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Brazen ATO scam costs Sydney woman $22k

 

Brazen scams continue.  Police have issued a warning after a Sydney woman fell prey to an elaborate ATO scam that cost her $22,000.

 

           

NSW Police have commenced an investigation after a 42-year-old woman received a phone call from a woman claiming to represent the Tax Office, telling the victim that she had a tax debt and would be contacted by a police officer.

A short time later, the woman received a call from a man who claimed to be a police officer and instructed the woman to withdraw money and deliver the cash to him.

According to the police, the number displayed on the caller identification was that of the local police station.

Following the scammer’s instruction, the victim proceeded to meet a man in a shopping centre car park on Polding Street, Wetherill Park, later the same day, providing him $22,000.

Officers from Liverpool Police Area Command investigating the matter are now looking to speak to a man described as being of Indian or subcontinent appearance.

Members of the community have been warned not to readily engage with unsolicited phone calls requesting personal or financial information.

“If you have doubts about the identity of any caller who claims to represent a business, organisation or government department, contact the body directly,” said NSW Police.

“Don’t rely on contact details provided by the person — find them through an independent source such as a phone book or online search.

“Don’t let scammers press your buttons — scammers use detailed scripts to convince you that they’re the real deal and create a high-pressure situation to make a decision on the spot.”

 

Jotham Lian 
16 December 2020 
accountantsdaily.com.au

 

Videos and other resources for our clients

Making our website into a valuable resource for our clients is very important to us.  There are more tools and resources available when compared to almost anywhere else and this month we highlight our educational videos. 

We hope you enjoy these 'extras' and if you have any question then click on the Contact Us button  and ask. 

 

       

Educational videos on accounting topics. Every 12 weeks the current range of 6 videos is changed for another 6. 18 in all and all are relevant, interesting, educational and interesting. Videos that are changed three times a year to ensure you and your family are able to lean about many issues related financial issues and topics.  This month's topics are: 

  • Why choose and Accountant?
  • Understanding Estate Planning
  • Reducing your capital gains tax liability
  • Lending interest rates effect everyone differently
  • Caring for Aged Parents
  • How franking credits work

Latest news articles. 7-9 individual articles every month, though 13-15 in March, and all chosen for their relevance. Our website is a great place to stay informed.

Calculators. A good range of calculators to help you better understand and manage your personal and family financial issues. Four of the more popular are: Pay calculator, Budget Calculator, Loan Calculator, and Super Calculator

Client portals. Portals are quite common on many sites and can be used to store your data, pay bills, log onto investment systems.

Ask us a question at any time. If you have a question on any related topic then don’t hesitate to use a form on our site to ask.

Your information is private and confidential and should be treated that way. Using Secure File Transfer means your information is encrypted when sent in either direction over the Internet.

Many sites also have a message window feature that displays messages of interest or that cover topics and deadlines you should be aware of.

 

* Not all are on every website.

Your Accountant

Key dates for the second JobKeeper extension period

 

The JobKeeper program moves into its final phase from Monday, with payment rates set to be reduced.

 

       

From 4 January, the wage subsidy payments will fall to $1,000 per fortnight for those on the tier 1 rate and $650 per fortnight for those on tier 2.

The new rates will apply until the JobKeeper program comes to its scheduled end date of 28 March.

Entities looking to claim JobKeeper payments for the period running from 4 January to 28 March will need to demonstrate a decline in actual GST turnover for the December 2020 quarter.

With this next phase kicking in around the festive period, the ATO has now provided revised dates that employers and their advisers should be aware of:

4 January

New decline in turnover form available.
Meet wage condition for JobKeeper fortnight 20 (21 December 2020 to 3 January 2021).

28 January

Business monthly declaration due for payments made in JobKeeper fortnights 18, 19, and 20. An extension from the usual 14th of each month.
31 January

Meet wage condition for JobKeeper fortnights 21 and 22.

 

 

Reporter 
04 January 2021 
accountantsdaily.com.au

 

Approaching the dawn

 

COVID-19 has completely, and mercilessly, dictated the direction of economies and financial markets through most of this year. So, as we rapidly approach the end of an extremely unpredictable and volatile year, what's in store for 2021?

