New data break laws coming into effect in February 2018.

ATO reporting about businesses not repaying debts.

Make sure you’re aware of all your consumer rights this year

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A Video Update from
Forrester Korfiatis

Know Your Consumer Rights

Did you make a complaint to the Australian Competition and Consumer Commission last year? In 2017, the ACCC recorded a near 40% jump in complaints, to more than 29,000. The report showed the automotive industry, electronics and whitegoods retailing, and online sales were three of the most complained about sectors, with the most common complaint regarding customers being misled with their rights to have faulty goods repaired, replaced or refunded. Consumers are reminded that retailers have an obligation to repair, replace or refund goods that are faulty or not fit for purpose, and that consumer law guarantees may last longer than any manufacturer or store warranty, depending on the type of good and price.

 Upcoming Key Dates

21 February
Lodge and pay December 2017 monthly business activity statement for business clients with up to $10 million turnover who report GST monthly and lodge electronically.
Lodge and pay January 2018 monthly activity statement.
28 February
Lodge tax return for non-taxable large/medium entities as per the latest year lodged (except individuals).
Payment (if required) for companies and super funds is also due on this date. Payment for trusts in this category is due as per their notice of assessment.
Lodge tax returns for new registrant (taxable and non-taxable) large/medium entities (except individuals).
Payment (if required) for companies and super funds is also due on this date. Payment for trusts in this category is due as per their notice of assessment.
Lodge tax return for non-taxable head company of a consolidated group, including a new registrant, that has a member who has been deemed a large/medium entity in the latest year lodged.
Lodge tax return for any member of a consolidated group who exits the consolidated group for any period during the year of income.
Lodge tax return for large/medium new registrant (non-taxable) head company of a consolidated group.
Lodge and pay self-managed superannuation fund annual return (NAT 71226) for new registrant (taxable and non-taxable) SMSF, unless they have been advised of a 31 October 2017 due date at finalisation of a review of the SMSF at registration.
Note: There are special arrangements for newly registered SMSFs that do not have to lodge a return – see super lodgment.
Lodge and pay quarter 2, 2017–18 activity statement for all lodgment methods.
Pay quarter 2, 2017–18 instalment notice (form R, S or T). Lodge the notice only if you vary the instalment amount.
Annual GST return – lodge (and pay if applicable) if the taxpayer does not have a tax return lodgment obligation.
If the taxpayer does have a tax return obligation, this return must be lodged by the due date of the tax return.
Lodge and pay quarter 2, 2017–18 superannuation guarantee charge (SGC) statement – quarterly if the employer did not pay enough contributions on time.
Employers lodging a superannuation guarantee charge statement – quarterly can choose to offset contributions they paid late to a fund against their super guarantee charge for the quarter. They still have to pay the remaining super guarantee charge.
Note: The super guarantee charge is not tax deductible.
21 March
Lodge and pay February 2018 monthly activity statement.
31 March
Lodge tax return for companies and super funds with total income of more than $2 million in the latest year lodged (excluding large/medium taxpayers), unless the return was due earlier.
Payment for companies and super funds in this category is also due by this date.
Lodge tax return for the head company of a consolidated group (excluding large/medium), with a member who had a total income in excess of $2 million in their latest year lodged, unless the return was due earlier.
Payment for companies in this category is also due by this date.
Lodge tax return for individuals and trusts whose latest return resulted in a tax liability of $20,000 or more, excluding large/medium trusts.
Payment for individuals and trusts in this category is due as advised on their notice of assessment.

Modernising Business Registers

There may be some changes this year regarding business registers, with the government currently exploring approaches to modernise business registers administered by the Australian Securities and Investments Commission, and the Australian Business Register, administered by the ATO. The government is considering establishing a whole-of-government registry platform to deliver updated business registration and licensing services for the Australian community. This initiative will make it easier for businesses to interact with the government, and forms part of the National Business Simplification Initiative. Responses from businesses have been submitted to the government since August 2017, so watch this space to see how any changes may affect you.

