A Grade Tax News Personal Newsletter
The time has now come to complete your 2017 Income Tax Return. Please ring for an appointment to complete your Tax Returns this year with either Donna, Tynna, or Max.
It is important that anyone considering an investment proposal seeks our advice with regard to the taxation consequences and options available to minimize taxation. For example, there can be very significant tax advantages available by holding an investment in a Self Managed Super Fund rather than your own name.
We provide a full range of taxation services including:
- Advice regarding the best tax structure for the formation of new businesses. It is always best to discuss your new business proposal before committing to any new venture.
- Company & Family Trust returns.
- Formation & administration of Self Managed Super Funds.
- Investment property tax advice.
- Our mobile lending service offers a wide range of finance options for home & investment loans plus vehicle financing.
Please review the above PDF of our checklist and tax tips, to assist with the preparation of your returns.
B.Comm (NSW Uni.) FIPA JP
Labor's negative gearing and CGT changes will start 1 Jan 2020
In an address to the Financial Services Council BT Political Series, Shadow Treasurer Chris Bowen has announced that Labor's reforms to negative gearing and the Capital Gains Tax (CGT) discount would commence from 1st January 2020. "This of course means that any investment undertaken prior to 1st January 2020 will be fully protected by our grandfathering arrangements. That is, all investments made before the 1st January 2020 will continue to enjoy the current negative gearing and capital gains tax concession arrangements. This gives investors adequate time to plan and invest this year before the new rules come into force."
Mr Bowen said the negative gearing changes "will buttress some of this weakness by targeting tax concessions at new residential construction". He said a 1st January 2020 start date allows for around 7 months, being a sufficient amount of time to get the legislation in place before the changes are due to come into effect. He said Labor announced its reforms to negative gearing over 3 years ago and has "withstood the shrill scare campaigns and the apocalyptic warnings".
· Scammers fake ATO phone numbers
There is a current scam involving pre-recorded robocalls impersonating the ATO and threatening immediate arrest for an unpaid tax debt. The scammers use a technology known as 'spoofing' to show a genuine ATO number on the caller ID.
Prior to the end of the financial year, there is an opportunity to claim a significant tax deduction for contributions to taxpayers personal superannuation.
To ensure that the contributions are deductible, what do we need to consider?
Notice of intention to claim a tax deduction
To qualify and claim the deduction, a notice of intention must be received and accepted by the superannuation fund prior to the lodgement of the member's income tax return or 30 June of the year following, whichever occurs first.
In some circumstances it may be necessary to lodge a notice of intention earlier. If you have a member planning to rollover or withdraw their benefits or seeking to commence a pension, lodgement and acceptance of the notice must occur before these events take place.
In order for a contribution to be allocated in the current financial year payment must be received by the superannuation fund. This is important for ensuring deductibility and the allocation towards a members contribution cap in this financial year.
CAUTION: 30 June 2018 falls on a Saturday! The timing of contributions is therefore crucial to ensure that they are received by the member's superannuation fund by no later than 29 June 2018.
Some superannuation funds have a cut off date just prior to the end of financial year to ensure that contributions received are processed and allocated in the current year. Please check with the relevant superannuation fund.
There are lots of property related tax deductions that all investors claim: council rates, water rates, property management fees, repairs. But depreciation is one that many claims people don’t even know about.
Think of it as compensation for wear and tear. Buildings suffer wear and tear, and so do their contents. If you are renting out a property, you can claim this as a tax deduction.
To claim depreciation, you need a Quantity Surveyor to put together a document called a Depreciation Schedule. It sets out how much you can claim every year as a deduction.
Depending on when your property was built, the Quantity Surveyor will estimate the construction cost at the time it was built and they will put a value on it. You will claim this at 2.5% per year.
You can even claim depreciation on renovations done by a previous owner.
Do you own an Investment Property? If the answer is YES, expect some big tax changes with new rules coming into force on 1st July 2017.
If you purchased a property that had installed fridges or dishwashers, you were entitled to claim tax deductions by depreciating them. Owners are now only entitled to claim things they have purchased themselves.
If you have an Interstate or Overseas Investment Property, you are no longer allowed to claim any trips to visit your property against tax.
So if you are planning on visiting your Overseas or Interstate Investment Property soon, we suggest a short trip to inspect it before 30th June 2017.
If you would like to schedule an appointment for Tax Advice regarding your Investment Property, please contact A Grade Tax on (02) 4731 1405.
The ATO are stressing for you to be aware of any emails, phone calls, faxes or SMS’ you receive, claiming to be the ATO.
If you have been contacted by the ATO advising you that you have a debt outstanding, we strongly advise that you contact us on (02) 4731 1405 so we can clarify this information for you.
If you would like to verify or report a scam to the ATO, or you would like to see some examples on what to look out for, please visit the ATO at: https://www.ato.gov.au/general/online-services/identity-security/verify-or-report-a-scam/#Phonescams
Did you read the Sunday Telegraph on April 23rd 2017? If you missed it, not to worry, here is an overview of the article on page 8…
Six of Australia’s largest Industry Superannuation Funds have all paid more than $5 Million to unions in the past 10 years.
When you look at the statistics, there are roughly 5 million Australians who have industry Super Funds but only 15% of workers belong to a union. It makes you think about what they are doing with your Superannuation, doesn’t it.
If you would like more information on choosing a Superannuation Fund that is right for you, visit ASIC’s MoneySmart website at: https://www.moneysmart.gov.au/superannuation-and-retirement/how-super-works/choosing-a-super-fund
Now is the time to make non-concessional (after tax) Superannuation Contributions before 30th June 2017!!
If you have been thinking about making Superannuation Contributions, now is the time to do it!
Take advantage of the current $180,000 after-tax contributions cap and the $540,000 bring-forward cap before 30th June 2017.
From 1st July 2017, the non-concessional Contributions cap will drop dramatically to $100,000 per annum and $300,000 bring-forward cap. That is a dramatic difference to the $540,000 bring-forward cap prior to 30th June 2017. Also note that if your Superannuation balance total is equal to or more than $1.6 million, you will not be able to make non-concessional Contributions from 1st July 2017.
If you would like some assistance from a Tax Professional and would like to organise an appointment for Tax Advice, please contact us on (02) 4731 1405.
Superannuation Changes and what it means to you!
In the coming months, we will see some big changes to Australia’s Superannuation Rules.
Did you know that from 1st July 2017:-
- If you are under 75 years old, you are eligible to make tax deductible super contributions at any time rather than resorting to salary sacrifice;
- Before-tax contributions will reduce to $25,000 and after-tax contributions will reduce from $180,000 to $100,000 per year;
- Individuals will have a limit of $1.6 million held in a super pension account which is tax free. Anything over this amount needs to be invested in a taxed superannuation fund;
- Tax-free investment earnings will no longer be beneficial with transition to retirement pensions;
- If your spouse earns less than $40,000 per annum and you make super contributions to your partner’s superfund, you are entitled to claim the $540 low Income Spouse Contribution Tax Offset.
Now is the time to start reviewing your Superannuation and assess how these changes will affect you.
Here are some ideas on what to look into before these changes come into effect:-
- Planned Asset Sales are a good way to increase your Superannuation prior to the new financial year;
- Think about increasing your salary sacrifice prior to the lower caps start for pre-tax contributions;
- Take advantage of after-tax contributions capped at $540,000 now, before it decreases to $300,000 in the new financial year
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