 

           

COVID-19 has completely, and mercilessly, dictated the direction of economies and financial markets through most of this year.

So, as we rapidly approach the end of an extremely unpredictable and volatile year, what's in store for 2021?

It should come as no great surprise that the global economic outlook and the likely behaviour of financial markets remain hinged to COVID-19, and more specifically to health outcomes and responses.

That's a key finding from our just-released report: Vanguard Economic and Market Outlook 2021: Approaching the dawn.

Authored by senior economists and investment strategists from across Vanguard, the VEMO 2021 report highlights that the pace of economic recovery ultimately will be driven by the rate at which populations develop COVID-19 immunity.

As the human immunity gap narrows, the current reluctance gap – the fear of spending – will also narrow, leading to stronger economic growth.

Room for economic optimism

With the rollout of COVID-19 vaccines increasing, there is room for optimism.

In the VEMO report, we outline our base case that major economies will achieve infection immunity (when the person-to-person spread of COVID-19 becomes unlikely) by the end of 2021.

This would result in economic activity normalising by the second-half and output reaching pre-pandemic levels by the end of 2021. If infection immunity does not occur, economies may only see marginal progress from current levels.

But assuming immunity rates do rise, unemployment levels are set to fall, and a cyclical bounce in inflation is expected to occur around mid-year. This brings some risk that markets could interpret higher inflation with a more pronounced, but unlikely, inflation outbreak.

However, overall, there's more upside than downside to our economic forecast based on vaccine developments.

Country-specific economic growth rates will be varied, with our base case forecast for Australia at 4 per cent. This will trail the United States and the euro area, which are both forecast to grow at 5.4 per cent in 2021.

The strongest forecasts are for the United Kingdom at 7.4 per cent, albeit from a low base, and for strong growth of around 9 per cent in China due to its more successful navigation of COVID-19.

The outlook for markets

The key investment lessons to absorb from 2020 are that it's vital stay the course with your strategy and not become distracted by short-term market events, no matter how severe they are at the time, and that portfolio diversification will ultimately smooth out volatility.

The benefits of diversification played out over the most recent market cycle where investors holding a global equity portfolio would have outperformed someone holding an all-Australian equity portfolio by about 5 per cent in year-to-date terms.

In the period ahead, Vanguard predicts the Australian market should slightly outperform globally as economic conditions improve.

Vanguard's Capital Markets Model projections for global equity returns are in the 5 per cent to 7 per cent over the next decade, and in the 5.5 per cent to 7.5 per cent ranges for Australia over same period.

Although below the returns seen over the last few decades, equities are expected to continue to outperform most other investments and the rate of inflation.

In Australia, equity prices have rebounded roughly 40 per cent from the trough in March and valuations are considered to be in the middle of their fair value band.

US and China valuations are not overly stretched but at the higher end of their value bands given the recent stronger rebounds in those markets.

Despite rising equity valuations, the outlook for the global equity risk premium is positive and has increased since last year given record low bond yields.

Low interest rates will remain a feature in 2021, and Vanguard expects bond portfolios of all types and maturities will earn yield returns close to current levels.

But we continue to believe in the diversification properties of bonds, particularly high-quality bonds, even in a low or negative interest rate environment.

An investor holding a diversified portfolio (60 per cent equity and 40 per cent fixed interest) during the most recent market sell-off in March would have fared better than someone with an all-equity portfolio.

Rather than used as a returns enhancer, bonds are a risk reducer to balance out cyclical risks in portfolios.

In 2021, it will be important for investors to remain disciplined and focused on long-term outcomes, and to accept that current macro-economic events may mean medium-term investment returns will be lower than those recorded over recent decades.

 

 

15 Dec, 2020
By Tony Kaye
Senior Personal Finance Writer, Vanguard Australia
vanguard.com.au

 

Toyota returns $18m in JobKeeper payments

 

The Japanese car manufacturer has confirmed it has approached the ATO to return more than $18 million in JobKeeper payments after a spike in sales towards the end of last year.

