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10 top global corporations since 1998

A very interesting, graphical, summary of the monsters of our global economy.  Fascinating stuff!!

The following video is a really great representation of how the top 10 global corporations have changed since 1998.

 

         

 

Catch-up Contributions

July 2019 sees the introduction of the new catch-up contribution rules, which allow people with less than $500,000 in super to make extra concessional contributions up to their previously unused $25,000 annual cap.

         

 

So, if $10,000 went into your super last financial year, this financial year you could put in $25,000 plus last year’s unused $15,000.

However, take care!

The rules only apply to unused contribution caps starting from the 2018-19 financial year. 

There are many eligibility and threshold tests throughout the superannuation system.

So, obtain advice and consider regular conversations about life insurance, superannuation, retirement, etc.

 

 

AcctWeb

Life Insurance

Important:  A major change to life insurance in many super funds.

       

 

The Federal Governments Protecting Your Super package starts on 1 July 2019 and will see an estimated three million people affected as new rules automatically switch off life insurance policies in super funds that have not received contributions in 16 months.

It’s designed to stop unwanted insurance premiums eating into retirement savings.

But a side effect is that those who need insurance but haven’t contributed recently – perhaps after taking time off work to raise children may lose that protection and be unable to get it back. 

Fixing this is simple.  Contact your super fund or make a (small) contribution.

 

 

AcctWeb

Community tip-offs trigger ATO visits

Around 700 small businesses in Western Australia are set to receive door knocks from the ATO next month after the agency received intelligence around possible black economy behaviour.

       

 

The ATO is planning to visit around 700 small businesses in Broome, Cable Beach, Derby and Kununurra, Western Australia in August as it looks to tackle black economy behaviour.

ATO assistant commissioner Peter Holt said these towns have been singled out as a result of some tell-tale signs of black economy behaviour.

“Black economy signs that we look out for are things like not being registered for GST or pay as you go withholding, lifestyle and assets far exceeding reported business income, or a lack of merchant payment facilities like EFTPOS,” Mr Holt said.

“We understand that some businesses may not have merchant payment facilities due to individual circumstances. The issue is when businesses are deliberately ‘cash only’ to avoid reporting all their income. By detecting and addressing this behaviour, we’re helping to keep things fair for honest small businesses.

“Another reason we’re heading to Broome, Cable Beach, Derby and Kununurra is because we’ve received intelligence from the community that some businesses aren’t playing by the rules, such as paying their workers cash in hand and keeping them off the books.”

Prior to the visits, local businesses and tax professionals are invited to attend a one-hour information session that will explain the purpose of the visits, what to expect if visited, and how to avoid common mistakes. Single Touch Payroll information sessions will also be offered in both locations.

The industries that are more likely to be visited by the ATO include:

  • Residential building construction
  • Building completion and installation services    
  • Other construction services                    
  • Building cleaning, pest control and gardening services
  • Accommodation                    
  • Automotive repair and maintenance    
  • Cafes, restaurants and takeaway food services
  • Personal care services  

The latest number of towns set for a visit comes after the ATO announced it was planning to visit around 500 businesses in or around Port Macquarie and Wauchope in late July and early August.
 

 

Jotham Lian 
30 July 2019 
accountantsdaily.com.au

 

 

Australia at a glance

The following link takes you to a site that sets it all out in black and white, though a strong coffee will help!

         

 

One great source of data about Australia. Become better acquainted with the country we love.

An up-to-date snapshot of Australia's vital statistics.  

Please click on the following link to see all this interesting information. The areas covered are:

  • Overview
  • Markets
  • GDP
  • Labour
  • Prices
  • Money
  • Trade
  • Government
  • Business
  • Consumer
  • Housing
  • Taxes
  • Climate

 

Access all this data here.

2019: Tax Time Checklists – Individuals; Company; Trust; Partnership; and Super Funds

Printing and completing these checklists makes it more efficient for your tax agent to complete your tax returns.  Doing so also helps maximise any refunds you receive or payments you have to make.

             

 

Please click on the following links to access the checklists most appropriate to your needs.

