The ATO have introduced a simpler BAS to take effect from 1 July 2017 to help reduce GST compliance costs for small businesses. From 1 July 2017, small businesses will only need to report GST on sales (1A); GST on purchases (1B) and Total sales (G1) on their BAS. Businesses will no longer need to […]
The Australian Taxation Office (ATO) has issued a ruling that clarifies the circumstances in which a deduction for bad debts is allowable. Under section 63 of the Act, to obtain a bad debt deduction a debt must exist before it can be written off as bad. A debt exists where a taxpayer is entitled to […]
The disposal of a depreciating asset may incur capital gains tax (CGT) if the asset has been used for a non-taxable purpose (i.e. private purposes). However, there are a number of CGT exemptions that may apply to a capital gain or capital loss made from the disposal of a depreciating asset: Pre-CGT assets: you disregard […]
The ATO is targeting individuals (at, or approaching, retirement age) purporting to divert personal services income to a SMSF to minimise or avoid income tax obligations. A person earns personal services income (PSI) when 50 per cent of their income is earned from offering products or services that involve their skills, knowledge, expertise or efforts. Personal […]
Property investors can access a wide range of tax deductions and items subject to depreciation for their rental property yet many miss out on unknown tax breaks, foregoing an average of $20,000 a year on a $1 million house. Here are five ways to maximise your tax deductions while complying with the tax office: Use […]
Franking credits are a kind of tax credit that allows Australian companies to pass on the tax paid at company level to shareholders. Franking credits can reduce the income tax paid on dividends or potentially be received as a tax refund. Where a company distributes fully franked dividends (and those dividends are included in the taxable […]
The Australian Tax Office has recently collaborated with industry representatives to develop a safe harbour guideline for Australian businesses when calculating tax on car fringe benefits. The new guideline is designed to ease the burden of compliance, as it simplifies the approach for working out the business use percentage of car fringe benefits for fleets […]
Some Australian small business owners may now be able to apply the small business restructure roll-over concession upon restructuring their small business. A key decision when starting up your own small business is deciding on the structure you will use. A small business’s structure depends on the size and type of the business, as well as […]
The ATO is currently targeting contrived trust arrangements that minimise tax by creating artificial differences between the taxable net income and distributable income of closely held trusts. Arrangements where trustees are engineering a reduction in trust income to improperly gain favourable tax breaks or pay no tax at all are being targeted by the Tax […]
Beneficiaries who inherit a property need to be aware of the various CGT implications associated with owning and selling an inherited property. When someone dies, a capital gain or loss is generally disregarded when a property passes: to the deceased person’s executor or other legal personal representative to the deceased person’s beneficiary – such as […]
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