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Non Commercial Business Losses

Individual and Business Tax Returns - Penrith Accountant

In the 2009 Budget, the government announced changes to the non-commercial losses rules. These changes will further restrict the deductibility of business losses incurred in relation to non-profitable business activities. The measure will ensure excess deductions from unprofitable business activities cannot be used to reduce salary, wage and other income of high income earners.

From 1 July 2009 deductions from unprofitable business activities cannot be used to reduce salary, wage and other income of high income earners by tightening the application of the non‑commercial losses rules. Taxpayers with an adjusted taxable income of over $250,000 will instead have excess deductions quarantined to the business activity. The existing rules will continue to apply to taxpayers with an adjusted taxable income of $250,000 or less.

Taxpayers will still have the ability to apply to the Commissioner of Taxation for relief from the rules if there are exceptional circumstances or because the nature of the activities means that they are temporarily carrying on an unprofitable business but the activities they are undertaking are nonetheless independently assessed as commercially via.

A Grade Tax Accountants Penrith on (02) 4731-1405 for personal and business clients full range of taxation and accounting services

Medical Expenses Tax Offset

Tax Refund - A Grade Tax Accountants Penrith NSW

 

Rental Property Expenses

 A Grade Tax Accountants Penrith

With one in five taxpayers owning a rental property, the Tax Office has issued a timely reminder that, depending on your circumstances, you may be able to claim the following expenses this tax season:

  • Capital works;
  • Repairs and improvements;
  • Interest, legal costs and other expenses incurred when purchasing the property;
  • Interest paid on the loan;
  • Borrowing expenses such as:

 - mortgage broker and loan establishment fees;

 -stamp duty charged on the mortgage;

 -title search fees charged by the lender;

 -fees for any valuation for loan approval;

-the costs of preparing and filing documents on the loan; and

-lender's mortgage insurance

Remember, if your total borrowing expenses exceed $100, the deduction is spread over five years or the term of the loan - whichever is less.

Call (02) 4731-1405 A Grade Tax Penrith for all your tax accounting, bookkeeping, superannuation, tax return, capital gains tax advice and planning.

What are Reportable Super Contributions?

A Grade Tax Accountants Penrith - Taxation Consultants

Your reportable super contributions are the sum of any of the following:

Personal deductible contributions you may have made ( Your personal deductible contributions include any personal contributions you made to a super fund for which you can claim an income tax deduction on your individual tax return.)

Reportable employer super contributions your employer may make for you (those contributions your employer makes for you where all of the following apply: you influenced the amount or rate of super your employer contributes: the contributions are additional to the compulsory contributions your employer must make under any of the following: super guarantee law: an industrial agreement: the trust deed or governing rules of a super fund: a federal, state or territory law.

For the 2009-10 income year and all future years, your reportable super contributions will affect the income tests for some tax offsets, the Medicare levy surcharge, and certain government benefits and obligations.

For all your taxation services Penrith contact A Grade Tax Accountants on (02) 4731-1405 or visit our website www.agradetax.com.au


 

Accessing your Super

A Grade Tax Accountants Penrith - Tax Planning and Retirement

Promoters of arrangements to access superannuation savings has attracted ATO attention.

Except in some very specific circumstances, you cannot access your super savings until you reach retirement age (which is between age 55 and 60, depending on your date of birth.)

The specific circumstances in which you can access your super savings early are very limited and tightly restricted - these are mainly related to specific medical conditions or when you are experiencing severe financial hardship.

For specific taxation, superannuation needs please contact A Grade Tax Accountants Penrith on (02) 4731-1405 or visit our website www.agradetax.com.au

Company cars - don't forget your FBT obligations

A Grade Tax Accountants, Penrith NSW

If you run your own business and have bought or are thinking about buying or leasing a company car, make sure you consider your fringe benefits tax (FBT) obligations.

Recent checks of luxury cars by the Tax Office found that many company owned or leased cars used by employees didn't account for FBT - resulting in some hefty tax bills for employers.

In a recent case involving an employee and an employer, an employer failed to lodge an FBT return for a number of years and when followed up by the Tax Office received a default FBT assessment of over $100,000 (including penalties).

