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All news by: Varun Kumar

NSW State Budget 2022-23

The 2022-23 NSW State Budget was handed down by Treasurer, Matt Kean on 21 June 2022. The budget focuses on easing cost of living pressures along with a commitment by the State to ensure more affordable housing. We have listed some of the measures announced.  

S100A and Trusts – what is the ATO concerned with?

Trusts are a popular structure for family businesses and groups because of its inherent asset protection, flexibility and ability to pass assets to future generations with limited tax consequences. Moore Australia tax experts discuss what the ATO is concerned with and upcoming changes. 

2021-22 Federal Budget measures enacted and other updates

Over the last couple of weeks, various Bills have received Royal Assent and various measures which were announced in last year’s Federal Budget have now become law.

NSW Small Business Support Program

Eligible businesses can receive 20% of their weekly payroll paid as a lump sum for the month of February 2022. The minimum payment will be $750 per week and the maximum payment is set at $5,000 per week. Non-employing businesses will receive a lump sum of $2,000 (i.e., $500 per week).

Car Parking Fringe Benefits – changes to consider before 1 April 2022

The Australian Taxation Office (ATO) released a Taxation Ruling (TR) 2021/2 which considers when a parking station is considered a commercial car parking station for the purposes of Fringe Benefits Tax (FBT) provisions.

Logbook Requirements

In most cases, having a valid car logbook is beneficial for both claiming a personal tax return deduction for work related travel cost using your own car, and calculating the taxable value of a car fringe benefit, when the car is provided by an employer.

FBT and Car Fringe Benefits

With the Fringe Benefits Tax (FBT) year ending on 31 March 2022, here are a few issues in relation to car fringe benefits to look out for during the 2021-2022 FBT year.

ATO – Practical Compliance Guideline 2021/4

The Australian Taxation Office (ATO) is targeting accountants, architects, engineers, lawyers and other professionals!  The ATO has released Practical Compliance Guideline (PCG) 2021/4 which finalises its compliance approach towards the allocation of profits from professional firms to an individual professional practitioner (IPP). The ATO is specifically concerned with arrangements involving the provision of services where the IPP redirects income to an associated entity, where it has the effect of altering their overall tax liability.

Extended Government support for your business cashflow

The SME loan recovery scheme has been extended for a further six months to 30 June 2022 (from 31 December 2021). Under the extended scheme, the amount guaranteed by the Government will reduce to 50% (previously 80%) from 1 January 2022 – 30 June 2022.  

Increased risk of incurring FBT liability

As the festive season draws closer, we would like to remind businesses of the fringe benefits tax issues associated with this time of year.  

Reporting of unpaid debts to credit reporting agencies

The Australian Taxation Office (ATO) will commence reporting unpaid business tax debts to credit reporting bureaus (CRBs) in certain circumstances.  

ATO extends work from home shortcut method – here’s what you need to know

The ATO have extended the shortcut method for claiming home office deductions to the 2021-22 income year. Here's what it means if you work from home, what you need to do now. 

Property and Taxes: vacant land deductions - ATO releases new ruling

The Australian Taxation Office (ATO) has released draft taxation ruling TR 2021/D5 which considers the ATO’s view on non-deductible expenses associated with vacant land. From 1 July 2019, certain taxpayers are denied a tax deduction for outgoings in relation to vacant land unless the land is used in a business, or another exclusion applies. Deductions which are denied by the operation of these provisions include interest expenses, council rates, land taxes and maintenance costs. Importantly, certain entities are not impacted by these provisions including (but not being limited to) companies and managed investment trusts.  

Director Identification Numbers: Alert

All directors of a company, registered Australian body, registered foreign company or Aboriginal and Torres Strait Islander corporation will need a director identification number (director ID). From November 2021, company directors will be able to start applying for a Director Identification Number (DIN) through the Australian Business Registry Services (ABRS) website.

Time to Cash Flow Forecast in NSW

As NSW will soon start to exit lockdown, business owners need to plan for the Government’s announcement to reduce and end the JobSaver payments. Cash flow is going to be one of the key issues many businesses will face over the coming months.  

