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  • Excess Transfer Balance Determinations from January 2018

    Posted on December 15th, 2017 admin No comments

    The Australian Tax Office will start sending Excess Transfer Balance (ETB) Determinations from January 2018.

    ETB determinations will be sent to any individuals who have exceeded their transfer balance cap and have not taken any steps to correct this error.

    If you manage a SMSF and have exceeded the balance transfer cap by less than $100,000 on 1 July 2017 as a result of income streams in existence prior to 20 June 2017, you have until 31 December 2017 to commute the excess capital, under transitional rules.

    If you manage a SMSF and have exceeded the balance transfer cap by more than $100,000, under the transitional rules, you may receive the ETB determination. The ATO becomes aware of transitional balance cap breach based on information APRA funds pass on.

    If you receive an ETB determination from the ATO, remember the following:
    – The quicker the member rectifies the amount owing set out in the ETB Determination from the retirement phase, the lower the amount of excess transfer balance tax they will be required to pay.
    – The SMSF trustee must report information relevant to the member to the ATO, so that they have all the relevant information needed. It is important to do this straight away, if it has not already been done.
    – You must commute the amount owing as listed on the ETB Determination from retirement phase. If you choose to remove the amount by making a large pension payment, you will still be in excess of your transfer balance cap as the large pension payment will not, under the circumstances, result in a debit on your transfer balance account.
    – You may keep the excess amount determined in the ETB Determination in an accumulation phase account, unless you are commuting a death benefit income stream. If you are, the amount needs to be removed from the super stream.
    – Ensure minimum pension payment standards are met at the time of commuting money into your income stream.

    If you have any questions or queries regarding Excess Transfer Balance Determinations and how this may affect you, please do not hesitate to contact our office.

  • Annual ATO closure

    Posted on December 15th, 2017 admin No comments

    The Australian Tax Office (ATO) will be closed from midday Friday 22 December 2017 to 8.00am Tuesday 2 January 2018 over the festive season.

    The Tax Agent Portal Dashboard and BAS Agent Portal Dashboard will be available to check portal availability.

    The ATO’s technical help desk will be available from 7.00am to 6.00pm weekdays, excluding public holidays and 10.00am to 4.00pm Saturdays to assist with technical log on, connection, firewall and VPN issues.

    The Tax Office will hold returns and forms not processed before the annual closure until processing resumes in the New Year.

    Lodgements made after 7 December may not issue until the New Year.

    tax
  • ATO action on overdue SMSF annual returns

    Posted on December 7th, 2017 admin No comments

    The Australian Tax Office (ATO) is cracking down on self-managed super funds (SMSFs) that have overdue SMSF annual returns, particularly those with two or more returns overdue.

    As part of its compliance action, the ATO is currently:
    – Cancelling approximately 9,000 ABNs of SMSFs that show no evidence of operating
    – Writing to SMSF trustees who are in pension phase to remind them that they still have a lodgment obligation
    – Continuing to focus on SMSFs with high levels of income and/or high-value assets who also have overdue returns
    – Taking further compliance and audit action on selected SMSFs
    – Visiting selected tax agents to obtain feedback on why their SMSF clients’ lodgments are overdue
    – Contacting tax agents by phone to obtain an agreed date for lodgment of overdue SMSF annual returns.

    SMSFs that do not meet the agreed lodgment timeframes will be subject to serious financial implications.

  • Early payments

    Posted on December 7th, 2017 admin No comments

    Taxpayers are being reminded they can prepay amounts towards their expected tax bill to help stay on top of their tax and avoid falling into debt.

    To make a prepayment to the Tax Office, you must get the correct payment reference number, decide how much to pay and choose a payment method.

    Using the correct payment reference number is critical in ensuring the ATO credits the right account.

    The payment reference number can be found on a relevant notice or payment slip received from the ATO, or through the ATO portals.

    The ATO’s research shows keeping amounts for GST, super and income tax payments separate from other business affairs, i.e., in a separate bank account or by making a prepayment helps to stay on top of payments to the Tax Office.

    tax
  • SMSFs warned of risky retirement planning

    Posted on November 22nd, 2017 admin No comments

    The ATO is warning self-managed super fund (SMSF) trustees about the risks of some emerging retirement planning arrangements.

    Retirees or SMSF trustees who are involved in any illegal arrangement, even by accident, may face severe penalties, risk losing their retirement savings, and potentially, their rights as a trustee to manage their own fund.

    The Tax Office has released additional information through their Super Scheme Smart Program to help educate retirees and trustees of these complex tax avoidance schemes and arrangements.

    Super Scheme Smart provides case studies and information packs to ensure taxpayers are informed about illegal arrangements including what warning signs to look for and where to go for help.

    Many of the arrangements are cleverly designed to look legitimate, give a taxpayer a minimal or zero amount of tax or tax refund or concession, aim to give a present day tax benefit and involve a fair amount of paper shuffling.

    Some arrangements may be structured in a way which appears to satisfy certain regulatory rules, however, these arrangements are often ‘too good to be true’ and are in fact illegal.

    Among the ATO’s previous concerns about dividend stripping arrangements and contrived arrangements involving diversion of personal services income to an SMSF, there are some new arrangements on the Tax Office’s radar, including:
    – Artificial arrangements involving SMSFs and related-party property development ventures.
    – Arrangements where an individual or related entity grants a legal life interest over a commercial property to an SMSF. This results in the rental income from the property being diverted to the SMSF and taxed at lower rates whilst the individual or related entity retains legal ownership of the property.
    – Arrangements where individuals (including SMSF members) deliberately exceed their non-concessional contributions cap to manipulate the taxable component and non-taxable component of their fund balance upon refund of the excess.

