Small business and general business tax break ends 31st December 2009

Businesses can claim an additional tax deduction when they buy certain assets, and when they spend money to improve existing assets, for a limited time. It’s called the Small Business and General Business Tax Break – ‘business tax break’ for short.

The Australian Government announced the tax break as an ‘investment allowance’ in December 2008 aimed at helping businesses meet the challenges of the economic downturn.

The government later extended this tax break in the May Budget to allow small businesses to claim a 50% tax deduction on eligible assets bought by 31 December 2009.

Source  :   www.ato.gov.au

Advertisement

Read Full Post »

Australian Tax Returns: It’s That Time Again!

The Australian tax year ended on 30th June, 2009.

With its knowledge of migrant tax matters and the impact of visa status on how income and capital gains are taxed Go Matilda Accounting and Tax is here to help. It is particularly important for temporary visaholders (eg subclass 457, 410, provisional business skills subclasses 160 to 165) who are residing in Australia to be aware that income and capital gains arising from outside Australia are not subject to Australian tax – only Australian source income is taxable.

This is to be contrasted with the generality of Australian taxpayers (Australian citizens and permanent residents) who are resident in Australia, for whom worldwide income and capital gains are assessable in Australia. Go Matilda Accounting and Tax is managed by Alan Collett and Jane Cooper, both of whom are tax qualified in the UK and Australia.

They will be pleased to discuss your situation, how we might help – and to confirm our fees if we are instructed to assist.

Contact Alan Collett on Geelong number 03 5222 6288, or Jane Cooper on Perth number 08 9261 7762.

Source  :  www.gomatilda.com

Read Full Post »

How to avoid an end of financial year tax headache

• Last-minute tips to save on tax
• What to claim, how to file
• Plenty of help on ATO website

HAPPY New Year! Well, almost. With only 24 hours left until the end of financial year, what should you be doing today to ensure that you don’t end up with a big tax hangover tomorrow?

“Don’t forget to pay your expenses,” says Tracey Nicholson, the Assistant Commissioner of Taxation.

“Ensuring that expenses are paid and claimed in the correct tax year can save a lot of headaches in having tax returns amended down the track.”

Ms Nicholson suggests that some top-priority things for taxpayers to do prior to lodging their return include:

• Go surfing! The ATO website, that is.

“There is a wealth of information on the ATO website, both general as well as information that’s specific to various professions,” says Ms Nicholson. “It’s a great place to start your research on what you may be able to claim as a deduction.”

• Spring clean the house to find your receipts.

“At the end of the day you need to keep your receipts to substantiate your claims,” says Ms Nicholson.

• Lodge online.

If you are DIYing your tax, Ms Nicholson recommends the online e-tax process as a great way to complete your return.

“It’s free, and has a great step-by-step process that will help remind you of anything that you have forgotten,” she says.

It can be worth getting professional advice as well though. Bill Keays, founding director of WA-based Hales Keays Chartered Accountants says that in his experience there are a number of tax-related benefits that people sometimes overlook.

“Motor vehicle expenses are often overlooked,” he says.

“You can claim up to 5000 kilometres of work-related use based on a reasonable estimate of business kilometers, without needing to keep a log book. But some people think that if they haven’t kept a log book, they can’t claim.”

Another forgotten area, according to Mr Keays, is depreciation on a rental property.

“Sometimes clients are not aware of how much depreciation they can claim,” he says.

“For taxpayers who have a relatively modern rental property, engage a quantity surveyor to prepare a depreciation report. They will typically save you many times more than their fee due to the deductions they identify.”

But lest you get carried away with all the potential deductions out there, remember that you do need the paperwork to back it up.

“We conduct plenty of audits,”says Ms Nicholson.

“We’re going to have a special focus on truck drivers, sales and marketing managers, sales reps and electricians this year – but any taxpayer has the chance of being audited.”

And while it may be too late for this financial year, consider getting some professional advice for next year’s tax return because sometimes you don’t know what you don’t know.

