Business Tax
Deadline for lodgment of all tax returns is fast approaching ...
Single Touch Payroll will change the way you report your tax & super
How do you prepare for STP Phase 2?
The following information will be required to be reported in STP Phase 2:
Employee commencement date (already reported in Phase 1)
Employee termination date (already reported in Phase 1)
Employment basis (new requirement)
Termination reason (new requirement)
Tax treatment (new requirement)
15 Sept 2023
Extension of the instant asset write-off
Small Business Support – $20,000 instant asset write-offThe Government announced for the 2023–24 income year, the instant asset write off threshold will increase to $20,000.Last updated 19 September 2023
On 9 May 2023, as part of the 2023–24 BudgetExternal Link, the Australian Government announced it will improve cash flow and reduce compliance for small businesses by temporarily increasing the instant asset write-off threshold to $20,000, from 1 July 2023 until 30 June 2024.
This measure is not yet law.
Small businesses, with aggregated turnover of less than $10 million, will be able to immediately deduct the full cost of eligible assets costing less than $20,000 that are first used or installed ready for use between 1 July 2023 and 30 June 2024.
The $20,000 threshold will apply on a per asset basis, so small businesses can instantly write off multiple assets.
Assets valued at $20,000 or more (which cannot be immediately deducted) can continue to be placed into the small business simplified depreciation pool and depreciated at 15% in the first income year and 30% each income year after that.
The Treasury Laws Amendment (Support for Small Business and Charities and Other Measures) Bill 2023External Link containing the Small Business Support – $20,000 instant asset write-off measure is currently before Parliament.
On 9 May 2023, as part of the 2023–24 BudgetExternal Link, the Australian Government announced it will improve cash flow and reduce compliance for small businesses by temporarily increasing the instant asset write-off threshold to $20,000, from 1 July 2023 until 30 June 2024.
This measure is not yet law.
Small businesses, with aggregated turnover of less than $10 million, will be able to immediately deduct the full cost of eligible assets costing less than $20,000 that are first used or installed ready for use between 1 July 2023 and 30 June 2024.
The $20,000 threshold will apply on a per asset basis, so small businesses can instantly write off multiple assets.
Assets valued at $20,000 or more (which cannot be immediately deducted) can continue to be placed into the small business simplified depreciation pool and depreciated at 15% in the first income year and 30% each income year after that.
The Treasury Laws Amendment (Support for Small Business and Charities and Other Measures) Bill 2023External Link containing the Small Business Support – $20,000 instant asset write-off measure is currently before Parliament.
Deductions for personal contributions to super
If you intend to claim personal super contributions made during the year as a tax deduction you are required to submit a 'Notice of Intent" (NOI) form to your super fund and you must receive an acknowledgement back from the fund to confirm the treatment of the contributions.
Whilst this has always been the case, there are some individuals who receive deductions on the personal super contributions without submitting the required form. This results in the super funds not applying the appropriate rate of tax to the contribution and as the contribution has been deducted from the individual's income, no tax is paid on it at all. It therefore goes without saying that the Goverment now intends to crack down on this practise to ensure that anyone wishing to claim personal super contributions as a tax deduction does so through the correct processes.
Whilst this has always been the case, there are some individuals who receive deductions on the personal super contributions without submitting the required form. This results in the super funds not applying the appropriate rate of tax to the contribution and as the contribution has been deducted from the individual's income, no tax is paid on it at all. It therefore goes without saying that the Goverment now intends to crack down on this practise to ensure that anyone wishing to claim personal super contributions as a tax deduction does so through the correct processes.
Expanding the Contractor Payment Reporting System
Which businesses must lodge a TPAR?building and construction.cleaning.road freight.couriers.information technology.security, investigation or surveillance.3 Sept 2023
When your business provides TPRS services and other unrelated servicesFrom 1 July 2019, if your business provides both courier and road freight services, you must combine the payments you receive for both these services. Do this when you work out if you need to lodge a TPAR.
If TPRS services are only part of the services your business provides, you need to work out what percentage of the payments you receive are for TPRS services each financial year. You do this to determine if you need to lodge a TPAR.
This does not apply to building and construction services you provide.
If the total payments you receive for TPRS services are:
10% or more of your business income: you must lodge a TPARless than 10% of your business income: you do not need to lodge a TPAR.Steps to work out if you need to lodgeStep 1: calculate your total payments received from contractors for each relevant service.
Add up all payments your business received for each relevant TPRS service during the financial year. Include payments received when employees, contractors or sub-contractors performed services on your behalf.
Step 2: calculate your current or projected business income
If you have been operating your business for:
the full financial year: use your current business income for the yearless than 12 months of the financial year: use your projected business income. Do this by working out what your business income will be for the next full financial year.Step 3: calculate what percent of your business income is from a relevant service
Calculate this percentage by using the following formula for each financial year:
Total payments received for a relevant service ÷ current or projected business income x 100 = %
You must lodge a TPAR if:
10% or more of your business income for the financial year is from a relevant service, andyou made payments to contractors for a relevant service during the year.If you need to lodge a TPAR, report the total contractor payments made to each contractor for the relevant service provided on your behalf. 28 AugustReporting requirements for TPAR reportThe report rules for the Taxable Payments Annual Report (TPAR) in Australia include: Due Date: Lodge the TPAR with the Australian Tax Office each year by 28 August. Online lodgement: TPAR lodgement is through the ATO's Online Portal or via a registered tax or BAS agent.15 Mar 2023
If TPRS services are only part of the services your business provides, you need to work out what percentage of the payments you receive are for TPRS services each financial year. You do this to determine if you need to lodge a TPAR.
This does not apply to building and construction services you provide.
If the total payments you receive for TPRS services are:
10% or more of your business income: you must lodge a TPARless than 10% of your business income: you do not need to lodge a TPAR.Steps to work out if you need to lodgeStep 1: calculate your total payments received from contractors for each relevant service.
Add up all payments your business received for each relevant TPRS service during the financial year. Include payments received when employees, contractors or sub-contractors performed services on your behalf.
Step 2: calculate your current or projected business income
If you have been operating your business for:
the full financial year: use your current business income for the yearless than 12 months of the financial year: use your projected business income. Do this by working out what your business income will be for the next full financial year.Step 3: calculate what percent of your business income is from a relevant service
Calculate this percentage by using the following formula for each financial year:
Total payments received for a relevant service ÷ current or projected business income x 100 = %
You must lodge a TPAR if:
10% or more of your business income for the financial year is from a relevant service, andyou made payments to contractors for a relevant service during the year.If you need to lodge a TPAR, report the total contractor payments made to each contractor for the relevant service provided on your behalf. 28 AugustReporting requirements for TPAR reportThe report rules for the Taxable Payments Annual Report (TPAR) in Australia include: Due Date: Lodge the TPAR with the Australian Tax Office each year by 28 August. Online lodgement: TPAR lodgement is through the ATO's Online Portal or via a registered tax or BAS agent.15 Mar 2023
