Income tax continues to do heavy lifting

Paul Osborne
(Australian Associated Press)

 

The federal budget will become more reliant on personal income tax revenue as other sources dwindle and no action is taken on reaping more from gas and mining firms, a new report says.

The Parliamentary Budget Office on Wednesday released an analysis of the tax system since 2001 and some of the risks ahead.

The main changes since 2001 had been a drop in fuel excise due to fuel efficiency and a previous freeze in indexation, a fall in customs receipts due to free trade deals, and a drop in company tax receipts as losses are carried forward.

Based on recent trends, the report found the future would see a drop in company tax receipts, an increase in personal income tax receipts and drops in consumer tax receipts driven by consumer behaviour and technological change.

“If these risks to tax receipts eventuate, and in the absence of other taxation reforms, maintaining Commonwealth Government revenue at recent levels as a share of GDP will lead to an increasing reliance on taxes on labour income through the personal income tax system,” the report concluded.

The study found personal income tax already accounted for 53.7 per cent of commonwealth receipts.

In comparison, the report showed resource rent taxes made up 0.4 per cent of receipts.

Petroleum Resource Rent Tax had fallen as a share of GDP since 2001 despite the increase in petroleum production and exports and strong price growth through much of the period.

The report warns that although Australia is set to become a leading producer and exporter of liquefied natural gas, there is a “significant likelihood that this will not translate into higher PRRT revenue”.

Labor’s mining tax was abolished by the coalition in 2014.

Shadow treasurer Chris Bowen said the tax base clearly needed to be broadened, as the government continued to rely on income tax to fund basic services.

“The PBO’s key finding is premised on no tax reform occurring and the only major party going to the next election with a tax reform agenda which broadens Australia’s tax base is the Labor party,” Mr Bowen said.

Labor has announced reform of the taxation of trusts, tax affairs, negative gearing and capital gains tax, as well as removing dividend imputation refundability.

It’s also outlined plans for a “bigger, better and fairer income tax cut” for low and middle income earners than the government had proposed.

Greens spokesman Senator Peter Whish-Wilson said generous deductions for resources companies and rampant tax avoidance meant workers carried the heavier burden.

“Future budgets will still rely on bracket creep because the government’s income tax plan did not fix bracket creep – it just gave lots of money to wealthy people,” Senator Whish-Wilson said.

He said the government needed to abolish capital gains tax concessions, overhaul petroleum taxes, introduce a mining super profits tax and treat multinational tax avoidance more seriously.

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ATO warns of high scam risks at tax time

(Australian Associated Press)

 

Taxpayers are being warned to be on high alert for scams as they prepare to file their tax returns.

ATO Assistant Commissioner Kath Anderson said most Australian taxpayers expect some form of interaction with the ATO during tax time, and scammers take advantage of it to gain money and personal information from victims.

“More than 37,000 scam attempts were reported to the ATO during tax time last year. Although many people were alert and didn’t fall for the scams, hundreds handed over a total of more than $630,000, and thousands handed over their personal details,” Ms Anderson said in a statement on Wednesday.

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Turnbull rejects GST ‘average’ proposal

Paul Osborne
(Australian Associated Press)

 

Malcolm Turnbull has promised every state will be better off under the government’s proposed changes to the way GST revenue is carved up.

The federal government will announce its plans on Thursday, but has rejected the key recommendation made by the Productivity Commission in its report on a fairer formula.

The commission’s report, also to be released on Thursday, recommended using an average figure as the basis of the carve-up, which would have resulted in severe cuts for Queensland, Victoria and South Australia.

“We will set out a model tomorrow where no state will be worse off and indeed every state would be better off,” Mr Turnbull told reporters on Kangaroo Island on Wednesday.

State and territory treasurers were briefed on the report on Wednesday but not on the federal response.

The current formula, known as horizontal fiscal equalisation, ensures all states can provide a similar level of services with the strongest state setting the benchmark.

However, Western Australia was outraged its share of the GST take fell to about 30 cents in the dollar.

Under the “average” model, over an eight-year transition, NSW would have been $8.9 billion better off in the period to 2026/27, while Queensland would have been $8.2 billion worse off.

Western Australia would get an extra $7 billion, while Victoria would be down $3 billion.

There would also be negative impacts for SA ($2.7 billion), Tasmania ($814 million), ACT ($689 million) and the NT ($376 million).

Tasmanian Treasurer Peter Gutwein was outraged by the report’s recommendation, saying he had expressed his disappointment directly to the Productivity Commission.

