Latest News

Travel Allowance Deductions – Harder Line taken by ATO – Truck Drivers Beware

The ATO is prepared to take a hard line on travel expense claims in relation to travel allowances paid to employee truck drivers.  Even though there is an exception to substantiation provisions for these sorts of expenses, the ATO looks like it may still expect truck drivers to be able to back up how many nights they were away, what …

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Data Matching Program – Share Transactions

        The ATO has announced a new “Share transactions data matching program” that will acquire details of transaction from share registries from 20 September 1985 to 30 June 2016 from the following:- Link Market Services Limited Computershare Limited Australian Securities Exchange Limited Boardroom Pty Ltd Advanced Share Registry Services Pty Ltd Security Transfer Registrars Pty Ltd The …

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Data matching program – Motor Vehicles

Data matching program – Motor Vehicles The ATO has announced a new “Motor vehicle data matching program” to collect details of individuals or businesses that have purchased or acquired a vehicle costing $10,000 or more from the following:- Australian Capital Territory – Australian Capital Territory Road Transport Authority New South Wales – Roads and Maritime Services New South Wales Queensland …

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Lost Super climbs to $14 billion

Lost Super Climbs to $14 Billion New statistics released by the ATO reveal that more than $14 billion in lost super is waiting to be claimed. Assistant Commissioner John Shepherd says that a particular concern are the billions of dollars sitting in the super accounts where funds have lost contact with the owner. “There’s over $6 billion of super sitting …

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Work-related Expenses – ATO Focus

The ATO continues to pay close attention to work-related expenses and is using extensive data analysis to identify areas requiring attention across all work-related expense claims regardless of occupation. However, it is indicated that specific attention will be paid to:- Overnight Travel There is no deduction for an amount received as a reasonable travel allowance (if it is not required …

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ATO Data Matching – Expands!

Data Matching to be expanded on individual returns The ATO has advised that last year, it cross-referenced information reported in tax returns against more than 600 million transactions provided to it by third parties identifying omitted income and gains, incorrectly-claimed offsets or entitlements and exemption from surcharges to name a few.  It contacted around 400,000 taxpayers who had apparent discrepancies …

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ATO warns over-claiming easy to detect

The ATO warns that over-claiming is easier to detect than ever.  In relation to 2014/15 individual income tax returns to be lodged this year, the ATO says it will be focusing on:- unusually high work-related expense claims across all industries and occupations expenses claimed that have already been reimbursed by employers; and claims for private expenses such as travel from …

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Phone Scam Alert – ATO Imposters

There have been a number of incidents of phone scams. Fraudsters are calling random public members, posing as ATO personnel advising that they owe money.  Anyone owing money to the ATO would have been advised in writing and would have had more than one piece of communication.  So don’t be fooled.  One way of dealing with calls of this nature is to ask for …

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Contractors in cash economy hit with tax bills

Hundreds of thousands of building industry contractors who may have dodged their GST or income-tax obligations have been hit with $2.3 billion in tax bills.  But their could be billions more outstanding, as the Australian Taxation Office (ATO) continues data matching information reported to it to identify operators in the cash economy. A reporting system was introduced in 2012-13 that …

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Online Selling Data Matching

The ATO will request and collect, from eBay Australia & New Zealand Pty Ltd (a subsidiary of eBay International AG, which owns and operates www.ebay.com.au), online selling data relating to between 15,000 and 25,000 individuals that sold goods and services of a total value of $10,000 or more for the period from 1 July 2013 to 30 June 2014. This …

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Employers and SMSFs – SuperSteam Ready?

With 30 June 2015 deadline fast approaching for medium to large employers to be SuperStream compliant, the ATO is urging these employers to act now to ensure they are SuperStream ready. Editor:  For ‘small employers’ with 19 or fewer employees, SuperStream starts from 1 July 2015 and they have until 30 June 2016 to be ready (though they can start …

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No to Vaccinate – No Government Benefits

The government has announced that it will end the one religious exemption on children’s vaccinations for access to the taxpayer-funded Child Care Benefit, Child Care Rebate and the Family Tax Benefit Part A end of year supplement from 1 January 2016. Editor:  Apparently the only religious organisation with an approved vaccination exemption, the Church of Christ, Scientist, is not advising …

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ATO focus on rental property expenses

The ATO is increasing its focus on rental property deductions and has advised tax agents to ensure their clients get their claims right. They have identified some common errors made by rental property owners, including:- claiming rental deductions for properties not genuinely available for rent incorrectly claiming deductions for properties only available for rent part of the year such as …

