month's update:

  • Single Touch Payroll - are you ready?  If you had 20+ employees at 1 April 2018 you need to be ready by 1 July 2018.  All other employers have until 1 July 2019 to make sure they are able to report.  We look at what you need to know...
  • New Super Measures - Buying your first home?  Downsizing at retirement?  We look at how the new super laws might assist...
  • Tax Deductions - And we look at the ATO's favourite topic - tax deductions.  Over $22 billion of tax deductions were claimed in the 2014-2015 year alone. We look at what a recent Inquiry into Tax Deductions has uncovered...

 Business and Tax Update April 2018

Business & Tax Update - March 2018

What is in our Business & Tax Update this month?

1. In March everyone's thoughts turn to Fringe Benefits Tax - we look at the ATO's FBT Hot Spots:

  • Motor Vehicle Use
  • Car Parking
  • Living Away from Home Allowances

We discuss how salary sacrifice or employee contributions can help offset your tax liability.

2. GST on Property Developments - we look at the bill currently before parliament which will mean significant changes to how the GST on property is currently managed.

3. Will your business be audited?  It's something no-one actually enjoys... We look at the small business benchmarks and how the ATO uses these to identify audit targets.  A number of industries have small business benchmarks listed on the ATO website, and while being outside these benchmarks may not necessarily mean there is a tax related problem, it may mean that you will encounter other viability issues down the track.

For all this and more read our March 2018 update.

 Business and Tax Update March 2018


Available Drought Assistance in NSW

How nice is the few drops of rain we've had lately but it certainly isn't enough. We can all see how terribly dry it is in the Hunter Valley at the moment and a number of our clients are suffering due to the lack of rain. 

To play our part we have gathered a few resources together for your information regarding some of the assistance measures available.  Government assistance is available at both State and Commonwealth levels, and the Hunter Local Land Services also has area specific information available.

The Department of Primary Industries has a DroughtHub where a number of these resources can be found:  www.droughthub.nsw.gov.au

Dairy Farmers have also announced a loan facility available to active members: http://www.dfmc.org.au/services/loans/

 2018 Drought Assistance Factsheet

 Local Land Services Drought Factsheet

 Support Services Drought Factsheet


What's New in 2018?

What's new in 2018?  How can we keep up with new changes and legislation that we all should be aware of as business owners, employers, employees, investors, and everyday tax paying citizens?  Log-in monthly to check our Business & Tax Updates.  Sometimes serious, sometimes light-hearted and always informative!

This month we review:

  • New data breach laws - with all our info out there in the cloud new legislation attempts to make it a safer place.  We look at who this affects and what you need to do...
  • Proposed legislation to allow the ATO to apply criminal penalties to Director's of companies who fail to pay superannuation guarantee...
  • Changes coming in 2018, do these affect you?

 Business and Tax Update February 2018

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