“What’s important now is the federal government’s response and I welcome the prime minister’s comments today … that all states will be better off than they are now,” Mr Gutwein said in a statement.

Victoria’s acting premier James Merlino warned Mr Turnbull not to put politics ahead of economics.

“We know Victoria is being short-changed when it comes to health funding – it would be ridiculous to be punished again by Malcolm Turnbull just because we have a strong economy and don’t have a by-election,” Mr Merlino said.

A Queensland government spokeswoman said it was right to reject the “averaging” model but the answer lay in broader tax reform beyond just the GST.

A spokesman for the ACT government said it would not support anything that took money away from the territory.

Shadow treasurer Chris Bowen said Labor, which has announced a funding package for Western Australia after it complained of the GST shortfall, would ensure no state or territory was worse off.

“We have recognised the legitimate grievances of Western Australia and the virtue of our policy is we can say the same thing in Perth as we say in Brisbane or Bundaberg,” Mr Bowen said.

“We have said we will top up WA’s GST payments with payments from the Commonwealth.”

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Consumers give limp response to tax cuts

Colin Brinsden, AAP Economics Correspondent
(Australian Associated Press)

 

Australians don’t appear to be upbeat about the Turnbull government’s victory in steering $144 billion of personal income tax cuts through federal parliament.

The weekly ANZ-Roy Morgan consumer confidence index released on Tuesday fell 0.6 per cent, adding to a 0.7 per cent drop in the previous week.

“It’s a little disappointing that the passage of the income tax cuts through parliament last week failed to boost expectations about future finances,” ANZ head of Australian economics David Plank said.

However, the confidence survey – a pointer to future retail spending – was taken at a time of a further easing in house prices and a spike in petrol prices in some capital cities.

Polling released at the weekend ahead of the July 28 federal by-elections in Mayo and Longman also suggested voters are hardly stampeding to the coalition following the tax cuts.

The seven-year tax package that was voted into law kicks off with a rise in the 32.5 per cent marginal tax rate threshold from July 1.

From the same date, a new low and middle-income tax offset worth up to $530 begins, although it won’t be paid out until taxpayers do their tax returns at the end of the 2018/19 financial year.

Other tax reductions won’t occur until 2022 and 2024 and tax cuts Labor has vowed to roll these back if it wins the next federal election.

Opposition Leader Bill Shorten told a conference Australians can’t just keep making these massive tax scale change promises without analysing where is the money coming from.

“I haven’t heard a satisfactory answer from the government,” he told a Committee for Economic Development of Australia conference in Canberra.

“Getting the parliament to vote on $144 billion on changes in tax scales and another $80 billion on corporate tax changes, where is that money going to come from?”

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Tax tips for small business and for employees

(Feedsy Exclusive)


End of Financial Year Tax Tips

The end of the financial year is one of the busiest and most stressful times for businesses and employees. Are your financial records in order? Do you know how to take advantage of standard deductions? While many people only see their accountant once or twice a year, you’re much more likely to identify deductions and make necessary adjustments when an ongoing relationship is in place. Whether you’re a business owner or an employee, you need to understand which deductions are available and relevant to you so you can benefit from them.

 

Tax tips for small businesses

If you run a home office, you may be able to get a significant tax break. Sole traders and anyone who is operating a business from their home may be able to claim a deduction for occupancy and running expenses. This includes things like your mortgage and rent, which can add up to a large sum over time.

Business travel expenses are another common deduction, whereby any expenses incurred by you or your employees can be claimed. If you’re away from home for six or more consecutive nights, you need to record all of your activities and expenses.

Auto expenses are another common area for deductions. Any motor vehicle expenses by your employees can be claimed as business-related expenses, with the fringe benefit tax (FBT) also relevant if the employer uses the vehicle for private use. The salaries and wages you pay to your workers can also be claimed as a tax deduction, including any super contributions that you make for them.

Repairs, maintenance, and operating expenses can also be claimed in some situations. The amount of these deductions can vary considerably and is dependent on the type of business that you run, which is why it’s so important to keep up a relationship with an accountant.

 

Tax tips for employees

With the end of the tax year quickly approaching, it’s time to educate yourself so that you can meet your tax obligations and reduce your tax liability. From vehicle and travel expenses through to self-education and tools, making the right deductions now could have a huge impact on your financial health going forward.

With different deductions available for work and private purposes, and many work-related deductions requiring stringent record keeping, it’s hard to keep on top of it all. Instead of waiting until the end of June to get your financial records in order, perhaps it’s time to set up an ongoing relationship with a qualified and experienced accountant.