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Time Limits for Family Assistance Payments

The ATO has reminded practitioners with clients who want to claim family assistance payments for the 2014 financial year that they must lodge a claim with the Department of Human Services (Centrelink) by 30 June 2015 to be eligible.  The deadline applies to clients who intend to lodge a claim for: Family Tax Benefit Child Care Benefit Single Income Family …

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Rich and Poor – Gap Growing in Australia

Rich and poor; the gap is growing in Australia between those with the most and those with the least.  A report just released by The Australia Institute has drawn the conclusion, from ABS data, that the wealth in the hands of a mere seven Australian citizens is more than the combined wealth of the poorest 20% of the population — …

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Scams – Australian Taxpayers are Victims

Scams – Australian Taxpayers are victims A new report has revealed that over 90,000 Australians were victims of scams last year with $89 million reported lost. The Australian Competition and Consumer Commission’s (ACCC) ‘Targeting Scams Report 2013’, released in June this year, found that relationship scams moved to the number one position in terms of financial losses, with over $25 million …

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Are your contractors really employees?

Are your contractors really employees? The ATO continues to enjoy a high success rate challenging the treatment of contractors under the superannuation guarantee (SG) legislation.  Despite recent comments made by the Government that the ATO should ‘relax’ its approach to contractors, the ATO has no reason to simply walk away from such a potentially lucrative revenue stream – why would …

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Employers paying Superannuation Guarantee (SG)

Employers paying Superannuation Guarantee (SG) Employers can expect a renewed focus from the ATO on superannuation guarantee (SG) payments made to employees.  With the increase in the SG rate from 9.25% to 9.5% on 1 July 2014, employers will need to make sure that payments are made on time and that the calculations are accurate.  Just be aware that the …

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SMSFs and protecting assets

SMSFs and protecting $558 billion in assets Access to, and the use of, the $558 billion in assets currently held in Australian Self Managed Superannuation Funds (SMSFs) is a touchy subject.   From 1 July 2014, the ATO has new powers to deal with delinquent trustees including directly levying financial penalties. Trustees should read the bolstered ATO powers more broadly as …

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Overseas assets and income? Why the ATO wants you

Overseas assets and income?  Why the ATO wants you The ATO is heavily targeting individuals that have assets and income from overseas.   A month ago, the ATO announced an amnesty, called Project DO IT, that allows people to declare unreported assets and income they have received from overseas.  These voluntary disclosures have already raised over $13 million in back taxes.  …

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The push for change; impact for business

The push for change; impact for business The Senate composition changed on 1 July and with it, the Government’s opportunity to push for change through its reform agenda.  The reintroduced repeal Bills for the Carbon Tax and Mining Tax have already passed the House of Representatives with high expectations of being passed by the new Senate when it sits on …

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Clear out the old: End of Financial Year housekeeping

Clear out the old: End of Financial Year housekeeping For business, July is the month you need to make sure you have properly closed off the last year and can start the New Year the right way.  Here is the essential checklist to prevent last year overflowing into this year:   •   Reconcile your GST control account. •   Does the …

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Fringe Benefits Tax rate increase

Fringe Benefits Tax rate increase The Fringe Benefits Tax (FBT) rate will increase by 2% from 47% to 49% from 1 April 2015 until 31 March 2017.  The increase is to prevent individuals attempting to use the FBT system to avoid the 2% Temporary Budget Repair Levy.    The cash value of benefits received by employees of public benevolent institutions …

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Higher education loans: Repayment income and rates

Higher education loans:  Repayment income and rates. If you’re studying to achieve professional development and are looking for higher education loans, the ATO has issued the following updates to the repayment incomes and repayment rates for the Higher Education Loan Program (HELP).  The repayment thresholds and rates for 2014 are listed below. HELP repayment thresholds and rates 2014/15 HELP repayment …

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More tax returns will need to provide bank account details

More tax returns will need to provide bank account details From 1 July 2013 individual income tax returns lodged with the ATO required banking details to be available where a return was estimated.  From 1 July 2014, banking details will also be required on other types of returns; and they are:- •   FBT return (from 1 April 2014) •   Company …

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Superannuation – Government Announcements

