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Paying tax on superannuation contributions Posted on Oct 30, 2016 by editor

Super

The amount of tax an individual pays on their super contributions depends on whether the contributions were made before or after they paid income tax; they have exceeded the super contributions cap or they are a very high-income earner. Before-tax super contributions Concessional (before-tax) super contributions are taxed at 15 per cent. They include employer contributions; contributions that are allowed as an income tax deduction and notional taxed contributions if you are a member of a defined benefit fund. After-tax super contributions Non-concessional (after-tax) super contributions are not subject to tax. They include contributions you or your employer make from […]

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ATO develops safe harbour for car fringe benefits Posted on Oct 30, 2016 by editor

Tax

The Australian Tax Office has recently collaborated with industry representatives to develop a safe harbour for car fringe benefits. A safe harbour is a guideline that allows Australian businesses to make use of an efficient way to calculate tax where certain conditions are met. This particular safe harbour will simplify the approach for working out the business use percentage of car fringe benefits for fleets of 20 cars or more. The new approach reduces the recordkeeping burden for businesses and allows them to use an ‘average business use percentage’ when using the operating cost method. Businesses can access the safe […]

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Accessing your superannuation Posted on Oct 27, 2016 by editor

Super

Australians are required to meet a condition of release under superannuation law before they are allowed to cash preserved benefits, restricted non-preserved benefits or access any of their super. Some conditions of release restrict the form of the benefit or the amount of benefit that can be paid. These are known as ‘cashing restrictions’. The most common conditions of release for paying benefits are that the member: has reached their preservation age and retires has reached their preservation age and begins a transition-to-retirement income stream ceases an employment arrangement on or after the age of 60 is 65 years of […]

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ATO warns small businesses of SuperStream deadline Posted on Oct 27, 2016 by editor

Tax

The Australian Tax Office has warned small businesses that time is running out to start paying superannuation contributions in the new and mandatory electronic standard called SuperStream. SuperStream is the new mandatory way employers must make super contributions on behalf of their employees. It involves employers sending all super payments and employee information electronically in a standard format. Those employers that are still paying their super by cheque must move to the electronic solution to make super contributions. Small business employers have until this Friday – 28 October 2016 – to become compliant. Small businesses who have failed to adopt […]

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Personal superannuation contributions overview Posted on Oct 18, 2016 by editor

Super

Adding your own contributions to your super fund is a simple and effective way to boost your superannuation. Personal super contributions are amounts an individual contributes to their super fund from their after-tax income. These contributions are in addition to any compulsory super contributions an individual’s employer makes on their behalf and do not include super contributions made through a salary-sacrifice arrangement. Personal contributions are non-concessional (after-tax) contributions that count towards a person’s non-concessional contributions cap unless they have claimed a tax deduction for them. While employees generally can’t claim a tax deduction for personal super contributions, they may be eligible […]

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Changes announced to ATO withholding amounts Posted on Oct 18, 2016 by editor

Tax

Following an announcement in July, the Australian Government recently increased the 32.5 per cent tax threshold from $37,001 – $80,000 to $37,001 – $87,000. The new PAYG withholding rates will apply to individual taxpayers who earn more than $80,000 from 1 October 2016. The Australian Tax Office provides a range of tables to assist employers work out how much to withhold from payments they make to their employees. Since the latest edition of the new tax tables is now available, employers should use these new tax tables for payments made from 1 October 2016. The Tax Office also provides a […]

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SMSF investment in a private company or business Posted on Oct 12, 2016 by editor

Super

Self-managed super funds (SMSFs) are allowed to invest a private company or business provided the business is operated for the sole purpose of providing retirement benefits for fund members and it is allowed under the trust deed. SMSF trustees must take into account the sole purpose test when determining whether purchasing a private company or business is appropriate. The sole purpose test means your fund needs to be maintained for the sole purpose of providing retirement benefits to your members or to their dependants if a member dies before retirement. Under the sole purpose test, the SMSF is eligible for […]

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Home-based work expenses Posted on Oct 12, 2016 by editor

Tax

The Australian Tax Office allows Australians who work at or from their home to claim a deduction for the additional expenses they incur from running their business. Generally speaking, the deductible expenses that can be claimed are divided into two categories; occupancy expenses and running expenses. Occupancy expenses: relate to ‘the place of business’, i.e. where part of an individual’s home is used solely for income producing activities. Examples of occupancy expenses include: mortgage interest rental costs insurance security To be eligible to claim a deduction for an occupancy expense, the area of the home used for business activities must […]

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Increased focus on SMSF compliance Posted on Oct 6, 2016 by editor

Super

The Australian Tax Office (ATO) is taking a more serious approach to SMSF non-compliance over the coming year. The Tax Office has found that more than an acceptable number of SMSF trustees are lacking transparency and are operating of the system, i.e. not lodging SMSF annual tax returns and/or not undergoing an annual independent audit. Compliance issues, such as regulatory contraventions reported through auditor contravention reports are a growing problem. The 2015 income year saw 22,000 auditor contravention reports reported for 8,200 funds. The ATO is urging trustees to engage with the Tax Office by self-correcting and rectifying compliance issues […]

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ATO reminds small businesses about SuperStream deadline Posted on Oct 6, 2016 by editor

Tax

The Australian Tax Office (ATO) is reminding small businesses to transition to SuperStream by 28 October 2016. SuperStream is the new mandatory way employers must make super contributions on behalf of their employees. It involves employers sending all super payments and employee information electronically in a standard format. Those employers that are still paying their super by cheque must move to the electronic solution to make super contributions. Small business employers have been given extra compliance flexibility from 30 June 2016 to 28 October 2016. This means the ATO will not be taking compliance action against small businesses until 28 […]

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