A Grade Tax News Personal Newsletter
Australians are being warned to steer clear of sophisticated tax time phishing emails that purport to come from the ATO but are really designed to steal people's banking emails and passwords.
The MessageLabs Intelligence unit, part of computer security company Symantec, has observed an increase in the fraudulent emails as the end of the financial year approached. This year, the scams are more sophisticated than ever before.
"Scammers have mastered the art of making these emails look legitimate, often including the ATO logo and links to the ATO website," Symantec said.
"These phishing emails generally offer online tax returns, luring internet users with subject lines and key words such as 'benefits of e-tax', 'eligibility requirements' and 'click here to get tax refund'."
The scammers try to entice users into giving away personal details including banking information and passwords by saying that these details are required in order to get the refund.
In another variation of the attack, emails contain links to phishing web pages designed to look like a legitimate online tax return. The attackers can then use the information gathered by these scams to access the victims' accounts and steal money. It could also be used for identity theft.
"Impersonating tax and government agencies is becoming an ever more popular angle for phishers," Symantec said.
"Symantec has observed that the instances of ATO phishing attacks have been on the increase since January 2010."
The ATO said Australians should be alert to potential email or phone scams or suspicious door knockers. Suspicious activity can be reported to the tax office on 13 28 61.
"While we may occasionally send you emails or SMS text messages promoting new products or services we will never ask for your personal information such as credit card details, TFN, your date of birth or passwords," the ATO said.
For many years, the humble tax agent, who consistently and legitimately has been able to claim
$’000s more in tax deductions than taxpayers doing it on their own, has been a thorn in the side of
the Government and the Tax Office.
This is the background to the new ‘standard deductions’ and the Government’s and Tax Office’s
desire to try and elbow tax agents to the sidelines – tax agents claim too much and they don’t like
So, taxpayers applauding the proposed introduction of ‘standard deductions’ may rue the day they
allowed the Government and Tax Office to lead them down this slippery slope.
“A slippery slope that we believe will inevitably lead to the abolition of Tax Returns and Tax
Refunds”, said Andrew Gardiner, spokesperson for the NTAA.
“The Treasurer himself has forewarned that this is a ‘step’ towards a tick and flick system of
returns. If it is this Government’s first step, what’s next?”
Taxpayers love receiving their annual income tax refund. It’s a form of self-imposed, forced
savings. If taxpayers want to ensure they continue to receive their refunds, they would be better
off to reject this proposal for standard deductions outright, unless they make sure it comes with an
iron-clad guarantee that their right to receive annual tax refunds is permanently locked into law.
“History is our teacher”, said Andrew, “and history teaches us that you cannot trust Governments
that bring in standard deductions”.
“In the 70’s, taxpayers were entitled to claim deductions for doctor, medical, hospital and chemist
expenses, education of dependants and self education, life insurance, rates and taxes on their
home, and a deduction for funeral expenses.”
“However, the government of the day criticised the tax system as too complex and introduced a
‘standard deduction’. That deduction was turned into a rebate and then the rebate was abolished
Beware of Identity Crime
Your Tax File Number (TFN) is a key part of your identity while you are in Australia.
It is an important form of identification when you start a new job, open bank accounts and apply for government benefits. Keep it secure.
Protect your identity by protecting all your personal details, including your TFN. Keep your passwords and TFN safe and never record or store them where they could be stolen, such as in your purse or wallet.
Only certain people and organisations can ask for your TFN, the most common being:
- the Tax Office when discussing your tax records
- your employer after you start work
- your bank or other financial institutions
- your superannuation fund.
If you think someone else has used your Tax File Number, or it has been stolen, phone the Tax Office on 1800 060 062.
Ring A Grade Tax Accountants in Penrith on (02) 4731-1405 providing a full range of accounting, taxation services, bookkeeping, business setup and ongoing tax advice, tax returns, planning and tax advice to personal and business clients.
Employees who salary sacrificed into super in the lead up to 30 June 2009 to take advantage of the $100,000 and $50,000 concessional contribution caps which were halved from 1 July 2009 may unwittingly be hit with excess concessional contributions tax in the current financial year.
The extra tax will be imposed because for many employees the salary sacrifice super amounts deducted from their pay during the June 2009 quarter may not have been paid by their employer into the superannuation fund until the following July. This means that these contributions will be counted towards the lower $50,000 and $25,000 contribution caps in the current financial year.
It should be noted that the compulsory 9% superannuation guarantee contributions paid by employers are also included in the concessional contribution caps.
Peter is an anaethetist aged 54 and employed by a public hospital. He salary sacrificed $20,000 into super just before 30 June 2009 to take advantage of the higher contribution limits. This $20,000 was paid by the hospital into the super fund in July 2009. Peter has so far salary sacrificed $40,000 into super this financial year.
On this basis Peter’s super fund has received $60,000 in salary sacrificed contributions this financial year meaning that he has already exceeded his $50,000 concessional cap this financial year by $10,000. In addition to the 15% contributions tax that will be deducted from Peter’s super balance, excess concessional contributions tax of 31.5% will be paid on the $10,000. Peter will also be hit with excess concessional contributions tax of 31.5% on the super guarantee contributions made by the hospital as they are also counted in the $50,000 concessional cap.
UNIVERSITY undergraduates will be able to claim educational expenses as a tax deduction after a former student had a landmark win against the Tax Office in the Federal Court recently.
A former Australian Catholic University student, was successful in her bid to claim $920 as self-education expenses after fighting the Australian Tax Office through a number of jurisdictions over the past three years.
While studying as a primary teacher full-time, Ms Anstis worked as a part-time sales assistant for retail chain Katies, where she earned $14,946. She also received a Youth Allowance of $3622 during the 2006 income year.
In a bold move she claimed education expenses including travel costs, supplies for children during teaching rounds, student administration fees and depreciation of her computer.
The Tax Office rejected the claim, so Ms Anstis and her father, Michael, who is a qualified solicitor but does not work as a lawyer, fought them.
The full bench of the Federal Court upheld an earlier decision that because the former student had to be enrolled in a full-time course of study to get her assessable income of Youth Allowance, any costs incurred in the course of studying should be deductible.
Tax experts say hundreds of thousands of university students who receive Youth Allowance could benefit from the ruling, but they will need to generate a taxable income above $15,000.
About 440,000 students receive Youth Allowance or Austudy, according to government figures. Many of these students would earn enough with the addition of part-time work to have a tax liability, according to Dale Boccabella from the Australian School of Business at the University of NSW.
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.
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
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
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.
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