Preparing for Single Touch Payroll Phase 2

The Australian Taxation Office has announced that it will be deferring the start date for the Single Touch Payroll (STP) expansion which was intended to commence from 1 January 2022. Under the STP expansion – Phase 2, employers are required to provide additional information as part of the STP lodgement process.  

Changes to employee superannuation fund choice rules

Superannuation fund rules will change from 1 November 2021.  Under the new rules, employers will have to refer to the ATO to check an employees stapled fund before making payments into their default fund.

Proposed changes to the tax residency provisions for individuals explained

Recently, the Government announced that it would “modernise” the individual tax residency provisions in the 2021-22 Federal Budget. Whilst we are yet to see any draft legislation in relation to this, the Government did mention that the rules will be based on the recommendations made by the Board of Taxation.

QLD COVID-19 Business Support Grant

The Queensland Government have announced financial support for businesses impacted by the lockdown order which commenced at 4pm on Saturday 31 July 2021 for local government areas in Southeast Queensland.

Cryptocurrency - tax issues to consider for individuals

We may not understand the dynamics of how cryptocurrency works (very few do), but the last few days and weeks have highlighted the volatility of the cryptocurrency market. Whilst we are not economists and cannot explain how a couple of tweets can cripple the crypto market, we are well placed to advise you on the tax ramifications of buying and selling cryptocurrency.  

Superannuation Guarantee: Employer considerations

The superannuation guarantee rate will increase from 9.5% to 10% from 1 July 2021.  We look at how this impacts businesses and give practical tips for employers to consider in the lead up to the change.

Property and Taxes - interest deduction is not always obvious

Interest paid is usually the largest tax deduction against rental property income, and in a lot of cases creates an overall loss, which may lead to an overall reduction in income tax payable. Taking out a loan to buy an investment property and claiming the interest charged as a tax deduction seems to be a simple proposition, however, as with anything in relation to tax, there are some complications. It is crucial to be aware of a few rules, especially when the expectation of tax deduction creating tax savings is one of the main deciding factors in purchasing an investment property.  

Fringe Benefits Tax changes - what to look out for

When it comes to Fringe Benefit Tax, not a lot has changed in recent years. However, from 1 April 2021, a few additional concessions and exemptions have been afforded to taxpayers.

New SME Recovery Loan Scheme

On 11 March 2021, the Government announced a new SME Recovery Loan Scheme which will assist eligible businesses to access finance to maintain and grow their businesses when JobKeeper concludes at the end of March 2021.The Scheme builds on the framework established in the two phases of the Coronavirus SME Guarantee Scheme, and is specifically targeted at SMEs currently receiving JobKeeper (i.e. the scheme is only open to certain recipients of the JobKeeper payment between 4 January 2021 and 28 March 2021).

Tips for the FBT year end - car fringe benefits

With the Fringe Benefits Tax (FBT) year ending on 31 March 2021, here are a few issues in relation to car fringe benefits to look out for during the 2020-21 FBT year.

Allocation of professional firm profits - the compliance approach

Following several years of deliberation, the ATO has finally released draft Practical Compliance Guideline - PCG 2021/D2 that sets out the ATO's proposed compliance approach to the allocation of profits by professional firms. The guideline explains how the ATO intends to apply compliance resources when considering the allocation of professional firm profits or income in the assessable income of the individual professional practitioner (‘IPP’). It also assists the IPP to self-assess against the risk assessment factors set out.

Incentivising key employees and retaining talent

Forward thinking businesses understand that retaining key loyal staff, especially in the current environment is critical to business survival and igniting growth, but how do you keep staff happy in such difficult trading conditions?

The JobMaker Scheme

The Economic Recovery Package (JobMaker Hiring Credit) Amendment Bill 2020 received Royal Assent on 13 November 2020. Final Rules governing JobMaker will be released after public consultation, therefore the information provided in this document is based on the draft rules.  

Loss carry back rules for companies

The loss carry back rules for companies which were announced in the 2020-21 Federal Budget are now law. The Treasury Laws Amendment (A Tax Plan for the COVID-19 Economic Recovery) Bill 2020 (the Bill) received Royal Assent on 14 October 2020.

