12
MarLoans to members continue to be the highest reported contravention of the superannuation laws that the ATO sees in auditor contravention reports. SMSF trustees should remember that they cannot loan money or provide other forms of financial assistance to a member or relative, and if they do, they can incur a penalty of up to $18,780. They may also be disqualified as a trustee. SMSF trustees also cannot loan money to a related party, such as a business, where the value of the loan exceeds 5% of the value of the fund’s total assets, as this is a prohibited ‘in-house asset’ investment.
04
MarPrivate company clients who receive payments, benefits or loans from their private companies need to ensure compliance with their additional tax obligations (which are often referred to as their ‘Division 7A’ obligations).There are multiple ways in which business owners may access private company money, such as through salary and wages, dividends, or what are known as complying Division 7A loans.Division 7A is an area where the ATO sees many errors and the ATO is currently focused on assisting taxpayers in managing their obligations when receiving payments and benefits from their private companies.In this regard, the ATO has recommended that business owners do the following:• keep adequate records;• properly account for and report payments and use of company assets by shareholders[…]
26
FebEmployers are reminded that, in relation to their SG obligations for the quarter ending 31 December 2023, the due date is 28 January 2024.If the correct amount of SG is not paid by an employer on time, they will be liable to pay the SG charge, which includes a penalty and interest component.The SG rate is 11% for the 2024 income year.Please note: Many of the comments in this publication are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances.
21
FebThe ATO will acquire officeholder data from ASIC, the Office of the Registrar of Indigenous Corporations and the Australian Charities and Not-for-profits Commission for the 2024 and 2025 income years, including details such as: The ATO estimates that records relating to approximately 11 million individuals will be obtained. This program aims to (among other things) enable the Australian Business Registry Services to increase uptake of the director ID, and better utilise registry data to combat unlawful activity.
14
FebTaxpayers should remember that they can only claim deductions for holiday home expenses to the extent they are incurred for the purpose of gaining or producing rental income. They need to consider the following in determining whether the deductions they wish to claim are valid rental deductions: How many days during the income year did they use or block out the property for their own use? Taxpayers cannot claim deductions for the periods the property was used or blocked out by them. How and where did they advertise the property for rent, and is the rent in line with market values? If they only used obscure means of advertising, or put unreasonable restrictions or conditions in the advertisement, they may[…]
07
FebThe ATO is remitting failure to lodge penalties for eligible small businesses. Businesses which have not yet taken advantage of the ATO’s lodgment penalty amnesty only have until 31 December 2023 to do so. Businesses must meet the following criteria in order to be eligible for the amnesty: 1. had an annual turnover under $10 million when the original lodgment was due; 2. have overdue income tax returns, business activity statements or FBT returns that were due between 1 December 2019 and 28 February 2022; and 3. lodge between 1 June and 31 December 2023. When taxpayers lodge their eligible income tax returns, business activity statements and FBT returns, failure to lodge penalties will be remitted without the need to[…]
31
JanChanges to Individual income tax rates and thresholds from 1 July 2024. On 25 January 2024, the government announced proposed changes to Individual income tax rates and thresholds from 1 July 2024. These changes are not yet law. From 1 July 2024, the proposed tax cuts will:
11
Jan[4042] Ordinary meaning of the term ’employee’ [updated] We are reviewing several products that currently provide guidance on the meaning of the term ‘employee’ to reflect the direction provided in the High Court decision in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1:
20
DecWhen a gift or donation is deductible You can only claim a tax deduction for a gift or donation to an organisation that has the status of a deductible gift recipient (DGR). To claim a deduction, you must be the person that gives the gift or donation and it must meet the following 4 conditions: DGRs sometimes authorise a business to collect donations on their behalf. For example, a supermarket may be authorised to accept a donation at the register that they then send onto the DGR. You can claim a deduction for a gift or donation you make in this way, if: If you receive a material benefit in return for your gift or donation to a DGR – for example, you[…]
01
Decaccountant melbourne A joint investigation between the Australian Border Force (‘ABF’) and the ATO spanning almost two and a half years has led to the disruption of serious criminal behaviour by four Chinese nationals within the NSW and ACT construction industries.A 55-year-old Chinese national this week received a criminal conviction and fine for her involvement in money laundering, tax evasion and foreign worker exploitation within the construction industry – one of four people to be successfully prosecuted under ‘Operation Underpitch’. Operation Underpitch is an ABF-led investigation by the Serious Financial Crime Taskforce (‘SFCT’), which comprises of multiple agencies including (among others) the ABF, the ATO and ASIC.The ABF has successfully disrupted organisers of the money laundering cohort through the execution[…]