Government Announcements re Superannuation The Government announced that it would proceed with four of the proposed measures in relation to superannuation.  They are;- Superannuation reforms – transfer of lost member accounts to the ATO.  Increases the threshold below which lost accounts are required to be transferred to the ATO from $2,000 to $4,000, and then to $6,000.  This measure is …

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Data matching: Childcare Service and Educator Payments

The ATO will, through data matching, acquire details of more than 12,000 taxpayers receiving taxable Childcare Service and Educator Payments from the former Department of Education, Employment and Workplace Relations (now the Department of Education), for the 2011/12 and 2012/13 financial years. These will be electronically matched with certain sections of ATO data holdings to identify non-compliance with lodgement and payment …

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Data matching: Qld State Government payments and grants

The ATO will acquire details of entities receiving taxable payments and grants from the Queensland State Government for the 2010/11, 2011/12 and 2012/13 financial years from various State Government departments and authorities. Records matched under this program are expected to exceed 5,000 individuals and will be electronically matched with certain sections of the ATO data holdings to identify recipients of …

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Data matching: Online selling

The ATO has announced that it will conduct an online selling program to obtain details of online sellers who sold goods and services to the value of $10,000 or more in the 2011/12 and/or 2012/13 financial years via online selling sites. Data owners will be included in the program where they: • Operate a business in Australia that is governed by …

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ATO gets serious with the ‘Big Boys’

Following an interview that the ATO gave to the Financial Review, it was reported that the ATO is investigating 86 multinational companies in Australia. The new ATO Deputy Commissioner, Mark Konza, says;  “At the moment – and I should say this process is ongoing, so other cases will be identified over time – these 86 cases where we felt that …

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Disclose offshore income today – Project DO IT

On 27 March 2014, the Commissioner of Taxation announced an initiative to allow eligible taxpayers to come forward and voluntarily disclose unreported foreign income and assets. He urged taxpayers disclose offshore income/assets and declare their interests ahead of a global crackdown on people using international tax havens. The initiative covers amounts not reported or incorrectly reported in tax returns, including: …

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RETIREMENT AT AGE 70?

Retirement age will increase to 67 between 2017 and 2023. Now the government has signalled that the retirement age needs to increase to 70.  Why?  It’s purely financial – the government will expect to save up to $150 billion over the years through this policy change. Research by Randstad in December 2013 (10,000 surveyed) (reference:  Taxpayer Australia) found that most …

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Victim of identity theft?

Identity theft in tax return lodgements is on the increase. Tax returns have been lodged and refunds processed and sent to the…… identity thief!  The only people that need to know your tax file number (TFN) are you, the ATO, your accountant and your employer. Identify theft is a real threat nowadays. To combat this, the Tax Office has set …

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Self Education – You can claim – No Limits!

Good News for self-education – Nurses, doctors, teachers, tradies, marketers and other professionals are the big winners in the recent announcement by Treasurer Joe Hockey to dump the tax that the federal labour government had proposed to implement in 2014. The law would have limited deductions for work related studies to a total of $2000 per year. The cap would …

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BUSINESS CONCESSIONS LOST

From 1 July 2012, as part of the introduction of the Carbon Tax and the Mineral Resources Rent Tax (MRRT), policies were introduced to provide small business entities to some very favourable depreciation deductions. Specifically, *  An immediate write off for depreciating assets that cost less than $6500 *  An immediate deduction for the first $5000 for any motor vehicle …

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Data Matching – Motor Vehicles – ATO ramping

The Tax Office announced a motor vehicle data matching program that is aimed at identifying all vehicles sold, transferred or newly registered in 2011-12 and 2012-2013 where the transfer or market value is $10,000 or greater. This will; Identify taxpayers whose expenditure is in excess of their reported income Identify businesses that sell vehicles and do not report, or under-report …

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Hands off our Superannuation!

As the government has belatedly identified a budget shortfall along with the failure of the mining tax to raise any real revenue, the $1.5 trillion superannuation industry has become a convenient target  to raise additional revenue from. Notwithstanding the recent announcement on increasing the tax rate for certain individuals, there is continuing media speculation that the fiddling with superannuation by …

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Data Matching – Motor Vehicles – ATO ramping up the monitoring of taxpayers

The Tax Office announced a motor vehicle data matching program that is aimed at identifying all vehicles sold, transferred or newly registered in 2011-12 and 2012-2013 where the transfer or market value is $10,000 or greater.  This will; Identify taxpayers whose expenditure is in excess of their reported income Identify businesses that sell vehicles and do not report, or under-report …