Mandatory Data Breach Laws

Is your business subject to the Privacy Act 1988? If it is, then make sure you’re aware of the changes coming to Australia for the first time this February. Starting from 22 February 2018, entities subject to the Privacy Act 1988 will have a mandatory obligation to report eligible data breaches to both the Office of the Australian Information Commissioner and any individuals who may be potentially affected by a data breach. To learn more about the changes, what exactly is an eligible data breach and what you need to do if it happens, simply arrange an appointment with our team.

Cryptocurrency Taskforce

2017 saw a massive rise in cryptocurrencies, with Bitcoin being one of the biggest economic topics of the year. As a result, the Australian Tax Office has created a cryptocurrency taskforce to help identify and track cryptocurrency transactions. The dedicated team of tax experts and lawyers will work alongside tax officials to explore common queries and practical issues relating to cryptocurrency, and the ATO is also working with banks, Austrac and state revenue offices. What’s more, promoters of cryptocurrency who are profiting over the buyer hysteria due to inaccurate or misleading information will also be under the spotlight. If you’re curious about cryptocurrency then speak with us!

Contractor or Employee?

The difference between a contractor and an employee is not always clear cut. The courts and tax office take a number of factors into account when determining the actual status, such as hours worked, superannuation, method of payment and leave to name a few. Any written agreement stating the nature of the relationship is certainly relevant, but it’s not conclusive, and should not be relied solely upon. Both employers and contractors need to be fully aware of their situation as serious penalties are involved with sham contracting arrangements. Find out more here.

"Holiday home" included in tax concession test

A taxpayer company has been unsuccessful before the Administrative Appeals Tribunal (AAT) in a claim to secure the capital gains tax (CGT) concessions for small businesses.

In this case, the AAT affirmed the Commissioner's decision that the taxpayer did not satisfy the "maximum net asset value" test for the purposes of qualifying for the concessions. The AAT found that the individual who controlled the company could not exclude from the test his interest in a Queensland property, which he claimed was used for "personal use and enjoyment".

TIP: The small business CGT concessions are intended to offer small business taxpayers a range of unique tax concessions. However, despite being targeted towards taxpayers who typically have less complicated affairs, the rules are riddled with complexities that may not appear obvious at first glance.

Each concession has its own particular rules. However, there are two basic conditions for the relief - either the taxpayer is a small business entity (SBE) or is a partner of a partnership that is an SBE, or the taxpayer satisfies the maximum net asset value test. If you have any questions, please contact our office.

Small business benchmarks catch out florist

The AAT has recently dismissed an appeal by a florist against the Tax Commissioner's decision to issue income tax and GST assessments following an ATO audit of her florist business.

The taxpayer had reported that the cost of goods sold in her business represented 83% of her reported business income. The ATO had selected the taxpayer for audit because this figure was outside what it considered to be the industry benchmark range of between 44% and 54%.

In this case, the taxpayer was unable, due to a lack of evidence, to prove to the AAT that the assessments were excessive.

TIP: The Tax Commissioner has warned that businesses operating outside the relevant benchmarks could be subject to ATO review and/or audit, and where the businesses do not have adequate records to substantiate their performance, the ATO will make a default assessment using the appropriate small business benchmark.

Businesses may want to consider reviewing their record-keeping practices and assess whether they are at risk of an audit. Please contact our office for further information.

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Disclaimer: This is not advice. Information provided in this bulletin may be in the form of summaries and generalisations - it may omit detail that could be significant in a particular context or to your personal circumstances. You should not act solely on the basis of material contained in this bulletin. Before you start any transactions, you should obtain appropriate professional advice relevant to your particular circumstances. Links to third-party websites are inserted for your convenience, but do not constitute endorsement of material at those sites or any associated product or service. Changes in legislation may occur quickly and we therefore recommend that our formal advice be sought before acting in any of the areas. The information in this bulletin is provided on the basis that all persons accessing the bulletin undertake responsibility for assessing the relevance and accuracy of its content.

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