 

       

Toyota Australia president and CEO Matthew Callachor said the move was the “right thing to do as a responsible corporate citizen” after it recorded strong sales in the final quarter of 2020.

Around 1,400 of Toyota’s employees were on JobKeeper after the car manufacturer qualified for the wage subsidy program in the middle of last year after its revenue fell by more than 50 per cent.

However, the company posted a record fourth-quarter total of 66,179 vehicles, a gain of 29.1 per cent over the same period in 2019.

The surge in sales saw Toyota deliver a total of 204,801 vehicles for the year, retaining its title as the best-selling car brand for the 18th consecutive year.

“Like most businesses, Toyota faced an extremely uncertain future when the COVID-19 health crisis developed into an economic crisis that even led to dealerships closing for extended periods in Victoria and Tasmania,” Mr Callachor said.

“We claimed JobKeeper payments to help support the job security of almost 1,400 Toyota employees around Australia — the people who are our first priority.

“In the end, we were very fortunate to weather the storm better than most, so our management and board decided that returning JobKeeper payments was the right thing to do as a responsible corporate citizen.”

The return of JobKeeper payments comes after key figures within the government reaffirmed their decision to end the program by March despite a number of industries continuing to struggle due to border closures and state-imposed lockdowns.

Acting Prime Minister Michael McCormack said a wide range of businesses, starting at “A, accountants, and you could work right through to Z, zoos and everything in between”, had told him that JobKeeper needed to end by March.

Treasurer Josh Frydenberg also noted that 2.2 million workers and 450,000 businesses had dropped off JobKeeper after September 2020, a sign that the program had done its job in helping businesses weather the downturn.

“It was always meant to be a temporary program, it was always designed to help get businesses to the other side, and it’s not the only support measure that we have in place,” he said.

“It was initially legislated for six months, and as you know, we extended it for another six months. But it is a program that goes to the end of March.”

 

 

Jotham Lian 
13 January 2021
accountantsdaily.com.au

 

Vaccination rates as they happen around the world

 

A new resource is now available that shows the rates per country of COVID-19 vaccinations.  We all suffered in many ways as COVID number increased, now, as expected, let's watch them start to drop.

 

           

How many people have received a coronavirus vaccine?

Click here or on the image to go to the live site.

Tracking COVID-19 vaccination rates is crucial to understand the scale of protection against the virus, and how this is distributed across the global population.

Country-by-country data on COVID-19 vaccinations
 

 

 

Source:  ourworldata.org

 

How Australians are taking advantage of income tax cuts

 

New research has offered insight into how Australians intend to save the gains generated from income tax cuts rolled out in this year’s federal budget.

 

       

Colonial First State (CFS) has surveyed 2,000 Australians to determine their tax-saving intentions following changes to personal income tax announced in the budget on 6 October.

As part of the measures to personal income tax, Treasurer Josh Frydenberg declared tax cuts worth nearly $30 billion would be made available to more than 11 million individual taxpayers two years earlier than previously legislated.

Stage 2 of the Personal Income Tax Plan, legislated to apply from 1 July 2022, will now take effect on 1 July 2020. The upper threshold of the 19 per cent tax bracket will increase from $37,000 to $45,000, and the upper threshold of the 32.5 per cent tax bracket will increase from $90,000 to $120,000.

Further, low- to middle-income earners will receive additional support through an increase in the low-income tax offset (LITO) from 1 July 2020 from $445 to $700 as well as access to the low and middle-income tax offset (LMITO) for 2020–21.

According to the research by CFS, the majority of Australians intend to put the cut to personal income tax towards their savings. Sixty-six per cent of those surveyed aged between 18 and 24 said they planned to save some or all of the tax cut, versus 57 per cent of Australians overall.

Of the 22 per cent of Australians who intend to spend their tax cut, 33 per cent said they are going to put it towards essentials such as bills, groceries and insurance.

Almost one in five indicated that they plan to use their tax cut to reduce their mortgage, and 16 per cent will use it to invest in the stock market.

A further 11 per cent of Australians said they plan to use their tax saving to pay off high-interest debt such as credit card and buy now, pay later accounts. 

