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

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Blitz on working holiday visa scam

A SPECIALIST integrity unit has been formed inside the Department of Immigration to deal with widespread fraud in the working holiday visa program, on which industries such as fruit growing depend.

More than 200 internet advertisements have been found offering to buy or sell documents allowing backpackers to claim they had worked in rural jobs without them leaving Sydney, and thus extend their working holiday visas. The standard fee is $400. So far, 64 visas have been cancelled over the fraud and at least 19 more are being reviewed.

One man, an Irish national, has been convicted of fraud. ”There’s been more than 100 fraudulent claims identified this financial year,” a spokeswoman for the department said. ”The answer is we don’t know [the full extent of the fraud]. At this stage it’s too early to determine and we will be looking at it over the next six months.”

The working holiday visa (subclass 417) allows people to extend their stay in Australia by a year if they can prove they have worked in a rural area for three months. Applications are lodged online but have been abused by people selling Australian business numbers linked to farms so backpackers can falsely claim they worked on farms.

”Second year visas for sale,” one ad read. ”Will email completed 1263 form and add your details to my books so you can gain second year visa with ease.”

Another ad offering similar services, posted on the Gumtree website on Saturday, had received more than 2000 hits by last night. Unlike visa scams targeting international students, mainly Indians, this fraud is used mainly by European visitors.

One backpacker told the Herald he had been offered the false documentation as soon as be arrived in Australia, by people staying at the same hostel.

”People told me about buying the documents – getting the numbers to put in,” he said. ”When I arrived here people said you can go there [to a farm] or you can buy. Everyone knows about it. It’s easy. All the people who are here know about that.”

The federal Opposition spokeswoman on immigration, Sharman Stone, said the widespread fraud reflected under-resourcing of the department.

Source  :  www.smh.com.au

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Banks set own interest rate hikes

 

Banks say they will be forced to lift rates

Will be more than official RBA rises

Facing higher costs of raising money

 

 

BANKS have confirmed homeowners’ worst fears: they will increase mortgage rates by more than the official Reserve Bank rises in the coming months.

The Big Four banks claim they will be forced to lift interest rates beyond the official RBA cash rate increases because they are facing higher costs of raising money in the wholesale markets.

Full story  :  http://www.news.com.au/business/money/story/0,28323,26194165-5013952,00.html

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Quinns Rocks couple win the lotto

A Quinns Rocks couple in their 50’s have wasted no time coming forward to claim an $820,000 win from last weekend’s Saturday Lotto draw.

The couple said that the prize money is the “icing on the cake” and will allow them to retire earlier than they’d expected.

They have decided to keep the win a secret from all family and friends.

The winning ticket was purchased at Ocean Keys Lottery Centre in Clarkson.

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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

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Foreign students could be forced to leave – Research your migration agent first

SCORES of foreign students, suspected of using bogus documents to support permanent residency applications, have been discovered by Federal Government migration fraud investigators.

More than 60 students, whose documents were initially accepted as genuine by the Government, will be forced to leave Australia if they are unable to prove their documents are authentic.

It is the latest indication that rorting in the lucrative $15.5 billion international education industry — the nation’s third-biggest export earner — is a serious problem, which could undermine the integrity of Australia’s education and immigration systems.

The students are suspected of using fake references from employers, which claim to show they have 900 hours’ work experience in a job related to their area of study.

Foreign students are required to provide evidence of 900 hours’ work experience to support their applications for permanent residency.

Sources in the international education industry have told The Age some students pay up to $20,000 to rogue college operators or middlemen, such as unscrupulous migration agents or education agents, to obtain fake paperwork.

Trades Recognition Australia (TRA) is the body nominated by the Department of Immigration and Citizenship to assess skills, including those of foreign students. Under the Australian migration system, a successful skills assessment by TRA can be used by foreign students to support their permanent residency applications.

In the last financial year, TRA received 34,180 applications for skills assessment, about 10,000 of which were from foreign students. TRA initially accepted the documents of the students in question as genuine. But after the Federal Government received information suggesting their paperwork could be bogus, it sent letters to the students threatening to revoke their successful skills assessments if they did not prove their documents were authentic within 28 days.

More than 60 such letters have been sent to foreign students since the start of the year, with 48 sent last month alone.

The Department of Education, Employment and Workplace Relations, which investigates matters relating to international education refuses to say how many students have already had successful skills assessments revoked.

“Disclosing departmental actions as part of quality control and fraud measure could adversely impact on the administration of the program,” the department said in a statement to The Age.

The students are believed to be either close to the expiry of their student visas or on bridging visas. Either way, they will be expected to leave the country within 28 days if they are unable to prove their documents are genuine.

The identification of students suspected of using bogus documents follows the discovery of an alleged racket uncovered by the Department of Immigration and Citizenship in March.

Three migration agents were allegedly providing fake documentation to support permanent residency applications for foreign students based on their claimed skills in a number of occupations, including cooking, hairdressing, horticulture work and car mechanics.

Investigations are continuing into possible offences relating to forgery and migration fraud, which carry penalties of up to 10 years’ imprisonment.

Source  :  www.theage.com.au

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Property tycoon vows to defend legal action

WA property tycoon Nigel Satterley has vowed to defend legal action against the Satterley Property Group by a group of Secret Harbour families who claim the company mislead them over the location of the Mandurah road and rail. 

The group of nine families lodged their writs in the Federal Court this morning claiming they were the victims of a breach of the Federal Trade Practices Act and a breach of contract.

The families claim they were not told about the realignment of the Mandurah road when they purchased their blocks.

