Latest News

ATO's 'main residence exemption tips' The main residence exemption needs to be considered in a variety of situations when a taxpayer sells a property they have lived in. The ATO hopes that the following tips will help in this regard: Taxpayers should consider if they have started earning income from their home (in which case they may need to get a market valuation for CGT purposes). When renting out a property that was their main residence, taxpayers need to consider whether to use the 6-year absence rule when they sell their property. Taxpayers can only have one property as their main residence at a time. The only exception is the 6-month period when they move from one home to another. Has the taxpayer's residency changed? If so, this may affect eligibility for the exemption. Also discussed in this month's edition: Reminder of June 2024 Quarter Superannuation Guarantee ('SG') Notice of Medicare levy exemption data-matching program Family trust elections and interposed entity elections ATO may cancel inactive ABNs New lodgment obligation for income tax exempt organisations Taxpayers able to apply CGT small business concessions Disclaimer: the above comments in this blog post 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. To read more download our monthly practice update below:

ATO's three focus areas this tax time The ATO will be taking a close look this 'tax time' at the following common errors made by taxpayers: Work related expenses: Taxpayers using the 'revised fixed rate method' of calculating a working from home deduction must have comprehensive records to substantiate their claims, including records that show the actual number of hours they worked from home, and the additional running costs they incurred to claim a deduction. Rental properties: Performing general repairs and maintenance on a rental property can be claimed as an immediate deduction. However, expenses which are capital in nature (such as initial repairs on a newly purchased property) are not deductible as repairs or maintenance. Failing to include all income in tax return: The ATO warns taxpayers against rushing to lodge their tax return on 1 July. If they have received income from multiple sources, they need to wait until this is pre-filled in their tax return before lodging. Also discussed in this month's edition: End of financial year obligations for employers Getting trust distributions right Support available for businesses experiencing difficulties Minimum yearly repayments on Division 7A loans ATO issues notice of crypto assets data-matching program Disclaimer: the above comments in this blog post 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. To read more download our monthly practice update below:

Government warns of 'malicious' myGov scammers The Government has urged Australians to be vigilant regarding scammers who target ATO login details to commit tax fraud. The ATO has received a large number of reports of scammers using fake myGov sites to steal myGov sign-in details, which can be used to commit tax and refund fraud in other people's names. These criminals will often use text message or email to lure people into clicking a link using phrases such as 'You are due to receive an ATO Direct refund' or 'You have a new message in your myGov inbox - click here to view'. The Government says the ATO or myGov will never send an email or text message with a link to sign in to myGov. Last year, the ATO introduced new fraud controls to help protect Australians from online identity theft. This included using myGovID to strengthen security during the sign-in processes on myGov accounts, making it more difficult for criminals to gain access. Also discussed in this month's edition: What to know about disaster relief payments Illegal early access to super ATO issues warning about false invoicing arrangements NFPs need to get ready for new return Taxpayer unsuccessful in having excess contributions reallocated Disclaimer: the above comments in this blog post 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. To read more download our monthly practice update below:

How to claim working from home expenses Taxpayers who have been working from home this financial year, and who consequently incurred work-related expenses, have two ways to calculate their work from home deduction: the actual cost method; or the fixed rate method. Using the fixed rate method, taxpayers can claim a rate of 67 cents per hour worked at home. This amount covers additional running expenses, including electricity and gas, phone and internet usage, stationery, and computer consumables. A deduction for these costs cannot be claimed elsewhere in their tax return, although taxpayers can separately claim any depreciating assets, such as office furniture or technology. Taxpayers need to have the right records, and the record-keeping requirements differ for the fixed rate method and the actual cost method. Also discussed in this month's edition: Reminder of March 2024 Quarter Superannuation Guarantee (‘SG’) Quarterly TBAR lodgment reminder Prepare for upcoming lodgments of SMSF annual returns Taxpayer who lived and worked overseas found to be tax resident Earning income for personal effort Disclaimer: the above comments in this blog post 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. To read more download our monthly practice update below:

Super contribution caps to rise The big news story for those contributing to super is that the contribution caps are set to increase from the 2025 income year. The concessional contribution cap will increase from $27,500 to $30,000. This 'CC' cap is broadly applicable to employer super guarantee contributions, personal deductible contributions and salary sacrificed contributions. The non-concessional contribution cap will increase from $110,000 to $120,000. This 'NCC' cap is generally applicable to personal non-deductible contributions. The increase in the NCC cap also means that the maximum available under the three-year bring forward provisions will increase from $330,000 to $360,000. This is provided that the 'bring forward' is triggered on or after 1 July 2024. The 'total superannuation balance' threshold for being able to make non-concessional contributions (and the pension general transfer balance cap) will remain at $1.9 million. Also discussed in this month's edition: Small business concessions FBT time is fast approaching! Jail sentence for fraudulent developer Avoiding common Division 7A errors Penalties soon to apply for overdue TPARs Disclaimer: the above comments in this blog post 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. To read more download our monthly practice update below:

Government announces changes to proposed 'Stage 3' tax cuts Despite previous assurances, and after much speculation, the Government has announced tweaks to the 'Stage 3' tax cuts that will apply from 1 July 2024. More particularly, the Government proposes to: reduce the 19% tax rate to 16%; reduce the 32.5% tax rate to 30% for incomes between $45,000 and a new $135,000 threshold; increase the threshold at which the 37% tax rate applies from $120,000 to $135,000; and increase the threshold at which the 45% tax rate applies from $180,000 to $190,000. The Medicare levy low-income thresholds for the 2024 income year will also be increased. Also discussed in this month's edition: Changes in reporting requirements for sporting clubs Deductions denied for work-related expenses Sale of land subject to GST Melbourne man sentenced to jail for attempting to defraud the ATO New ATO guidance on "who is an employee?" Disclaimer: the above comments in this blog post 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. To read more download our monthly practice update below:

ATO warning regarding prohibited SMSF loans Loans 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. If the SMSF's in-house assets exceed 5% of the total value of its assets at the end of the financial year, the trustee must prepare a plan to reduce their in-house assets to less than 5%, which must be implemented by the end of the following financial year. If a trustee has made a prohibited loan from their SMSF, the loan must be repaid as soon as possible. Also discussed in this month's edition: ATO's lodgment penalty amnesty is about to end Notice of officeholder datamatching program Don't forget the two further 'boosts'! Claiming deductions in relation to a holiday home Reminder of December 2023 Quarter Superannuation Guarantee ('SG') Disclaimer: the above comments in this blog post 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. To read more download our monthly practice update below:

Does your SMSF invest in Crypto? The ATO has observed SMSF trustees losing crypto investments due to scams, theft, platform collapses, and lost passwords. Many crypto assets are not regulated as financial products, leaving trustees unprotected if a platform fails or is hacked. The ATO advises trustees to be aware of these risks and to seek financial advice before investing in crypto. Also discussed in this month's edition: 1. Tax Implications for Support Payments: Assess tax implications of government support payments. Grants are generally taxable; some may be non-assessable. Deduct expenses directly linked to assessable income. 2. Super Benefits Caution: SMSF trustees must verify members' release conditions. Unlawful releases face penalties; rules persist during pension phases. 3. ATO's Visa Data Program: ATO monitors tax obligations via visa data. Aims to detect fraud; affects around nine million individuals yearly. 4. Cybersecurity Advisory (ATO): Cybercrime surged in FY2022 (one report every 7 minutes). ATO recommends updates, multi-factor authentication, regular backups, and strong passphrases. Disclaimer: the above comments in this blog post 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. To read more download our monthly practice update below:

Getting Your Taxes Right: A Quick Guide With tax season in full swing, the Australian Taxation Office (ATO) has some important reminders for rental property owners and taxpayers. Reporting Rental Income: Report rental income in the year you receive it, not when your agent transfers it. Report the full income before expenses like property management fees are subtracted. Types of Rental Expenses: Non-deductible Expenses: Includes personal use costs and capital expenses. Immediate Deductions: For expenses like loan interest, council rates, repairs, and assets under $300. Long-term Deductions: For expenses like 'capital works' and loan setup costs over multiple years. Choosing PAYG Instalment Method: Two methods: Instalment Amount (for steady income) and Instalment Rate (for variable income). You can adjust instalments if needed. GST Fraud Conviction: A man sentenced to 7.5 years for fraudulent GST refunds. ATO's Operation Protego tackles GST fraud. Unused Concessional Contributions Cap: If your super balance is under $500,000, you can contribute more than the regular cap, rolling it over for up to five years. Deduction for Personal Super Contributions: Ensure you meet 'notice requirements' to claim a deduction. Accuracy and timely notifications are crucial. Disclaimer: the above comments in this blog post 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. To read more download our monthly practice update below: