Are you sure you don't have to lodge a Taxable payments annual report this year?
If your business is in the building and construction industry and you paid contractors for building and construction services in the last financial year, you need to lodge a Taxable payments annual report by 28 August 2017.
For details, please refer to link: https://www.ato.gov.au/Newsroom/smallbusiness/Lodging-and-paying/Paid-any-contractors-/ (23 August 2017)
1. The Medicare levy will increase from 2.0 to 2.5 per cent of taxable income from 1 July 2019.
2. The Medicare levy low-income thresholds for singles, families, and seniors and pensioners will increase from the 2016-17 income year.
| 2015/2016 | 2016/2017 | |
|---|---|---|
| Single | $21,335 | $21,655 |
| Family* | $36,001 | $36,541 plus |
| Single Sr, Pr | $33,738 | $34,244 plus |
| Family Sr, Pr* | $46,966 | $47,670 plus |
| Taxable income | Tax on this income (new rates) |
|---|---|
| 0 - $18,200 | Nil |
| $18,201 - $37,000 | 19c for each $1 over $18,200 |
| $37,001 - $87,000* | $3,572 plus 32.5c for each $1 over $37,000 |
| *$87,001 - $180,000 | $19,822 plus 37c for each $1 over $87,000 |
| $180,001 and over | $54,232 plus 47c for each $1 over $180,000 |
1. Access to the small business CGT concessions will be tightened from 1 July 2017 to deny eligibility for assets which are unrelated to the small business.
2. The $20,000 instant asset write-off for small business will be extended by 12 months to 30 June 2018, for businesses with an aggregated annual turnover of less than $10 million.
Small businesses will be able to immediately deduct purchases of eligible depreciating assets costing less than $20,000 provided they are first used, or installed ready for use, by 30 June 2018. Only a few assets are ineligible (such as horticultural plants and in-house software). Depreciating assets valued at $20,000 or more (which cannot be immediately deducted) can continue to be placed into the general small business pool (the pool) and depreciated at 15 per cent in the first income year, and 30 per cent for each income year thereafter. The pool can also be immediately deducted if the balance is less than $20,000 over this period (including existing pools). The current “lock out” laws from the simplified depreciation rules will continue to be suspended until 30 June 2018. These rules prevent small businesses from re-entering the simplified depreciation regime for five years if they opt out. From 1 July 2018, the immediate deductibility threshold, and the balance at which the pool can be immediately deducted, will revert to $1,000.
1. Purchasers of new residential properties or new subdivisions will be required to remit the GST directly to the ATO as part of settlement from 1 July 2018.
2. The GST treatment of digital currency (such as Bitcoin) will be aligned with that of money from 1 July 2017.
3. Access to diplomatic and consular concessions under the Indirect Tax Concession Scheme has been extended.
1. A person aged 65 or over can contribute up to $300,000 from the proceeds of the sale of their home as a non concessional contribution into superannuation, from 1 July 2018.
2. First home buyers will be able to build savings more quickly for a home deposit by salary-sacrificing contributions to superannuation.
From 1 July 2018, voluntary contributions made after 1 July 2017 may be withdrawn for a first home deposit. Withdrawals will be taxed at marginal rates, less a 30% offset.
There will be an annual cap of $15,000, and a total cap of $30,000, in contributions for this scheme. For couples, each person can take advantage of this scheme.
3. Deductions for travel expenses related to inspecting, maintaining or collecting rent for a residential rental property will be disallowed from 1 July 2017.
4. Plant and equipment depreciation deductions will be limited to outlays actually incurred by investors in residential real estate properties from 1 July 2017.
These changes will apply on a prospective basis, with existing investments grandfathered. Plant and equipment forming part of residential investment properties as of 9 May 2017 (including contracts already entered into at 7:30pm (AEST) on 9 May 2017) will continue to give rise to deductions for depreciation until either the investor no longer owns the asset, or the asset reaches the end of its effective life. Investors who purchase plant and equipment for their residential investment property after 9 May 2017 will be able to claim a deduction over the effective life of the asset. However, subsequent owners of a property will be unable to claim deductions for plant and equipment purchased by a previous owner of that property. Source: Budget Paper No 2, p 30.
5. The CGT discount for Australian resident individuals investing in qualifying affordable housing will be increased from 50 per cent to 60 per cent from 1 January 2018.
The conditions to access the 60 per cent discount are:
5.1 The housing must be provided to low to moderate income tenants
5.2 Rent must be charged at a discount below the private rental market rate
5.3 The affordable housing must be managed through a registered community housing provider
5.4 The investment must be held for a minimum period of three years.
The higher discount will flow through to resident individuals investing in affordable housing via managed investment trusts as part of the tax measure enabling such trusts to invest in affordable housing. Source: Budget Paper No 2, p 29.
6. Foreign and temporary tax residents will be denied access to the CGT main residence exemption.
7. The foreign resident CGT withholding rate will be increased to 12.5 per cent and will apply to Australian real property and related interests valued at $750,000 or more.
8. An annual levy of at least $5,000 will be imposed on foreign owners of under-utilised residential property.
9. A 50 per cent cap on foreign ownership in new developments will be introduced through a condition on new dwelling exemption certificates.
10. The principal asset test in Div 855 of the Income Tax Assessment Act 1997 will be applied on an associate inclusive basis for foreign tax residents with indirect interests in Australian real property.
1. The multinational anti-avoidance law will be amended to prevent the use of foreign trusts and partnerships in corporate structures for tax minimisation, with retrospective effect from 1 January 2016.
2. The government will provide $28.2 million to the ATO to target serious and organised crime in the tax system.
3. The Black Economy Taskforce has delivered an interim report to the government and the government has accepted some recommendations for immediate action.
4. The taxable payments reporting system will be extended to contractors in the courier and cleaning industries from 1 July 2018.
5. Sales suppression technology and software, used to understate business income by deleting electronic transactions, will be prohibited.
6. Funding for the ATO’s Black Economy Taskforce audit and compliance activities will be extended until 30 June 2018.
7. A two-year public information campaign from 2016-17 will highlight the government’s key tax integrity measures.
1. The use of limited recourse borrowing arrangements will be included in a member’s total superannuation balance and transfer balance cap from 1 July 2017.
2. Opportunities for members to use related party transactions on non-commercial terms to increase superannuation savings will be reduced from 1 July 2018.
3. The current tax relief for merging superannuation funds will be extended until 1 July 2020.
1. The foreign investment framework will be clarified and simplified with effect from 1 July 2017.
2. A major bank levy will be introduced for authorised deposit taking institutions (ADIs), with licensed entity liabilities of at least $100 billion, from 1 July 2017.
3. Businesses that employ foreign workers on certain skilled visas will be required to pay a levy that will provide revenue for a new Skilling Australians Fund from March 2018.
4. The taxation of “roll your own” (RYO) tobacco and other products (for example cigars) will be adjusted so that manufactured cigarettes and RYO tobacco cigarettes receive comparable tax treatment.
5. The government will provide additional funding to Treasury and the Office of Parliamentary Counsel to ensure dedicated drafting resources for relevant legislation.
Currently, individuals with income and concessional super contributions greater than $300,000 will trigger a Division 293 assessment.
From 1 July 2017, the government will lower the Division 293 income threshold to $250,000. An individual with income, and concessional super contributions, exceeding the $250,000 threshold will have an additional 15% tax imposed on the lesser of:
For details, please refer to link: https://www.ato.gov.au/Individuals/Super/Super-changes/Change-to-Division-293-income-threshold/ (17 February 2017)
You may be eligible for the super co-contribution, low-income super contribution (LISC) from the 2012–13 to 2016–17 financial years, or low-income super tax offset (LISTO) from 1 July 2017. This means the government also adds to your super.
You don't need to apply for these government super contributions. If you're eligible and your fund has your tax file number (TFN), we will pay it to your fund account automatically.
For details, please refer to link: https://www.ato.gov.au/Individuals/Super/Growing-your-super/Adding-to-my-super/Government-super-contributions/ (10 February 2017)
From 1 July 2017, most people, regardless of their employment arrangement, will be able to claim a full deduction for personal super contributions they make to their super until they turn 75. Individuals who are aged between 65 and 75 will need to meet the work test to be eligible to claim the deduction. See below for further information.
If you wish to claim a tax deduction for personal contributions, you must complete and lodge a notice of intent with your super fund and have this notice acknowledged (in writing) by your fund.
For details, please refer to link: https://www.ato.gov.au/individuals/super/growing-your-super/adding-to-my-super/personal-super-contributions/ (6 February 2017)
In most cases, when a person dies their super fund pays their remaining super to their nominated beneficiary. Super paid after a person's death is called a 'super death benefit'.
If the rules of your fund allow it, you can nominate the beneficiary for your super with your super fund. This nomination may be non-binding or binding.
