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News & Articles

The following news, articles and checklists may be of interest to you

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TAX ALERT : November 2017

Residential Property Purchasers to pay GST directly to ATO after 1 July 2018

Introduction:  The Government has recently released Exposure Draft legislation in relation to new GST rules that will require Purchasers of new residential premises or new residential subdivisions, to remit the GST on the purchase price directly to the Australian Taxation Office (ATO).

These new rules are proposed to be effective from 1 July 2018 with some transitional concessions.

It is important to note that the proposed rules explained below are at exposure draft stage until 20 November 2017 and are subject to change.

To read more, click here.


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TAX ALERT : November 2017

SINGLE TOUCH PAYROLL REPORTING STARTS 1ST JULY 2018

What is STP ?  Single Touch Payroll (STP) is a new reporting regime being introduced by the Australian Taxation Office (ATO) to provide real time visibility over the accuracy and timeliness of organisations' payroll processes.  STP will enable employers to report salary or wages, pay as you go (PAYG) withholding and super information directly to the ATO at the same time they pay their employees.

When does STP start ?  The new STP reporting regime will commence on 1st July 2018.  Organisations with 20 or more employees will be required to start transmitting from 1st July 2018.

To read more, click here.

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TAX ALERT - October 2017

NEW PASSIVE INCOME TEST TO ACCESS THE REDUCED CORPORATE TAX RATE

On 18 October 2017, the Government introduced the Treasury Laws Amendment (Enterprise Tax Plan Base Rate Entities) Bill 2017.  This Bill proposes that corporate entities with no more than 80% passive income will be eligible for the lower corporate tax rate.  

Provided the Bill passes both houses of Parliament, it will apply prospectively from the 2017-18 income year, commencing on 1 July 2017.

To read more, click here.

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TAX ALERT : September 2017

CAPITAL GAIN WITHHOLDING REGIME IS RELEVANT FOR ANY TAXPAYER SELLING CERTAIN PROPERTY ASSETS!

From 1 July 2017, there is now a very quick simple rule - if you are a purchaser of property for more than $750,000 then you must withhold unless the vendor shows you a clearance certificate or a variation certificate.

Introduction:  The Foreign Resident Capital Gains Withholding ("FRCGW") regime commenced on 1 July 2016, and we are now one year on, it is necessary to give an update of these rules.

The terminology "foreign resident" is slightly misleading.  We must stress that this obligation arises regardless of whether the vendor is a foreign resident or not.

On 1 July 2017, the following important changes to the FRCGW regime took effect:

  1. The withholding rate increased from 10% to 12.5% and,
  2. The market value threshold reduced from the current $2 million to $750,000.

To read more, click here.

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IS YOUR BUSINESS PERFORMING AS IT SHOULD?

In this series we will provide benchmark statistics to help you compare the performance of your business to your competitors.

In comparing your business, these benchmarks should be considered the minimum acceptable performance. Don't settle for average. Seek to outperform.

  • Restaurants
  • Child Care Services
  • Clothing Retailers
  • Pubs, Taverns and Bars
  • Pharmacies
  • Concreting Services
  • Printing
  • Discount and Variety Stores
  • Air-conditioning, Refrigeration and Heating Services
  • Bottle Shops and Liquor Retailing
  • Health and Fitness Centres
  • Hardware and Building Supplies Retailing
  • Hairdressers

To read more, click here.

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TAX ALERT : July 2017

TRAVEL EXPENSES BEING TARGETED BY THE AUSTRALIAN TAXATION OFFICE

The Government has recently made various announcements in relation to denying or restricting tax deductions in relation to travel expenses incurred by taxpayers.

Firstly, the Treasury has released draft legislation in relation to denying tax deductions for travel expensesn relating to inspecting, maintaining or collecting rent for a residential rental property.

The draft legislation is effective from 1 July 2017 and designed to apply to certain taxpayers only.  the guidance released from the Treasury includes various examples to explain which travel expenses may be denied a tax deduction, however, some consider the examples do not cover all components of travel expenses and create uncertainty for taxpayers.

Secondly, the Australian Taxation Office (ATO) recently released Draft TR 2017/D6: Income tax and fringe benefits tax: when are deductions allowed for employees travel expenses? 

 

The draft ruling consolidates and updates a number of former ATO guidance documents.  It sets out the ATO's interpretations on the general principles for determining whether an employee's travel and accommodation would otherwise be deductible for income tax and FBT purposes.

To read more, click here.

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ARE YOU LIABLE FOR THE COMPANY'S TAX DEBTS?

Directors are not normally liable for the debts of a Company, however in certain circumstances the Directors can be liable for the tax debts.

To read more, click here.

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HAVE YOU RECEIVED A CREDITOR'S STATUTORY DEMAND?

When you (the Company) have an outstanding amount that you owe to a supplier (creditor), the creditor could serve a Statutory Demand.

To read more, click here.

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IS YOUR CUSTOMER GOING BROKE?

How can you avoid losing money when a customer goes broke?

To read more, click here.

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INSOLVENCY WARNING SIGNS

Directors need to be aware they could be personally liable should their company trade whilst insolvent.  Being aware of the indicators of insolvency may avoid any insolvent trading claim and assist directors in assessing the business trading position.

To read more, click here.

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TAX ALERT - JULY 2017

SBE REDUCED TAX RATES FOR PASSIVE INVESTMENTS?

ATO Releases Draft Tax Ruling

Yesterday, some of the major news outlets published articles claiming that the ATO may have opened the floodgates for family investment companies to claim back millions of dollars in company tax, after issuing the (draft) ruling.

Until the draft ruling was issued in March, it had been understood that Australia's many passive investment vehicles, used mainly by families and investors to take advantage of a corporate tax rate lower than marginal income tax rates, would not be entitled to the recent rule changes to reduce corporate tax rates for SBEs.

Revenue Minister Kelly O'Dwyer responded to the news reports that  "...the policy decision made by the Government to reduce the tax rate for small companies was not meant to apply to passive investment companies."

The ATO has indicated it is working on more detailed guidance on the issue, which should be published "very soon".

To read more, please click here.

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TAX ALERT - JULY 2017

ATO ANNOUNCEMENT "SIMPLER BAS" REPORTING

ATO Announcement

The ATO has recently announced changes to the GST reporting requirements for small businesses, called the "Simpler BAS".  This is a proposed partnership between the ATO, software developers, tax professionals and small business associations.

To read more, please click here.

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TAX ALERT - JUNE 2017

SUPERANNUATION CONTRIBUTION LIMITS FOR THE 

YEAR ENDING THE YEAR ENDED 30TH JUNE 2017

  

The superannuation contributions caps for concessional (before tax) and non-concessional (after tax) contributions have not increased for the 2016/2017 year.

 

Concessional contributions include your employer's compulsory Superannuation Guarantee (SG) contributions, your salary-sacrificed contributions, or any contributions claimed as a tax deduction.

Non-concessional (after-tax) contributions are super contributions made from after-tax dollars or non-taxed savings.

 To read more, please click here.

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END OF YEAR CHECKLISTS : 

To read more click here : 2016/2017 Individual Tax Return Checklist

To read more click here : 2016/2017 Year-end Checklist for Business

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TAX ALERT - MAY 2017

SMALL BUSINESS ENTITIES REDUCED TAX RATES & IMPUTATION RULES

 

The Treasury Laws Amendment (Enterprise Tax Plan) Bill 2016 was introduced into Parliament on 1 September 2016 and contains a number of changes to progressively reduce the corporate tax rate for small business entities and the franking of dividends which apply from 1 July 2016.

 It is important to note that these changes apply to "small business entities" (or SBEs), which are corporate tax entities which satisfy two requirements: (a) carrying on a 'business'; and (b) having aggregated turnover below the 'aggregated turnover threshold'.

While a reduction in the tax rate will clearly benefit companies, be aware that consider the profits earned by the company will eventually be paid to shareholders in the form of dividends, and it is necessary to consider the taxation of these dividends when determining the total tax paid on company profits.

To read more, please click here

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FEDERAL BUDGET 2017

SUMMARY AND FULL COMMENTARY UPDATES

 

The 2017 Federal Budget was handed down by Scott Morrison on the evening Tuesday 9th May.

Lowe Lippmann is pleased to provide the following commentaries, explaining the key issues released in the budget.

To read the Summary, please click here

To ready the Full Commentary, please click here

For further clarification, contact your Relationship Partner at Lowe Lippmann.

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NEWS ALERT:  NOVEMBER 2016

ATO'S TOP CYBER TIPS FOR BUSINESS

 

The ATO together with the Cyber Security Working Group are working at making businesses aware of the importance to keep all their business and client information secure in order to combat the growing threat of identity theft and cyber crime.

 

In today's times, we are far more reliant on our computer systems than ever before due to the reliance of the internet, wireless networks (Bluetooth and Wi-Fi) and the growth of smart devices.

 

Cyber security also known as computer security is the protection of computer systems from theft or damage to hardware, software or the actual data (information) on them.  Furthermore, this includes protecting the system against the disruption of the services they provide.

 

To read more, please click here: TOP CYBER SECURITY TIPS FOR BUSINESS - NOVEMBER 2016.

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TAX ALERT:  SEPTEMBER 2016

CHANGES ANNOUNCED FOR THE BUDGET SUPERANNUATION REFORMS

The Government has recently announced a number of changes to the superannuation reforms revealed in the 2016-2017 Budget.  The most significant change is that the lifetime non-concessional (after tax) contribution limit of $500,000 will now be withdrawn and in its place a $100,000 per annum contribution cap. 

 Individuals under 65 years of age will continue to have access to the "bring forward" rule, and be able to contribute three years worth of non-concessional contributions in one year.  However, any taxpayer with a superannuation balance over $1.6 million will not be able to make any further non-concessional contributions from 1 July 2017.

While all of the details were not released at this time, we have provided a summary of the key changes that have been announced, and we will continue to advise of further announcements as they are made.

