August 2021 Newsletter

Contents:

  • Extra Support for Victorian Businesses
  • How much super you should have & how you compare
  • Financial reporting thresholds raised for 5,000 charities
  • Gig economy workers brace for new tax reporting rules
  • ATO zeroes in on SMSF lifestyle assets
  • 7 most surprising things you can and can’t claim
  • 6 member SMSFs now possible – pros and cons
  • Tax benefits of working from home requires more than just receipts
  • Announcements

Extra Support for Victorian Businesses

A new jointly funded package from the Victorian and Commonwealth Governments will give Victorian small and medium businesses the extra support and confidence they need to recover from the recent lockdown.
The package will deliver an additional $400 million in support to thousands of businesses and includes a $156 million Business Continuity Fund, a new $85 million Small Business COVID Hardship Fund as well as support for commercial tenants and landlords.

 

How much super you should have & how you compare

Soaring houses might mean Aussies need more superannuation than they think, with a superannuation provider revealing steps to lifting retirement savings.
A study released by the University of NSW showed that soaring house prices could see Australians under the age of 35 priced out of the market.
While younger Aussies might not be able to afford a place to live, the superannuation system is based upon them owning their own home. 

Financial reporting thresholds raised for 5,000 charities

Over 5,000 charities will no longer have to produce reviewed or audited financial statements as the government lifts reporting thresholds.
From 1 July 2022, small charities registered with the Australian Charities and Not‑for‑profits Commission (ACNC) will see their financial reporting annual revenue threshold increased from $250,000 to $500,000.
The financial reporting threshold for medium-sized charities will also be lifted to under $3 million, up from the previous threshold of less than $1 million.
 

Gig economy workers brace for new tax reporting rules

The government is set to launch a new compulsory reporting scheme, targeted at stopping share economy participants from skipping out on their tax obligations.
Uber drivers and users of Airbnb are among the share economy participants that will soon have to adhere to a new compulsory reporting regime, which will be implemented by applying the taxable payments reporting system (TPRS) to certain transactions undertaken through these platforms. 
 

ATO zeroes in on SMSF lifestyle assets

The ATO will now have information on an individual’s new $65,000 car or their $100,000 boat as it looks to flush out tax dodgers who aren’t being completely honest about their financial affairs.

The Tax Office has now extended its lifestyle assets data-matching program for the 2020–21 financial year through to 2022–23, allowing it to acquire insurance policy information for certain asset classes.

 

7 most surprising things you can and can’t claim

Depending on your area of employment, there are a range of tax deductions that could be available. The basic rule is that if you’ve incurred an expense as part of your job, you can claim it. For instance, if you’re a taxi driver, you can claim fuel for your car. While if you’re a tradie, you can likely claim a deduction for an array of essential tools. 
Such examples are relatively straightforward and obvious, but with tax being something of a grey area for many, it is inevitable that some of the claims tax specialists encounter aren’t always of the typical variety.
 

6 member SMSFs now possible – pros and cons

3 years after it was initially announced in the 2018 Federal Budget, 6 member self-managed superannuation funds are now here.
Treasury Laws Amendment (Self Managed Superannuation Funds) Bill 2020 received royal assent on 22 June 2021. Section 17A SIS Act defines an SMSF and has been amended – from 1 July 2021, we can now have an SMSF with less than 7 members.
For many, this has been a long-awaited legislated proposal. However, before we consider expanding an SMSF up to 6 members, we should consider the advantages and disadvantages of doing so.

Tax benefits of working from home requires more than just receipts

There’s more than one way to go about tax deductions when it comes to working from home.
With more Australians than ever expected to capitalise on the tax benefits of working remotely, the stakes of getting the finer details right are higher than ever.
Back in March, the Australian Bureau of Statistics said the number of Australians working from home at least once a week almost doubled in the 12 months from March 2020.
 

Announcements:

This month we wish a very Happy Birthday to Hayley, Paul & Phoebe!
There are also some very notable staff anniversaries with Jo achieving 10 years, Cris 20 years and Paul 15 years. Congratulations guys!

Paul Mackereth

Phoebe McPherson

Joanne Dreckow

Paul Mackereth

Important ATO Dates


Lodgement Program Due Date
STP Finalisation Report 31/07/2021
Business Portal Retired, switch to Online Services 31/07/2021
PAYG withholding payment summary annual report  14/08/2021
July monthly activity statements 21/08/2021
Final date for eligible monthly GST reporters to elect to report GST annually. 21/08/2021
Taxable payments annual report (Building & Construction services; Cleaning services; Courier or Road freight; Information Technology; Security, Investigation or Surveillance services) 28/08/2021
 

New Partner

We would like to congratulate Lee O’Grady (top left) on her recent promotion to Partner at Watts Price Accountants and Knights Accounting.

Lee has been providing taxation and business advice at Watts Price Accountants for 20 years now. Lee possesses a wealth of knowledge and experience in taxation, superannuation, GST & other business issues for both primary production and other business entities.

In her expanded role as a Partner, Lee will manage client engagement for her client base, assist with human resources including coordinating staff development, as well as focus on client development and the goodwill of the practices.

Congratulations Lee on your recent promotion!

Meet the Partners (Clockwise from top left: Lee O’Grady, Grant Kuchel, Gabi Freijah & Andrew Price).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Super Guarantee Increase – important notice!

On 1 July 2021, the super guarantee rate will rise from 9.5 per cent to 10 per cent. Some pay periods will cross over between June and July when the rate changes. The ATO advises that the percentage employers are required to apply is determined based on when the employee is paid, not when the income is earnt. The rate of 10 per cent will need to be applied for all salary and wages that are paid on and after 1 July 2021, even if some or all of the pay period it relates to is before 1 July 2021. That means, if the pay period ends before 30 June, but the pay date falls on or after 1 July, the 10 per cent rate applies on those salary and wages which are ordinary time earnings. The date of salary and wage payment determines the rate of super guarantee payable, regardless of when the work was performed. For example, if the work was done

  • in June (or partly in June and partly in July) but employees were paid in July, the rate is 10 per cent and contributions totalling 10 per cent of the employee’s ordinary time earnings for the September 2021 quarter must be made to the employee’s super fund by 28 October
  • in July but employees were paid in advance (before 1 July), the rate is 9.5 per cent and contributions totalling 9.5 per cent of the employee’s ordinary time earnings for the June 2021 quarter must be made to the employee’s super fund by 28 July.

How to update your software to reflect the new changes Note: Quickbooks Online, Xero & KeyPay will update automatically unless you have set up non-default superannuation categories! MYOB AccountRight

  1. Go to the Payroll command centre and click Payroll Categories.
  2. Click the Superannuation tab.
  3. Click the blue zoom arrow to open the Superannuation Guarantee payroll category.
  4. Make sure the Calculation Basis is set to 10.00%. If it’s not, you will need to update it.
  5. Remember to check all the superannuation guarantee categories that you use – you may have set up your own categories that will also need updating.

MYOB Essentials:

  1. Go to the Payroll menu and choose Employees.
  2. Click an employee’s name.
  3. Click the Superannuation tab.
  4. Under Super guarantee, make sure the Employer contribution is set to 10%. If it’s not, you’ll need to update it.
  5. Click Save.
  6. Repeat for each employee.

SuperStream Rollovers

New rules mean a greater number of SMSFs will need an Electronic Service Address (ESA) going forward including:

  • any SMSF receiving rollovers into the fund (eg on establishment of the fund), and
  • any SMSF rolling benefits out of the fund (eg on windup of the fund).

If either of the above scenarios affect you and you do not have an ESA please contact our office.

 
All the best from the Watts Price Team!