For details, please refer to link: https://www.ato.gov.au/Individuals/Super/In-detail/Withdrawing-and-paying-tax/Withdrawing-your-super-and-paying-tax/?anchor=Superdeathbenefits#Superdeathbenefits (10 January 2016)
In the 2016-17 Budget, the Government announced an increase to the small business entity turnover threshold from $2 million to $10 million. From 1 July 2016, business with a turnover of less than $10 million will be able to access a range of concessions which are currently only available to business entities with a turnover of less than $2million.
For details, please refer to link: https://www.ato.gov.au/General/New-legislation/In-detail/Direct-taxes/Income-tax-for-businesses/Increase-the-small-business-entity-turnover-threshold/ (3 December 2016)
In the 2016-17 Budget it was announced that from 1 July 2017 a Low Income Superannuation Tax Offset will be introduced.
This will be a tax offset available to superannuation funds based on the tax paid on concessional contributions made on behalf of low income earners. The offset will mean that individuals with an adjusted taxable income up to $37,000 will receive a refund into their superannuation account of the tax paid on their concessional superannuation contributions, to a cap of $500.
For details, please refer to link: https://www.ato.gov.au/general/new-legislation/in-detail/super/introducing-a-low-income-superannuation-tax-offset/ (3 December 2016)
Our retirement calculator and planner helps you work out your future retirement income. Visit ASIC's MoneySmart website to learn more.
For details, please refer to link: https://www.moneysmart.gov.au/tools-and-resources/calculators-and-apps/retirement-planner (7 August 2016)
Deductions for specific industries and occupations. You may be able to claim deductions for expenses that directly relate to your work as an employee.
For details, please refer to link: https://www.ato.gov.au/Individuals/Income-and-deductions/In-detail/Deductions-for-specific-industries-and-occupations/Deductions-for-specific-industries-and-occupations/ (29 July 2016)
Under SuperStream, employers need to pay super contributions for their employees electronically and send the associated data electronically in a standard format.
For details, please refer to link: https://www.ato.gov.au/super/superstream/employers/ (29 July 2016)
Superannuation, or super, is money you put aside during your working life to use in retirement.
When it's time to access your super you should consider your options to work out what’s best for you. The choices you make could affect how comfortably you live in your retirement.
For details, please refer to link: https://www.ato.gov.au/individuals/super/in-detail/withdrawing-and-paying-tax/withdrawing-your-super-and-paying-tax/ (29 July 2016)
| Taxable income | Tax on this income |
|---|---|
| 0 - $18,200 | Nil |
| $18,201 - $37,000 | 19c for each $1 over $18,200 |
| $37,001 - $80,000 | $3,572 plus 32.5c for each $1 over $37,000 |
| $80,001 - $180,000 | $17,547 plus 37c for each $1 over $80,000 |
| $180,001 and over | $54,547 plus 45c for each $1 over $180,000 |
The above rates do not include the:
| Taxable income | Tax on this income |
|---|---|
| 0 - $80,000 | 32.5c for each $1 |
| $80,001 - $180,000 | $26,000 plus 37c for each $1 over $80,000 |
| $180,001 and over | $63,000 plus 45c for each $1 over $180,000 |
Foreign residents are not required to pay the Medicare levy.
If you're a foreign resident for tax purposes:
If you're an Australian resident for tax purposes:
| If you: | you are generally: |
|---|---|
| leave Australia temporarily and do not set up a permanent home in another country | an Australian resident for tax purposes |
| are an overseas student enrolled in a course that is more than six months long at an Australian institution | an Australian resident for tax purposes |
| are visiting Australia for more than six months, and for most of that time you live at the same place, and you either have or establish ties in the local community | an Australian resident for tax purposes (see the example) |
| are visiting Australia for more than six months, and for most of that time you are travelling and working various locations around Australia | a foreign resident for tax purposes (see the example) |
| migrate to Australia and intend to reside here permanently | an Australian resident for tax purposes |
| leave Australia permanently | treated as a foreign resident for tax purposes from the date of your depature |
If you use the logbook method, you:
For details, please refer to link: https://www.ato.gov.au/Business/Income-and-deductions-for-business/Business-travel-expenses/Motor-vehicle-expenses/Calculating-your-deduction/Keeping-a-logbook/ (22 June 2016)
Australian residents buying or selling real property with a market value of $2 million or more need to be aware of new rules which come into effect on 1 July 2016. “The seller needs to provide a clearance certificate to the buyer by settlement, or the buyer will be required to withhold 10% of the sales price and pay this to the ATO,” Mr Allen said.
For details, please refer to link: https://www.ato.gov.au/Media-centre/Media-releases/New-tax-rules-for-property-sales-over-$2-million (19 May 2016)