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2017
FEDERAL BUDGET - 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.

For further clarification, contact your Relationship Partner at Lowe Lippmann.
MAY 2017
TAX ALERT - 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.
JUN 2017
TAX ALERT - 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.
JUL 2017
TAX ALERT - 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.
JUL 2017
TAX ALERT - 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".
2017
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.
2017
IS YOUR CUSTOMER GOING BROKE?
How can you avoid losing money when a customer goes broke?
2017
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.
2017
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.
JUL 2017
TAX ALERT - 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.
2017
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.

We have data on various industries, and this list is growing.
SEP 2017
TAX ALERT - 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.
OCT 2017
TAX ALERT - 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.
NOV 2017
TAX ALERT - 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.
NOV 2017
TAX ALERT - 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.