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ATO extends due date for 2016/17 SMSF returns

The ATO will extend the due date for lodgment of self-managed superannuation fund (SMSF) annual returns for 2016/17 to 30 June 2018.

Deputy Commissioner James O'Halloran said "We recognise there are some major new considerations and decisions for SMSFs and their advisers to make in this first financial year of operation of the superannuation reforms that came into effect from 1 July 2017.

"We have therefore decided to extend the lodgment date for 2016/17 SMSF annual returns so that SMSF trustees and their advisers can focus on these important matters."

Review of rules for early release of superannuation

The Government has announced that Treasury will review the current rules governing early release of superannuation on grounds of severe financial hardship and compassionate grounds.

It will also review whether, and the circumstances in which, a perpetrator's superannuation should be available to pay compensation or restitution to victims of crime.

The review will not examine other general conditions of release for superannuation.

The Government also announced that it will transfer the regulatory role of administering the early release of superannuation benefits on compassionate grounds from the Department of Human Services to the ATO in 2018, to enable the ATO to provide a more streamlined service to members.

ATO warning regarding small business record-keeping

According to the ATO, of all of the things that can cause small businesses to fold, "high on that list is poor record keeping".

More than half of the businesses they visited in their Protecting honest business campaign needed to improve their record keeping.

Issues they found include businesses:

  • estimating their sales and income;
  • using the 'no sale' and 'void' button on cash registers when taking cash payments;
  • not keeping cash register tapes and not reconciling at the end of the day; and
  • paying their employees cash-in-hand.

They are writing to these businesses to recommend they attend one of the ATO's record keeping workshops, which cover why good record keeping is important and how it will save them time.

Further "affordable housing" measures passed

Parliament has passed the legislation allowing first home buyers to save for a deposit inside superannuation through the First Home Super Saver Scheme (FHSSS), and also allowing older Australians to 'downsize' and then contribute the proceeds of the sale of their family home into superannuation.

From 1 July 2018, a first home buyer will be able to withdraw voluntary superannuation contributions they have made since 1 July 2017 (up to $30,000 each, with individuals being able to contribute up to $15,000 a year within existing caps), along with a deemed rate of earnings, to help buy their home.

Also, from 1 July 2018, when Australians aged 65 and over sell a home they have owned for at least 10 years, they may contribute up to $300,000 from the proceeds into their superannuation accounts, over and above existing contribution restrictions.   Both members of a couple may take advantage of this measure, together contributing up to $600,000 from the proceeds of the sale into superannuation

New Approved Occupational Clothing Guidelines 2017

The government has issued new guidelines to set out criteria for tax deductible non-compulsory uniform

  • the clothing is in the nature of occupation specific, or protective clothing; or
  • the wearing of the clothing is a compulsory condition of employment for employees and the clothing is not conventional in nature; or
  • where the wearing of the clothing is not compulsory, the design of the clothing is entered on the Register of Approved Occupational Clothing.

 The new guidelines outline (among other things):

  • the steps that need to be undertaken by employers to have designs of occupational clothing registered; and
  • the factors that will be considered in determining whether designs of occupational clothing may be registered.

The guidelines commence on 1 October 2017, and the previous Guidelines are revoked with effect from the same day.

If the total value of a superannuation fund member's pensions exceeded $1.6 million on 1 July 2017, they may face adverse tax consequences.

However, there is a transitional provision that permits a minor excess over $1.6 million to be ignored, subject to certain conditions being met.

Basically, this will be satisfied if the value of their pension interests on 1 July 2017 exceeded $1.6 million by no more than $100,000 (i.e., their total value did not exceed $1.7 million), but the member is able to commute the pension(s) by an amount that is at least equal to that excess no later than 31 December 2017. 

This will mean that no 'transfer balance cap' consequences arise (e.g., no 'excess transfer balance earnings' will accrue on the excess and no 'excess transfer balance tax' will become payable).

Therefore, it is important that this issue is identified and, if applicable, dealt with promptly

The Leader of the Opposition, Bill Shorten, has announced that a Labor Government (should they be elected) will introduce a standard minimum 30% tax rate for discretionary trust distributions to "mature beneficiaries" (i.e., people aged 18 and over).

Although the ALP acknowledges that individuals and businesses use trusts for a range of legitimate reasons, such as asset protection and business succession, "in some cases, trusts are used solely for tax minimisation."

Labor's policy will only apply to discretionary trusts, so other trusts – such as special disability trusts, deceased estates and fixed trusts – will not be affected by this change

Change to travel expenses for truck drivers

Source:  NTAA Practice Update - August 2017

For the 2017/18 income year, the reasonable amount for travel expenses (excluding accommodation expenses, which must be substantiated with written evidence) of employee truck drivers who have received a travel allowance and who are required to sleep away from home is $55.30 per day (formerly a total of $97.40 per day for the 2016/17 year).

If an employee truck driver wants to claim more than the reasonable amount, the whole claim must be substantiated with written evidence, not just the amount in excess of the reasonable amount.

Source:  NTAA Practice Update - August 2017

From 1 July 2017, GST applies to imported services and digital products from overseas, including:

  • digital products such as streaming or downloading of movies, music, apps, games and e-books; and
  • services such as architectural, educational and legal.

Australian GST registered businesses will not be charged GST on their purchases from non-resident supplier if they:

  • provide their ABN to the non-resident supplier; and
  • state they are registered for GST

However, if Australians purchase imported services and digital products only for personal use, they should not provide their ABN.


Small Business 2017

Small Business 2017

The small business asset write off up to $20,000 has now been extended to 30 June 2018.  The deduction is used for each asset that costs less than $20,000 whether new or second hand.

From 1 July 2017:

  • The tax rate for small business is reduced to 27.5%
  • For sole traders, partnerships and trusts, there is a 8% small business tax offset (up to $1,000 limit) for those with a turnover of less than $5 million.
  • The small business turnover threshold has now been increased to $10 million (previously $2 million).  This means more businesses can access a range of small business concessions including the $20,000 instant asset write off and reduced company tax rate.

The reduced company tax rate of 27.5% will progressively apply to companies with turnover less than $50 million by the 2018-19 income year. 


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