Meanwhile, just 6 per cent of those surveyed indicated that topping up their super or retirement savings was a priority. This is despite 16 per cent of respondents having withdrawn super as part of the government’s early release of super scheme.

“For many Australians hit hard by the coronavirus-led recession, the personal income tax cuts brought forward by the government in this year’s federal budget have been well received, alongside a range of other measures, as much-needed support,” said CFS general manager Kelly Power.

“We know that a lot of Australians have been doing it tough and the focus for many has been on navigating the current uncertainty. As we begin to emerge on the other side of the pandemic, with infection rates falling and the economy restarting, it’s important to start thinking about the future, including protecting and rebuilding wealth.

“Whether Australians decide to save or spend, it’s about being savvy about what you use the extra cash for. A little can go a long way, and if used wisely, the income tax cuts can provide an additional boost to your overall financial position.”

 

 

Emma Ryan 
01 December 2020 
accountantsdaily.com.au

 

Small-business coronavirus grants set to be income tax-free under new bill

 

A new bill that ensures state and territory grants issued in response to the coronavirus pandemic are not subject to income tax has now been introduced.

 

       

Treasury Laws Amendment (2020 Measures No. 5) Bill 2020 has now been introduced in Parliament, following the government’s announcement that small and medium business grants announced on or after 13 September will be non-assessable non-exempt income.

The bill will amend the income tax law to make payments received by eligible businesses under certain grant programs administered by a state or territory non-assessable non-exempt income so that these payments are not subject to income tax by the Commonwealth.

Only entities with an aggregated turnover of less than $50 million will be eligible for the concessional tax treatment.

Eligibility will also require that the payment must be made under a grant program that is declared by the Minister to be eligible and is, in effect, responding to the economic impacts of the coronavirus pandemic.

The grant program must be first publicly announced on or after 13 September and directed at supporting businesses subject to certain restrictions regarding their operations.

“The concessional tax treatment ensures that eligible businesses obtain an additional boost to their cash flow, further supporting their economic recovery,” said the explanatory memorandum.

“This is because, in addition to the payments not being subject to income tax (by being treated as non-assessable non-exempt income), businesses will continue to be able to claim deductions for eligible expenses made with the grant payments.”

The bill was first introduced in the House of Representatives on Wednesday and has yet to pass both houses.

The concessionary measure was first revealed by Prime Minister Scott Morrison following Victoria’s $3 billion Business Resilience Package.

 

 

Jotham Lian 
12 November 2020 
accountantsdaily.com.au

 

ATO extends JobKeeper deadlines ahead of Christmas

 

JobKeeper deadlines for the second extension period have now been extended by the ATO ahead of the festive season.

 

       

Completion of the December business monthly declaration, for employers to be reimbursed for payments between 23 November 2020 and 3 January 2021, has also been extended from the usual 14th of each month to 28 January 2021.

To account for the New Year weekend, the Tax Office will also allow employers to meet the wage condition for payments between 21 December and 3 January 2021 by 4 January 2021.

From 4 January, the second extension period for JobKeeper will kick in, reducing payment rates to $1,000 per fortnight for those on the tier 1 rate and $650 per fortnight for those on tier 2.

Entities will be required to demonstrate that their actual GST turnover has declined by the requisite shortfall for the December 2020 quarter, with the ATO to make the new decline in turnover form available on its systems from 4 January.

New employers enrolling for the first time, and existing employers, will be required to submit the decline in turnover form by 31 January.

Employers will also be given until 31 January 2021 to meet the wage condition for fortnights starting on 4 January and 18 January 2021.

JobKeeper figures

The new dates come as statistics released by the government show that 450,000 businesses stopped accessing JobKeeper after eligibility was tightened at the end of September.

The number of Australian workers on JobKeeper also fell from 3.6 million recipients at the height of the program to 1.5 million by the end of November.

Around 86 per cent of workers are now on the tier 1 payment of $1,200 per fortnight, with around 14 per cent on the tier 2 payment of $750 per fortnight.

Treasurer Josh Frydenberg said the lower-than-forecast take-up of JobKeeper was evidence that economic recovery was well underway in Australia.

 

 

Jotham Lian 
01 December 2020
accountantsdaily.com.au

 

Super, death, and taxes

 

An interesting finding in the federal government's Retirement Income Review report is that many Australians are dying with the majority of the wealth they had when they retired.

 

       

Having enough superannuation to enjoy a financially comfortable lifestyle in retirement is the aspiration of most Australians.

As the super system continues to mature, and with the benefit of compounding investment returns, average retirement savings balances are rising.

But an interesting finding in the federal government's just-released Retirement Income Review final report is that many Australians are dying with the majority of the wealth they had when they retired.

Concerned about outliving their superannuation savings, the report found that the majority of retirees tend to spend less rather than use financial products to better manage their longevity risk.

In other words, rather than wanting to spend up, many retirees are keen to watch their savings balance grow.

And that's pointing towards a huge blow-out in the payment of super death benefits, which actuarial firm Rice Warner projects in the Retirement Income Review report will rise from the current level of around $17 billion per annum to just under $130 billion by 2059.

Projected value of superannuation death benefits

Unintended consequences

When there's superannuation still left over at the end of your life, it's most commonly inherited by your surviving spouse or children, or bequeathed to other nominated beneficiaries.

If you don't have a spouse, and intend to leave your super to your adult children, there may be serious tax consequences for them.

It all comes down to whether your beneficiaries are entitled to access your super funds tax free or not after you're deceased.

So, having an understanding of the tax rules around super death benefits is extremely useful. With proper estate planning before you die, it may be possible to reduce your after-death super tax liabilities.

The tax rules around super death benefits

While there is no formal inheritance tax in Australia, super death benefits are taxed in some cases.

Essentially, superannuation can only be passed on tax-free when it is left to a spouse or dependant children under the age of 18.

A death benefit dependant, as determined by the Tax Act, can also include de factos, former spouses, those with whom you have shared an interdependency relationship immediately prior to death, and others who were financially dependent on you just before you died.

Beneficiaries who fall outside of these parameters, such as adult children, are often caught up in the ATO's tax dragnet.

Superannuation benefits are generally comprised of both taxable and tax-free funds, based on the nature of contributions that have been made over time.

Those contributions made by your employer at the concessional tax rate of 15 per cent form part of the taxable component, while after-tax contributions made by you separately as non-concessional contributions make up the tax-free component.

It's the taxable component – usually where the bulk of an individual's super funds reside – that will carry the tax liability for any adult children receiving your super payout on your death.

Avoiding an after-death tax experience

Transferring super wealth is a non-issue from a tax perspective if you have a spouse or dependant children to leave it to.

If you don't, there are ways to reduce your potential super tax burden for non-dependent beneficiaries.

One of them is through the use of what's known as a super recontribution strategy.

If you've reached an age where you can legally access your funds, this enables you to draw out the taxable component of your super as a lump sum and then recontribute it back into your super fund in the form of after-tax contributions.

Any taxable super withdrawn will be liable for tax at your marginal tax rate, however if you are aged over 60 and have stopped working (are retired) then your marginal tax rate is effectively zero.

Current laws allow individuals to contribute up to $100,000 per financial year as non-concessional (tax-paid) contributions, or up to $300,000 in one year using what's known as the three-year bring forward rule.

Keep in mind however that there are restrictions on personal super contributions for those aged 67 and above.

Using a recontribution strategy can effectively reduce or eliminate the taxable portion of your super, meaning non-dependant beneficiaries of your super may not have to pay any tax if it's received as a lump sum after your death.

Careful planning

When you're looking at who you want to leave your super to, it's very important you consider things carefully as some proper planning needs to be done.

Without planning there could be some unexpected and significant taxes bestowed upon your heirs, which could be exacerbated if any life insurance payout from your super fund is made to someone who is not a spouse or dependant.

To discuss your estate planning needs, including around your super death benefits and potential tax liabilities, it's important to consult a licensed financial adviser.

 

 

By Tony Kaye
Senior Personal Finance Writer
Vanguard Australia
01 Dec, 2020