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Spry Roughley Articles

ATO warning: watch out for tax avoidance schemes

To many individuals, the difference between tax planning and tax avoidance is not immediately obvious, while the ATO considers the former to be a legal way of arranging your affairs to minimise the tax you pay, the latter could land you in legal hot water. So, how can your clients tell the difference? The ATO has outlined some common features of tax avoidance schemes in order to warn individuals to steer clear of them. While it is not always easy to identify these schemes, the old adage of "if it seems too good to be true, it probably is" usually applies.  Read more…

COVID-19 Supplement extension to 31 March 2021

The Federal Minister for Families and Social Services has registered the Social Security (Coronavirus Economic Response – 2020 Measures No 16) Determination 2020 to ensure the continued payment of the COVID-19 Supplement to 31 March 2021.  Read more…

Working from home deductions: “shortcut” rate until 30 June 2021

The ATO has again extended – this time from 31 December 2020 to 30 June 2021 – the application of the "shortcut" rate outlined in Practical Compliance Guideline PCG 2020/3 for claiming work-from-home running expenses.  Read more…

JobMaker Hiring Credit rules and reporting

The Government registered the Coronavirus Economic Response Package (Payments and Benefits) Amendment Rules (No 9) 2020 on 4 December 2020. These set out details of the JobMaker Hiring Credit rules.

The JobMaker Hiring Credit was announced in the Federal Budget and legislation to implement the rules – the Economic Recovery Package (JobMaker Hiring Credit) Amendment Act 2020 – received assent on 13 November 2020. This Act contains what may be termed the "machinery" provisions, while the Statutory Rules contain the "nuts and bolts" of the system.  Read more…

Small businesses: don’t forget your FBT concessions

If your clients own a small business still recovering from the COVID-19 induced downturn, remember that they can take advantage of FBT concessions to lower the amount of FBT they will need to pay. The concessions include exemptions for car parking in some instances, and work-related portable electronic devices. All this could mean more cash to invest in the revitalisation and ultimate success of small businesses. Even if a business was not considered to be a small business entity a few years ago, the turnover threshold has changed, and it may be worth a reassessment.  Read more…

New insolvency rules commence

Important changes to Australia's insolvency laws commenced operation on 1 January 2021. The Government has called these the most important changes to Australia's insolvency framework in 30 years.  Read more…

Coronavirus Supplement extended (but reduced)

The Federal Government's Coronavirus Supplement has once again been extended for a further three months, accompanied by an associated cut-in rate. The first extension was due to end on 31 December 2020, but the extension will allow the Supplement to run until 31 March 2021, which will be welcome news for many individuals still struggling with unemployment and other economic difficulties associated with the COVID-19 pandemic. However, recipients should be aware that the Supplement rate will be further cut from 1 January 2021 to $150 per fortnight. Read more…

Additional $250 Economic Support Payments on the way

The Social Services and Other Legislation Amendment Coronavirus and Other Measures Bill 2020 received Royal Assent on 13 November 2020 as Act no 97 of 2020. Read more…

ATO advises of PAYG instalment and company tax rate error

On 10 November 2020, the ATO advised that the recent reduction in the company tax rate had not been applied correctly in its systems from 1 July 2020. The error, which resulted in pay-as-you-go (PAYG) instalments being calculated using the former rate of 27.5% and not the correct 26%, affected companies that are base rate entities with an aggregated turnover of less than $50 million. Read more…

ATO post-COVID expectations for businesses

The ATO has recently outlined its expectations for businesses post-COVID. Overall, it warns companies against using loopholes to obtain benefits from the various government stimulus packages and urged them to follow not only the letter of the law, but also the spirit of the law. Specifically, it reminds taxpayers that measures such as the expanded instant asset write-off and the loss carry-back scheme should not be used in artificial arrangements for businesses to obtain an advantage.  Read more…

JobMaker Hiring Credit up to $200/week: draft rules

The Federal Government has released an exposure draft of the Coronavirus Economic Response Package (Payments and Benefits) Amendment Rules (No 9) 2020, which sets out details of the JobMaker Hiring Credit rules.  Read more…

Budget personal tax cuts and business concessions now law

The Treasury Laws Amendment (A Tax Plan for the COVID-19 Economic Recovery) Bill 2020 received Royal Assent on 14 October 2020 as Act No 92 of 2020. It implements several tax announcements from the 2020 Federal Budget.

Importantly, the Act brings the personal tax cuts (Stage 2) forward to 1 July 2020. From that date, the top threshold of the 19% personal income tax bracket is increased from $37,000 to $45,000. The top threshold of the 32.5% tax bracket is increased from $90,000 to $120,000. The Act also brings forward to 2020–2021 the increase in the low income tax offset (up to $700). The low and middle income tax offset (up to $1,080) is retained for 2020–2021. Read more…

Working from home “shortcut” deduction extended

The ATO has updated Practical Compliance Guideline PCG 2020/3 to extend the availability of the "shortcut" 80 cents per hour rate for claiming work from home running expenses. This shortcut deduction rate will now be available until at least 31 December 2020 (it was previously extended to 30 September 2020).  Read more…

JobKeeper decline in turnover tests

On 21 October 2020, the ATO issued an addendum to Law Companion Ruling LCR 2020/1 on the JobKeeper decline in turnover test. The ruling has been updated to make it clear that it covers the original test (introduced by the Coronavirus Economic Response Package (Payments and Benefits) Rules 2020) and does not include guidance on applying the "actual decline in turnover" test (which is an additional requirement for JobKeeper fortnights from 28 September 2020). The ruling has also been amended to reflect legislative changes made to the original test by the Coronavirus Economic Response Package (Payments and Benefits) Amendment Rules (No 8) 2020. Read more…

Data-matching program: apprentices and trainees

The Department of Education, Skills and Employment (DESE) has commenced a new ongoing data-matching program with the ATO in relation to the Supporting Apprentices and Trainees (SAT) measure. The program seeks to confirm the eligibility of employers receiving the subsidy, as well as stamp out any potential double-dipping of government assistance. It is estimated that around 117,000 apprentices and trainees and more than 70,000 employers could be affected. Read more…

Small business tax options during COVID-19: ATO reminder

The ATO has reminded businesses impacted by COVID-19 that they have a range of tax options to consider, including claiming a deduction for any losses. Read more…

Insolvency reforms announced for small businesses

The Government has announced that it will introduce insolvency reforms to help small businesses restructure in response to COVID-19. Key elements of the reforms include: Read more…

JobKeeper payments satisfy “work test” for super contributions

The Australian Prudential Regulation Authority (APRA) has published a new frequently asked question (FAQ) on the interaction between JobKeeper payments and satisfying the "work test" for the purpose of voluntary superannuation contributions. Read more…

SMSF asset valuations: concession during COVID-19

The ATO has advised that it will not apply a penalty for self managed super fund (SMSF) trustees that have difficulty in obtaining evidence to support market valuations of assets due to COVID-19.  Read more…

Digital AGMs and signatures: legislative determination

The Government has registered the Corporations (Coronavirus Economic Response) Determination (No 3) 2020, which extends until March 2021 the ability for companies to convene annual general meetings (AGMs) and other Corporations Act 2001 prescribed meetings entirely online. Read more…

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