Archive for the ‘General News’ Category

Tax measures for affordable housing

Friday, October 6th, 2017

The Government has released draft tax legislation to implement elements of its housing affordability plan. The proposed measures include an increased capital gains tax discount for people who hold affordable rental housing investments for at least three years.
Under the draft legislation, managed investment trusts would be allowed to hold affordable housing investments with the main aim of deriving long-term rental income, but purchasing residential property that is not affordable housing would no longer be permitted for these trusts.
TIP: If this legislation is passed, there will be a transitional period for managed investment trusts that already hold non-affordable housing residential property to change their investments to comply with the changes.

Identification numbers for directors: an Icarus moment for phoenix activities?

Friday, October 6th, 2017

The Government has announced a package of reforms to combat phoenix activities, including the introduction of a Director Identification Number (DIN).
Phoenixing involves deliberately transferring assets from a failed or insolvent company to a new company, with the intention to avoid paying the original company’s creditors, tax and employee entitlements (that is, the new company illegally “rises from the ashes” of the indebted company).
The DIN would identify each director with a unique number, allowing regulators to map the relationships directors have with entities and other people.

Tax cut closed off for passive investment companies

Friday, October 6th, 2017

The Government has released exposure draft legislation to deny access to the lower corporate tax rate of 27.5% (down from 30%) for companies with predominantly passive income. Under the changes, companies will qualify for the lower tax rate only if:
• their passive income is less than 80% of their assessable income for the year;
• they “carry on a business” in that year; and
• they come below the aggregated turnover threshold for the year ($25 million for 2017–2018).

Small business restructure rollover: changes

Friday, October 6th, 2017

The ATO is proposing to modify how the small business restructure rollover (SBRR) operates.
The SBRR means that small businesses can restructure from one legal entity to another – for example, from a company to a trust – and transfer the business’s assets to the new structure without immediately causing a capital gains tax liability.
The ATO’s latest proposed changes address the fact that the transferred business assets in this type of restructure could still give rise to a dividend for the transferee.
TIP: Are you thinking about changing how your small business operates? Talk to us for more information about the options and tax implications.

Compensation for ATO systems outages

Friday, October 6th, 2017

After the ATO’s unplanned systems outages, it provided lodgment deferrals, and remitted interest and penalties where the outages affected practitioners and their clients’ lodgments.
The ATO has also advised that it assesses claims for compensation in two ways:
• compensation for legal liability (eg negligence); and
• compensation under the Compensation for Detriment caused by Defective Administration (CDDA) scheme, which allows the ATO to consider claims and pay compensation for disadvantage or loss because of defective administration.
The ATO considers claims in accordance with guidelines issued by the Department of Finance.
TIP: If your tax affairs were affected by the ATO systems outages, contact us to find out if you’re eligible to seek compensation.

Super assets total $2.3 trillion at June 2017

Wednesday, September 13th, 2017

APRA has released its Quarterly Superannuation Performance publication and the Quarterly MySuper Statistics report for the June quarter 2017. As at 30 June 2017, superannuation assets totalled $2.324 trillion (up 10% from $2.113 trillion in June 2016).
Total assets in MySuper products amounted to $595 billion (up 25.5% from $474 billion in June 2016).
Self-managed super fund (SMSF) assets totalled $697 billion (up 9.8% from $635 billion in June 2016) held in over 596,000 SMSFs, representing 30% of all super assets.

First Home Super Saver Scheme – draft legislation

Wednesday, September 13th, 2017

Treasury has released draft legislation to implement the 2017–2018 Federal Budget superannuation measures aimed at improving housing affordability by the establishment of the First Home Super Saver Scheme (FHSSS).
The FHSSS will allow voluntary superannuation contributions made from 1 July 2017 to be withdrawn for a first home deposit starting from 1 July 2018. The scheme provides for up to $15,000 per year (and $30,000 in total) to be withdrawn from superannuation.
TIP: To be eligible to use the FHSSS, a person must be 18 years or over, have not used the scheme before and never have owned property before in Australia.

Segregated current pension assets

Wednesday, September 13th, 2017

A warning has been issued from the Actuaries Institute that tens of thousands of self-managed super funds (SMSFs) could be at risk of incorrectly claiming exempt current pension income (ECPI) under the ATO’s approach to segregated current pension assets.

Super system reforms

Wednesday, September 13th, 2017

Australian Prudential Registration Authority (APRA) has written to RSE licensees setting out its approach to the Government’s super system reforms aimed at enhancing APRA’s prudential powers to improve member outcomes. Under the proposed reforms, the current “scale test” will be replaced with an “outcomes test” requiring MySuper trustees to attest to outcomes promoting the financial interests of members on a broader range of indicators.

GST: simplified accounting for food retailers

Wednesday, September 13th, 2017

The ATO has released a draft determination on the choice available to you, if you are a food retailer, to use a simplified accounting method (SAM) to help you to work out your net amount by estimating your GST-free sales and GST-free acquisitions of trading stock.
The Draft SAM is substantially the same as the previous determination it replaces. If you were eligible to use a particular SAM specified in the previous determination, you will continue to be eligible to use that SAM under the draft determination.
TIP: Are you a food retailer? We can help you to use the simplified accounting method for your business.