Talking Concepts

September 2019 Newsletter

Dates to Remember

21 Sep: Lodge and pay August 2019 monthly business activity statement
30 Sep: Lodge PAYG withholding payment summary annual report of BAS lodged with Concepts & Results
30 Sep: Single Touch payroll deadline to start reporting
21 Oct: Lodge and pay September 2019 monthly activity statement
28 Oct: Superannuation Guarantee Contributions for Sept Quarter Due
21 Nov: Lodge and pay October 2019 monthly activity statement
25 Nov: Lodge & Pay September 2019 quarterly activity if lodged with Concepts & Results
21 Dec: Lodge & Pay November 2019 monthly activity statement

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Bet you didn’t know…

 J.K. Rowling is the first billionaire author
 A polar Bear’s fur is transparent
 A dog’s nose print is like the fingerprint of a person: no two are alike
 Charlie Chaplin once participated in a Charlie Chaplin lookalike contest in San Francisco. He didn’t win
 The only fish that can blink with both eyes are sharks
 A goldfish has memory span of 3 seconds
 In Finland, Donald Duck comics were banned because he does not wear pants

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Tax Man Travels

Are you going away soon? Next time you’re in the office, ask for a Tax Man and take him on an adventure!
Send your photos to concepts@cr.com.au for a chance to win a prize.

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2019 Income Tax Return

Don’t delay doing your return. You may be entitled to a refund. Better the money in your pocket.
Call 9569 5676 for an appointment, drop your paperwork off to our office or post to: PO Box 61, Holmesglen 3148; or email to: concepts@cr.com.au

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Interest Rates that start from…..

2.99% pa Fixed Rate
3.62% pa Comparison Rate
Call or email our Results Home Loans team today 9569 5676 concepts@cr.com.au

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Team Update

Congratulations to one of our bookkeepers Anu Joy and her husband Wasantha on the birth of their first child – a daughter Hope.
We welcome new team members to our Bookkeeping team Joe Porto, Johanna Cabezas and Seb Moses.

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Getting in shape forces you to face your biggest challenges, and sticking to a regular routine for a long period of time. This class will make sure you know how to focus on the right exercises and workouts to reach your goals. 

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Outrageous & Dodgy Tax Claims Source: In The Black


Meals taken on the way to family ski holidays
Sunscreen and sunglasses (for someone who didn’t work outside)
Payment of $5,000 to a 7 year old son for secretarial services
Depreciation of an outdoor patio setting
Family pets (as guard dogs)
$9000 for wine bought while on holiday in Europe

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myGov account

Do you already have a myGov account? If not it may be time to set one up.
Government services you can access via your myGov Account
– Australian JobSearch
– Australian Taxation Office
– Centrelink
– Child Support
– Department of Veterans Affairs
– Housing Vic Online Services
– Medicare
– My Aged Care
– My Health Record
– National Disability Insurance Scheme
– National Redress
Did you know that from 1st July 2019 Single Touch Payroll came into effect and many employers are now required to report your pay, tax and super information direct to the ATO each pay day. All of this information is available to you in one place when you need it.
Your employer will not have to give you a payment summary (Group Certificate). Instead, you will get an end of year income statement in ATO online service through myGov
Your Income Tax Notice of Assessment can also be accessed via your myGov account.
If the Concepts & Results Group lodge your return, you don’t need to do anything if you don’t want, as your tax agent we can download your information via our ATO access
To set up a MyGov account you will need
An email address
A mobile number (optional)

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Is your business HR compliant?

Take a Free Human Resources (HR) check to determine if you are meeting your legal obligations under Australian workplace laws. Check if you at risk of big fines and penalties, damaging employee claims and costly back-pay orders.
Workforce Guardian provide a free HR Health Check to help Australian employers, business owners and HR professionals. To determine if you and your business are at risk, click on the link and answer the questions.
https://secure.workforceguardian.com.au/public-forms/free-hr-health-check/health-check

Illegal early release from SMSFs on ATO’s high-risk watch list Source: Tax & Super Australia e-Newsletter July 2019

