News

Income Tax Changes – Small Businesses Tax Rates The tax rate for small business entity companies has been reduced to 27.5% for the 2017 financial year, down from 28.5% in the 2016 year. To be eligible for this rate, you need to be considered a “small business entity.” To meet this definition, you must: ▪...

Overview The 2017–2018 Budget contained a number of measures designed to improve Australians’ access to secure and affordable housing across the housing spectrum. These include: strengthening the CGT rules to reduce the risk that foreign investors avoid paying CGT in Australia; introducing a 50% cap on pre-approved foreign ownership in new developments; applying an annual...

No major new super measures, but 1 July reforms loom large The Government did not announce any new major superannuation measures in the Budget. This will be a welcome relief for the super industry, which already has enough on its plate with major reforms set to start on 1 July 2017. As is the case with any large-scale...

No change to personal tax rates; Budget deficit levy to end The 2017–2018 Federal Budget contained no changes to the personal income tax rates and thresholds. This means that the 2% budget deficit levy on incomes over $180,000 will not be extended beyond its initial three years, and will cease on 30 June 2017. The...

In addition to marketing and education activities to re-enforce the need for employers to meet their SG obligations, the ATO conducts audits and reviews to ascertain SG non-compliance, with 70% of cases stemming from employee notifications (the remaining 30% of cases are actioned from ATO-initiated strategies). On average, the ATO receives reports from employees which...

In a recent case, the Federal Court has agreed with the ATO that ‘ride-sourcing’ (such as that provided using Uber) is ‘taxi travel’ within the meaning of the GST law. The ATO has advised people who are taking up ride-sourcing to earn income should: keep records; have an Australian business number (ABN); register for GST,...

The ATO has confirmed that, if intangible capital improvements are made to a pre-CGT asset, they can be a ‘separate CGT asset’ from that pre-CGT asset if the relevant requirements are satisfied. Example A farmer, holding pre-CGT land, obtains council approval to rezone and subdivide the land. Those improvements may be separate CGT assets from...

The ATO has issued a reminder that the government has changed the way fringe benefits will be treated for the calculation of several tax offsets from 1 July 2017. The meaning of ‘adjusted fringe benefits total’ (which is used to calculate a taxpayer’s entitlement for the low income superannuation tax offset, the seniors and pensioners...

The ATO is currently reviewing arrangements where individuals (at, or approaching, retirement age) purport to divert their personal services income to an SMSF, so that the income is taxed concessionally (or exempt from tax) in the fund, rather than being subject to tax at the individual’s marginal tax rate. These arrangements normally involve the individual’s...

An employee construction project manager/supervisor was denied deductions for overtime meal expenses, as he was not paid an overtime meal allowance under an industrial agreement (award). The taxpayer often worked at nights and on weekends during the relevant income years, and so additional amounts were negotiated and ‘rolled into’ his salary to cover the fact...