Category: Small Business
Trust distribution landscape now more settled
If you carry on your business affairs through a trust structure, there is now more clarity around the law on distributions following much uncertainty throughout the year. Neither the taxpayer, Mr. Springer, nor the Commissioner has appealed against the Full Federal Court decision handed down in January 2023 (Commissioner of Taxation v Guardian AIT Pty...
ATO reviewing arrangements where profits pass through an interposed company
In February, the Commissioner released Taxpayer Alert TA 2023/1: Interposition of a holding company to access company profits tax-free. In the Alert, the Commissioner says the ATO is currently reviewing arrangements where an individual accesses the profits of a private company in a tax-free form (that is, without an additional tax liability for the individual)...
PAYG instalment variations
The ATO is encouraging accountants to educate clients around varying PAYG instalments – this can potentially assist cashflow. To recap, PAYG (pay-as-you-go) instalments allow business taxpayers to make regular prepayments towards the tax on their business and investment income. This is in contrast to salary and wage earners who already make prepayments by having tax...
FBT and car logbooks
With the end of the FBT year approaching, are your car logbooks in order? The operating cost method is used by many employers to calculate their car FBT liability. This method is particularly effective where the business use of the vehicle is high. Keeping a logbook is essential to use the operating cost method. Employees...
New work from home record keeping requirements
Are you one of the five million Australians who claim work from home deductions? If so, stricter record-keeping rules may now apply. For this financial year and moving forward, there are now only two methods to calculate your work from home claim: Revised fixed rate method (with new rules applying) Actual costs method (unchanged). The...
ATO finalises Section 100A guidance for Family Trusts
Do you operate your business via a family trust? The ATO released its final guidance material on the application of section 100A on 8 December 2022 – TR 2022/4 and PCG 2022/2. In doing so, it has clarified a number of issues which is welcome. To recap, the ATO in February 2022 updated its guidance...
The importance of cash flow forecasts
As we enter into the new year, with many economists predicting a slowing of the economy, planning your business’s cashflow is more important than ever. Studies suggest that the failure to plan cash flow is one of the leading causes of small business failure. To this end, a cash flow forecast is a crucial cash...
ATO New-Year Resolutions
The ATO has released its new year resolutions…and there is not a gym in sight! According to the ATO the five new year’s resolutions to keep if you want to stay on top of your tax and super in 2023 are: Know if you’re in business or not Are you earning an increasing income from a...
Missed the Director ID Deadline?
Have you missed the deadline to apply for a director identification number (director ID)? If so, you can still apply! The ATO says it will take a reasonable approach with directors who are trying to do the right thing. Importantly, directors who need additional time to apply (beyond 14 December 2022), can request an extension of...
Bonus Article, Director IDs and resignations
In the final week of November, the ATO announced that more than one million directors still need to apply for their director identification number (director ID). Importantly, while penalties can apply if the deadline (generally 30 November) is not met, the community can expect that the ATO and Australian Business Registry Services (ABRS) will take...