“There’s usually always some way in which we can save clients extra money, either by identifying deductions or simply getting their tax structures right to start with,” says Mr Keays.

“The Small Business CGT concessions are a great example.

“One of my clients was expecting to pay capital gains tax of approximately $240,000 when he disposed of his business and he ended up paying nothing by applying these concessions.”

Your tax time checklist                                                                                                                                                                                           

To help you get the best tax return possible, here’s a few things to tick off your “to do” list today:

1. Are you eligible for the Superannuation Co-contribution? If so, it’s up to $1,500 of free money.

2. If you use your car for work, don’t forget to estimate your motor vehicle expenses.

3. A 20% tax offset is available for out of pocket medical expenses over $1500.

4. Donations of over $2 made to a deductible gift recipient are tax deductible.

5. The cost of having your tax return prepared is also an allowable deduction.

6. Income Protection insurance premiums can also be a tax deduction.

7. Small business owners who are selling business assets can take advantage of extremely generous “small business CGT concessions.”

8. You can claim up to $300 of work related expenses without the need to have written receipts. However once your claim exceeds $300 you must have receipts for the full amount.

9. Don’t forget all those miscellaneous work expenses such as union fees, seminars, trade journals, software and home office expenses. Even an appointment diary can be deductible.

10. Check the deductions fact sheet for your specific occupation to ensure that you are claiming everything that you are entitled to.

Source  :   www.news.com.au

Read Full Post »

2009 Tax time is here

The Tax Office today reminded Australia’s 11.8 million taxpayers to start getting ready to lodge their tax returns.                                                                                                

Tax Commissioner Michael D’Ascenzo said the Tax Office has a range of information and assistance available to help people meet the 31 October 2009 deadline.

“From 1 July, people can prepare and lodge their return online using e-tax, which is free, secure and easy to use software which in most cases processes your return within 14 days.

“As well as calculators, help screens and links to rulings, you can also download information from third parties directly into your tax return, including payment summaries, government payments such as pensions and allowances, bank interest and private health insurance details.

“E-tax can be accessed free of charge 24 hours a day, seven days a week from our website at www.ato.gov.au,” Mr D’Ascenzo said.

Government and third party information will be available to download progressively from 1 July. You can subscribe to an alert service within e-tax which will let you know when the information becomes available.                                                                                                                                                                                        

People can still lodge using TaxPack 2009 or the short tax return for individuals 2009.

TaxPack 2009 is available from most newsagents, Tax Office shopfronts or the Tax Office website from 1 July.

If you used the short tax return last year you’ll receive a copy in the mail shortly.

Mr D’Ascenzo also reminded people to contact their tax agent as soon as possible.

“If you’re using a tax agent for the first time or using a different one from last year you need to contact them by 31 October 2009,” he said.

“Only registered tax agents can charge a fee to prepare and lodge a tax return.

“However some people present themselves as tax agents when they are not.

“Registered tax agents are regulated by the Tax Agents’ Board and have the qualifications and experience to handle your tax affairs.”

Visit the Tax Agents’ Board website http://www.tabd.gov.au or call 1300 362 829 to check if your agent is registered.

Compliance focus

We cross-check tax returns against a wide range of data including financial institution data, state and territory revenue and property sales information and Australian stock exchange data.

Help and assistance

If people have questions or need assistance they should visit the Tax Office website www.ato.gov.au or phone the Tax Office on 13 28 61 between 8.00am and 6.00pm weekdays.

The Tax Office can provide you a more personalised service if you provide your tax file number when you call.

source  :  www.ato.gov.au

Read Full Post »

Shaping up for the end of financial year

The end of financial year can be a stressful time for small business owners, and that time is now upon us once again.  For those of you who are behind and not ‘in shape’ for the end of  financial year… don’t panic, right now there is still a very small window of time for you to get prepared for the end of financial year, but that time is ticking by.

How can you get in shape?

Before 30 June make it a priority to ensure all your bookkeeping and reconciliation is up-to-date, follow up payment of overdue invoices, pay outstanding bills and pay all super contributions (this should not only be for your employees, but for yourselves too). 

