RBA keeps interest rates at 1.5% for 25th consecutive month
Customer Fraud is Australia’s top economic crime
Amazon Australia’s arrival may lead to retail job Armageddon
On The Money - Episode 31
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Changes to the lower company tax rate are now law. This means the definition of a base rate entity has changed by replacing the ‘carrying on a business’ requirement with a passive income test. For the 2017-2018 income year a company will be a base rate entity, and eligible for the 27.5% lower company tax rate, if: 80% or less of their assessable income is base rate entity passive income, or they have an aggregated turnover below the $25 million turnover threshold, this increased to $50 million for the 2018–19 income year. Learn more about these changes, and how they’ll effect you, by talking to our expert team.
Pay annual PAYG instalment notice (Form N). Lodge only if you vary the instalment amount or use the rate method to calculate the instalment.
Lodge and pay quarter 1, 2018–19 PAYG instalment activity statement for head companies of consolidated groups.
Lodge and pay September 2018 monthly business activity statement.
Lodge and pay quarter 1, 2018–19 activity statement if lodging by paper. Pay quarter 1, 2018–19 instalment notice (form R, S, or T). Lodge the notice only if you vary the instalment amount.
Make super guarantee contributions for quarter 1, 2018–19 to funds by this date.
Employers who do not pay minimum super contributions for quarter 1 by this date must pay the super guarantee charge and lodge a Superannuation guarantee charge statement – quarterly (NAT 9599) by 28 November 2018.
Note: The super guarantee charge is not tax deductible.
Lodge and pay annual activity statement for TFN withholding for closely held trusts where a trustee withheld amounts from payments to beneficiaries during the 2017–18 income year.
Final date to add new clients to your client list to ensure their 2018 tax return is covered by the lodgment program.
Note: The lodgment program is a concession to registered agents. We can ask for documents to be lodged earlier than the concessional due dates.
Lodge tax returns for all entities if one or more prior year returns were outstanding as at 30 June 2018.
Note: This means all prior year returns must be lodged, not just the immediate prior year.
If all outstanding prior year returns have been lodged by 31 October 2018, the lodgment program due dates will apply to the 2018 tax return.
Lodge and pay October 2018 monthly business activity statement.
Lodge and pay quarter 1, 2018–19 activity statement if you lodge electronically.
Lodge and pay quarter 1, 2018–19 Superannuation guarantee charge 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.
As of July 1, 2018, if your company employs 20 or more people, you were required to implement Single Touch Payroll. But, what is Single Touch Payroll? It’s a reporting change for employers that reports payments such as salaries and wages, pay-as-you-go withholding, and superannuation information to the A.T.O. from your payroll solution each time you pay your employees. Subject to pending legislation, from July 1, 2019, Single Touch Payroll will also be expanded to include employers with 19 or less employees. Ensure your company is compliant with the new Single Touch Payroll system, as penalties will be handed down to those that aren’t.
For the 25th consecutive month the Reserve Bank of Australia has kept interest rates on hold at the record low of 1.5%. The last time interest rates were cut by the R.B.A. was back in August 2016, and the last rate rise was eight years ago in November 2010. With home lenders such as Westpac and Suncorp starting to raise rates independently of the R.B.A., and economic data generally weaker over the month, there was never any doubt rates would be kept on hold. The market had priced in no chance of a change, and the odds of an interest rate hike have once again been pushed into the future.
Customer fraud is the number one economic crime in Australia with organisations experiencing a significantly higher rate than the rest of the globe in the past two years. Almost two-thirds of all fraud and economic crime came from external sources compared to less than half just four years ago. However, 60 percent of these crimes were committed by someone close to the organisation, such as a customer, supplier, consultant or agent. Especially at this time of year, it’s important to remember that the A.T.O. is extremely vigilant against scams, and fraudulent activity. If you believe you’ve uncovered a scam, you must report it immediately to the ACCC.
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.
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.
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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