Temporary Full Expensing Provisions

The temporary full expensing (TFE) of depreciating assets measure announced in the 2020-21 Federal Budget is now law. The Treasury Laws Amendment (A Tax Plan for the COVID-19 Economic Recovery) Bill 2020 (the Bill) received Royal Assent on 14 October 2020. The TFE provisions allow eligible businesses with an aggregated turnover of less than $5 billion to claim a tax deduction for the full cost of an eligible depreciating asset purchased between 6 October 2020 and 30 June 2022 (the relevant period).

Updated PAYG Withholding Tax Tables

The Australian Taxation Office (ATO) have updated the PAYG withholding tax tables to reflect the income tax cuts announced in the Budget last week.

Should the Stamp Duty rules be reformed?

Stamp duty (or transfer duty) is a financial burden that may deter individuals and families from entering the property market and acts as a barrier to investment opportunities. It raises the issue of whether stamp duty is still appropriate in the modern economic landscape and calls for replacing stamp duty with a broad-based land tax are getting louder. This issue was considered by NSW Treasury in a recent report NSW Review of Federal Financial Relations -Supporting the road to recovery (the NSW Report).

Should a review of GST be on the table?

Last week we asked about the future of GST in Australia and as we expected, more than 65% of the respondents felt that change is required. As we come out of COVID-19, revenue collection will be high on the Government’s agenda, primarily to fund the cost of stimulus funding. On numerous occasions, our leaders have stated that they are against increasing taxes and want to encourage consumer spending in Australia. There are media reports of personal tax rate cuts being brought forward to reinvigorate the economy. ​Our GST system is complex and needs improvement. There have been some minor adjustments, such as making certain foreign suppliers of goods and services in Australia being liable for GST, but there is scope to make some targeted changes to improve the efficiency of the GST system. Read more about our thoughts and the options available.

JobKeeper 2.0: The rules explained

The Coronavirus Economic Response Package (JobKeeper Payments) Amendment Bill 2020 was recently passed by Parliament to facilitate the extension of the JobKeeper Scheme to 28 March 2021. The Treasurer has subsequently released amended Rules for the Scheme, which were registered on 15 September 2020.  

Is it time to 'fix' corporate tax rates once and for all?

Last week we asked what the future of the corporate tax system of Australia should look like. More than 64% of respondents felt that Australia should have a single corporate tax rate set at 25%.  The upcoming Federal budget is going to be important for business. Hopefully the Government will carefully consider some issues which in our view require immediate reform. Read more about our thoughts on the complex dual corporate tax system is complex, and why we should be moving towards a single lower corporate tax rate.

Issues company directors should be aware of during COVID-19 and beyond

The last few months have had far reaching implications for many businesses across Australia. Whilst some businesses are starting to show signs of recovery, there are a few ‘ticking’ timebombs you need to be aware of as a company director. Directors may be personally liable for certain actions by the company including situations of insolvent trading and failure to meet employee (PAYG and superannuation guarantee), or GST obligations (in certain scenarios). The Government has provided some relief for directors in relation to insolvent trading due to the impact of COVID-19, but it is important to look out for issues not necessarily covered by the relief.

JobKeeper 1.0: Changes you need to be aware of

The Federal Government recently announced the expansion for the eligibility of the current JobKeeper Scheme.   As part of the changes announced, the Federal Government introduced changes for employees eligible for the JobKeeper Scheme from 3 August 2020. On Friday 14 August, the Coronavirus Economic Response Package (Payments and Benefits) Amendment Rules (No. 7) 2020 (the Rules) were registered which commence from 15 August 2020. 

Revenue vs Capital: two sides of the coin

The ongoing debate of capital vs revenue was recently raised in a Full Federal Court case - Greig v FCT [2020] FCAFC 25. The case highlights the continuing difficulty in the capital vs revenue distinction. This area of law falls within a grey zone where the outcome turns on the facts of each situation.

Taxable payments annual reporting obligations

Businesses who make payments to contractors in relation to certain services may be required to prepare and lodge the Taxable payments annual report (TPAR) which is due for lodgment by 28 August 2020.  

JobKeeper 2.0 and the next phase of stimulus activity

The Government has released some further detail on what the future of stimulus will look like in Australia.

Australia: how we are faring during COVID-19

We're lucky to be in Australia and even more so in these times with a global pandemic of COVID-19. Businesses have struggled, people have self-isolated and the Government has done its best to prop up businesses with the Jobkeeper payment and other stimulus measures. The economy has suffered greatly, and it will take time to revert to pre-COVID times. Due to our geographical isolation and quick actions of Governments, we were able to contain the number of cases of Coronavirus to a degree, however, with the recent spike in Victoria, we need to remain vigilant. A second wave is occurring, and it is up to states and territories to contain this and keep strategising to reduce the detrimental impact on our economy.

Planning for the worst - what happens when the stimulus runs out?

Businesses who are currently in receipt of stimulus payments have less than three months to get their cashflow in order. 

Superannuation contributions – don’t leave it too late

With 30 June fast approaching, it is necessary to be aware of the timing issues that may impact superannuation deductions and your contribution caps. In general, provided the relevant conditions are met, superannuation deductions can only be claimed in the year the superannuation fund receives the contributions.

Protecting capital losses – common issues with related party loans

The last few months have been tumultuous for Australia and within the tax world, we have seen a raft of new legislation being introduced to save the Australian economy. However, in trying to stay agile and keeping up to date with the changes, we may lose sight of the usual hidden issues contained within our complex tax system. One of these is the personal use assets provision and its impact on the capital gains tax (CGT) treatment of loans advanced by individuals (or any other entity) to prop up struggling businesses.

Extension of the Instant Asset Write Off and how it applies to motor vehicles

The Government has announced that it will extend the instant asset write off (IAWO) to 31 December 2020 for asset purchases below $150,000. Businesses with an aggregated turnover of less than $500 million are currently eligible for the write off and it is intended that this announcement will be legislated soon.

HomeBuilder – the Government’s new $25,000 grant

The Government has announced a new $680 million HomeBuilder package designed to spark life into the residential construction industry by encouraging the building of new homes and substantial renovations.

Rental Assistance – Code of Conduct for commercial tenancies

The Federal Government released a code of conduct (the Code) for commercial tenancies and its purpose is to impose a set of good faith leasing principles for application to commercial tenancies.

JobKeeper payments update

The Coronavirus Economic Response Package Omnibus (Measures No. 2) Bill 2020 (the Bill) was passed by Parliament to introduce the JobKeeper payment.

Government’s Third Stimulus Package designed to save Australian jobs impacted as a result of COVID-19

On 30 March 2020, the Government announced a $130 billion wage subsidy to combat the impact of COVID-19 on the Australian economy. The Government has provided further support to Australian businesses and encouraged businesses to keep their workers employed by providing a “JobKeeper” payment to eligible employers for eligible employees.

COVID-19 Economic Response Package receives Royal Assent

The Coronavirus Economic Response Package Omnibus Bill 2020 received Royal Assent on 24 March 2020 and is now law. The package included various changes which were announced in the two stimulus packages released recently by the Government.

Government’s 2nd Stimulus Package Announced

The government announced a second stimulus package worth $66 billion in an attempt to deal with the impact of COVID-19 on the Australian economy.

Superannuation Amnesty – six months to get your employer obligations in order

The Bill introducing the superannuation guarantee (SG) amnesty received Royal Assent on 6 March 2020 and employers have until 6 September 2020 to correct any historic non-compliance with their SG obligations.

Reduction in Corporate Tax Rate

Changes, changes and more changes - Bringing forward the company tax cuts Following on from the various changes to company tax rates earlier in the year, the Treasury Laws Amendment (Lower Taxes for Small and Medium Businesses) Bill 2018 was introduced and passed by the Senate relatively quickly last week. The Bill proposes to bring forward the tax cuts for small and medium businesses. The Bill is currently awaiting Royal Assent.

Moore Stephens Tax Alert - Redundancies and ETPs

Redundancies are, unfortunately, a part of doing business. Over the last year or so, there has been a lot of movement within the Western Australian job market with employments being terminated or being made redundant.  As an employer, it is critical that you understand what your responsibilities are. To help you, we have undertaken various reviews of calculations for Employee Termination Payments (ETP) and genuine redundancies