Extension of $20,000 instant asset write-off to 30 June 2019.
What Andy says: “It’s fantastic that they’ve kept this but that doesn’t mean go out and ruin your good spending habits. Buy things if you need them it in the first place, don’t buy it for a tax deduction only. You end up worse off, you’re basically spending $1 to save $0.30.”
“Buy things if you need them..don’t buy it for a tax deduction.”
A cap on cash refunds on the R&D Tax Incentive to $4 million for companies with an aggregated turnover below $20 million.
What Andy says: “While this may not affect the majority of small businesses – it’s a good reminder to review if any of your activities could qualify for R&D tax offset. If you’re unsure about this, why not contact our R&D Specialists?
Black economy measures – ATO
What Andy says: “We do not endorse any activity in the black economy. This is a good reminder and warning that the ATO will be focussing more efforts on tacklings the issue of cash sales and expenses not being reported.”
Tax relief for low and middle-income earners.
Stage 1 – There is a new tax offset available. It is the Low and Middle-income Tax Offset and it is available from 2018/19 to 2021/22. The effect for individuals are as follows:
- Taxable income below $37,000/ will receive a benefit of $200
- Taxable income between $48,000 and $90,000 can receive a benefit up to $530
- Taxable income over $90,000 will see a reducing benefit as income increases
Stage 2 – From 1 July 2022 there will be a change in tax thresholds.
- Increase in Low Income Tax Offset from $445 to $645
- Increase the 19% personal tax rate threshold from $37,000 to $41,000
- Increase the 32.5% personal tax rate threshold from $90,000 to $120,000
- The 32.5% personal tax rate will also apply to incomes between $120,000 to $200,000
What Andy says: “Honestly, this will all be done by your accountant and you won’t need to worry too much. What it means for you guys is that you’re paying less tax.”
Additional funding of $600M to increase compliance activities
What Andy says: “The ATO has been given the mandate to collect money. That means they will be stricter around enforcing lodgement dates, payment due dates and debt collection. What this means for you guys is to really get in front of things, be proactive and plan – no more last minute reconciliations!”
“…be proactive and plan..”
Disclaimer: This article should not be intended as your primary source of Tax, Accounting or Financial Advice. Always contact your trusted Accodex Accountant for help.
Written By: Andrew Wang
An accountant that actively refrains from the stereotype exhibited by the industry, Andy is defiantly non-traditional when it comes to servicing his clients.
Established as the Wellness Accountant, Andy firmly believes that an accountant’s responsibilities are not only restricted to the economic health of their client’s business or finances but rather that accountants are also obligated in ensuring that clients are educated and empowered to meet their financial goals.
Now also an Accodex Partners, Andy is focused on working with business owners within the Health & Wellness industry. Through his experience, expertise and service offering, Andy is passionate about helping his clients achieve both a work-life balance along with successfully growing a sustainable business.