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TAX | NEWS | VIEWS & CLUES Welcome to the December 2018/January 2019 edition of the Spry Roughley Report. As we approach the end of 2018 there feels to be more uncertainty in the air. In Australia, we have upcoming NSW State and Federal elections and all that encompasses for the economy and taxation; the housing market is down; and there are signs of a slowing economy. Overseas, there are continuing tensions between the US and China over trade; the "Yellow vest" demonstrations in France over the rising cost of living; and Brexit is proving to be a political & economic quagmire. The question that then comes to mind is "What can I do about it?" and "How do I respond if X happens?". Now is an excellent time to consider your plans for 2019 and the range of options available to you and your business. Maybe it is time to reconsider contingency plans, especially if you are directly impacted by the possible international surprises that may be awaiting us. The domestic situation is possibly more predictable, but again, agility will be your friend I think. Strange times indeed, but potentially very disruptive for some businesses. It is probably also a good time to take a look ahead and to be prepared for what you can foresee - tweak and adjust your plans as needed.
As one client remarked to me recently, "in this environment, you have to play to win!". I also find this time of year is great for reflection. Are you having conversations with your family about the future, particularly if you are in a family business? You might ask yourself:
In other news:
As usual, please do not hesitate to call us on (02) 9891 6100 should you wish to discuss how any of the points raised in the report specifically affect you, or click here to send us an email. Finally, our best wishes for a Merry Christmas and a Happy, Safe and Prosperous New Year in 2019. Warm regards, Shaun
Liability limited by a scheme approved under Professional Standards Legislation Work-related tax deductions down for 2018
The ATO has reported a decline in the overall value of work-related deductions for tax time 2018. In his opening statement to Senate Estimates on 24 October 2018, Commissioner Chris Jordan said taxpayers appear to be taking extra care when claiming work-related expenses in their 2017–2018 income tax returns. This follows recent ATO awareness and education efforts to close the income tax gap for individuals.
ATO identifies 26,000 incorrect rental property travel expense claims From 1 July 2017, investors cannot claim travel expenses relating to inspecting, maintaining or collecting rent for a residential rental property as deductions, subject to certain exceptions. An exclusion does apply for this restriction if the expenditure is necessary for the income-producing purposes of carrying on a business (for example, a rental property business), or if the costs are incurred by an "excluded entity". Small business corporate tax rates Bill is now law The new law also increases the small business income tax offset rate to 13% of the basic income tax liability that relates to small business income for 2020–2021. The offset rate will then increase to 16% for 2021–2022 and later income years. The maximum available amount of the small business tax offset does not change – it will stay capped at $1,000 per person, per year. GST reporting: common errors and how to correct them
Government announces super refinements
CGT on grant of easement or licence In the ATO's view, CGT event D1 (creating contractual or other rights) rather than CGT event A1 (disposing of an asset) happens when any of the following rights are granted over an asset:
First Home Super Saver scheme and downsizer super contributions: ATO guidance The ATO also issued guidance on the recently enacted downsizer superannuation contribution measures, which allow people aged over 65 to contribute the proceeds from selling certain property into their super. ATO scam alert: fake demands for tax payments Be wary if anyone contacts you demanding payment of a tax debt that you didn't know about. The ATO will never ask you to make a payment into an ATM or using gift or pre-paid cards such as iTunes and Visa cards, and will never you to deposit funds into a personal bank account. Scammers have been known to impersonate tax agents as well as ATO staff. If you have any doubts about the legitimacy of a phone call or other communication, you can call the ATO directly (toll free) on 1800 888 540. Government to establish $2 billion fund for small business lending Treasurer Josh Frydenberg has said some small businesses currently find it difficult to obtain finance on competitive terms unless it is secured against real estate. To overcome this, the proposed Australian Business Securitisation Fund will invest up to $2 billion in the securitisation market, providing additional funding to smaller banks and non-bank lenders to on-lend to small businesses on more competitive terms. ATO information-sharing: super assets in family law proceedings The Government has announced an electronic information-sharing mechanism to be established between the ATO and the Family Law Courts to allow superannuation assets held by relevant parties during family law proceedings to be identified swiftly and more accurately from 2020. This measure was included as part of a broader financial support package for women announced on in November. |
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