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Know what concessions you may be eligible for?
9 August 2021
As a small business, you have access to a range of concessions that could help your cash flow.
Here’s some news and details about available concessions for you to consider.
Lower company tax rates have changed.
If you’re a base rate entity, your company tax rate is 26% in the 2020–21 income year.
The small business income tax offset has increased.
If you’re a small business sole trader or have a share of net small business income from a partnership or trust, you can claim the small business income tax offset. It’s 13% in the 2020–21 income year, up to $1,000, if your turnover is under $5 million.
Deductions for professional expenses for start-ups are available.
You may be able to immediately deduct start-up costs such as professional, legal and accounting advice and government fees and charges.
There are simplified trading stock rules. If the estimated difference between your 2020–21 opening and closing trading stock is $5,000 or less, you don’t need to do a stocktake. Just report the same amount for your opening and closing stock in your tax return.
You may also be able to claim immediate deductions for prepaid expenses.
Find out about:
Claiming motor vehicle expenses?
9 August 2021
You can claim a deduction for motor vehicles expenses that are part of the everyday running of your business – but you can only claim the business portion if your vehicle is for both business and private use.
Depending on whether you’re a sole trader, partnership, company or trust and the type of motor vehicle you drive (for example, a car, ute or motorcycle), you may be able to use the:
- cents per kilometre method – for claims up to 5,000 business kilometres per car, at a rate of 72 cents
- logbook method – where you need to keep a logbook for at least 12 continuous weeks and work out the percentage of business use for each expense
- actual costs method – where you can only claim the actual costs of expenses incurred based on receipts.
If you use the logbook or actual costs methods, you can generally claim a deduction for depreciation. For the 2020–21 income year, the limit you can use to work out your claim is $59,136, or the cost of the vehicle if it’s under this amount.
You need to keep records showing how you calculated your claim for five years.
Find out about:
- Claiming a tax deduction for motor vehicle expenses – check out our handy fact sheet for more information
Fuel tax credit rates have increased
4 August 2021
Fuel tax credit rates increased on 2 August 2021 in line with fuel excise indexation.
You may need to use different rates for fuel acquired before and after 2 August.
If you claim less than $10,000 in fuel tax credits per year, you can use simplified methods including:
- the rate that applies at the end of your BAS period
- the Basic method for heavy vehicles to calculate your claims if you use a heavy vehicle.
The next time you work out your fuel tax credits, remember to:
- check how your fuel is used
- check you’re using the right rate
- use simplified methods to make calculating your fuel tax credits easier
- check your calculations to ensure you haven’t over-claimed
- keep complete and accurate records to support your claim.
Find out about:
Do you receive personal services income?
9 August 2021
You receive personal services income (PSI) if over 50% of your income is a reward for your personal efforts or skills. You can receive PSI in almost any industry or profession.
You can find more information about PSI and if the PSI rules apply to your income on our website.
If the PSI rules apply to your income, complete the PSI questions in your tax returns. You may need to complete both individual and business tax returns, depending on your business structure. It’s important to declare all income in your tax return.
You can only claim deductions against your PSI if the expenses relate directly to earning PSI. You can’t claim rent, mortgage interest rates or payments to associates for support work. You also can’t claim expenses you generally can’t deduct as an employee.
For example, Andre is a sole trader. He charges $250 for a job – $25 for materials and $225 for labour. Andre keeps all required records and calculates his total PSI at the end of the financial year. He completes the PSI question in his individual tax return and is careful to only claim deductions he’s entitled to for his PSI. He also includes his income from other sources and related deductions in his return.
Find out about:
Finding it hard to lodge and pay?
16 July 2021
Missing a due date can be stressful. If you’ve simply forgotten a due date or if you need more support, we have options available to help you.
The ‘Support to lodge and pay’ web page provides you with a simple point of access to the support available depending on your situation. It helps you with:
- understanding and managing your obligations
- what to do if you can’t lodge or pay on time
- how to find tax support in challenging times.
Remember, even if you can’t pay, it’s still important to lodge as soon as you can. Once you lodge, we can help you understand your tax position and find the best support for your circumstances.
If you still need to lodge a tax return for a previous year, it’s important to get up to date as soon as possible. This will ensure all your information is current and complete, giving you greater certainty about your overall position.
Head to our website to find out more today. It’s never too late to get back on track.
- Support to lodge and pay
- Help for Business and Non-Profits.
Time to claim the JobMaker Hiring Credit
05 August 2021
The JobMaker Hiring Credit scheme’s third claim period is now open. If you’ve taken on additional eligible employees since 7 October 2020, you may be able to claim JobMaker Hiring Credit payments for your business.
To claim you need to:
- Register at any time before 6 October 2021 through ATO online services, Online services for business, or through your registered tax or BAS agent.
- Nominate your additional eligible employees by running payroll events through your Single Touch Payroll (STP)-enabled software.
- Claim your payments – enter your headcount and payroll information for the Jobmaker period, and we will calculate your claim amount based on the information you provide.
Eligible businesses can receive up to:
- $10,400 over a year for each additional eligible employee hired aged 16 to 29 years
- $5,200 over a year for each additional eligible employee hired aged 30 to 35 years.
The JobMaker Hiring Credit is available to businesses for each additional eligible employee hired before 6 October 2021.
If you’re thinking about taking on extra staff, check if you’re eligible to participate in the scheme. We have resources available to help you, including a guide, key dates and a tool for estimating payments.
- JobMaker Hiring Credit guide
- JobMaker Hiring Credit payment estimator
- JobMaker Hiring Credit key dates
How to claim the loss carry back tax offset
9 August 2021
If your business is a corporate tax entity (company, corporate limited partnership or public trading trust), you may be eligible to claim the loss carry back tax offset in your 2021 company tax return.
If you’re eligible, you can carry back losses to certain earlier years where there was an income tax liability.
To complete your return you’ll need to know:
- your opening and closing franking balance – your offset is limited by your closing franking account balance, so we recommend you review your franking account balance before lodging your return
- your aggregated turnover
- the amounts of tax losses you’re carrying back
- your tax liability for the income year you’re carrying the losses back to
- any amounts of unutilised net exempt income for the income years you’re carrying the losses back to.
Make sure you complete the additional loss carry back labels in your return which are listed in the Company tax return instructions for 2021.
Instead of carrying back a loss you may choose to carry it forward to use in a later income year. However, a loss can only be used once so make sure to keep accurate records.
Do you have a dispute with an employee?
You will need to seek our advice on this type of matter.
We are able to assist you in certain circumstance by acting as an advocate for your business and represent your business via Fair Work Australia to negotiate a settlement with employee/s. We can also enlist the services of Experienced Industrial Lawyers from various capital cities. Industrial court, also called labour court, any of a variety of tribunals established to settle disputes between management and labour, most frequently disputes between employers.