Individuals

Company Trust Partnership

Superannuation Funds

 

 

 

Small business clients need to be ready for STP by 30 September

The original deadline of 1-7-2019 has been extended.  Read more about what every small business needs to do by then.

 

 

Reporting through Single Touch Payroll (STP) for small employers started on 1 July. Small businesses have until 30 September 2019 to take action. There are a range of resources available on the ATO website to help, click on the link below.

STP is mandatory for all small businesses.

 

SINGLE TOUCH PAYROLL (STP) and what do do before 30 September 2019.

 

 

The Australian Taxation Office

 

 

Big four firm outlines new financial year checklist for SMSFs

With the new financial year starting, one of the big four accounting firms has highlighted the key areas on which SMSF professionals should focus their attention for SMSF clients.

           

 

With end of financial year planning now out of the way, Deloitte Private partner Liz Westover outlined some of the areas that might need to be reviewed with SMSF clients for the 2019–20 financial year.

Minutes for withdrawals above the pension minimum

Speaking at a recent Chartered Accountants Australia and New Zealand event, Ms Westover said where clients are planning to withdraw more than the pension, there may be certain minutes that need to be made.

“If you’re above the minimum and you want to treat some of them as lump sums from accumulation and so on, then get your documents in place because the ATO has a view that they must be prospective, they can’t be retrospective,” Ms Westover said.

Update clients on the new rates and thresholds

SMSF professionals should also ensure their clients are up to date with the rates and thresholds for the 2019–20 financial year.

“The ATO released this months ago, but there are plenty of organisations that just have a two-page list of rates and thresholds that you might want to distribute to your clients,” she said.

Sort out data feeds

Ms Westover said using proper SMSF administration software can create a lot of efficiency for SMSF firms, but practitioners need to ensure that the data feeds are actually in place.

“Now is a good opportunity to get clients to sign authorisations to get those data feeds in place,” she said.

Contributions splitting

Contributions splitting is a good strategy for evening up the balances between spouses, she said.

If an SMSF client made contributions last financial year, then this financial year they can make an election to split up to 85 per cent of those concessional contributions to their partner.

“So, if I’m looking to bring my partner’s balance up, then that’s a great way to do it. It’s a bit of a slow burn, but if you’re talking to younger clients where they can benefit from that over time, contribution splitting can be a good way to build up that second person’s balance,” she explained.

Determining lodgement dates for 2019–20

If it’s a new fund, then the client’s lodgement date will be in February, or if there are funds that were late last financial year, then they will have an October deadline, Ms Westover explained.

“Most clients will generally be in that May–June bucket, but as you’re planning your work, if you just get a good sense of when funds are actually going to be due for lodgement, that can help you work through your workflows and make sure that nobody is late,” she said.

“The ATO has a very strong focus on non-lodgements at the moment.”

Individual versus corporate trustee

While the ATO’s statistics show that 81 per cent of funds are now being set up with a corporate trustee, she said, there are still a lot of funds around with corporate trustees.

“I won’t set a client up [in an SMSF] without a corporate trustee. Nevertheless, we are still in a situation where 59 per cent have corporate trustees and 41 per cent have individual trustees,” she said.

While the process of changing a fund with individual trustees to a corporate trustee is a lengthy process, she said, the new financial year may be a good opportunity to revisit this with clients that still have individual trustees and encourage them to switch to a corporate trustee.

“Everyone has a fresh mind in the new financial year, so that might be a great exercise to actually do,” she said.

Addressing potential residency issues

If SMSF professionals have clients that are heading off overseas on secondments, they will need to consider how this might impact the fund and whether it will jeopardise the fund’s residency status, Ms Westover warned.

“I had a client recently who joined his mum’s fund because he wanted to help her out in terms of the investment side, which was fine, but then he decided he was going to move overseas and semi-permanently, so we had some real issues around the fund in terms of residency and what we did,” she said.

“We talked him through what all the implications were, what he could actually do, and in the end we made the decision that we were going to get him back out of the fund, and in actual fact he was in a better position to help his mother with some of the investments out of the fund than he was being in the fund because he didn’t have control over then.”

One of the other options would have been to turn the fund into a small APRA fund, she said.

