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Topping up your super with downsizer payments

Posted on April 27, 2018 by admin


Due to new super measures introduced by the Government, Australians will now be able to contribute part of the proceeds of the sale of their home towards their superannuation. From 1 July 2018, where the exchange of contracts of sale for a ‘main residence’ home occurs on or after 1 July 2018, individuals will be able to access the new downsizer super measure. Eligible individuals can contribute up to $300,000 from the proceeds of selling their home into superannuation. This is not a non-concessional contribution, therefore, it will not count towards an individual’s’ contributions caps. However, it will count towards an individual’s transfer balance cap, set at $1.6 million. There is no requirement for individuals to downsize by acquiring a smaller or another property, however, individuals must meet the following requirements to access the downsizer contribution: You are 65 years or older at the time of making a downsizer contribution The contribution amount is from the proceeds of selling your home where the contract of sale was exchanged on or after 1 July 2018 Your home was owned for 10 years or more by you or your spouse The capital gain or loss from the sale is exempt or partially […]


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Employing holiday makers on a visa

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Employers can employ holiday makers on either a Working Visa (subclass 417) or a Working and Holiday Visa (subclass 462). Employees on either visa are taxed at 15 per cent from the first dollar earned, regardless of their residency. Working holiday makers cannot claim the tax free threshold and must provide their employer with their tax file number (TFN). Those who do not supply their employer with their TFN will be taxed at top marginal tax rate. If a working holiday maker meets eligibility criteria, employers are required to pay superannuation. Before employing someone on a Visa, you should check they have the correct visa using the ATO’s Visa Entitlement Verification Online service and register with the ATO before making your first payment to them.


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How to catch out an illegal super scheme

Posted on April 18, 2018 by admin


When a super scheme seems too good to be true, it often is. Many illegal super schemes are operating in Australia, so it is crucial to understand the characteristics of such schemes. A popular illegal scheme is one whereby an individual is enticed by being told they can access their super early to pay off a credit card debt, go on a holiday, buy a car and so on. Generally, such schemes are illegal as superannuation can only be accessed early by meeting a condition of release. Those promoting such schemes usually: – Encourage individuals to transfer super from an existing super fund to an SMSF to access super before they are legally entitled to; – Target those under financial pressure or who do not understand the super laws; – Claim you can use your super for anything you want; – Charge high fees and commissions, and risk losing some or all of the individuals super to them. Unfortunately, participating in these schemes subject the affected individual to identity theft from the promoter of the scheme. Identity theft is when someone uses another person’s details to commit fraud or other crimes. Individuals need to be aware that super is usually […]


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Changes to GST payments at settlement

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Buyers of new residential premises or subdivisions of potential residential land will need to pay the GST component of the purchase price to the Australian Tax Office (ATO) as of 1 July 2018. The amount of GST will not change. This change does not affect the sales of existing residential properties or the sales of new or existing commercial properties. Buyers will need to split the amount of GST from the total purchase price, pay the GST component directly to the ATO by a disbursement at settlement and pay the GST exclusive purchase price to the vendor. It is important to note settlements will not be conditional on the payment of GST to the Tax Office. It is the property developer’s responsibility to provide written notice to the buyers when they need to withhold. The liability for GST remains with the property developer.


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Staying ‘super’ compliant

Posted on April 16, 2018 by admin


Employers have a legal responsibility to pay eligible employees superannuation to provide for their retirement. And although most employers do the right thing, some do try to bend the rules which can see them facing hefty penalties. Employees are entitled to superannuation if they are paid $450 or more before tax in a calendar month, this is known as the super guarantee (SG). To remain complaint, employers must pay SG quarterly using SuperStream. Not paying on time or not paying the right amount may mean you need to pay the super guarantee charge (SGC) and you cannot claim a tax deduction for super payments. Additionally, employers must report and rectify missed, late or underpaid SG contributions by lodging an SGC statement by the due date. The ATO reminds employers who are able but unwilling to meet their obligations that they are breaking the law. Firm compliance action is taken for employers who: – Repeatedly fail to pay the correct amount of SG – Attempt to obstruct the ATO’s ability to determine an SGC liability – Repeatedly fail to keep appointments – Repeatedly fail to supply information that is irrelevant, inadequate or misleading – Engage in any culpable behaviour to delay […]


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Fuel tax credit mistakes

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Fuel tax credits are provided to businesses who acquire, manufacture, import or use fuel in part of running a business. These credits can greatly benefit business owners but it is important to get the claim right. The ATO sees common mistakes made when calculating and claiming fuel tax credits, including: Wrong calculationsA common error is to calculate fuel tax credits using the cost of the fuel rather than the quantity of fuel multiplied by the relevant rate. The correct formula is: quantity of eligible fuel x correct fuel tax credit rate = fuel tax credits. Inaccurate recordsYou must keep accurate records of your fuel purchases and how the fuel is used in your business. If you claim less than $10,000 a year in fuel tax credits, you can use a range of documents to support your claims. Using an incorrect rateFuel tax credit rates change every February. Check the rates before you lodge your BAS. The current rates for fuel acquired from 5 February 2018 to 30 June 2018 are as follows: Eligible fuel type Unit Used in heavy vehicles for travelling on public roads All other business uses (including to power auxiliary equipment of a heavy vehicle)1 Liquid fuels, […]


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ATO alerts issued for unclaimed super

Posted on April 6, 2018 by admin


The Australian Tax Office (ATO) will be contacting 80,000 individuals, starting this week, to alert them of unclaimed super. An email campaign will alert members about ATO-held unclaimed super money from 5 April. On 16 April, 20,000 letters and SMS will be sent. The ATO currently holds unclaimed super money for around 5.38 million accounts, totalling $3.75 billion as at 30 June 2017. These alerts will form part of a number of strategies used by the Tax Office to reunite individuals with their unclaimed super. To claim unclaimed super money, individuals must create a myGov account which is linked to ATO online services. If you need assistance with unclaimed super, do not hesitate to contact our office today.


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ATO targeting holiday homes

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The Tax Office has rental property owners in its sights this tax season with a large number of mistakes, errors and false claims made by some using their own property for personal holidays. The ATO is reminding owners they cannot claim deductions for holiday homes that are not actually available for rent or only available to friends and family. Private use is entirely legitimate although it does reduce an owner’s ability to earn income from the property. Properties must be genuinely available for rent to claim deductions. This means you cannot use the property for your personal use or let friends and family stay rent-free and claim a deduction. For those who rent the property to friends or family at “mates rates,” they must only claim deductions for expenses up to the amount of the income received. In addition to rental properties, the ATO is investigating cases where taxpayers claim their property is available for rent but there is no intention of renting it out. Rental rates well above market rates and unreasonable conditions for prospective renters are just a couple of ways owners can be doing this. The ATO will also be scrutinising incorrect rental property claims. Data matching […]


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Claiming personal super contributions deductions

May 25, 2018

More taxpayers can now claim a personal super contributions deductions this tax time due to the removal of the 10 per cent maximum earnings condition that came into effect from 1 July 2017.

Eligible individuals include those who earn their income from:

Those who wish to claim a deduction need to: