Category: Taxation
Be prepared: What you need to bring to your tax return appointment
If you’re coming in soon to discuss your tax return for yourself or your business, try not to turn up completely empty handed, or at least to turn up prepared with some records or electronic access to them. To “be prepared” is not just a great scouting motto, but a wise approach for everyone, especially...
Streaming trust capital gains and franked distributions: An overview
The ATO has stated that a trust’s capital gains and franked distributions can, if not prevented by the trust deed, be streamed to beneficiaries for tax purposes by making these beneficiaries “specifically entitled” (more below) to the amounts. This allows beneficiaries to offset capital gains with their capital losses, apply applicable discounts and, subject to...
ATO waves a red flag on deductions for holiday rentals
Just when many Australians are considering getting away for a mid-winter break, the ATO is reminding taxpayers that it is paying close attention to rental properties located in popular holiday destinations around Australia. The ATO recently issued a statement saying that last year it identified a large number of mistakes with deductions for rental properties,...
BONUS Commutation requests and ATO reviews: What you need to know before June 30
In a recently released practical compliance guideline, the ATO sets out its administration approach in relation to super fund commutation requests. It is an essential piece of information for SMSF trustees because it explains which commutation requests will not be subject to an ATO review. With the new superannuation rules taking effect on July 1,...
End-of-year tax planning tips for business
The general rule is that you can claim deductions for expenses your business incurs in its task of generating assessable income. Many of these deductions are obvious – rent, materials, supplies and so on — but there are also some less obvious options left available just before the end of the income year, should your...
What is a tax loss, and how can it be turned to good use?
You generally make a tax loss when the total deductions that can be claimed for a financial year exceed the total of assessable and net exempt income for the year. If you operate a business that makes a loss you can generally carry forward that loss and claim a deduction for it in a future...
Who is assessable on interest income? Those who “benefit”
It is a fairly well-established and welcome act for an aunt or uncle or of course a parent to start a savings account for a new addition to the next generation. It is not so common however, among the warm and generous emotions that accompany such a gift to factor in the taxation obligations that...
Company tax franking implications
The recent cut to the tax rate for incorporated businesses that turnover less than $50 million a year, while generally welcomed, can bring with it some important considerations when it comes to distributing franked dividends. The rate change to 27.5% is to be staggered, starting with companies that turnover up to $10 million a year,...
Business costs, and the deductibility of interest expenses
If a business racks up an interest bill from borrowing funds to pay for the expenses of running the business, or to acquire other income-producing assets or investments, this expense is generally allowed as a tax deduction for the relevant year. For business taxpayers under the accruals accounting method, a claim can be made for...
Are personal carer travel costs claimable? It depends
A recent court decision, and subsequent appeal, has ramifications for taxpayers with disabilities, and who are in need of a personal carer. The decision centres around what is or is not acceptable as a tax deduction in relation to the costs that arise with regard to that carer under certain conditions. The circumstances of the...