In this Issue:
- Christmas Holiday Business Closure 2017
- Numerous work-related expense claims disallowed
- Tool for applying the margin scheme to a property sale
- ATO relief for SMSFs reporting ‘transfer balance account’ events
- Has your life changed in 2017?
- Christmas Candy Canes
- FREE Copy of Our Book
What a great time of the year with Christmas and the New Year approaching fast… and I say this with gratitude to my family and my team. We also want to thank YOU for your support this year.
The Team at Straight Talk Accounting & Tax wish all our valued clients a safe and enjoyable Christmas Holiday break and a prosperous and healthy New Year.
If you have any questions about the items published in this newsletter, please don’t hesitate to give us a call on 07 3399 8844… or stop by at our office for a coffee. We’re never too busy to sit down and talk to you.
Best regards from Robert & the Team at
Christmas Holiday Business Closure
Numerous work-related expense claims disallowed
The AAT has denied a taxpayer’s deductions for work-related travel, clothing, self-education and rental property expenses (totalling $116,068 and $140,581 for the 2013 and 2014 income year respectively), and upheld the ATO’s 50% administrative penalty on the tax shortfall for recklessness.
Apart from being unable to prove (or ‘substantiate’) some claims due to lack of receipts, and documents being in the wrong name, the AAT also criticised the taxpayer for:
- claiming work-related travel expenses on the basis of the ‘gap’ between travel expenses reimbursed by her employer and the ATO’s reasonable rates (which “was clearly not permissible under any taxation law”); and
- claiming clothing expenses for “formal clothes of high class”, despite her clothing not being distinctive or unique to her employment at the Department of Finance, and was instead rather conventional in nature (and so was not deductible).
Tool for applying the margin scheme to a property sale
The ATO is recommending that taxpayers use their recently updated GST property decision tool to work out if GST applies to their property sales.
The tool can be used to determine GST on the sale, lease or purchase of real property, and was recently updated for easier use on mobile devices.
In particular, after providing the relevant information, the tool will generate a GST decision that:
- advises whether GST is payable on a sale;
- estimates the amount of GST payable when applying the margin scheme; and
- advises whether the taxpayer is eligible to claim input tax credits.
ATO relief for SMSFs reporting ‘transfer balance account’ events
The ATO has announced that, from 1 July 2018, SMSF event-based reporting regarding events impacting a member’s transfer balance account (i.e., via a Transfer Balance Account Report) will be limited to SMSFs with members with total superannuation balances of $1 million or more.
Editor: This new reporting is only required if an event that impacts a member’s transfer balance account actually occurs (e.g., such as starting an account based pension, or commuting such a pension).
This effectively means that up to 85% of the SMSF population will not be required to undertake any additional reporting with respect to a member’s transfer balance cap, outside of current time frames (as SMSFs with members with account balances below $1 million can choose to simply report events which impact their members’ transfer balances when the fund lodges its SMSF annual return).
However, from 1 July 2018, SMSFs that have members with total superannuation account balances of $1 million or more will be required to report any events impacting members’ transfer balance accounts within 28 days after the end of the quarter in which the event occurs.
Editor: Whilst SMSFs are not required to report anything to the ATO until 1 July 2018, SMSF trustees should be mindful that, where the $1.6 million transfer balance cap has been breached in respect of a member from 1 July 2017, any resulting tax liability will continue to accrue until the excess amount is commuted (i.e., irrespective of when reporting that breach is required).
Has your life changed in 2017?
As time never stands still and life changes all the time, you can guarantee that some of those changes will have an impact on your tax structure or on your retirement plan. That’s why we’ve created a checklist of seven major areas in which you could experience change. It includes questions like:
- Did you sell a major asset like your home?
- Did you transfer any major financial assets?
- Do you know how to access your super savings?
- Did you receive a gift or inheritance?
- Did you get married?
Please call us on 07 3399 8844 or email us at firstname.lastname@example.org to request the full check list, so you can get started one step ahead in 2018.
The Christmas Candy Cane originated in Germany about 250 years ago. They started as straight white sugar sticks.
A story says that a choirmaster, in 1670, was worried about the children sitting quietly all through the long Christmas nativity service. So he gave them something to eat to keep them quiet! As he wanted to remind them of Christmas, he made them into a ‘J’ shape like a shepherds crook, to remind them of the shepherds that visited the baby Jesus at the first Christmas. However, the earliest records of ‘candy canes’ comes from over 200 years later, so the story, although rather nice, probably isn’t true!
Sometime around 1900 the red stripes were added and they were flavoured with peppermint or winter-green.
FREE Copy of Our Book
We hope that you’ve enjoyed this edition of the Straight Numbers & Tax Talk.
As a Thank You to our readers we’ll give away a FREE copy of our highly sought-after book titled ‘Straight Money Talk – A Straightforward Plan for Financial Independence” (worth $17.95), PLUS the accompanying workbook “5 Steps to Financial Independence”.
In this book, Robert Bauman lays out 10 steps anybody can follow to become truly wealthy, and reveals ‘money myths’ and ‘inside secrets’.
Just contact us on 07 3399 8844 to claim your gift and we will send it out to you.
About Straight Money Talk—A Straightforward Plan for Financial Independence
“I’ve read many financial books and found this one to be up there with the best. It can really kick-start your journey to get your financial situation into great shape.”
– Dr. Joe Vitale, author “Attract Money Now” www.attractmoneynow.com
“Robert has done a fantastic job on this book. My views on how to handle money and how to educate my kids to learn the value of savings have totally changed now. This is an excellent book to guide you to creating great financial wealth in your life!”
– Keith Abraham CSP – Professional Speaker and Best Selling Author
Please Note: Many of the comments in this publication are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances.