|
Welcome to the June newsletter.
Retail Sales; Business Indicators
The following commentary has been provided by CommSec Equity Economics and is an informative reflection on the latest retail trading within the economy:
• Retail trade fell by 0.2% in April after rising by 0.2% in March. The early timing of Easter and higher cost of food have been key influences on spending in recent months, together with higher petrol prices and interest rates.
• Annual growth of retail sales fell to a 27 month low of 4.7%, down from 5.1% in March.
• Excluding food, retail sales rose by 0.5 per cent in April after falling 0.5% in March and falling 0.4% in February.
• The biggest falls in spending were recorded by jewellery and watch retailing (-8.0%), furniture and floor-covering (-6.1%), and toys, sporting goods and photographic equipment (-4.3%). Biggest increases in spending were in clothing (up 3.9%), domestic appliances and recorded music (up 3.8%).
• Company profits rose by 2.2% in the Match quarter to stand 7.0% higher than a year ago. Profits rose in four of the eight sectors, led by mining (up 9.0%) and transport (up 8.9%).
• Sales rose in six of the eight industry groupings in the March quarter. Strongest gain was by transport and storage (up 4.7%) while weakest was construction (down 4.0%). Interestingly, sales by the retail sector rose for the seventh straight quarter, up 1.0%.
For the
investors and borrowers
out there CommSec is of the opinion:
• The sluggishness in consumer spending will keep the Reserve Bank on the interest rate sidelines until much later in the year. Inflation is still a problem, but rate hikes are working to slow the economy and reduce inflationary pressures. There is no need for another dose of interest rate medicine.
• Investors have every reason to be encouraged by yet another quarter of profit growth. The economy softened markedly in the March quarter but businesses still made more money. Further, the underlying fundamentals remain solid, including a strong job market and on-going strength in economic growth by developing nations such as China and India.
Depreciation of Computer Software
The statutory effective life on in-house computer software for tax depreciation purposes will be increased from two and a half to four years for expenditure incurred on or after 7:30pm (AEST) on 13 May 2008.
Consequently a deduction for expenditure on computer software will be taken at 25% of cost per annum. For purchases during a financial year the deduction will be pro rated accordingly.
In-house software is software mainly used by the taxpayer as a resource within the business.
You may note this month’s newsletter is a bit lighter than usual on content. This is due to the fact we are producing a special Year End Planning Newsletter to be forwarded shortly.
|
ATO Key Dates
Sunday 15 June
• Due date for payment of assessments of Superannuation contributions surcharge and termination payments surcharge issued on 15 May 2008.
Saturday 21 June
• May 2008 monthly activity statement – due date for lodgment and payment – self-assessed deferral is available.
Monday 30 June
• Final day for appointment of tax agent for activity statement role – you must advise us by this date to ensure quarter 4 activity statements for your new clients will be linked to you.
• Superannuation guarantee contributions need to be paid by this date to qualify for a tax deduction in the 2007-08 financial year.
|