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Data Matching – Contractors that have been providing services to local governments and shires! ATO ramping up the monitoring of taxpayers

A data matching program conducted by the Tax Office will examine various local government and shire councils across Queensland, Victoria, Tasmania and NSW.  A sample being looked at by the Tax Office consists of contractors that have or had provided services to them.  A key objective of this exercise is to identify non-compliance with lodgement and payment obligations under the …

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Data Matching – Pensioners or other benefit receivers! ATO ramping up the monitoring of taxpayers

If you are receiving a tax free government pension or other similar benefit, the Tax Office is sharing data with agencies such as the Department of Veterans’ Affairs, the Department of Human Services and Centrelink in order to see whether some benefits and tax offsets are being incorrectly claimed. (source:  The Taxpayer March 2013) At Tax with Integrity, tax law …

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Data Matching – Businesses beware! ATO ramping up the monitoring of taxpayers

A series of data matching initiatives by the ATO will provide them with information that could reveal businesses that are failing to pay the right amount of tax.  The ATO recently announced that a credit and debit card data matching program would match sales made by taxpayers against the taxpayer’s records to identify risk of the taxpayer under-reporting or omitting …

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Investing

The share market has not fully recovered from the GFC, and while it has begun to trend upwards in the past year, it is not predicted to produce great returns for the next 5-10 years. While most investors fled into cash during the GFC, it doesn’t make sense to continue to be fully invested in cash.  Interest rates are low …

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Small business… big impact

Small business is the backbone of the Australian economy!  We’d like to share with you some interesting statistics sourced from the IPA’s professional journal – January issue.  To keep things in perspective, a definition of what a ‘small business’ means does differ globally so here are the definitions relative to various global regions. Australia, fewer than 20 employees Asia (generally) …

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SMSF’s for Gen Y – not too soon

Generation Y are poised to inherit from their cashed up Baby Boomer parents, significant assets.  It is therefore important to bring parent and child together sooner rather than later. Gen Y’s live and breath the internet and seem to be welcoming of professional financial advice.  They adapt to online calculators and tools and are comfortable with visual displays of their …

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The Chartered Tax Adviser (CTA) – The global ‘go to’ brand for high quality tax advice

Because of Gerard Viswasam’s qualifications and extensive tax experience, the Tax Institute of Australia (TIA) has awarded him the Chartered Tax Adviser (CTA) designation. Already recognised in the UK, Europe, Ireland and now in Australia, the CTA designation is a global mark of excellence in taxation and the ‘go to’ brand for the highest quality tax advice.  The CTA is the highest membership status of …

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WHY YOU NEED AN ACCOUNTANT

Traditional Image of accountants Bean counters, keepers of the ledgers (those large bound volumes covered with rows and columns of numbers; making sense to other accountants), the quiet introvert unravelling the mysteries of the numbers before him, reporters of business profits or otherwise. The Modern day accountant Modern computer systems facilitates the manual arithmetic of the now defunct ‘ledger’; the …

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ATO COMPLIANCE 2012-13

WHAT INDIVIDUALS AND BUSINESSES SHOULD KNOW The ATO has published its Compliance program for 2012-13.  It has highlighted areas of focus for individuals, micro enterprises small to medium enterprises and large businesses. Over the coming year, the ATO says it will focus on the following compliance risks for individuals: incorrect or fraudulent refunds from over-claiming and deliberate fraud review of …

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Tax Reform Measures (Household Assistance Package)

The Tax Reform Measures (Household Assistance Package). Some taxpayers will benefit from the tax reforms that were implemented as part of HAP. Australians with incomes of less than $80,000 may receive a tax cut, depending on their specific circumstances. A summary of the changes are provided below. These changes will not affect the way a taxpayer completes their 2011/12 tax …

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Household Assistance Package (HAP)

Household Assistance Package (HAP) The Clean Energy (Carbon Tax) Compensation Payments. This is the name given to the much talked about compensation package relating to the Labour Government’s Carbon Tax policy. It includes; An initial payment – called the Clean Energy Advance Increase to regular payments – the Clean Energy Supplement Additional support to low income earners – the Low …

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Government Changes – new tax information

There are a number of new taxes and associated changes that come into play on the 1 July 2012. One major reason behind these new regulations is the desire by the present government to bring the budget back into surplus in 2012/2013. Some of the important changes are summarised below: Dependent Spouse Rebate From 1 July 2012, the dependent spouse …

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