    If you are concerned about your involvement with such arrangements, you can contact the Tax Office early to work towards a resolution.

  • ATO’s data matching programs

    Posted on November 22nd, 2017 admin No comments

    The Australian Tax Office (ATO) has sophisticated data matching programs in place to ensure individuals and businesses are complying with their obligations and to uphold the integrity of the tax system for the community at large.

    The Tax Office uses data matching to pre-fill tax returns, ensure people and businesses are lodging tax returns and activity statements when required, correctly declaring their income and claiming offsets, and meeting their tax obligations.

    It helps to detect dishonest individuals and businesses operating outside the tax system, detect fraud against the Commonwealth and to recover debt.

    The following areas are currently under close scrutiny:

    Credit and debit cards
    The ATO obtains data from banks and financial institutions to identify the total credit and debit card payments received by Australian businesses.

    Specialised payment systems
    Data on electronic payments made through specialised payment systems to Australian businesses is analysed in conjunction with data collected through the credit and debit card data-matching program.

    Business transactions through payment systems
    Data is collected from organisations that process electronic payments for businesses in a report.

    Online selling
    Details of online sellers who sell goods and services to the value of $12,000 or more is attained. Data is obtained from online selling sites where the data owner or its subsidiary:
    – Operates a business in Australia that is governed by Australian law.
    – Provides an online marketplace for businesses and individuals to buy and sell goods and services.
    – Tracks the activity of registered sellers.
    – Has clients whose annual trading activity amounts to $12,000 or more.
    – Has trading activity for the years in focus.

    Ride-sourcing
    Data is obtained from ride-sourcing facilitators operating in Australia and/or their financial institutions to identify ride-sourcing drivers. This information is used to notify drivers and help them understand their tax obligations.

    Motor vehicle registries
    The Tax Office acquires data from all the state and territory motor vehicle registering bodies to identify all motor vehicles sold, transferred or newly registered, where the transfer and/or market value is $10,000 or more.

    tax
  • SMSF annual return for pension phase trustees

    Posted on November 15th, 2017 admin No comments

    Self-managed super fund (SMSF) trustees who are in pension phase must lodge their SMSF annual returns if they remain active, or choose to wind up the fund.

    The ATO is warning SMSF trustees about their regulatory obligations and is paying close attention to those SMSFs that are not meeting their lodgment obligations.

    Trustees must lodge a Self-managed superannuation fund annual return 2017 if it was a self-managed super fund on 30 June 2017, or a self-managed super fund that was wound up during 2016-17.

    Super funds that are not SMSFs at the end of 2016-17 must use the fund income tax return 2017 and, where required, a separate super member contributions statement.

    Even if your fund does not have a tax liability, your SMSF must lodge an SMSF annual return.

  • Using the margin scheme for property sales

    Posted on November 15th, 2017 admin No comments

    Those selling property as part of a business sale may be eligible for the margin scheme.

    The margin scheme is a way of working out the GST you must pay on the property that you are selling as part of your business. The scheme is only applicable if the sale of a property is taxable.

    The GST on property sales is generally equal to one-eleventh of the sale price. If the margin scheme is used, the GST is calculated on the difference between the sale price and your purchase price of the property (or the property’s value on 1 July 2000 if it was acquired before that date).

    To meet the eligibility requirements you need to be registered for GST or required to be registered for GST.

    Contact our office to check your eligibility for the margin scheme when selling property as the application of GST to property-related transactions can be quite complex.

    tax
  • SMSFs: Stats

    Posted on November 10th, 2017 admin No comments

    The Australian Tax Office (ATO) has released its June 2017 quarterly SMSF statistical report detailing key SMSF figures.

    As of June 2017, the number of SMSFs increased to 596,516. The number of SMSF members in Australia is 1,124,453.

    The estimated value of total Australian and overseas SMSF assets is $696.7 billion.

    The number of annual wind-ups including both those initiated by trustees and those as a result of ATO compliance and cleansing activity was 1,419 as of June 2017. This is a significant decrease from 10,551 in June 2016.

    The top five asset types held by SMSFs by value include listed shares (30 per cent or $212,210m), cash and term deposits (23 per cent or $159,686m), non-residential real property (11 per cent or $74,772m), unlisted trusts (10 per cent or $71,455m) and other managed investments (5 per cent or $37,695m).

  • Changes to GST on low-value imported goods

    Posted on November 10th, 2017 admin No comments

    Australian goods and services tax (GST) will be implemented on sales of low-value goods imported into Australia by consumers as of 1 July 2018.

    According to the ATO, business will have to register for GST, change GST on sales of low-value imported goods and lodge returns if they meet the $75,000 AUD registration threshold.

    These business includes merchants who sell goods, electronic distribution platform operators or re-delivers. Customs duty and clearance charges will be changed to the importer at the border under existing process should goods be imported in a consignment over the value of $1,000 AUD.

    Through the implementation of this new law, businesses will not:
    – Charge GST on a sale where GST is to be charged at the border. This occurs when an item is worth over $1,000 AUD or is a tobacco product or alcoholic beverage.
    – Need to charge GST where it is clear that multiple goods will be shipped in the one consignment coming to a value of over $1,000 AUD. In these instances, GST will be charged at the border instead.

    The ATO will be holding a number of international engagements on the application of Australian GST to low-value, imported goods sales throughout November 2017.

    tax

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