Interest is a common deduction claimed by taxpayers. Generally, interest is seen as being inherently deductible where it is incurred in gaining or producing assessable income.

An established factor from court cases is that the deductibility of interest depends on the purpose of and use of borrowing the principal. Interest expenses will not be deductible where money is used for a purpose that does not produce income, even if the money is borrowed by being secured over rent-producing property.

The Federal Budget measure of allowing businesses to fully write-off eligible assets is a boon to Australian businesses, even though the measure is temporary.

Just to recap, businesses with aggregated annual turnover of less than $5 billion will be able to deduct the full cost of eligible capital assets acquired from 7:30pm AEDT on 6 October 2020 (Budget night) and first used or installed by 30 June 2022.

As a general rule, expenses relating to travel between home and work (and vice versa) are non-deductible. A number or exceptions to this principle exist, including for situations that require bulky equipment be transported to and from work. In order for transport expenses to be deductible under this ‘bulky equipment’ exception, it is usually necessary that all of the flowing conditions are satisfied. The taxpayer will also need to substantiate the expenses by keeping appropriate records of the travel, such as the time, dates, distance, etc.

Note that the boost to the instant asset write off rules that the government put in place to help stimulate the Australian economy in the face of the COVID-19 crisis has been extended to the end of this year. Businesses with a turnover of up to $500 million a year will be allowed to continue writing off newly purchased assets worth up to $150,000.

The ATO has been charged with running the JobKeeper Payment scheme, which is intended to support businesses that are financially affected by COVID-19 to help keep their staff employed.

An alternative decline in turnover test for the JobKeeper payment scheme has now been registered by the ATO. The ATO says the alternative tests will only kick in if an entity cannot satisfy the basic decline in turnover test.

A legislative package has been pushed through Parliament which contains a number of bills that implement the government’s economic response to the spread of the coronavirus.

Along with a more automated exchange and processing of invoices, e-invoicing also promises reduced payment times and better cash flow

The headline above may give the impression that electronic invoices are a futuristic concept, but of course even today there is a version of e-invoices — think PDFs and other electronic documents that can contain the information that a standard tax invoice is required to display

The personal services income (PSI) rules apply to income that is earned mainly from the personal efforts or skills of a person.

It does not matter whether the income is earned by the individual in their own name or through an entity such as a business. The rules do not apply to income earned from being an employee.

There is a simple step that many businesses can take to better manage the risk that can attach to certain assets.

Not so many years ago, a new scheme was introduced, which also established a national register, that could affect anyone who answers “yes” to any of the following scenarios — are you in business, and do you:

• sell goods on retention of title terms?
• hire, rent or lease out goods?
• buy or sell valuable second-hand goods or assets?
• want to raise finance using stock or other assets as collateral?
• work as an adviser to clients who conduct these activities?

As you will gather from the very wide-ranging scenarios listed above, the scheme (the Personal Property Security Register, or PPSR) can potentially cover a significant proportion of Australian business.

Oreon Partners is a proud member of the MSI Global Alliance, one of the world’s leading international associations of independent legal and accounting firms.

An essential starting point for consideration of trust income and how that income is to be distributed is to look at the trust deed. This very central document sets out the rules and expectations for the governance and operation of the trust and the powers that can be exercised by…

When you have plans for starting a new business, one of the central decisions is which business trading structure will work best for your venture.

In the first quarter of this calendar year, legislation was passed that will supplement the ATO’s current “same business test” for losses with a more flexible “similar business test”. The new test will expand access to past year losses when companies enter into new transactions or business activities.

Car parking fees incurred in the course of producing assessable income are generally deductible, but special rules apply if the car is used by an employee to commute between home and work or the car is provided to the employee by the employer. Here’s some information about which expenses are allowable for employees and non-employees, as well as what rules apply if the car is provided by an employer.