This financial year is almost over, but there are still effective strategies you may be able to employ to make sure you pay the right amount of tax for the 2019-20 year and maximise any refund entitlement. This is still, if not more so, the case in the current COVID-19 environment.
So what happens from a tax point of view when a person leaves Australia part-way through the income year? How is the income they derived before that time taxed? And how is any income they derived after that time taxed (whether from Australian or foreign sources)?
When assessing eligibility for JobKeeper assistance, the first question that must be answered is whether the entity was carrying on a business as at 1 March 2020. This question is of particular relevance to entities that have solely or predominantly rental income (other than input taxed supplies).
Many residential rental property owners have had their rental income affected by COVID-19. As a result of this income year not being business as usual, the ATO has provided answers to some typical scenarios that may crop up in this area for tax time.
The ATO, as regulator of self-managed superannuation funds, has reported an increase in the number of SMSF trustees entering into arrangements involving buying and then developing property (either with related or unrelated parties) that is subsequently sold or leased.
The government has temporarily changed bankruptcy law to help protect people who are facing unmanageable debt as a result of the economic impacts of COVID-19. If you are in financial difficulty, application can be made for temporary debt protection, which prevents recovery action by unsecured creditors, for six months.
There are many questions being asked lately about claiming expenses when forced to work from home over the COVID-19 period – plus a lot of concern about any consequent capital gains issues when later selling a property from which people have been coerced to work from during this time.
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.
The ATO has announced that it has identified some common errors regarding luxury car tax (LCT) claims, but also says there are issues it has identified with LCT that are more associated with actively trying to pay less tax than required.
A mandatory code of conduct signed off by the National Cabinet yesterday will force commercial landlords to accept rent reductions in proportion to a tenant’s decline in turnover due to COVID-19. Landlords are required to offer tenants at least 50% of their rent relief as ‘waivers’ over the next few months and the remainder in deferrals. The ‘good-faith’ leasing principles should be negotiated individually between landlords and their tenants, and are designed to aid the management of cashflow for SME tenants and landlords on a proportionate basis, as a result of the economic impacts of COVID-19.
The COVID-19 stimulus and relief package also contains measures relating to the instant asset write-off, accelerated depreciation, a cash flow boost for employers, superannuation, stimulus payments to households and much more. Here are more details on each area.
To coincide with the Adelaide 500 motor racing weekend, Oreon Partners proudly hosted a fun-filled corporate event in our grounds with viewing decks, food, drinks and plenty of action. Enjoy our recap video from the weekend.