For all the latest information
2021 Year End Tax Planning - 24th March 2021
It has been a demanding year for many people.
As we approach the end of the 30th June 2021 financial year, we feel it is timely to be proactive about reviewing your financial affairs.
There have been many changes in the taxation system as well as the banking and insurance sectors.
Often with changes come opportunities and we have been able to identify strategies that have resulted in significant savings & value being added to our clients business affairs. We want to ensure you have the opportunity to benefit from these strategies.
It is timely to consider if you can benefit from any tax planning strategies.
We have attached a list of matters we would consider as part of a detailed tax planning review for individuals and businesses.
Loan Finance Review
We can assist with a loan finance review to compare your existing interest rates to currently available fixed and variable rates, as there are some attractive rates & terms on offer.
For example, some banks are offering fixed rate loans with 100% offset facilities.
This enables you to have the certainty of fixed rates but also the flexibility of reducing the interest paid via offset.
We have also noticed that not all banks are passing on interest rate discounts consistently.
We have noticed that general asset and personal risk insurance premiums have been increasing significantly. We can facilitate insurance review for you to assess the appropriateness of your current level of cover and compare premiums.
We have also been assisting clients by facilitating cost effective estate & succession planning reviews.
We have noticed that many clients do not have a good understanding of what they need and have not reviewed their estate planning regularly enough.
A list of estate planning documents that we would consider as part of a review is attached.
Should you have any queries, we would welcome the opportunity to discuss how we can assist with any of the above reviews.
If you wish to proceed, in particular with a tax planning review, please contact us promptly so we can confirm the information we need to work out your estimated tax position and how we can maximise tax savings for you ASAP prior to 30th June 2021.
Important New ATO Guidelines effecting Professional Services Business - 17th March 2021
How the profits are allocated by professional firms has been a particular area of focus for the ATO for quite some time now. The ATO is concerned about arrangements where a taxpayer, who is a partner or owner of a professional practice, receives compensation that is artificially low, arrangements can’t be justified commercially or are considered to exhibit ‘high risk’ features.
For years up to 30 June 2021 the original guidelines require that any one of the following requirements must be met to be ‘low risk’ of an ATO review or audit:
- the individual is assessed and taxed on at least 50% of the total income that they and their associated/related entities are entitled to from the practice; or
- the individual and their associates all have an effective 30% tax rate for their income from the practice; or
- the individual is assessed on income that is at least the remuneration that is paid to the highest level of professional employees providing equivalent services to the firm, or if there are no such employees, their income must be compared to that of comparable firms or relevant industry benchmarks.
The ATO has recently released new guidelines that will apply from 1 July 2021 requiring the partners or owners of professional practices to be sure that all arrangements are commercially-driven and don’t exhibit ‘high risk’ features, and to undertake a risk assessment using a matrix that is based on:
- the profit the individual is assessed on as a percentage of their total profit entitlement and
- the total effective tax rate that they and their associates pay on their total profit entitlement.
There is the option to extend the risk assessment to include the remuneration paid to the individual as a percentage of the commercial benchmark for the services that they individually provide to the firm.
Where a partner or owner has a higher risk under the new guidelines than under the original guidelines, the ATO is allowing a grace period should they choose to modify their arrangements to lower their risk. As an interim measure they can continue to apply the original guidelines until 30 June 2023, provided that their arrangements are commercially driven and are not considered to have ‘high risk’ features.
As you will appreciate these rules are complex and even though they are subject to change before they are finalised we would welcome the opportunity to discuss how these new draft guidelines may impact you, so please feel free to reach out to us.
JobMaker Hiring Credit Scheme - 11th January 2021
To encourage employers to create new jobs for job seekers the Government has legislated the JobMaker Hiring Credit Scheme that applies to employers who employ new employees from 7 October 2020, provided that both the employer and employee meet all the eligibility requirements.
Under this incentive eligible employers will be paid a $200 weekly incentive payment for each eligible new employee aged 16 to 29 years, or for new employees aged 30 to 35 years the payment is $100 per week.
A number of requirements must be met by employers, including in relation the ‘baseline’ headcount and payroll amount, and employees, including that they must have received either the Parenting Payment, Youth Allowance or JobSeeker Payment for a period prior to starting employment. In addition, eligible employees will need to complete a written declaration to confirm that they are eligible for this scheme, see the ‘JobMaker Hiring Credit Employee Notice’ below:
Federal Budget Update 2021 - 7th October 2020
The Federal Government tabled their proposed 2020-2021 Budget with a focus on stimulating jobs and the economy post Covid-19. The Budget is largely positive for both individuals and business taxpayers for the upcoming year and includes a raft of spending measures aimed at getting everyone to spend, with the ultimate aim of thereby generating jobs. However the result of this proposed Budget is a deficit of $213.7 billion. The key measures of the Budget are outlined below.
JobKeeper 2.0 - 16th September 2020
The JobKeeper 2.0 rules were released on 15th September 2020 to extend the subsidy and to implement a new 2-tiered payment system and decline in turnover test.
JobKeeper Extension Rules Relaxed - 14th August 2020
On 7 August 2020 the ATO announced further changes to the Jobkeeper Payment scheme, a summary of the new rules is attached.
JobKeeper to Continue - 22nd July 2020
Please see below a summary of recently announced changes to the Federal Government JobKeeper payment concessions.
HomeBuilder Subsidy Fact sheet - 17th June 2020
See below for HomeBuilder Subsidy Fact sheet.
2020 Year End Tax Planning Checklist - 3rd June 2020
See below for 2020 Year End Tax Planning Checklist.
It May be a Good Time to Review your Bank Loans to Secure Savings - 30th April 2020
See below for It May be a Good Time to Review your Bank Loans to Secure Savings information.
Commercial Tenancies (COVID-19 Response) Bill 2020 - 30th April 2020
See below for Commercial Tenancies (COVID-19 Response) Bill 2020.
JobKeeper - Seven Step Process - 23rd April 2020
See below for JobKeeper seven step process.
JobKeeper Guide for Employers by Employinsure - 19th April 2020
See below for JobKeeper guide for employers by Employinsure
SME Commercial Rental Relief During Covid-19 - 19th April 2020
See below for SME commercial rental relief during Covid-19
Checklist of Covid 19 Measures - 17th April 2020
See below for a detailed checklist of Covid-19 Measures
JobKeeper Scheme - 17th April 2020
On 9th April 2020, the Treasurer released the Coronavirus Economic Response Package (Payments and Benefits) Rules 2020 which sets out the rules for administrating the JobKeeper scheme. You need to act now, as you must lodge before 26th April 2020 to claim the first two fortnightly payments!
Business Financial Continuity 10 Point Action Plan - 13th April 2020
See below for a business 10 Point Action Plan
Individual Financial Continuity 10 Point Action Plan - 13th April 2020
See below for an individual 10 Point Action Plan
Thinking About Deferring Loan Repayments? - 13th April 2020
As we grapple with the loss of incomes, many will look to the banks for the repayment holidays being offered by lenders.
Investment Strategy Approach - 13th April 2020
It is prudent to review your investment portfolios and speak to your independent specialist investment advisor if you have one. It is important not to panic and rather, make well considered decisions that are aligned with your long-term plans and your particular circumstances.
Client Alert: Cash Saving Measures - 30th March 2020
A number of measures have been announced by the Federal and State Governments, the Banks and also the ATO to support individuals and small business taxpayers to preserve and manage their cash flows over the coming months.
Government Guarantee Loan Application - 30th March 2020
Steve Vicary, our Director of Maxim Private Finance provides some current commentary on the $250k government backed small business loan initiative.