Fair Work changes

12 July 2023

Although not related to tax, there are a number of changes on the Fair Work front that employers should be aware of:

Minimum wage increase

The National Minimum Wage applies to employees who aren’t covered by an award or registered agreement.

From 1 July 2023, the new National Minimum Wage will be $882.80 per week or $23.23 per hour.

The new National Minimum Wage will apply from the first full pay period starting on or after 1 July 2023. This means if your weekly pay period starts on Monday, the new rates will apply from Monday, 3 July 2023.

Note that if a worker is covered by a registered agreement, the minimum wage increase may apply to them. This is because the base pay rate in a registered agreement can’t be less than the base pay rate in the relevant award. Check your agreement by searching for it on the Commission’s website: Find an agreement

Continue reading “Fair Work changes” →

Small business energy incentive now open

12 July 2023

The recently announced Small Business energy incentive is now open for business!

The Energy Incentive will help up to 3.8 million small‑ and medium‑sized businesses save energy and save on their energy bills.

The incentive is delivered by way of a bonus tax deduction which will provide businesses with annual turnover of less than $50 million an additional 20% deduction on spending that supports electrification and more efficient use of energy.

It will help small businesses make investments like electrifying their heating and cooling systems, upgrading to more efficient fridges and induction cooktops, and installing batteries and heat pumps.

Tradies, manufacturers, restaurants, hairdressers, real estate agents and other small businesses may find it particularly attractive. This incentive helps ensure these businesses share in the benefits and opportunities of the energy transition that’s now underway.

It will support investments that deliver ongoing power bill savings for businesses, while at the same time helping Australia lower emissions.

Up to $100,000 of total expenditure will be eligible for the incentive, with the maximum bonus tax deduction being $20,000 per business.

Eligible assets or upgrades will need to be first used or installed ready for use between 1 July 2023 and 30 June 2024.

Feel free to reach out to us for more information.

Do you have a side-hustle?

8 July 2023

With the cost-of-living skyrocketing, have you taken up a side-hustle?

With new and emerging ways to make money, the ATO is reminding taxpayers to consider if they are ‘in business’ and to declare to their tax agent if they are engaged in a sidehustle.

Record numbers of taxpayers are now working multiple jobs or supplementing their income with ‘side-hustles’ or ‘gig’ economy activities.

ATO Assistant Commissioner Tim Loh said if you earn money through continuous and repeated activities for the purpose of making a profit, then it’s likely you’re running a business.

While there are always new and different ways to make money, the tax obligations remain the same. Don’t fall into the trap of forgetting to include all your income thinking the ATO won’t notice.

You also need to declare any additional income earned through that side-hustle.

Continue reading “Do you have a side-hustle?” →

ATO Tax Time focus areas

29 June 2023

With the end of the financial year on our doorstep, the ATO has announced its three key focus areas for 2022-23 Tax Time – rental property deductions, work-related expenses, and capital gains tax (CGT). To maximise your claims in this area and protect yourself from ATO audits and adjustments, be sure to keep the appropriate records.

Work-related expenses

This year the ATO is particularly focused on ensuring taxpayers understand the changes to the working from home methods and are able to back up their claims. To claim your working from home expenses as a deduction, you can use the actual cost method, or the revised fixed rate method, provided you meet the eligibility and record-keeping requirements as follows:

Continue reading “ATO Tax Time focus areas” →

How to claim an early tax deduction on SG contributions

24 June 2023

Are you an employer who needs to make superannuation guarantee (SG) contributions for your employees? If so, it may be worthwhile bringing forward these SG contributions to before 1 July to benefit from a tax deduction this financial year.

However the timing of when SG contributions are deductible to an employer can be tricky if employers pay SG contributions for their employees via a superannuation clearing house (SCH).

Recap – what is a SCH?

The ATO’s free Small Business Superannuation Clearing House (SBSCH) is the only ‘approved’ clearing house – none of the many commercial clearing houses have this status. The SBSCH is a free service that small businesses with 19 or fewer employees, or an annual aggregated turnover of less than $10 million, may use to make superannuation contributions to employees.

The SBSCH aims to reduce compliance costs for small business employers by simplifying and streamlining the process of making employee superannuation contributions, by allowing employers to make a single lump payment of their contributions to the SBSCH each quarter. That lump sum payment is broken into individual payments by the SBSCH, and then contributed to each employee’s respective super fund or RSA.

Continue reading “How to claim an early tax deduction on SG contributions” →

Generous depreciation in its final days

7 June 2023

The May federal budget confirmed that temporary full expensing (TFE) is now in its final days.

To recap, TFE will cease and be replaced by a $20,000 instant asset write-off (IAWO) from 1 July 2023.

Under this change, small businesses (aggregated annual turnover of less than $10 million) will be able to immediately deduct the full cost of eligible assets costing less than $20,000 that are first used or installed ready for use between 1 July 2023 and 30 June 2024. Assets valued at $20,000 or more (which cannot be immediately deducted) will be placed into a small business simplified depreciation pool and depreciated at 15% in the first income year and 30% each income year thereafter.

For larger businesses, the write-off threshold is cut to $1,000 also from 1 July 2023.

Continue reading “Generous depreciation in its final days” →

Super pensions and the Commonwealth Seniors Health Card

4 June 2023

Are you a self-funded retiree who does not qualify for the Age Pension? If you’ve answered yes, then help may be available for certain living expenses by way of the Commonwealth Seniors Health Card (CSHC).

What is the CSHC?

The CSHC is a concession card enabling access to  cheaper health care and some discounts if you’ve reached Age Pension age.

Benefits of the CSHC

With a CSHC you may receive benefits such as:

  • Cheaper medicine under the Pharmaceutical Benefits Scheme (PBS)
  • Bulk billed doctor visits – this is up to your doctor
  • A refund for medical costs when you reach the Medicare Safety Net, and
  • Depending on your state or territory government and local council, lower electricity and gas bills, property and water rates, and public transport.

Who can get the CSHC?

To get this card you must meet all of the below conditions:

  • Be of Age Pension age or older
  • Meet residency rules
  • Not be receiving an income support payment (such as the Age Pension) from Centrelink or the Department of Veterans’ Affairs
  • Give Centrelink your Tax File Number (including your partner’s TFN) unless you’re exempt from doing so
  • Meet identity requirements, and
  • Meet the income test.

Continue reading “Super pensions and the Commonwealth Seniors Health Card” →

Employee or contractor? – the Federal Court weighs in

13 May 2023

A recent Federal Court case has highlighted important superannuation guarantee (SG) implications for businesses that engage certain types of contractors.

Background facts

The case of Jamsek v ZG Operations Australia Pty Ltd (No 3) [2023] FCAFC 48 (24 March 2023) concerned two truck drivers who previously drove delivery trucks for a company, ZG Lighting, and its related and predecessor companies for just under 30 years. The drivers provided their services via a partnership with their spouses.

The drivers commenced proceedings against ZG Lighting claiming they were employees for the purposes of section 12(3) the Superannuation Guarantee (Administration) Act (1992).

In the first appeal decision more than two years ago, the Federal Court held that Mr. Jamsek and his colleague Mr. Whitby were employees of ZG Lighting within the ordinary, common law, meaning of that term.

The court, in the first appeal decision, did not consider whether the ‘expanded meaning’ of employee in section 12(3) applied.

The expanded meaning provides that “if a person works under a contract that is wholly or principally for the labour of the person, the person is an employee of the other party to the contract”. 

On appeal, the High Court held that the workers were not employees within the ordinary, common law meaning of that term and remitted the matter back to the Federal Court to determine whether Mr. Jamsek and Mr. Whitby were ZG Lighting’s employees within the expanded meaning in s 12(3). That is, were the two workers engaged under contracts that were wholly or principally for their labour? If yes, then an SG obligation arose. That was the question that the Federal Court turned its mind to in March 2023.

Continue reading “Employee or contractor? – the Federal Court weighs in” →

Top cyber security tips for business

13 May 2023

It is important you keep all your business, staff and client information secure. If your data is lost or compromised, it can be very difficult, time consuming, and costly to recover.

The federal government have created a list of top security tips to help keep your and your clients’ information safe.

Use strong and secure passwords

Regularly change passwords and do not share them.

Use multi-factor authentication where possible. This requires users to provide multiple pieces of information to authenticate themselves – for example, a text message to your phone when logging in to a website.

As a business owner, remember:

  • multi-factor authentication puts an additional layer of security on your accounts, making it harder for others to access your account
  • consider using a password that includes numbers and symbols which is easy for you to remember but difficult for someone to guess (for example, P!ne@pp1eP!zz@).

Continue reading “Top cyber security tips for business” →

FBT and car logbooks

15 April 2023

With the end of the FBT year now here, are your car logbooks in order?

The operating cost method is used by many employers to calculate their car FBT liability. This method is particularly effective where the business use of the vehicle is high. Keeping a logbook is essential to use the operating cost method.

Employees need to prepare a logbook for any vehicle that you provide them with where there is an element of private use. The logbook period is for 12-weeks, which must be representative of typical usage. For example, a period where an employee is taking a block of annual leave is not representative.

Where employees share a vehicle during a year, each employee will need to prepare a logbook to substantiate their respective business use percentage.

Logbooks are valid for five FBT years (including the year the logbook is prepared), provided there is no significant change in the vehicle’s business use.  Once the five-year period expires, a new logbook will need to be kept if you wish to continue using the operating cost method. Therefore, if a logbook was last prepared in 2017/18, a new logbook is required for this FBT year (2022/23).

Continue reading “FBT and car logbooks” →