Tax time guides from the ATO

Tax Time

Time to lodge!

Tax time is almost over! If you haven’t yet lodged your return, it’s time to move it to the top of your to-do list! You can lodge online by logging into ATO online services through your myGov account, or through a tax agent. If lodging with an agent, check they’re registered with the Tax Practitioners Board. To find out more, visit www.ato.gov.au/taxessentials

Small Business/Employers

Are your business deductions greater than your business income?

If your business makes a tax loss, you may be able to claim the loss in the current year, carry it forward and claim it in a future year, or carry it back. For more information, visit ato.gov.au/businesslosses

Remember you need to lodge a tax return, even if your business hasn’t earnt any income.

Returns are usually due on 31 October but you may be able to lodge by a later date if you lodge through a tax agent. Lodging on time shows the ATO that you’re doing your best to meet your obligations. For more information, visit ato.gov.au/SBtaxreturns

Keeping business records

You legally need to keep records of all transactions related to tax and super – this includes starting, running, selling, changing or closing your business. Want more information about the rules, examples of records (such as banking records) and the information they need to show? Have a look at detailed business record-keeping requirements, visit ato.gov.au/recordkeeping

How to claim home-based business expenses

You may be able to claim running and occupancy expenses if you operate your business from home. It’s a good idea to keep complete records of all expenses (instead of a representative period) to give you more flexibility around the method you can use. For more information, visit ato.gov.au/homebasedbusiness

Choosing the right method to calculate motor vehicle expenses

If you use a motor vehicle in running your business, you may be able to claim expenses such as fuel, oil, servicing and registration. Your business structure and type of vehicle you drive will affect what calculation method you can use to claim your motor vehicle expenses.

If you’re a sole trader or an individual in a partnership, the method you should use depends on the type of vehicle you drive. If you are claiming for:

  • a car, you can either use the cents per kilometre method or the logbook method (you can choose to change methods each year and use different methods for different cars)
  • another type of vehicle, such as a utility truck, minivan or motorcycle, you can only use the actual costs method – where you can only claim the actual costs of expenses incurred based on receipts.

If your business type is a company or trust, you must use the actual costs method to calculate your expenses, regardless of the type of motor vehicle you drive.

Remember, if you also use your vehicle for private purposes, you need to work out the business-use portion for your expenses and have sufficient records to support your calculations.

For more information, visit ato.gov.au/motorvehicleexpenses

Super guarantee payments due 28 October

The next super guarantee (SG) quarterly due date is 28 October. Make sure you pay in full and on time, and don’t forget the two recent changes:

  • the SG rate increased from 10% to 10.5%
  • the $450 per month eligibility threshold was removed.
Don’t miss the 30 November deadline – Apply now for your director ID

Are you a director of a company in Australia? Time is running out for you to apply for your director ID. Check what identity documents you need and apply online today.

Using business stock for private purposes

Small business expenses tip: If you’re a small business owner who takes goods out of your business for personal use, make sure you don’t record this in your stock on hand at the end of year to avoid overclaiming a deduction. Find out more at Using business stock for private purposes?

Review your PAYG instalments

You can vary your PAYG instalments if you think the current amount you pay will be more or less than your expected tax liability for the year. Your varied amount or rate will apply for all your remaining instalments for the income year, or until you make another variation. You can lodge your variation through myGov or Online services for business.

Providing entertainment to your employees?

If you’re planning a party for your employees, make sure you consider the fringe benefits tax implications of your celebration.

Missed the due date? Lodge your TPAR
If you missed the 28 August due date, lodge your Taxable payments annual report (TPAR) now to avoid penalties. Check out the ATO website to find out who needs to lodge a TPAR, and how to prepare, record and report.
Amend a lodged TPAR
The ATO website has information about what to do if you made an error on your Taxable payments annual report (TPAR). Remember, keeping good records makes it easier for your business to complete your TPAR each year.

Webinars

October is Indigenous Business Month. This year’s theme: ACTIONS TODAY, IMPACT TOMORROW, is to inspire the next generations of First Nations business leaders.

It acknowledges that the journey for many business owners is not linear, and the stories and experiences we share can play a key role in inspiring the next generation. What we do and say today could be the spark that inspires the businesses of tomorrow.

In support of Indigenous Business Month, the ATO is offering a range of webinars on many topics for small business owners who want to brush up their skills and help their businesses succeed.

The webinars will be co-delivered by an Indigenous Australian presenter. They’ll provide information about our Reach Out program, Indigenous helpline and free Tax Help, which work with Indigenous small businesses to help them meet their tax and superannuation obligations.

Next step:

Register for  Key webinar topics for small business

Rentals & Investments

Foreign residents and main residence exemption
Foreign residents selling property after 30 June 2020 are not entitled to the main residence exemption from CGT, unless they satisfy the requirements of the life events test.

If a foreign resident taxpayer doesn’t meet the life events test, they aren’t entitled to any main residence exemption, even if they were a resident for some of the ownership period.
Only foreign residents who sell property prior to 30 June 2020 may be eligible for the main residence exemption.

Foreign residents and the 50% CGT discount
When a foreign or temporary resident sells Australian property, the 50% CGT discount can only be applied to part of their capital gain when either of the following happened:

  • they acquired the asset on or before 8 May 2012
  • they had a period of Australian residency after 8 May 2012.

If either of these apply, you may pro rata portion of the discount for the number of days spent as an Australian resident after 08 May 2012. This is done by calculating the total number of residency days divided by overall ownership days in the ownership period and calculating it as a percentage.

Crypto
Check out our tips for keeping crypto records up to date and protected.

Crime and Fraud

New prosecution case studies

The ATO has just uploaded three new case studies to their tax crime prosecutions webpage. Read about a former tax agent sentenced to 6 years in jail, an accountant who made false statements in a business activity statement (BAS) and tax return, and two brothers who created and used false ATO documents to get bank loans.  Read the full stories

Consultation

Remember to have your say!

Time is running out to provide feedback that will shape the next version of the Taxpayers’ Charter. The guiding questions are available here and send your feedback to taxpayerscharter@ato.gov.au. Consultation closes Monday October 24.

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