Each year the ATO analyses its data to identify the key risk areas that then form part of its compliance program. These key risk areas in the SMSF space include:
• illegal early release and promoters
• non-lodgment
• top 100 tax planning arrangements
• top 100 auditors
• high-risk auditors.
On the first risk area, one of the ATO’s central compliance strategies involves targeting individuals (and promoters) who are registering an SMSF with the sole intent of using the fund as a vehicle to illegally access super benefits.
The ATO’s Assistant Commission for Superannuation said “Illegal early access undermines Australia’s retirement system. It places an unfair burden on the community because individuals who illegally access their employer super guarantee and voluntary contributions are more likely to become reliant on the age pension when they retire.”
Over the 2018-19 financial year, the ATO disqualified 257 trustees from 169 funds. Illegal early release (IER) and loans made to member was the reason for disqualification in more than 70% of these cases.
Over the tail end of calendar 2018 there were 12,211 new registrants in the SMSF sector, and the ATO have reviewed approximately 10% of these, with primary focus being to check for IER. As a result of these reviews, 123 funds had their details withheld from Super Fund Lookup, meaning they were unable to receive payments or rollovers.
The ATO also reported that 329 newly registered SMSFs had their registration cancelled. These actions resulted from the ATO’s addressing more than a third of the cases picked up by its risk models.
What the ATO found
IER most commonly occurs where individuals:
• want to access money due to:
o financial stress (for example, unemployment, marital breakdown, debt) or
o a desire to spend on a present-day benefit (such as a holiday or deposit on a home) or
• know little or nothing about setting up or running an SMSF and are targeted by unscrupulous promoters.
As a co-regulator of the sector, the ATO work very closely with ASIC to co-ordinate activities in relation to such operators. ASIC is of course responsible for licensing financial advice providers, while the ATO regulates SMSFs.
The ATO will refer matters to ASIC:
• if it is concerned that the organisation or person may not be licensed to provide financial advice, or
• if there is potential misconduct in relation to providing financial advice.
The ATO also works jointly with ASIC on some cases, with ASIC investigating the provider of the advice or investment vehicle and the ATO looking at any regulatory breaches by the SMSF.

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ASIC Fee Increase

From 1st July 2019 Company Fees have increased. The new fees are:
Company Annual Review $267
Special Purpose Company (Trustee of SMSF) $54
Late payment of Annual Review Fees and Late lodgement of changes to company have also increased
Within 1 month after due date
$80
More than 1 month after due date $333
Please ensure that you pay your ASIC invoices before the due date and if we have prepared documents to make changes to your company please return immediately to avoid penalties.

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Did you know that Australia’s household debt nears the highest in the world Source: Prepare For Life InterPrac Newsletter Winter 2019 edition

While governments use retail spending as an indicator of economic ‘health’, the sad reality is that personal debt and the lack of savings are likely to be a major cause of mental health issues amongst individuals and families.
It is not all that long ago that if we wanted to buy something, we put money aside for it and when we had saved enough, we went and bought the item.
People borrowed money for a house and often for a car, however cash was used to buy everyday consumer items like furniture, electronic, clothes, and holidays.
For those that wanted to guarantee they got what they wanted, layby was used to enable payment of the goods in instalments before they could be taken home.
But then, in 1974 the major Australian banks joined forces and introduced Australia’s first mass credit card – Bankcard.
Now, rather than wait until we have saved enough money, we can have instant gratification and buy now – and pay later.
Credit card debt in Australia is around $45 billion. That is just on $2,000 for each man, woman and child in the country today!
But what do you do when your credit card is ’maxed out’ and you simply must have that new clothing, dental treatment, electronic gadget, car repairs, or even a holiday?

You simply use one of the emerging arrays of “buy now – pay later” payment options, like Afterpay or Zip Money, to name just two.
These companies provide short-term financing (usually $1,000 to $2,000), often structured around weekly or fortnightly instalments. Short-term financing may, in some cases be interest free however fees still apply, particularly if repayments are not made on time.
The Australian Securities and Investment Commission (ASIC) recently released a report into the operations of ‘buy now – pay later’ schemes and how this emerging trend is influencing our buying patterns, especially the younger generation.
In its report, ASIC notes that in June 2018, 1.9 million transactions were made using ‘buy now – pay later’ with the total amount outstanding at almost $1 billion.
While ’Buy now – pay later’ arrangements offer convenience enabling individuals to purchase items without having the cash immediately available, the money has to be repaid at some stage. Like credit cards, these finance arrangements can be a wonderful servant, but a terrible master.
If planning to purchase something with any kind of credit, always check you budget first, taking into account any upcoming bills, and ensure you will have the money to make the payments as they fall due, without enduring stress.
Cutting spending, reducing debt and accumulating savings is a far more positive measure of personal financial and mental well-being. If you ‘must’ have that item, consider saving up before you buy it. You will feel so much better about your purchase.
In June 2018, 1.9 million transactions were made using ‘buy now – pay later’ with the total amount outstanding at almost $1 billion.

Relay FOR LIFE

Concepts & Results are again participating in the Cardinia Relay for Life in February 2020. Our team will walk in a relay, keeping at least one member of the team on the track for 18 hours. We have set ourselves a target of raising $10,000 for cancer council this Relay and are already on our way. If you would like to support our team, you can:

Donate (tax deductible) to the team. Search Cardinia Relay for Life – Team name Concepts & Results.

Donate goods or vouchers which we can use as raffle prizes

Support our fundraising:

Gold Class Movie Days – call or email Beth bcampbell@cr.com.au for details of our next event

Recipe Books $10 – call or email Sue scampbell@cr.com.au to order your copy.

Raffles – we are selling raffle tickets for $2 to win a Booze Bucket valued at over $500. Call or email Beth or Sue to purchase tickets. Raffle drawn 22 Feb 2020

Rental property owners: Top 10 tips to avoid common tax mistakes Source: Tax & Super Australia e-Newsletter July 2019

The ATO is reminding rental property owners that each year it sees some fairly common mistakes being made with tax claims made, and the outcomes that result, in regard to investment properties. It has therefore released a list of the top 10 stumbles, and how best to avoid them.
1. Apportioning expenses and income for co-owned properties
If you own a rental property with someone else, you must declare rental income and claim expenses according to your legal ownership of the property. As joint tenants your legal interest will be an equal split, and as tenants in common you may have different ownership interests.
2. Make sure your property is genuinely available for rent
Your property must be genuinely available for rent to claim a tax deduction. This means:
• you must be able to show a clear intention to rent the property
• advertising the property so that someone is likely to rent it and set the rent in line with similar properties in the area
• avoiding unreasonable rental conditions.
3. Getting initial repairs and capital improvements right
Ongoing repairs that relate directly to wear and tear or other damage that happened as a result of you renting out the property can be claimed in full in the same year you incurred the expense. For example, repairing the hot water system or part of a damaged roof can be deducted immediately.
Initial repairs for damage that existed when the property was purchased, such as replacing broken light fittings and repairing damaged floor boards, are not immediately deductible. Instead these costs are used to work out your capital gain or capital loss when you sell the property.
Replacing an entire structure like a roof when only part of it is damaged or renovating a bathroom is classified as an improvement and not immediately deductible. These are building costs that you can claim at 2.5% each year for 40 years from the date of completion.
If you completely replace a damaged item that is detachable from the house and it costs more than $300 (for example, replacing the entire hot water system) the cost must be depreciated over a number of years.
4. Claiming borrowing expenses
If your borrowing expenses are over $100, the deduction is spread over five years. If they are $100 or less, you can claim the full amount in the same income year you incurred the expense. Borrowing expenses include loan establishment fees, title search fees and costs of preparing and filing mortgage documents.

5. Claiming purchase costs
You can’t claim any deductions for the costs of buying your property. These include conveyancing fees and stamp duty (for properties outside the ACT). If you sell your property, these costs are then used when working out whether you need to pay capital gains tax.
6. Claiming interest on your loan
You can claim interest as a deduction if you take out a loan for your rental property. If you use some of the loan money for personal use such as buying a boat or going on a holiday, you can’t claim the interest on that part of the loan. You can only claim the part of the interest that relates to the rental property.
7. Getting construction costs right
You can claim certain building costs, including extensions, alterations and structural improvements as capital works deductions. As a general rule, you can claim a capital works deduction at 2.5% of the construction cost for 40 years from the date the construction was completed.
Where your property was owned by someone else previously, and they claimed capital works deductions, ask them to provide you with the details so you can correctly calculate the deduction you’re entitled to claim. If you can’t obtain those details from the previous owner, you can use the services of a qualified professional who can estimate previous construction costs.
8. Claiming the right portion of your expenses
If your rental property is rented out to family or friends below market rate, you can only claim a deduction for that period up to the amount of rent you received. You can’t claim deductions when your family or friends stay free of charge, or for periods of personal use.
9. Keeping the right records
You must have evidence of your income and expenses so you can claim everything you are entitled to. Capital gains tax may apply when you sell your rental property. So keep records over the period you own the property and for five years from the date you sell the property.
10. Getting your capital gains right when selling
When you sell your rental property, you may make either a capital gain or a capital loss. Generally, this is the difference between what it cost you to buy and improve the property, and what you receive when you sell it. Your costs must not include amounts already claimed as a deduction against rental income earned from the property, including depreciation and capital works. If you make a capital gain, you will need to include the gain in your tax return for that income year. If you make a capital loss, you can carry the loss forward and deduct it from capital gains in later years.

Visit us

Want to discuss the above face to face? Come visit our specialised team members to find out more.

612 Warrigal Road, East Malvern PO Box 61, Holmesglen, Vic 3148

Call us

Have any questions? Further discussions on the above can be may be held over a telephone appointment.

(03) 9569 5676

Contact us

For any and all queries regarding the above, you may contact Concepts & Reuslts by emailing us

concepts@cr.com.au