 

Read it on Apple news

Tips for small businesses: How to budget for your BAS?

(Feedsy Exclusive)

BAS reporting deadlines have a habit of sneaking up on us, leading to a scramble to get the statement in on time, followed by another scramble when the payment is due. However, it doesn’t have to be this way; by adopting a clearly-defined strategy when submitting and budgeting for your BAS, you can make sure that you stay on top of this task.

Read on for a few tips for small businesses.


Switch to Monthly Reporting

Traditionally, a BAS is submitted quarterly and then the payment due is required to be delivered just under one month later. This is fine, but for companies struggling to stay on top of the tax due, it divides the payment into four sizable sums each year, which can be overwhelming.

For business owners who are struggling to budget, switching to a monthly reporting program forces you to accept a budgetary framework. It means more instances of reporting but it helps you to keep on top of payments.


No Nasty Surprises

Knowing how much you will have to pay at the end of each submission period is vital. No one wants a nasty surprise that sends your business over budget. Get to know your deductibles, spend time personally going over profits and losses, and give yourself a realistic, ballpark figure for each month or each quarter, eliminating any shocks or surprises.


Utilising SBR Software

In order to make it easier for businesses to submit their BAS on time and to budget for the necessary payments, the government provides Standard Business Reporting – SBR – platforms. Introduced in 2010, these platforms were designed to simplify the process and introduce standards across the board.

Implementing SBR software within your own BAS reporting and payment structure gives you an effective method for staying on top of the payments and for developing a flexible budget to accommodate these payments.


If the Worst Happens…

It is sometimes possible to apply for a two week deferral on both the submission of your BAS and also the payment of what is due. This should not be relied on as a standard practice – as there are a range of criteria that you must meet if you are to qualify for this deferral.

However, for small or medium-sized business owners, the deferral can provide a little bit of breathing space within which to get your house in order. As discussed, this is to be used as an emergency last resort only.

Read it on Apple news

Tax tips for small business and for employees

(Feedsy Exclusive)


End of Financial Year Tax Tips

The end of the financial year is one of the busiest and most stressful times for businesses and employees. Are your financial records in order? Do you know how to take advantage of standard deductions? While many people only see their accountant once or twice a year, you’re much more likely to identify deductions and make necessary adjustments when an ongoing relationship is in place. Whether you’re a business owner or an employee, you need to understand which deductions are available and relevant to you so you can benefit from them.

 

Tax tips for small businesses

If you run a home office, you may be able to get a significant tax break. Sole traders and anyone who is operating a business from their home may be able to claim a deduction for occupancy and running expenses. This includes things like your mortgage and rent, which can add up to a large sum over time.

Business travel expenses are another common deduction, whereby any expenses incurred by you or your employees can be claimed. If you’re away from home for six or more consecutive nights, you need to record all of your activities and expenses.

Auto expenses are another common area for deductions. Any motor vehicle expenses by your employees can be claimed as business-related expenses, with the fringe benefit tax (FBT) also relevant if the employer uses the vehicle for private use. The salaries and wages you pay to your workers can also be claimed as a tax deduction, including any super contributions that you make for them.

Repairs, maintenance, and operating expenses can also be claimed in some situations. The amount of these deductions can vary considerably and is dependent on the type of business that you run, which is why it’s so important to keep up a relationship with an accountant.

 

Tax tips for employees

With the end of the tax year quickly approaching, it’s time to educate yourself so that you can meet your tax obligations and reduce your tax liability. From vehicle and travel expenses through to self-education and tools, making the right deductions now could have a huge impact on your financial health going forward.

With different deductions available for work and private purposes, and many work-related deductions requiring stringent record keeping, it’s hard to keep on top of it all. Instead of waiting until the end of June to get your financial records in order, perhaps it’s time to set up an ongoing relationship with a qualified and experienced accountant.

 

Read it on Apple news

Tips for small businesses: How to budget for your BAS?

(Feedsy Exclusive)

BAS reporting deadlines have a habit of sneaking up on us, leading to a scramble to get the statement in on time, followed by another scramble when the payment is due. However, it doesn’t have to be this way; by adopting a clearly-defined strategy when submitting and budgeting for your BAS, you can make sure that you stay on top of this task.

Read on for a few tips for small businesses.


Switch to Monthly Reporting

Traditionally, a BAS is submitted quarterly and then the payment due is required to be delivered just under one month later. This is fine, but for companies struggling to stay on top of the tax due, it divides the payment into four sizable sums each year, which can be overwhelming.

For business owners who are struggling to budget, switching to a monthly reporting program forces you to accept a budgetary framework. It means more instances of reporting but it helps you to keep on top of payments.


No Nasty Surprises

Knowing how much you will have to pay at the end of each submission period is vital. No one wants a nasty surprise that sends your business over budget. Get to know your deductibles, spend time personally going over profits and losses, and give yourself a realistic, ballpark figure for each month or each quarter, eliminating any shocks or surprises.


Utilising SBR Software

In order to make it easier for businesses to submit their BAS on time and to budget for the necessary payments, the government provides Standard Business Reporting – SBR – platforms. Introduced in 2010, these platforms were designed to simplify the process and introduce standards across the board.

Implementing SBR software within your own BAS reporting and payment structure gives you an effective method for staying on top of the payments and for developing a flexible budget to accommodate these payments.


If the Worst Happens…

It is sometimes possible to apply for a two week deferral on both the submission of your BAS and also the payment of what is due. This should not be relied on as a standard practice – as there are a range of criteria that you must meet if you are to qualify for this deferral.

However, for small or medium-sized business owners, the deferral can provide a little bit of breathing space within which to get your house in order. As discussed, this is to be used as an emergency last resort only.

Read it on Apple news

Personal tax blow for government in Senate

Matt Coughlan
(Australian Associated Press)

 

Income tax cuts aimed at people earning up to $200,000 a year have been dumped in the Senate, which voted to split the coalition’s tax bill.

In a blow for the government, Labor and the Greens teamed up to tie an upper house vote, effectively stripping out the third and final stage of the cuts due to start in 2024.

But the government can restore the package to its original form in the House of Representatives where it controls the numbers, before bouncing the bill back to the Senate for approval a second time.

Prime Minister Malcolm Turnbull told reporters “of course” the government will send the bill back to the Senate, because the coalition is committed to the full tax plan.

Labor also opposes stage two of the plan, which includes increasing the top threshold for the 32.5 per cent tax bracket from $90,000 to $120,000.

Finance Minister Mathias Cormann said Labor had effectively endorsed the second stage by only asking the upper house to vote on cuts starting in 2024.

“Somewhere overnight the Labor Party position has shifted,” Senator Cormann told parliament on Wednesday.

“It makes absolutely no sense for you not to have tried to get your policy tested in the Senate. You did not even try.”

There is broad support for the first tranche of tax cuts, which introduce a new low- and middle-income tax offset worth up to $530 for individuals from July 1.

But Labor is trying to strip away the remaining parts of the package.

When the tax cut debate resumes, the opposition has another amendment to dump the second stage of the package from the legislation.

Read it on Apple news

One log-in for government services access

Matt Coughlan
(Australian Associated Press)

 

Australians will be able to access government services with a single log-in under a plan to create a “single digital identity” by 2025.

Michael Keenan, the federal minister in charge of digital services, said face-to-face interactions with government services would be greatly reduced.

“Think of it as a 100-point digital ID check that will unlock access to almost any government agency through a single portal such as a myGov account,” Mr Keenan said.

The minister wants Australia to be a world leader in digital government, with almost all services to be available online by 2025.

Mr Keenan said having 30 different log-ins for government services is not good enough.

“The old ways of doing things, like forcing our customers to do business with us over the counter, must be re-imagined and refined,” he said.

People will need to establish their digital identity once before being able to use it across services.

The first of several pilot programs using a “beta” version of what will be known as myGovID will begin in October.

The initial pilot will enable 100,000 participants to apply for a tax file number online, which Mr Keenan says will reduce processing time to a day from up to a month currently.

In a pilot starting from March next year, services including student identification and Centrelink will be connected to the digital identity.

Also from March 2019, 100,000 people will be able to use their digital identity to create their My Health Record online.

Mr Keenan says one face-to-face or over-the-counter transaction costs on average about $17 to process, while an online transaction can cost less than 40 cents.

The Human Services department will operate as the gateway between service providers and people.

“This is key to protecting privacy, as the exchange will act as a double-blind – service providers will not see any of the user’s ID information and identity providers will not know what services each user is accessing,” Mr Keenan said.

Labor digital economy spokesman Ed Husic said the Turnbull government was responsible for a “dirty dozen” of failed digital transformation failures, including the census and tax office website crashes.

“The biggest challenge confronting the Turnbull government is to quit its addiction to glitzy digital announcements and get stuck into properly delivering these multimillion-dollar projects,” Mr Husic said.

Read it on Apple news

One log-in for government services access

Matt Coughlan
(Australian Associated Press)

 

Australians will be able to access government services with a single log-in under a plan to create a “single digital identity” by 2025.

Michael Keenan, the federal minister in charge of digital services, said face-to-face interactions with government services would be greatly reduced.

“Think of it as a 100-point digital ID check that will unlock access to almost any government agency through a single portal such as a myGov account,” Mr Keenan said.

The minister wants Australia to be a world leader in digital government, with almost all services to be available online by 2025.

Mr Keenan said having 30 different log-ins for government services is not good enough.

“The old ways of doing things, like forcing our customers to do business with us over the counter, must be re-imagined and refined,” he said.

People will need to establish their digital identity once before being able to use it across services.

The first of several pilot programs using a “beta” version of what will be known as myGovID will begin in October.

The initial pilot will enable 100,000 participants to apply for a tax file number online, which Mr Keenan says will reduce processing time to a day from up to a month currently.

In a pilot starting from March next year, services including student identification and Centrelink will be connected to the digital identity.

Also from March 2019, 100,000 people will be able to use their digital identity to create their My Health Record online.

Mr Keenan says one face-to-face or over-the-counter transaction costs on average about $17 to process, while an online transaction can cost less than 40 cents.

The Human Services department will operate as the gateway between service providers and people.

“This is key to protecting privacy, as the exchange will act as a double-blind – service providers will not see any of the user’s ID information and identity providers will not know what services each user is accessing,” Mr Keenan said.

Labor digital economy spokesman Ed Husic said the Turnbull government was responsible for a “dirty dozen” of failed digital transformation failures, including the census and tax office website crashes.

“The biggest challenge confronting the Turnbull government is to quit its addiction to glitzy digital announcements and get stuck into properly delivering these multimillion-dollar projects,” Mr Husic said.

Read it on Apple news

Income tax plan won’t be split: Morrison

Colin Brinsden, AAP Economics Correspondent
(Australian Associated Press)

 

Labor will be asked to back the Turnbull government’s personal income tax package as a whole when parliament resumes on June 18.

However, it will be a case of who blinks first, with Labor insisting the legislation should be split, to allow low- and middle-income tax cuts from July 1 but hold off on other measures.

Treasurer Scott Morrison said the package as a whole was needed to ensure the economy steams ahead, following figures released on Wednesday showing the economy grew by 1.0 per cent in the March quarter, lifting the annual growth rate to 3.1 per cent.

“We are putting the whole package to the Senate,” Mr Morrison told reporters in Canberra.

The Parliamentary Budget Office provided Labor and the Greens with year-by-year costings of the income tax cuts, which the federal opposition had sought before considering the legislation.

Shadow treasurer Chris Bowen said the financial benefits of the third stage of the package overwhelmingly flowed towards men over women at a ratio of three-to-one.

As well, by the end of the medium-term (2028-29), stage two of the plan costs $13 billion a year as the stage three costs rise to over $10 billion.

Mr Bowen said the government should split the legislation to allow tax relief to flow from July 1.

“If the Turnbull government wants to do better for low- and middle-income earners it should support Bill Shorten’s bigger, better and fairer income tax cut plan,” he said.

Mr Morrison branded the costing breakdown of his plan a “joke”, as it was not possible to be precise in individual years over a decade.

His comments echoed those of Treasury boss John Fraser to a Senate committee hearing last week.

Government policies are calculated over four years in the budget and even in the out-years there are “sensitivity risks”, the treasurer added.

The government’s whole tax package will cost $144 billion over the next decade.

The cuts will come in three stages, with final component in 2024 increasing the 45 per cent marginal tax rate bracket from $180,001 to $200,001.

It will also remove the 37 per cent marginal tax rate altogether, so all income from $41,001 to $200,000 is taxed at a rate of 32.5 per cent.

The PBO has calculated the cost to the budget will be $6.25 billion in 2024/25, before rising by around $1 billion a year and totalling $41.6 billion over five years.

PBO ON PERSONAL TAX CUTS – YEAR-BY-YEAR:

2018/19 $360 million

2019/20 $4.12 billion

2020/21 $4.42 billion

2021/22 $4.5 billion

2022/23 $13.4 billion

2023/24 $11.15 billion

2024/25 $17.85 billion

2025/26 $19.55 billion

2026/27 $21.1 billion

2027/28 $22.9 billion

2028/29 $24.6 billion

Total: $143.95 billion

(Source: Parliamentary Budget Office)

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Business to cough up $10 bln more in tax

(Australian Associated Press)

 

The head of the Australian tax office expects around $10 billion more will be collected from large corporations in income tax for the 2017/18 financial year, than it did in the previous year.

Tax commissioner Chris Jordan said while this can be attributed to economic growth and commodity price changes, the Australian Taxation Office has also contributed to this increase from better taxpayer compliance in this market, both voluntary and ATO-assisted.

“It shows our approaches to the large (corporate) market are working well,” Mr Jordan told a Senate estimates hearing on Wednesday.

Read it on Apple news

End of financial year tax tips for employees and small business

(Feedsy Exclusive)

The end of the financial year is one of the busiest and most stressful times for businesses and employees. Are your financial records in order? Do you know how to take advantage of standard deductions? While many people only see their accountant once or twice a year, you’re much more likely to identify deductions and make necessary adjustments when an ongoing relationship is in place. Whether you’re a business owner or an employee, you need to understand which deductions are available and relevant to you so you can benefit from them.


Tax tips for businesses

If you run a home office, you may be able to get a significant tax break. Sole traders and anyone who is operating a business from their home may be able to claim a deduction for occupancy and running expenses. This includes things like your mortgage and rent, which can add up to a large sum over time.

Business travel expenses are another common deduction, whereby any expenses incurred by you or your employees can be claimed. If you’re away from home for six or more consecutive nights, you need to record all of your activities and expenses.

Auto expenses are another common area for deductions. Any motor vehicle expenses by your employees can be claimed as business-related expenses, with the fringe benefit tax (FBT) also relevant if the employer uses the vehicle for private use. The salaries and wages you pay to your workers can also be claimed as a tax deduction, including any super contributions that you make for them.

Repairs, maintenance, and operating expenses can also be claimed in some situations. The amount of these deductions can vary considerably and is dependent on the type of business that you run, which is why it’s so important to keep up a relationship with an accountant.


Tax tips for employees

With the end of the tax year quickly approaching, it’s time to educate yourself so that you can meet your tax obligations and reduce your tax liability. From vehicle and travel expenses through to self-education and tools, making the right deductions now could have a huge impact on your financial health going forward.

With different deductions available for work and private purposes, and many work-related deductions requiring stringent record keeping, it’s hard to keep on top of it all. Instead of waiting until the end of June to get your financial records in order, perhaps it’s time to set up an ongoing relationship with a qualified and experienced accountant.

 

Read it on Apple news

End of financial year tax tips for employees and small business

(Feedsy Exclusive)

The end of the financial year is one of the busiest and most stressful times for businesses and employees. Are your financial records in order? Do you know how to take advantage of standard deductions? While many people only see their accountant once or twice a year, you’re much more likely to identify deductions and make necessary adjustments when an ongoing relationship is in place. Whether you’re a business owner or an employee, you need to understand which deductions are available and relevant to you so you can benefit from them.


Tax tips for businesses

If you run a home office, you may be able to get a significant tax break. Sole traders and anyone who is operating a business from their home may be able to claim a deduction for occupancy and running expenses. This includes things like your mortgage and rent, which can add up to a large sum over time.

Business travel expenses are another common deduction, whereby any expenses incurred by you or your employees can be claimed. If you’re away from home for six or more consecutive nights, you need to record all of your activities and expenses.

Auto expenses are another common area for deductions. Any motor vehicle expenses by your employees can be claimed as business-related expenses, with the fringe benefit tax (FBT) also relevant if the employer uses the vehicle for private use. The salaries and wages you pay to your workers can also be claimed as a tax deduction, including any super contributions that you make for them.

Repairs, maintenance, and operating expenses can also be claimed in some situations. The amount of these deductions can vary considerably and is dependent on the type of business that you run, which is why it’s so important to keep up a relationship with an accountant.


Tax tips for employees

With the end of the tax year quickly approaching, it’s time to educate yourself so that you can meet your tax obligations and reduce your tax liability. From vehicle and travel expenses through to self-education and tools, making the right deductions now could have a huge impact on your financial health going forward.

With different deductions available for work and private purposes, and many work-related deductions requiring stringent record keeping, it’s hard to keep on top of it all. Instead of waiting until the end of June to get your financial records in order, perhaps it’s time to set up an ongoing relationship with a qualified and experienced accountant.

 

Read it on Apple news