The end of financial year is almost here, the most important thing you can be doing right now (other than your annual tax planning meeting with the Harris Black Team) is planning for the year ahead.
In a rapidly changing environment, clients that have thoroughly planned for the year ahead have a significant advantage over their competitors. These clients are able to consider changing circumstances, how they will react to cost pressures or tightening revenue and the ultimate impact on their cash flows. At the end of the day cash is king!
We are currently working with clients to forecast their profit and loss for the year ahead and then determining their closing bank balance at the end of each month.
We have successfully helped clients:
- By giving them the best chance to approach the bank and have their finance approved
So take control of the year ahead and consult with your Harris Black Team Member so that you will have confidence to rise above your competitors and reach your full potential.
Innovative companies with an interest in getting involved in the "ideas boom" need to be aware of the Government's proposed tax incentives to help promote innovation. The Government has released draft legislation to implement more of the proposed tax measures announced as part of its National Innovation and Science Agenda (released in December 2015).
One of the tax measures will allow companies that have changed ownership to access past year tax losses if they satisfy a similar business test. Under the current law, companies that have changed ownership must satisfy the same business test to access past year tax losses. This measure is designed to encourage entrepreneurship by allowing loss-making businesses to seek out new opportunities to return to profitability.
The other measure proposes to allow taxpayers the choice to either self-assess the effective life of certain intangible depreciating assets (such as patents or copyrights) or use the statutory effective life. The current law only provides an effective life set by statute. According to the Government, changing the tax treatment for acquired intangible assets will make startups' intellectual property and other intangible assets a more attractive investment option.
Accounting add-ons have evolved recently in the world of accountancy. Each month we will feature a range of add-ons that will help you focus and become more efficient within your own practice.
All businesses are focussed on providing great and quality customer service. Our featured add-ons for this month will surely help you achieve in delivering customer satisfaction and success in your own business.
Timely is an appointment system for any service business that needs scheduling. Packed full of features including a calendar that supports multiple staff and locations, and SMS/email reminder that will reduce no-shows.
Timely is a cloud-based software, meaning you can access your schedule anywhere. This add-on works perfectly with your PC, Mac, tablets and even with your smartphones. There is no software to install, you will get upgrades automatically and your data is fully secured.
How it works?
Once an appointment or job is completed in Timely, an invoice can be raised and pushed into MYOB or Xero. The associated payment and customer information is also synchronised to provide the complete picture to the business owner.
Customer information including names and contact details is shared and updated automatically between both systems.
Click here to see how smart businesses use Timely to make life easier, so they can stay focussed on providing great customer service.
Cooking the Books is a complete kitchen management tool, not just a recipe manager, but everything you need to run a successful and profitable kitchen with consistently great food.
This add-on is designed by chefs for chefs to give their businesses the financial control and consistency they want.
Cooking the Books is a web based computer program that links into your MYOB or Xero accounting software and has been designed to generate food cost, stock, order sheet, recipe cards, sales revenue, electronic ordering, invoicing, and creating a food based operational management system for the hospitality industry.
To know more about these add-ons, contact your Harris Black Team Member today.
The year seems to fly by in the blink of an eye. Before you know it, the end of the financial year is approaching and you might not be quite aware of what you need to do. In this month's edition of Harris Black Top 10, team Harris Black will share some of the things "To Do" and suggestions before the financial year ends.
- Speak to your accountant regarding any tax planning strategies.
- Pay staff superannuation prior to 30 June to ensure you get a tax deduction in 2016 year.
- Purchase new assets under $20,000 to get immediate deduction assuming you are eligible for business concessions.
- If you have a trust, make sure the trustees makes a decision on how the income will be distributed and sign a resolution.
- Ensure bank feeds are up to date, so Xero and MYOB can reconcile at 30 June.
- Make a donation to your favourite charity.
- Buy any work related technology pre 30 June 2016.
Now let's continue our Top 10 with some fun and excitement!
- Planning a party in July because the financial year has finally ended.
- Pick an outfit to wear to End of Financial Year function and find drinking shoes.
- Go to an End of Financial Year sale and shop 'til you drop!
Happy End of Financial Year!
Australians who let their holiday homes for only part of the year should be aware of the ATO's compliance focus on excessive holiday home deduction claims.
