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Taxation

Treasurer raises ‘idea’ of personal tax cuts

Treasurer raises ‘idea’ of personal tax cuts

Who doesn’t like a tax cut when they personally benefit from it? In a recent speech, the Treasurer said that personal tax cuts were required to prevent ‘bracket creep’ – that’s jargon for what happens when the tax rate thresholds don’t keep pace with inflation and more people are pushed into a higher tax bracket (they get taxed more and potentially lose access to benefits but are economically standing still). 

What now for the GST?

What now for the GST?

Fifteen years after the introduction of the GST in Australia debate still rages over what should be taxed and whether the GST rate should increase. 

Unless the Government changes the GST Act, any change requires the approval of the States and Territories. The Treasurers’ workshop late last month resolved to keep the GST rate at 10% but enable a series of other changes. We look at the key areas of change: 

It’s not easy being a foreigner

It’s not easy being a foreigner

If you are not an Australian resident for tax purposes, you are excluded from many of the tax breaks available to residents and an increasing target of the Australian Taxation Office. We explore the widening gap between residents and non-residents. 

Tax scams catching out the unwary

Tax scams catching out the unwary

Every tax time is an opportunity for scammers to target the unwary.

This time around, the scammers are phoning and claiming to be from the prosecutions department of the ATO. They then state that they believe you have committed fraud and the Sheriff’s Office has been called. You can of course make this all go away by transferring cash using the details they provide or by giving your details to them. All of it is fake.

Landlords Beware: Key issues for property investors

Landlords Beware: Key issues for property investors

There has been a lot of negative conversation about negative gearing lately. But, if you are currently negative gearing your investment property, should you be concerned?

Negative gearing is when you claim more in deductions than you earn for an income producing asset that you have purchased using debt. It is not limited to property, you can for example negatively gear shares, but property is the dominant negatively geared asset claimed by Australians.

What will change on 1 July 2015

What will change on 1 July 2015

For Business

  • Small business tax cut - 1.5% for companies and 5% tax discount for unincorporated small businesses under $2m (capped at $1,000)*
  • Employee share scheme rule changes to make the schemes more attractive particularly to start-ups (covered in our April update)*
  • 'Fly in fly out' and 'drive in drive out' (FIFO) workers will be excluded from the Zone Tax Offset (ZTO) where their normal residence is not within a 'zone'*
  • Start-ups able to immediately deduct a range of professional expenses required to start up a business – such as professional, legal and accounting advice.*
  • The way work related deductions for car expenses are calculated will change. The '12% of original value method' and the 'one‑third of actual expenses method' will be removed. The 'cents per kilometre method' will be modernised, replacing the three current engine size rates with one rate set at 66 cents per kilometre to apply for all cars.

Superannuation

  • The terminally ill will be able to access super earlier*
  • Employers with 20 employees or more must use SuperStream for employee contributions.

Individuals

  • Changes to family tax benefits – income test changes, add on child payment removed, and changes to large family supplement.
* announced change not yet law.

“This information has been prepared without taking into account your objectives, financial situation or needs. Because of this, you should, before acting on this information, consider its appropriateness, having regard to your objectives, financial situation or needs”.