With all your reconciliation up-to-date, such as your receivables, payables, bank accounts and inventory, once 30 June is here you will only have one month to reconcile and you can then move on to completing your BAS.  Getting on top of this will ease some of the stress you may feel when preparing your end of financial year documentation.

For small business owners with employees, remember that you will also need to reconcile your payroll and send out payment summaries to your employees (before 14 July 2009).

Following the completion of all your reconciliation and BAS, it’s time to run your end of financial year reports.  Having all your records and reports prepared prior to visiting your accountant will really save you time and money. 

If you’re having difficulties with these tasks, speak to your accountant or bookkeeper, or alternatively a range of online resources, and even accounting software providers, have information on completing these activities.

If you’re having difficulties with these tasks, Don’t forget to backup all your data.  You will also need to keep copies of your accounting records for at least five years (an ATO requirement).

It is also important now to prepare for the 09/10 financial year, as no doubt you want everything to be ‘AOK with the ATO’.

A number of new Federal Government compliance changes will apply from 1 July 2009 and these will affect small businesses.  Information about the new compliance requirements is available from the ATO, or your accountant will also be able to update you on the changes.

If you use accounting/payroll software, you will need software updates that address the compliance changes.  Ensure you’re scheduled to receive the compliance update from your provider, so that you’re compliant for 09/10.

This time of year is also good to consider what improvements you could make to your work practices to stay in shape and make the 09/10 end of financial year less stressful.  For example, implement work practices that ensure you stay on top of your bookkeeping requirements, keep up-to-date with inventory, cash flow and debtors and follow task lists.

Yes, the economic downturn is having an impact on businesses and the pressure is really building, but this presents you with the opportunity to select your own course.

It’s important that you take a step back and look at the ‘big picture’.  Instead of only responding to daily issues, now is the time to develop and implement a sound business plan for overcoming future challenges.

Don’t be afraid to seek specialist advice.  Talk to your accountant.  They can not only help you with tax and accounting related matters, but they can also help you with your business planning, financial goal setting, cash flow and making sure your business is running at its best.

Remember… It’s important to be prepared!

Source  :  www.livenews.com.au

Read Full Post »

Superannuation on the rebound

SUPERANNUATION balances have recovered about $70 billion in the past few months as the share market continues to gain ground.     

The average growth fund is believed to have jumped another 1 per cent in May, adding $10 billion to balances.

This takes the recovery since February to about 7 per cent, or $70 billion.

According to independent research house Chant West, despite recent improvement, the average growth fund is still forecast to lose 13 per cent for the financial year.

Chant West investment research analyst Mano Mohankumar said yesterday results were still being held back by the share market and an continuing fall in unlisted assets, expected to show up to a 25 per cent loss for the year to June.

A separate survey released yesterday showed the downturn has put retirement plans of hundreds of thousands of Australians in doubt

Every second retiree or soon-to-be retiree had lost up to $50,000 in the past year from retirement savings or investment portfolios. About one in three had lost up to $100,000, it said.

The Bankwest survey, Retiring in the Downturn, said retirement plans of 74 per cent of older Australians had been disrupted.

“While younger Australians have years to recover, many retirees have little chance to recover lost wealth,” Bankwest’s Ian Corfield said.

Source  :   www.news.com.au

Read Full Post »

ATO warns SMSFs to keep deals at arm’s length

The Australian Tax Office has issued a warning to self-managed super funds (SMSFs) about people offering to set up agreements between funds and related parties to purchase assets, particularly properties.

Tax Commissioner Michael D’Ascenzo says he’s concerned some of the arrangements on offer breach the in-house asset rules.

“These arrangements use a paid third party to set up an agreement, sometimes referred to as ‘a joint venture agreement’, between the fund and a related trust to purchase an asset that provides income for the trust and the fund,” D’Ascenzo says.

“This is clearly an attempt to circumvent the in-house asset rules as the transaction is really an investment by the SMSF in the related trust.”

“This alert serves as a timely reminder to trustees that we’re looking closely at SMSFs to ensure they’re meeting their obligations in relation to loans, in-house assets, borrowings and non-arm’s length transactions.”

The Taxpayer Alert (2009/16) on this issue is available from the Tax Office website at www.ato.gov.au/atp.

Source  :  www.apimagazine.com.au

Read Full Post »

Warning: tax refund email scam

The Tax Office is warning people to be wary of a fraudulent email being circulated that claims to offer a refund from the Tax Office.

The email uses the Tax Office logo and the words ‘Tax refund online!’ in the subject heading and the following text:

Tax refund online!After the last annual calculation of your fiscal activity we have determined that you are eligible to receive a tax refund of AUD 452. Please submit the tax refund and allow us 2-5 business days in order to process it.

There may be more variations to this subject heading and text.

The email asks people to click on a link which directs them to a bogus Tax Office website and asks for credit card and personal details.

Tax Commissioner Michael D’Ascenzo said anyone who receives the email should delete it immediately.

“The Tax Office never sends emails asking people to provide personal information including credit card details.

“People should always be wary of unsolicited emails claiming to be from the Tax Office.

“As an extra precaution we recommend you type internet addresses directly into your internet browser rather than clicking on links embedded in emails,” Mr D’Ascenzo said.

These websites are often set up in multiple jurisdictions making them difficult to trace and to effectively shut them down.

If people have entered their credit card information on the website, they should immediately report it to their credit card provider.

More information www.ato.gov.au

Read Full Post »

Education Tax Refund

The Education Tax Refund (ETR) is a new government initiative to help with the cost of educating primary and secondary school children. It means eligible parents, carers, legal guardians and independent students could get 50% back on some education expenses. This includes items like computers, educational software, textbooks and stationery.

Most people are eligible for the ETR because they receive Family Tax Benefit (FTB) Part A. However, there are some payments that prevent you from receiving FTB Part A, but which still entitle you to receive the refund. You can also claim the refund if you are an independent student.

You can claim the ETR each financial year for children in primary and/or secondary school, or if you are an independent student. You will be able to claim the refund from 1 July 2009 for the 2008/09 financial year. This means you can claim for items purchased from 1 July 2008. Remember to keep your receipts as they will help you calculate your entitlement and you may be required to produce them as proof of purchase.

You can claim the ETR even if you are not required to lodge a tax return.

For more information, see  http://www.educationtaxrefund.gov.au/about-the-ETR/

Read Full Post »

Sales Tax & Refunds

Sales Tax & Refunds Australia has a Sales Tax & Refunds. Prices in Australia are shown as Sales Tax & Refunds International and domestic flights purchased overseas, by non-residents, are GST free. Continuous domestic legs of international journeys are also Sales Tax & Refunds. GST is payable on tourism services such as accommodation, day tours, guides, ground transport (including coach, rail and cruise), translators and meals. The tax applies to pre-booked and pre-paid goods and services in Australia, which are purchased before arrival in Australia, for example tours or accommodation. The prices quoted for your Australian holiday, by your travel agent, will already include the Goods and Services Tax (GST). The total amount is payable at the time of ticketing your holiday. Tourist Refund Scheme Departing travellers may be able to claim GST inclulaim a refund for GST and WET (Wine Equalisation Tax) paid on goods purchased in Australia. The refund is applicable to goods, totalling $A300 (sive) or more that are being taken out of Australia. The goods must have been purchased no earlier than 30 days before leaving Australia. You can purchase several lower-priced items from one store, either at the same time or on several occasions within the 30 day period. These goods will be covered by the one tax invoice. Or you can buy goods from several stores, provided that each store’s tax invoice totals at least $A300 (GST inclusive). Tourist Refund Scheme (TRS) facilities are located at international airports and cruise-liner terminals. To claim, out of Australia travellers must show their passport, international boarding pass, retailer’s tax invoice and the goods. Other conditions may apply. There is a range of government, airport, sea and local taxes applicable on air and sea travel. These will usually be included in your ticket.

Read Full Post »