The ATO has released guidance on claiming deductions in relation to holiday homes. If a taxpayer rents out their holiday home, they can only claim expenses for the property based on the proportion of the income year when the property was rented out or was genuinely available for rent. Notably, the new guidance indicates what is meant by "genuinely available for rent". According to the ATO, factors that may indicate a property is not genuinely available for rent include that:
- it is advertised in ways that limit its exposure to potential tenants (for example, the property is only advertised by word of mouth);
- the location of, condition of or accessibility to the property mean that it is unlikely tenants will seek to rent it;
- there are unreasonable or stringent conditions on renting out the property that restrict the likelihood of the property being rented out; or
- interested people are turned away without adequate reasons.
Although it is always prudent to check things over before tax time, holiday home owners may particularly want to take the opportunity to review their circumstances and ensure that any deduction claims are made correctly before "the taxman cometh".
The ATO has advised that it is investigating more than 800 individuals after a leak of taxpayer data in relation to a Panamanian law firm.
Deputy Commissioner Michael Cranston said that since the completion of the offshore disclosure initiative "Project DO IT", the ATO has ramped up its compliance work to deal with taxpayers who have failed to disclose offshore income and assets.
Mr Cranston said the ATO has been analysing the latest data against information these taxpayers had reported and against the information the ATO already has. The information the ATO received regards some taxpayers who it had previously investigated, as well as a small number of taxpayers who disclosed their arrangements to the ATO under Project DO IT. The information also regards a large number of taxpayers who have not previously come forward, including high-wealth individuals, and Mr Cranston said the ATO is already taking action on those cases.
The ATO has released guidelines that set out the "safe harbour" terms on which trustees of self- managed superannuation funds (SMSFs) may structure related-party limited recourse borrowing arrangements (LRBAs) consistent with an arm's-length dealing. The ATO generally takes the view that an SMSF may derive non-arm's length income (taxable at 47%) if the terms of an LRBA are not consistent with an arm's-length dealing. If an LRBA is structured in accordance with the ATO's guidelines, it will accept that the non-arm's length income (NALI) rules do not apply.
The ATO previously announced a grace period whereby it will not select an SMSF for review provided that arm's-length terms for its LRBA are implemented by 30 June 2016, or the LRBA is brought to an end before that date. Importantly, the ATO's guidelines require arm's-length payments of principal and interest to be made for 2015–2016 (including where the arrangement is brought to an end). If an LRBA does not meet all of the safe harbour terms, it does not mean that the borrowing is deemed not on arms'-length terms. Rather, trustees who do not meet the safe harbour terms will need to otherwise demonstrate that their arrangement was entered into and maintained consistent with arm's-length terms.
The ATO has announced details of its various data-matching programs. Most of the announcements regard extensions to existing data-matching programs. Records obtained through the programs will be electronically matched with ATO data holdings to identify non-compliance with registration, lodgement, reporting and payment obligations under taxation laws.
The following are key points:
- The ATO will acquire details of registered voters on the Commonwealth electoral roll from the Australian Electoral Commissioner. This data-matching program aims to identify taxpayers who are not registered with the ATO when they are required to be.
- The ATO will acquire data from businesses that it visits as part of its employer obligations compliance program during the 2016–2017, 2017–2018 and 2018–2019 financial years. This program aims to obtain intelligence to identify risks and trends about contractors who may not be complying with their taxation obligations.
- The ATO will acquire data relating to electronic payments made to merchants through specialised payment systems for the 2014–2015, 2015–2016 and 2016–2017 financial years. This data will be used to detect unreported income and to identify those operating a business but failing to meet their registration, lodgement and payment obligations.
We have two reasons to celebrate this month at Harris Black.
We'd like to congratulate Rebecca Smith (Supervisor) and Kathryn Healy (Workflow Manager) as they celebrate 3 years working with Harris Black.
Their dedication to Harris Black and our clients is outstanding.
Congratulations Rebecca and Kath!
- Fringe Benefits Tax Annual Return – due date for payment
- Due date for lodging the Superannuation Guarantee Charge Statement – Quarterly and paying the super guarantee charge for Quarter 3, 2015-2016 if the employer did not pay enough contributions on time.
- Tax return lodgement, including companies and super funds where the tax return is not required earlier and both of the following criteria are met:
- Non-taxable or a credit assessment as at least year lodged; and
- Non-taxable or receiving a credit assessment in the current year.
- May 2016 monthly activity statement – due for lodging and paying.
- 2016 Fringe Benefits Tax annual return – lodgement due date for tax agents (if lodging electronically). Payment (if required) is due 28 May 2016.
This newsletter is for guidance only, any professional advice should be obtained before acting on any information contained herein. Neither the publisher nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this newsletter. We recommend that you contact your Harris Black team member before making any decision to discuss your particular requirements or circumstances.