Tax Time

superannuation

Superannuation is payable by the employer every 3 months. That is 28 th January, 28 April,28 July and 28 October. The current rate is 11% on ordinary times earnings which includes loadings and allowances.

Its tax time!

Accountants are busy at this time of the year. Help them out by organizing your all receipts in a folder. Include your payment summary and health insurance documents.

Budget update for individuals

Changes affecting individuals.

1. A temporary (3 year) 2% Budget deficit levy (tax), known as the Temporary Budget Repair Levy, for incomes above $180,000.
2. Medicare levy surcharge and private health insurance offset thresholds to be frozen.
3. Medicare levy will increase from 1.4% to 2 % from July 2014
4. Most dependant offsets to be abolished for example dependent spouse offset and the mature worker offset
5. The First Home saver account scheme will be abolished
6. Unemployed people under 25 will get the lower paid Youth Allowance rather than the News tart Allowances
7. Trade support loans will be available to wanting to do a 4 year apprenticeship.

Budget May update

Budget 2014

The main changes affecting the tax of small business

The government confirmed that it was committed to cutting the company tax rate by 1.5 percentage points (to 28.5%) from 1 July 2015. For large companies, the reduction will offset the cost of the Government’s 1.5% Paid Parental Leave levy.

Super guarantee rate SGL to go to 9.5% on 1 July 2014 on wages

Businesses hiring over 50s to get cash incentive Businesses could get up to $10,000 if they hire a job seeker aged 50 or older in a wage subsidy program announced in the Budget, but the Mature Age Worker Tax Offset will be scrapped.

Reintroduction of fuel excise indexation Funding for road infrastructure will be sourced from reintroducing a biannual indexation by the consumer price index of excise duty for all fuels (except aviation fuels). The government said this will generate $2.2 billion over forward estimates. The excise has been locked at 38.1 cents a litre since the Coalition dumped indexation in 2001. The re-indexation of fuel will start from August 1, 2014.

ATO on the war path

The ATO has announced that it will obtain information about credit and debit card sales from 2012 to 2014.

Information will be sought from all financial institutions including the four major banks. The ATO will data match the sales to information declared in tax returns.

Beware the ATO has increased the value of all fines and penalties.

Make sure all BAS and tax returns are lodged on time

Quick Tips

Individual tax payers

• Bring your Health cover tax statement with you the next time you come to have your tax return prepared. It will show the type of cover, the number of days you were covered a The law has changed you will only be exempt from the Medicare Levy Surcharge if you earn below a certain amount this coming year.
• Many employees are required to use their own car to do work related activities, such as collect the mail, travel to another work site. Keep a record, a log book of these journeys so we can claim them as an expense
• Some occupations like teachers, architects, tradesmen need to have a home office to complete their work duties. Keep a record of how many hours you work in this office for a period of 10 weeks, so we have a sample we can use to estimate the rest of the years use. A percentage of your electricity bill can be claimed as a work related deduction
• For those with a rental property, items like dishwashers, heaters, stoves, fridges and washing machines can be deprecated .Depreciation is a tax deduction.

Business

• New laws extend directors personal liability for any unpaid company taxes and superannuation. Make sure PAYG withholding and superannuation are paid each quarter.
• The construction industry must now supply a list of all contractors they use and the amounts paid to them to the ATO
• If the business owner uses one room as an office some of the items are tax deductible.

Diane Wills – Professional Accountant, CPA and Tax Services

Make sure all superannuation and PAYG withholding tax are paid on time as  penalties apply if they late

Keep all receipts for items you buy for work like stationary
Do you have to wear a uniform? You can claim laundry
Do you have to use your car for work; have you got a log book?
Did you have to pay for a course this year?
Small businesses can claim an upfront deduction for equipment and cars this year