To read more, please click here:  CHANGES ANNOUNCED FOR THE BUDGET SUPERANNUATION REFORMS

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NEW SENIOR STAFF APPOINTMENT

 The Partners of Lowe Lippmann are pleased to announce the appointment of Ms Nicole (Nicky) Postan as Director - Audit Services, to our growing Audit & Assurance division.

Nicky joins our team having a wealth of experience in both the public and private sectors; gained through a combination of statutory and advisory audit assignments including financial reporting, forensic accounting, due diligence, internal control and risk reviews, as well as management accounting advisory. Nicky specialises in clubs and gaming operations, although her audit services extend to a broad range of clients.

 

As a highly regarded independent Company and Self-Managed Superannuation Fund Auditor, Nicky has for many years worked closely with autonomous accounting firms in Melbourne, assisting in meeting their clients' regulatory and reporting requirements.

 

Nicky is a Chartered Accountant (CA ANZ), Registered Company and SMSF Auditor (ASIC), and an Approved External Examiner - Law Institute of Victoria.  

 

Click here to downloads Nicky's bio

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TAX ALERT - ATO FOCUS ON TAXPAYERS WITH INCOME PRODUCING PROPERTIES

The ATO is reminding all taxpayers with interests in real property that they will be continuing their focus on a number of common tax errors associated with income producing properties.

Taxpayers with rental properties are reminded to review the  expenses they are entitled to claim as income tax deductions and to understand what records they need to maintain as substantiation.  The ATO also advises it will be paying close attention to excessive interest expense claims, claiming costs for initial repairs and incorrect apportionment of rental income and expenses between owners.

For taxpayers with interests in holiday homes, those currently involved with property developments and the expanding number of taxpayers entering the share-economy (i.e. Airbnb), the ATO has advised that the spotlight is moving their way for the 2016 tax year.

To read more, please click here: ATO Focus on Taxpayers with Income Producing Properties - August 2016

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TAX ALERT - SUPERANNUATION DEADLINES EXTENDED - JULY 2016

The ATO has announced that it has extended the Superstream deadline by which small businesses must become SuperStream compliant from 30 June 2016 to 28 October 2016.

The ATO has also extended the deadline by which trustees of self-managed superannuation funds have to make any limited recourse borrowing arrangements (LRBA's) consistent with an arm's length dealing or bring them to an end from 30 June 2016 to 31 January 2017.

To read more, please click here:  July 2016 - Tax Alert: Superannuation Deadlines Extended

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END OF YEAR CHECKLISTS : 

To read more click here :  2015 2016 Year-end Business Checklist

To read more click here:  2015 2016 Individual Tax Return Checklist

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TAX ALERT : NEW SUPERANNUATION CONTRIBUTION CAPS - MAY 2016

Following the 2016 Federal Budget announcement on 3rd May 2016, there has been a significant amount of commentary, concern and confusion surrounding some of the changes announced, in particular the new lifetime non-concessional contribution cap for superannuation.

The proposed lifetime cap of $500K (indexed) will replace the annual non-concessional contribution cap (currently $180K or $540K for three (3) years under the bring-forward rule).  The cap will be measured retrospectively to contributions made from 1 July 2007.

Contributions made from 1st July 2007 will be counted against the $500K lifetime limit.  If you have exceeded the $500K cap at Budget night (i.e. at 7.30 pm on 3rd May 2016), you will not be required to remove the excess and no penalty will apply.

Any after tax contributions made after 7.30 pm on 3rd May 2016 that exceed the $500K limit will need to be removed or a penalty tax will apply.

Clearly this places an onerous administrative obligation and potentially costly exercise for most super fund members.

To read more click here: New Superannuation Contribution Caps May 2016

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WARNING - Increase in Australian Taxation Office (ATO) Scam emails

To read more click here: ATO Email Scam Alert

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Federal Budget 2016 - Summary and Full Commentary Updates

The 2016 Federal Budget was handed down by Scott Morrison on the evening of Tuesday 3rd May.

Lowe Lippmann is pleased to provide the following commentaries, explaining the key issues in the budget.

 Click here - Federal 2016 Budget - Summary 

Click here - Federal 2016 Budget - Full Commentary

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TAX ALERT - MARCH 2016 - NEW WITHHOLDING TAX OBLIGATIONS ON PURCHASERS OF CERTAIN PROPERTIES

Parliament recently passed legislation amending the taxation law to impose withholding obligations on the purchasers of certain Australian assets - generally real property purchased from a non-resident.

However, the changes will affect most purchases of property in Australia!

Where the land, or the interest in the land is worth $2 million or more, the new law requires the purchaser to withhold 10% of the purchase price and send it to the ATO unless the vendor has obtained a "clearance certificate" from the ATO and provided it to the purchaser prior to settlement.

This obligation arises regardless of whether the vendor is a foreign resident or note.

These new obligations will generally apply where the contract to purchase an applicable asset is signed on or after 1 July 2016.

To read more, please click here