Small businesses are the big winners in Hockey’s Federal Budget
Date posted: Friday, May 15, 2015
It’s that time of year again: winter is setting in, the days get shorter – and there’s the Federal Budget.
This week Joe Hockey saturated all our screens as he laid down his second national budget as Treasurer, with what some are calling a more softly-softly approach after the more than chilly reception last year’s received.
In the Liberal Party’s constant battle to reduce the national deficit, the 2015 budget was geared towards boosting economic activity (and therefore tax revenue).
There were several key measures put in place that will work towards this goal, and you can get a good overview from the Australian Financial Review here.
If you’re a small business however, you’re in luck. Hockey’s centrepiece is a $5.5 billion “tax surprise” for you, including a 1.5% decrease in company tax to 28.5% starting July 1 this year. Find out all the details here.
If you have any questions or concerns about your own tax, personal or otherwise, don’t hesitate to get in touch with us at Pakenham Taxation and Accounting.
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What happens if your BAS is late?
Date posted: Tuesday, December 9, 2014
Ah, your Business Activity Statement. It’s no one’s favourite, but it is a necessary part of running a successful business in Australia.
Before we get into what happens if you lodge yours late, here’s a quick reminder of the quarterly due dates:
| Quarter | Due date |
| 1 – July, August and September | 28 October |
| 2 – October, November and December | 28 February |
| 3 – January, February and March | 28 April |
| 4 – April, May and June | 28 July |
So if you miss a date for whatever reason, what happens? The straightforward answer is that you’ll likely be hit with a Failure To Lodge penalty (FTL).
As of next financial year (July 2015), the penalty is $180 for each 28 days your BAS is late. And this is only for small businesses (less than $1million annual turnover) – for larger companies, the penalty is much greater.
As with most things, prevention is the best policy! To keep your BAS stress levels to an absolute minimum, keep these in mind when doing your day-to-day accounting:
- Lodge your BAS online
- If you don’t think you’ll make the due date, let the ATO or your BAS agent know in advance
- If you do miss the date, call the ATO anyway – they can help you develop a payment plan
- Keep the GST you collect in a separate bank account
- Make a cash flow budget
- Keep your records electronically
- Check your business systems regularly
Even better: take the weight off completely and talk to our team at Pakenham Tax + Accounting, the local expert BAS agents. Your business keeps you busy enough, so get in touch with us for any questions about lodging your BAS, what to do if it’s late or even about handing over the reigns completely.
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Double check your deductions
Date posted: Thursday, October 23, 2014
For many, tax time is just a painful reminder of why the word ‘taxing’ exists. The looming BAS deadlines are often a source of frantic stress and for others it’s a veritable bonanza. Working out what you can and can’t claim and how much is deductable can be the difference between getting a great refund or not. A common question we field at Pakenham Taxation and Accounting is…
How do some people manage to get such great refunds when others don’t?
Mainly, they know exactly what kind of tax deductions they’re eligible for and understand how to work the system to their advantage.
While you always need to keep personal and work expenses separate (and the ATO is currently cracking down on suspicious returns), you’d be surprised what you can claim, depending on the kind of job you have.
For example,
- Journalists can claim on sunglasses if they work outside
- Performers can claim stage make up and tinted contact lenses
- Workers in the adult industry can claim back on lingerie
- Policemen can claim bulletproof vests and
- If you work from home you can even claim on energy bills.
Even if you have a stock standard office job, it’s definitely worth checking out the ATO’s full list of deductible expenses, separated into the needs of each industry.
And remember, keep all your receipts in one place so next year isn’t the stressful scramble is usually is!
Contact us for support on how to get the biggest refund within your entitlements and to manage your tax accounting better.
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3 things you didn’t know about GST
Date posted: Tuesday, October 7, 2014
After nearly 15 years since its implementation, you probably think you’re a pro at navigating the complex world of our Goods and Services Tax, but we’re here to remind you that there’s almost always something new to learn. We know this because all the changes and adjustments over the years means we’re still learning it ourselves!
We put together a few key facts about the GST we find many people don’t even know about, to give you a head start and ensure you don’t get caught out.
GST is actually optional for businesses with an annual turnover less than $75,000.
Great news! Well, not quite – as always in tax, it’s not always that black and white. On one hand, having 10% lower prices can really put you at a competitive advantage, but not being GST registered keeps you from claiming input credits and some people don’t deal with business that are un-registered.
Basic goods are always GST-free, but only sometimes.
We all know that goods and services seen as essentials are exempt from the GST for example raw foods, various education courses etc.
When these same goods are put into a commercial setting however, this can change. For example, water is GST free, but when served at a restaurant or café, it’s not. It pays to be careful of these ‘hybrid’ products, especially if you’re in the food or beverage industry.
It can be better to split expenses annually.
If you’re a small business, dividing expenses between personal and professional for tax purposes is a constant headache. Most people do this split when they lodge their Business Activity Statement monthly or quarterly, but did you know you can do it annually? Year-end adjustments can prove to be more accurate, not to mention the savings in time and stress!
For more information, don’t hesitate to contact Pakenham Tax, your local Accounting specialists. We can arm you with a myriad of tricks and tips that could help you better navigate GST for you or your business.
Sign up with Pakenham Taxation + Accounting to receive tips on how to better manage your personal and business tax.
Superannuation concessional contributions cap 2014/2015
Date posted: Thursday, April 24, 2014
Some employers may be a bit confused by the recent changes made by the ATO to the superannuation rates and caps for 2014/15.
The amount contributed to super each financial year, is capped for tax purposes. Contributions above these caps are at risk of having to pay extra tax.
Factors impacting on the cap amount include:
- The superannuation holder’s age
- Whether the contributions are concessional or non-concessional contributions.
Concessional contributions are from before-tax income and are most commonly made up of employer contributions. Non-concessional contributions are from after-tax income and come from personal contributions.
To find out the current threshold on the superannuation concessional contributions cap then be sure to visit this link via the Australian Tax Office. This web page highlights the changes for the 2014/15 financial year.
Do you have more super questions? You can find out more by giving us a call, sending us an email or booking in for a visit. We specialise in servicing individuals and businesses in the South Eastern Suburbs including Pakenham, Lakeside, Berwick, Nar Nar Goon, Garfield, Tynong and Koo Wee Rup.