The employer argued in the Administrative Appeals Tribunal that the assessment was excessive and that the car was only used for business purposes. However, because there were insufficient records to support this claim the AAT upheld the Tax Office assessment.

To avoid getting stung remember these key points:

  • Cars garaged near an employee's home are considered available for the employee's private use.

If a car is garaged at or near an employee's home, the FBT law deems it as available for the employee's private use, regardless of whether the employee has permission to use the car privately. As a general rule, travel to and from work is private use of a vehicle.

  • Keep accurate and up-to-date log books.

You need to be able to prove to the Tax Office that the car was used for business purposes so it's important to keep these records up to date and accurate.

The Tax Office is not just checking on the private use of luxury cars. Last April the Tax Office announced a motor vehicle data match on vehicles with a value of $10,000 or greater sold or transferred between 1 July 2007 and 30 June 2008.

Pension Bonus Scheme

A Grade Tax Accountants Penrith

The Pension Bonus Scheme (PBS) will be closed to new entrants from 20 September 2009.

To register for the PBS you must first qualify for the Age Pension before 20 September 2009. Therefore, only men over the age of 65 and women over 63.5 years are eligible to register.

Note that you do not need to be eligible for the Age Pension at the time of registration. The pension bonus is calculated based on your Age Pension entitlement when you apply to receive the Age Pension for the first time.

What is the Pension Bonus Scheme

The Pension Bonus is a lump-sum, non taxable payment.

Tax Time 2009

A Grade Tax Accountants Penrith NSW

Dear Client,

With the growth of our practice, it will assist us if you could ring and make an appointment for the preparation of your 2009 Tax Return.

Please review the following checklist to ensure you bring everything to assist me to maximise your refund. [ Tax Return Checklist ]

Medical Rebate: If you or your family has had out of pocket medical expenses in excess of $1,500 you may be able to claim a 20% tax rebate on the amount in excess of $1,500.
If you want to claim this tax rebate you will need to bring:

  • Tax Statement from Medicare (phone Medicare on 132011&request a Tax Statement).
  • Taxation Certificate from your Private Health Insurer detailing claims made and benefits paid.
  • Statement of expenses from your Chemist (your regular Chemist can provide you with this) or a summary of your chemist receipts.
  • Summary of other medical expenses, including Dental&Optical.

Payment of Refund: Please bring your BSB&Bank account details for electronic payment of your refund. This provides the fastest method of receiving your refund.

Education Rebate: If you would like to claim this tax rebate please complete the attached worksheet to determine your eligibility and amount of your claim.

Overtime Meal Deductions: Please bring in your payslip showing the rate paid per meal.

Living Away from Home / Travel Allowance: Please bring in your payslip showing the rate paid per night whilst away from home.

Car Deduction – Employment related&self employed

2009 Individual Tax Return Checklist

A Grade Tax Accountants Penrith NSW - Tax Returns

[ Download a prinatble PDF version of this list here ] Get Adobe Reader

When you come in to see us at A Grade Tax, please bring the following items to assist us in completing your tax return:

Education Expenses Tax Offset

Tax Accountants Penrith

[ Download a prinatble PDF version of this list here ] Get Adobe Reader

Which individuals can claim the Education Tax Offset ?

To be eligible to claim the Education Tax Offset an individual must meet the following 3 conditions:

  1. The claimant has received or is entitled to receive Family Tax Benefit Part A in respect of a child. Thus the rebate must be claimed by the parent registered for Family Tax Benefits. If for example the parent that is registered for FTB does not need to lodge a tax return then they must complete a stand alone Education Tax Offset claim form – it cannot be transferred to the other parent to claim on their tax return.
  2. The child is enrolled in a primary or secondary school course.
  3. Eligible education expenses are incurred in respect of the child.

Eligible claimants will be able to claim the following tax offset amount for 2009:

  • A 50% tax offset for up to $750 of eligible education expenses incurred for each child attending primary school ( i.e., a refund of up to 50% x $750 = $375 per primary school child )
  • A 50% tax offset for up to $1500 of eligible education expenses incurred for each child attending secondary school ( i.e., a refund of up to 50% x $1500 = $750 per secondary school child )

Only the following prescribed education expenses can qualify for the tax offset:

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