Thompsons Australia Blog

NEWS ALERT! Private health insurance rebate changes.

admin — Mon, 19 Mar 2012 23:34:49 +0000

A package of Bills to means test the 30% private health insurance rebate has made its way through Parliament. The changes will mean the amount of rebate available will depend on an income test for each financial year for individuals and families. The changes will apply from 1 July 2012 and will introduce three new “Private Health Insurance Inc…entive Tiers”. In conjunction with this, and also from 1 July 2012, the rate of Medicare levy surcharge for individuals and families without private patient hospital cover will increase depending on their level of income.
TIP: Individuals and families should be mindful of the 1 July 2012 start date. Further, some health insurance companies have indicated their intention to increase premiums.

Note: The thresholds increase annually, based on growth in Average Weekly Ordinary Time Earnings (AWOTE). Single parents and couples (including de facto couples) are subject to the family tiers. For families with children, the thresholds are increased by $1,500 for each child after the first.

How to determine if workers are employees or independent contractors

admin — Thu, 01 Mar 2012 00:38:17 +0000

Employee or Contractor

There is increasing preference for usage of contractors in the current economic market – particularly in the building, mining and engineering sectors. The ATO has advised of increased audit activity this year targeting contractor arrangements.

A key test is determining whether a “contractor of service” or a “contract for services” exists. Employers’ obligations vary according to the circumstances.

For more information visit: www.ato.gov.au and search for fact sheet called “How to determine if workers are employees or independent contractors”

I am an employer. What are the cutoff dates for payment?

admin — Mon, 13 Feb 2012 22:51:26 +0000

The ATO has recently revealed some common superannuation mistakes made by employers. They include paying insufficient superannuation contributions for employees, missing the quarterly payment cut-off dates (ie 28 October, 28 January, 28 April, 28 July), and not understanding that in some circumstances superannuation should be paid for contractors, even if the contractor provides an Australian Business Number.

Super Fund planning issues leading up to 30 June 2012.

admin — Wed, 08 Feb 2012 01:24:48 +0000

We thought this information would be of some interest to those of you who have super funds.
Members who make a non-concessional contribution to a super fund may be eligible to receive a co-contribution from the government.
Note – The co-contribution amounts are going to be reduced, plan to ensure you maximise this benefit for 2012.

Will the Carbon tax commencing on 1 July 2012 affect my business?

admin — Thu, 02 Feb 2012 00:26:44 +0000

The Prime Minister has announced details of the Government’s plans to put a price on carbon. The plan, to commence on 1 July 2012, proposes to set a price of $23 for each tonne of carbon pollution released into the atmosphere by Australia’s biggest polluters. It is proposed that around 500 businesses will be required to pay for their pollution under the carbon pricing mechanism. The Prime Minister also announced tax cuts to assist households and support measures for businesses to assist them in adapting to the new carbon tax.
Although the carbon tax scheme will not commence until July, businesses should consider how they may be affected both directly and indirectly by the scheme and whether they are able to access some of the compensation and support measures announced as part of the scheme.

What are the changes being introduced to the taxation of Car fringe benefits?

admin — Mon, 23 Jan 2012 00:37:31 +0000

Legislative changes to simplify the method for determining the taxable value of car fringe benefits has been formally implemented. Broadly, the changes introduce a flat 20% rate to replace the previous method which, according to the Government, encouraged people to drive their vehicles further than they needed to in order to obtain a larger tax concession.

What is the new fuel tax credit rate for heavy road vehicles from July 2011?

admin — Thu, 12 Jan 2012 23:59:48 +0000

From 1 July 2011, the fuel tax credit rate for heavy vehicles that use fuel such as diesel or petrol and travel on public roads is 15.043 cents per litre.
A heavy vehicle, by definition, has a gross vehicle (GVM) greater than 4.5 tonne. Diesel vehicles acquired before 1 July 2006 can equal 4.5 GVM tonne.

How do I get information on the cost of a building?

admin — Tue, 20 Dec 2011 23:02:29 +0000

When purchasing a property that was built any time from the early 1980s, you should enquire as to whether there is an existing schedule showing the Div 43 deductions available for the construction costs of the building, as the vendor is required to provide this information to you. As this information is often not available, the law allows you to obtain a report from a quantity surveyor estimating the construction costs for this purpose.

Can I claim depreciation on the the building cost of my investment?

admin — Mon, 12 Dec 2011 22:17:52 +0000

It is important to distinguish between claiming depreciation deductions over the useful life of a depreciating asset under Div 40 of the Income Tax Assessment Act 1997 (Cth) (ITAA97), and claiming capital works deductions at 2.5% per annum straight line under Div 43 ITAA97.

Capital works deductions under DIV43 ITAA97 on acquisitions after 1 July 1997 create a reduced ‘cost base’ on disposal of the asset for purposes of CGT calculation.

I live on a farm. Do I get the main residence exemption?

admin — Mon, 05 Dec 2011 22:42:50 +0000

For rural and semi-rural properties used as the family home, up to two hectares of surrounding land will be exempt under the main resident exemption, but CGT may apply to the remainder of the land.