Not long now until before the end of year closes with only the June Quarter remaining, so now is the time to ensure you have your 2023 returns completed before we get stuck into the 2024 income tax returns. We would like to thank all our clients who have sent their information in and got their returns completed, if you require any assistance with the completion of your 2023 tax return, please do hesitate to reach out. Currently, we are beginning our FBT check-ins for all our clients who may be subject to FBT with their businesses as the FBT year comes to a close at the end of March. With Easter just around the corner our offices will be closed during the Easter break, so if you have any queries you have until Thursday for us get back to you. We also have our senior accountant Chris Hampson on annual leave until the 15th of April 2024 and Cathie Cains on annual leave from the 10th of April 2024 until the 8th of May 2024, however we have everyone else here to answer to your questions!
Have a Happy Easter!!
Office Closure
Our offices will be closed during the Easter Long Weekend, from 5pm 29 March 2024 until 8:30am Tuesday 2 April. Emails will be responded to as soon as possible from 2nd of April, please do not post anything to our offices directly but address them to our post office box:
PO Box 3284 Nerang East QLD 4211
Staff on Leave
We currently have the following staff on annual leave:
Chris Hampson – 25 March 2024 to 15 April 2024
Cathie Cains – 10 April 2024 to 8 May 2024
If you have any queries, please do not hesitate to contact us and will be do our best to assist with you with them whilst they are away.
Did You Know…?
Changes to Super Guarantee from 1 July 2024
As we all know, employers by law are legally obligated to set aside an amount of their employees’ weekly wage to the nominated superannuation fund accounts. Over the years the percentage has increased, more recently in the last 2 years. The change to the current 11% for the 2023/24 year is set to change once again to 11.5% for the 2024/25 financial year on 1 July 2024. The compulsory contribution amount has been increasing 0.5% increments since 2021 and is expected to continue until the 2025/26 financial peaking at 12%. It is essential to mark this change every financial year to ensure that you are paying your employees the correct amounts in the financial periods. Not paying the right amount of super to your employees can have serious implications on your business around claiming these amounts as a business tax deduction. Using a cloud-based accounting software does somewhat relieve the pressure for small business owners as the software usually updates the payment obligations for their customers automatically. However, having the due diligence of double-checking that the change occurs in your system is good business-sense to ensure you do miss out on those business deductions come tax time.
If you are unsure whether you are paying the right amount or require further assistance around the changes to the compulsory super payments, please contact us immediately so we may assist you further.
Claiming Personal Super Contributions as a Tax Deduction
Making personal contributions is a great way to minimizing your taxable income by claiming the amount you personally contribute to your super as a tax deduction. However, there are a few tips you should know before you make the contributions and claim them as a tax deduction.
The first tip is to ensure that you are not over your concessional contributions cap. This is the maximum amount you can contribute in one year and receive the concessional tax rate of 15% on these types of contributions. These contributions can include personal contributions claimed as a tax deduction as well as any salary sacrifice amounts and compulsory employer contributions. For the 2023/24 tax year the cap is still at $27,500.
The second tip is to ensure that your personal contributions are made within the tax year, that being before 30 June. If you make the contribution after the 30 June, then this will be claimable in the next financial year ending. Like with any tax deduction, the amount of expense to be claimed must have incurred in the financial year to which it relates to.
Lastly, you must also submit a notice of intent to claim an amount of personal contribution as a tax deduction to your superannuation fund. This provides your super fund with your intent to claim an amount you have personally contributed (outside of your employment, so excluding salary sacrificing arrangements) as a tax deduction. Once your super fund has received your Notice of Intent to claim, usually they provide you with an acknowledgement letter regarding the amount to which you can claim as a tax deduction in your personal tax return. Remember, your notice of intent must be submitted by the 30th of June of the preceding year otherwise the ATO could amend your return to disregard your deduction and you may have to pay the ATO back a portion of your refund plus interest.
If you are unsure whether you about whether you need to submit a notice of intent or unsure about making personal contributions to super, please contact us so that we may assist you further.
Messages from the ATO
Pay Your Tax on Time and Save
When you meet your tax obligations in full and on time, you’ll avoid paying unnecessary interest (currently 11.38%) and penalties.
Read more
Stay on Top of Your Employer Obligations
Avoid penalties and interest.
Read more
Do you Supply or Sell Food & beverage Products?
Read our final GST determination on supplies of combination food and updated Detailed Food List Public Ruling to find out if you need to charge GST on food and beverage products.
Read more
Crypto Tips for Your Small Business
Learn how tax applies to crypto assets.
Read more
Changes to the Tax Rates from 1 July
As you may recall, the government announced that they have made changes to the individual tax rates and income thresholds. These changes are expected to take effect as of 1st of July 2024. Currently the tax rates for individuals with taxable income of:
- $0 – 18,200 – 0%
- $18,201 – $45,000 – 19%
- $45,001 – $120,000 – 32.5%
- $120,001 – $180,001 – 37%
- $180,001 or more – 45%
The proposed changes, which have now become law, are as follows:
- Tax rate of 19% to reduce to 16%
- Tax rate of 32.5% to reduce to 30%
- Increase the income threshold which the 37% tax rate applies to $135,000 from $120,000, and
- Increase the income threshold for which the 45% tax rate applies from $190,000 from $180,000.
These changes fall under the Treasury Laws Amendment (Cost of Living Tax Cuts) Act 2024. The main purpose of these tax rate cuts is to assist low- and middle-income earners with the cost-of-living pressures stemmed from changes in the economic environment causing the spike in inflation and interest rates.
If you are unsure how the changes to the tax rates on 1 July 2024 effect you, please contact us so we can assist you further.
ATO Chasing Tax Debts
Keeping on top of your business obligations can be a tricky game as most small business owners are trying to keep on top of the flow of income and paying their creditors. However, sometimes the ATO being a creditor is often overlooked and that can result in a significant amount of tax debt being owed to the ATO. With changes in the economy the ATO have now reopened debts which taxpayers may have thought were written off due to them being “Uneconomical to Pursue”.
In a recent article published by ABC News, the ATO is currently owed $15 billion from 1.8 million entities and this is largely consisted of individual with the amount owed set to increase once interest is applied to those debts.
Whilst the resurrection has left many taxpayers putting in complaints to the Tax Ombudsman however the law doesn’t state how they can do it or what processes they use to do it. With this in mind, it is essential that small business owners stay on top of the amount owed to the ATO to prevent money owed having penalties and interest applied or worse, the amounts referred to a debt collecting agency.
Some ways that can help you stay on top of your ATO balances are:
- Keeping separate bank accounts to set aside amounts that are owed to the ATO for GST, Pay as You Go Withholding tax, and Super
- Ensuring you don’t fall into temptation to use this money as cash flow
- Any debts currently outstanding, contact the ATO to arrange a payment plan to pay off these debts.
If you require assistance with managing your ATO debts or unsure if you have any amounts outstanding with the ATO, contact us immediately so that we can assist your further.