Enright Tax Accountants

The 2012 Budget

kody — Mon, 14 May 2012 22:46:05 +0000

The recent federal budget included a number of

changes to taxation and superannuation rules and I have summarised some of the

key announcements below:

Personal

Education tax refund will be paid in advance for the 2012 financial
year to all eligible parents. This payment will be made in June 2012, so

no claim for educational expenses will be required in your 2012 tax

return.

Education tax refund is being replaced with the “Schoolkids Bonus”
worth $410 for primary school and $820 for high school students. This new

automatic payment will be paid to families receiving Family Tax Benefit A

in two equal instalments in January and July each year. Parents don’t need

to keep receipts as the payment is a fixed guaranteed payment.

The 50% discount for interest income will not proceed.

Scrapping the proposed standard tax-deduction for work related
expenses. Therefore, work related expense claims will still need to be

substantiated by receipts or other documentation.

Non-residents tax rates aligned to resident tax rates subject to a
minimum rate of 32.5%.

Means testing the medical expense offset for taxpayers who have an
adjusted taxable income above medicare surcharge thresholds.

Confirmation that the following tax rates will apply from 1 July
2012

Income Thresholds

Tax Rates including Medicare

$0 - $18,000

Nil

$18,001 - $37,000

20.5%

$37,001 - $80,000

34.0%

$80,000 - $180,000

38.5%

$180,000 plus

46.5%

Please note that with the low-income tax offset, low

income earners effectively now have a tax-free threshold of $20,542

Business

Taxation

For new vehicles purchased after 1 July 2012, an immediate
depreciation write-off on the first $5,000 of the vehicles cost is

available with the balance of the vehicles cost depreciated at the normal

business write-off rates

For assets purchased after 1 July 2012, an immediate depreciation
write-off is available for assets with a cost of less than $6,500.

Companies will be allowed to carry-back losses for up to 2 years,
for a maximum amount of $1,000,000, to claim back income tax paid within

this period. This benefit is currently proposed only to apply to companies

with sole traders, partnerships and trusts not included. Hopefully this

benefit can be extended to all business’s

Superannuation

Limit deductible superannuation contributions for all taxpayers to
$25,000 in the 2013 and the 2014 financial years. These contributions

include personal deductible and salary sacrificed. The higher $50,000

threshold still applies for the over 50 year old taxpayers till the 30^th

June 2012, so take advantage of this higher threshold this year if you

can.

Doubling of the superannuation contribution tax rate to 30% for
taxpayers who have an adjusted taxable income above $300,000

For

an obligation free interview to discuss the effects of the budget on your

business or to see if a self-managed superannuation fund could suit you, please

call Gregory Enright at Enright Chartered Accountants today on 6686 4744.

2011 Newsletter

kody — Mon, 04 Jul 2011 04:45:30 +0000

Click here to download/view a PDF copy of the 2011 Newsletter

2011 Business Checklist

kody — Mon, 04 Jul 2011 04:41:02 +0000

Click here to download/view a PDF copy of the 2011 Business Checklist

2011 Rental Property Checklist

kody — Mon, 04 Jul 2011 03:49:56 +0000

Click here to download/view a PDF copy of the 2011 Rental Property Checklist

2011 Education Expense Tax Offset

kody — Mon, 04 Jul 2011 03:47:57 +0000

Click here to download/view a PDF copy of the Education Expense Tax Offset

Medical Expenses Over $2000 Tax Offset

kody — Mon, 04 Jul 2011 03:46:30 +0000

Click here to download/view a PDF copy of the Medical expenses Tax Offset Worksheet

Tax Office Audits

kody — Tue, 22 Mar 2011 05:07:54 +0000

Editorial from The Northern Star & The Advocate Newpapers on the 22/03/2011

The tax office audit program has recently been ramped up with “business benchmarking” being their latest audit tool. This audit technique involves applying a “typical business” test and using the inputs into the business to determine the likely income that the business should be making.

For example, a typical painting business has a benchmarked material cost equal to 25% of sales, so if paint purchases were $100,000, then it should have an income of around $400,000. If the declared income is substantially different from this then an audit please explain letter has been issued.

This approach is rather a blunt instrument as business operations vary substantially between firms within the same industry depending upon their target market, business size and pricing policies. What this audit technique does highlight is the need to be able to explain why your business is different and that you need good accounting records to be able to support your explanation and financial figures.

Data matching by the tax office is also increasing in sophistication and breadth every year with millions of transactions reviewed by the tax office last year. Office of State Revenue records which record property transactions, vehicle and business sales and business levies is just one source of information that they have been using.

For advice on how your business compares to the tax office audit benchmarks, please call Enright Tax Accountants today on 6686 4744 or visit our website at www.enright.com.au for more information on our practice and the services we offer.