“He didn’t want to do that one, but it’s important to have those discussions with your clients. Are you moving overseas and what impact is it going to have on your fund?” she said.

Estate planning

Ms Westover said estate planning is probably the single biggest issue for SMSF clients, especially following the implementation of the super reforms on 1 July 2017.

Previously, it didn’t matter how much clients had in their income streams, she said, as they could just have a reversionary pension, and in their mind, it was sorted.

“Now we potentially have to pull a lot of money out of super as a result of the transfer balance cap provisions, so you need to be thinking about how to deal with the accumulation accounts. I might have a reversionary pension in place on the income stream account, but what about the accumulation account, do I need a binding death benefit nomination?” she said.

“I still see a lot of clients who do not understand that superannuation does not automatically form part of their estate and that their will won’t have any jurisdiction over their superannuation benefits. I’m actually quite astounded by the amount of times that I still see that.”

 

 

Miranda Brownlee
28 June 2019
smsfadviser.com

 

Alert – Online Share Accommodation

Home-owners should consider the wider taxation implications of renting the family home before taking a short-term benefit.

       

 

The online platform (e.g. AirBnb) that facilitates the rental of your residence also provides much of that information to the Australian Taxation Office (ATO).  Thereafter, it is a simple matter from them to ensure all taxpayers disclose this rental income in their income tax return.

It is unlikely that many costs of the property during that period will be deductible.

However, a much more significant concern is the loss of full main residence exemption from Capital Gains Tax when the family home is sold.  An apportionment for the “business use” of the property will mean some of the “tax-free” gain has become taxable.

How accurate are your records (compared to the ATO who have the on-line platform records)?  How complex has it become?

Most taxpayers will forget the details but be surprised by an amended assessment without enough information to dispute ATO assessment.

 

 

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ATO flashes warning over $7.2bn car expenses claims

Over $7.2 billion in work-related car expenses claimed last year have placed the popular deduction firmly in the headlights of the ATO this tax time.

         

 

According to ATO assistant commissioner Karen Foat, over 3.6 million people made a work-related car expense claim in 2017–18, totalling more than $7.2 billion.

The deduction will be a key focus area for the Tax Office this year, with one in five claims exactly at the maximum 5,000km limit for the cent per kilometre method.

“While some claims of exactly 5,000km are legitimate, we’ve found many people are unable to show how they’ve arrived at this amount, and as a result, they’ve had their claim reduced or disallowed in full,” Ms Foat said.

“We are still concerned that some taxpayers aren’t getting the message that overclaiming will be detected, and if it is deliberate, penalties will apply.

“While some people do make legitimate mistakes, we are concerned that many people are deliberately making dodgy claims in order to get a bigger refund. We see taxpayers claiming for things like private trips, trips they didn’t make and car expenses their employer paid for or reimbursed them for.”

Ms Foat said the ATO’s sophisticated analytics will compare taxpayer claims with others earning similar amounts in similar jobs.

In one unsupported claim last year, a taxpayer claiming $4,800 using the logbook method had triggered an ATO red flag, with a request for the logbook resulting in the taxpayer presenting a car service logbook instead of a logbook kept for calculating their work-use car percentage. The taxpayer was found to have not undertaken any work-related car travel during the year.

Another claim was flagged after the ATO identified an office worker claiming $3,300 for 5,000 kilometres of work-related travel using the cents per kilometre method. The taxpayer advised that his employer did not require him to use his car for work and that his claim was based on trips he made from home to work. 

According to Ms Foat, where the Tax Office identifies questionable claims, they will contact taxpayers and ask them to show how they have calculated their claim. In some cases, where further scrutiny is warranted, the ATO may even contact employers to confirm whether a taxpayer was required to use their own car for work-related travel.

“Simply driving between work and home is not enough to warrant a deduction. You must have a work-related need to travel while performing your job, like traveling from site to site or be required to transport bulky tools,” Ms Foat said.

Apart from work-related deductions, the ATO has also indicated its focus on the overclaiming of rental deductions and the non-declaration of rental income, after commissioner Chris Jordan said that a random audit sample of returns with rental deductions found that nine out of 10 contained an error.

 

Jotham Lian 
25 June 2019 
accountantsdaily.com.au

 

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