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Preparing for the second half of the financial year

Posted on May 8, 2013 by admin


Businesses should start reviewing whether their accounting systems are keeping track of all revenue and expenses, together with any private use of business assets. Planning ahead can save significant tax penalties, which start at 25 per cent of the unpaid tax to as high as 75 per cent. There are a few key areas business owners should focus on. –       Go through each employee and check whether contractors are actually employees, as the ATO has flagged this as an issue they will be cracking down on. –       Look at whether any new business equipment needs to be bought in order to take advantage of the new $6,500 instant write off. –       Review quarterly PAYG instalments. If profit is down considerably from last year businesses may wish to reduce their instalments. –       Businesses may also wish to review personal loan agreements and trust deeds to make sure they comply with the law and that company distributions to owners are properly treated for tax purposes.


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Business Fraud

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Last year business fraud over $100,000 hit the courts more than 61 times, totalling more than $131 million. There are a few ways to minimise the potential of business fraud happening. –       Start at the recruitment phase. Look for employment gaps in the potential employees history, do an internet search to see whether someone left under improper circumstances. –       Notice different or anti-social behaviour of employees. Also look for circumstances changing, such as their partner losing their job or an illness in the family. These things happen to everyone, but it can cause a lot of stress and anxiety and may cause them to find risky solutions to their problems. –       Check on the accounting systems in place. Avoid having all the business asset eggs in one basket. Separate responsibilities for those who record and those who have power to confirm any changes. – Regularly review bank reconciliations to check for a growing discrepancy between accounting records and actual cash and be aware of who can authorise payments and change accounting records.


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News

Expanded super for older Australians

April 12, 2019

The 2019-20 Federal Budget has placed a strong focus on the growth of the economy whilst also having the intention to look after older Australians.

Older Australians will benefit from the work test exemption age being extended from age 64 to 66. The work test requires an individual to work at least 40 hours in any 30 day period in the financial year in order to make voluntary personal contributions.

This change in age will now allow individuals aged 65 and 66 who previously didn’t meet the work test to contribute three years of after-tax contributions in a single year, meaning up to $300,000 can be injected into an account with less than $1.6 million in super (tax-free pension threshold). This adjustment aligns with the increase for the Age Pension from 65 to 67.

Spousal contributions can now be made until age 74, up from age 65, without having to meet the work test. Under spousal contribution regulations, an individual can claim an 18% tax offset of contributions up to $3,000 made on behalf of a non-working partner. A further $3,000 can be contributed but with no tax offset.