ARE YOU MAXIMISING YOUR RENTAL DEDUCTIONS?

If you own a rental property and you are not currently claiming capital works expense or depreciation expense you may be missing out on eligible deductions in your tax return.

Capital works and depreciation expenses spread the cost of capital assets across their useful life. Which means although you cannot claim an upfront deduction for new or current assets you can claim a proportion each year.

These deductions can significantly affect your taxable income and thus potentially reduce the amount of tax payable.

A Quantity Surveyor can inspect your property and provide a depreciation report. This report will detail potential deductions in this tax year and in years to come.

 Please contact Andrew Marshall or Janine Orpwood at Langley McKimmie Chartered Accountants on (03) 5427 8100 to discuss further.

We provide accounting and wealth management services to clients in Woodend, Gisborne and Macedon Ranges areas within Victoria Australia. 

HECS, HELP AND TSL REPAYMENTS

Once your income exceeds a set threshold repayments for your HECS, HELP or TSL will be automatically calculated by the ATO and included in your tax assessment.

For 2016 the income threshold is $54,126. Income for the purposes of calculating these repayments equals taxable income with any net investment loss added back on.

Your repayment amount is a set percentage of your income which increases according to your level of income eg, if you have earned $54,200 and had an outstanding debt greater than the repayment amount, you would have to make a repayment of 4% x 54,200 = $2,168

A list of the income brackets and the percentage of your income payable can be found at:

https://www.ato.gov.au/Rates/HELP,-TSL-and-SFSS-repayment-thresholds-and-rates/?anchor=HELPandTSLrepaymentthresholdsandrates201#HELPandTSLrepaymentthresholdsandrates201

Be sure your employer is aware that you have a HECS, HELP, or TSL debt and is withholding the appropriate tax to avoid getting a nasty surprise at tax time.

Please contact Andrew Marshall or Janine Orpwood at Langley McKimmie Chartered Accountants on (03) 5427 8100 to discuss further.

We provide accounting and wealth management services to clients in Woodend, Gisborne and Macedon Ranges areas within Victoria Australia. 

MAIN RESIDENCE EXEMPTION - PART 1 LARGE PROPERTIES

When selling your home, capital gains tax does not generally apply; this is commonly referred to as the main residence exemption. This exemption extends to the land surrounding the dwelling to a maximum of two hectares, so long as the land is not used for income producing purposes. But what happens if you live on more than two hectares? Let’s look at Maria’s situation:  Maria lives just out of Woodend on 20 hectares which is used entirely for private purposes. She decides to downsize and makes a net gain on the sale of the property. Maria can get the main residence exemption for the house and any two hectares of land she selects out of the 20 hectares.  Maria obtains a valuation which states that the dwelling and two hectares of land that she has selected were worth two-thirds of the total value of the property at the time she bought it, and this has not changed since purchase. Therefore she can claim the main residence exemption on two-thirds of the capital gain from the sale of her home.  Maria will be liable to pay capital gains tax on the remaining one third of the net gain at her marginal tax rate. If she held the property for over twelve months she is able to access the 50% discount to reduce the amount she has to pay tax on. Please contact Andrew Marshall or Janine Orpwood at Langley McKimmie Chartered Accountants on (03) 5427 8100 to discuss further. We provide accounting and wealth management services to clients in Woodend, Gisborne and Macedon Ranges areas within Victoria Australia.

Have you recorded your motor vehicle closing odometer reading TODAY?

Where a motor vehicle owned by a business is used by an employee for private purposes, FBT is an issue that needs to be managed.

If this is the case then as at the end of the FBT year which closed 31 March 2016 it is a general requirement that you record the closing odometer reading for the motor vehicle.

There are two calculation methods which can be used for motor vehicle fringe benefits one is the Operating Cost Method and the other is the Statutory Formula method. 

If the motor vehicle is used for a high business percentage it can mean that the Operating Cost Method results in a more beneficial outcome. 

In some cases an employee contribution can be made to offset the taxable benefit being received otherwise an FBT return needs to be lodged to the Australian Taxation Office (ATO). 

Please contact Andrew Marshall or Janine Orpwood at Langley McKimmie Chartered Accountants on (03) 5427 8100 to discuss further.

We provide accounting and wealth management services to clients in Woodend, Gisborne and Macedon Ranges areas within Victoria Australia. 

MINIMUM PENSION LEVELS

As 30 June 2016 approaches, members with account based pensions in their Self Managed Superannuation Funds should take to the time to ensure they have requested and received the correct amount of minimum pension.

Minimum pension levels are calculated with reference to the member’s age and account balance at 1 July in the year the pension is paid (or the date within the year the pension is commenced for the first time). The rates for the year ending 30 June 2016 are:

Age                            Required Payment
Under 65                           4%
65-74                                5%
75-79                                6%
80-84                                7%
85-89                                9%
90-94                                11%
95 and over                      14%

There is no maximum amount other than the member’s superannuation balance. 

The pension must be paid and cleared to the member’s personal bank account prior to 30 June to be effective.  Failure to meet the minimum pension requirements is likely to result in the member balance returning to accumulation status and losing its’ tax free pension status.

 

Please contact Andrew Marshall or Janine Orpwood at Langley McKimmie Chartered Accountants on (03) 5427 8100 to discuss further.

We provide accounting and wealth management services to clients in Woodend, Gisborne and Macedon Ranges areas within Victoria Australia. 

PAYING EMPLOYEE SUPERANNUATION GUARANTEE ON TIME

As the March 2016 quarter end is near, employers need to be mindful that the due date for superannuation payments is 28 April 2016.

The ATO link below explains additional requirements in the event an employer does not pay the superannuation guarantee on time for employees.

The ATO has been conducting audits on businesses and issuing default assessments to employers where non-compliance has occurred.

https://www.ato.gov.au/Business/Super-for-employers/Paying-super-contributions/Missed-and-late-payments/The-super-guarantee-charge-(SGC)/

 

Please contact Andrew Marshall or Janine Orpwood at Langley McKimmie Chartered Accountants on (03) 5427 8100 to discuss further.

We provide accounting and wealth management services to clients in Woodend, Gisborne and Macedon Ranges areas within Victoria Australia. 

TAX BASICS FOR SMALL BUSINESS - ATO WEBINAR SERIES

For those who are considering starting a new business, the ATO produces webinars called 'Tax Basics for Small Business'. These may prove useful in providing some understanding around the topics of budgeting, record keeping and your obligations to the ATO as well as employees. The webinars run for 45 minutes each and serve as a good starting point for any small business owner looking to build their knowledge base

For more information and to register, please see the following link from the ATO: 

https://www.ato.gov.au/Newsroom/smallbusiness/General/Webinar-series---Tax-basics-for-small-business/

Please contact Andrew Marshall or Janine Orpwood at Langley McKimmie Chartered Accountants on (03) 5427 8100 to discuss further.

We provide accounting and wealth management services to clients in Woodend, Gisborne and Macedon Ranges areas within Victoria Australia.