They claim the omission resulted in the busy road being metres from their doorsteps, and that they were misled about the close proximity of the Mandurah railway.

The residents are being represented by high-profile lawyer John Hammond.

Mr Satterley said the allegations against Satterley Property Group would be strongly defended.

Source www.thewest.com.au

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See through the rebate debate health insurance

The strategy :  To work out how the changes to the health insurance rebate affect me.

I suppose it means I’ll be paying more for my health insurance. That’s the gist of it though it will depend on whether Opposition leader Malcolm Turnbull delivers on his threat to block the legislation. As you may have picked up from the federal budget, the Government needs to find savings to fund higher pension payments.

One proposed measure is means testing the health insurance rebate, which currently allows you to claim a tax rebate of 30 per cent of the cost of your health insurance if you’re aged under 65, 35per cent if you’re 65 to 69 and 40 per cent if you’re 70 or older.

Most people ask their health fund to reduce their premiums to take account of the rebate rather than paying the full premium and claiming the rebate in their tax return. For someone under 65, a monthly insurance premium of $250 could be reduced to $175. That won’t change if you earn up to $75,000 if you’re single and $150,000 for families. But if your income is higher, your rebate will be reduced or cut out altogether.

How will that work? Let’s look at singles first. If you earn $75,001-$90,000, your rebate will be reduced to 20 per cent. If you earn $90,001-$120,000, the new rebate will be 10 per cent.

Once your income exceeds $120,000 you will be ineligible for the rebate.

For families, the combined income limits are $150,001-$180,000 for the 20per cent rebate, $180,001-$240,000 for the 10 per cent rebate and the rebate will disappear altogether once family income exceeds $240,000.

All income thresholds will be indexed to wages and will be adjusted for families with one child in the same way that thresholds are already adjusted for determining whether you have to pay the Medicare levy surcharge if you don’t have private health cover. The threshold is currently lifted by $1500 for each dependent child.

The Government says the definition of your income for the rebate will be the same as for the Medicare levy surcharge. Challenger’s head of technical services, Alex Denham, says this definition is changing from July 1 to include your taxable income, reportable fringe benefits, salary sacrificed to super or any personal deductible super contributions made and net investment losses. So higher-income earners won’t be able to use strategies such as salary sacrifice to get or increase their rebate.

Would I be better off dropping my health insurance and paying the Medicare levy surcharge? The proposed measures also include a rise in this surcharge precisely to stop this sort of behaviour.

The 1 per cent surcharge will rise to 1.25per cent once income exceeds $90,000 for singles or $180,000 for couples and to 1.5 per cent for incomes exceeding $120,000 or $240,000. That extra tax may cancel out any savings from dropping your health cover.

MLC’s head of technical services, Andrew Lawless, says a better option may be to make changes to your policy, such as increasing the excess you pay before claiming on the cover or reducing cover on ancillary benefits. However, to avoid the surcharge you must have hospital cover with an excess of $500 or less for singles or $1000 or less for families or couples per calendar year.

When will the changes come in? Not until July 1 next year, so you have time to check the final details if the measures are passed and weigh up your options.

It’s worth noting that the Medicare levy surcharge income limits will be indexed from their current levels of $70,000 for singles and $140,000 for couples to the new $75,000 and $150,000 levels at this time.

Source : www.watoday.com.au

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CommBank cops sustained online fraud attack

Commonwealth Bank customers are being inundated with phishing attacks, some at a rate of several scam emails a day, sent by cyber criminals seeking to steal passwords and credit card details.

The scammers, who are specifically targeting the bank in a sustained assault, are bombarding customers with several clever variations of the email ruse – such as using bogus call centres – in an attempt to hook even tech-savvy web users.

The emails have largely managed to evade spam filters using methods such as images instead of text.

Commonwealth Bank spokesman Steve Batten admitted the bank was losing the war with the fraudsters, despite working closely with the Australian Federal Police’s Australian High Tech Crime Centre.

“As soon as we close them down they are opening up elsewhere,” Batten said.

This is backed up by figures from the Australian Payments Clearing Association, which reported a 33 per cent increase in both the volume and value of fraudulent online payments in Australia for the year ended December 31, 2008.

The scam emails, which look authentic and include the Commonwealth Bank’s logo, try to trick the victim into handing over sensitive information by telling them they need to unlock an account, activate a card, claim a fee refund, update internet banking details, view an important security message or complete a survey in exchange for payment.

When the victim clicks on the link in the email, they are either infected with a password-stealing virus or presented with an official-looking page that asks them to enter their details, which are then harvested by the fraudsters.

Batten said some of the emails purport to come from actual Commonwealth Bank staff members. He stressed that the bank would never ask customers to submit sensitive information over email.

But in a new variation on the traditional “phishing” attack, which usually asks victims to click on a malicious link, one Commonwealth Bank scam email asks customers to call a Queensland phone number in order to redeem a $500 “cashback bonus”.

IT contractor Tom Howard, from the Central Coast, received the email and attempted to call the number just as an experiment.

“It’s an automated system with an American accent that welcomes you to the Commonwealth Bank of Australia and then requests an account number or says something’s expired and asks for your credit card number,” he said.

The voice recording then requested Howard’s expiry date and pin number, but he just entered in random digits.

“It actually told me the information was incorrect, which suggests that it’s hooked up to a payment gateway and it’s actually trying to do an authorisation on the credit card right then and there,” he said.

Howard said he was alarmed at the sophistication of the scam and believed the bogus call centre idea would trick a lot of people.

“People have been conditioned in terms of these phishing emails to ‘don’t click on the links’, but not so much to ‘don’t call the number’,” he said.

Source: smh.com.au 

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