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Welcome to the May newsletter.
Year End Planning
The end of financial year is fast approaching. There are new laws in place with respect to maximum levels of superannuation contributions on a financial year basis. Additionally new individual tax rates come into effect 1 July 2008 (
click here to access existing and new rates).
These are just two of a number of compelling reasons to consider your year to date profit and income position with a view to putting in place effective tax minimization strategies before it is too late. Please make contact with us to discuss your particular circumstances.
Fuel tax credits – get money back for your business
From 1 July 2008 more businesses can claim fuel tax credits for the fuel they acquire and use in a range of business activities, machinery, plant, equipment and heavy vehicles. The only fuels that are not eligible are aviation fuels. Alternative fuels and duels used in light vehicles of 4.5 tonne gross vehicle mass (GVM) or less travelling on a public road (for example, a car or small van).
The amount businesses can claim is 18.51, 19.0715 or 38.143 cents per litre depending on how the fuel is used.
You can check your eligibility with your usual contacts at Macquarie Partners.
Calculation of super guarantee is changing
The ATO has recently issued a reminder for employers that from 1 July 2008 ordinary time earnings (OTE), as defined in the super guarantee law, must by used to calculate super contributions for their employees.
OTE is generally what an employee earns for ordinary hours of work including over-award payments, shift loading or commissions. It excludes such things as overtime. There are some other exceptions that employers should be aware of.
Most employers are already using ordinary time earnings to calculate super guarantee. Some employers however are using methods such as earnings outlined in industrial awards or existing employment arrangements.
If the current super guarantee amount employers are paying is less than the minimum 9%, employers should increase this amount to meet the minimum to avoid the super guarantee charge.
The ATO have provided a checklist to assist employers in meeting their obligations.
Click here to access this checklist.
Application of Part IVA of the Income Tax Assessment Act 1936 to ‘wash sale’ arrangements
The ATO have released Taxpayer Alert TA 2008/7 regarding arrangements involving the sale and subsequent purchase of the same asset. These arrangements, called ‘wash sales’ typically result in a crystallisation of capital losses on an asset and these losses are then used to offset other capital gains in the same year of income.
Where there is no substantial change in economic interest in the asset and no significant change in the taxpayer’s economic exposure in the asset the ATO are considering the application of the ATO’s anti-avoidance provisions under Part IVA of the ITAA 1936.
If this is of interest to you or may be relevant to your financial circumstances please contact your partner at Macquarie Partners.
Click here is access Taxpayer Alert TA 2008/7 for the full ATO view.
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ATO Key Dates
Wednesday 21 May
• April 2008 monthly activity statement – due date for lodgment and payment – self-assessed deferral is available.
• Final date for appointment of tax agent for fringe benefits tax role. You must advise us by this date to ensure your new clients’ fringe benefits tax returns will receive your lodgment and payment concession.
Monday 26 May
• Quarter 3 activity statement – due date for lodgment and payment if lodging via ELS or the Tax Agent Portal – self-assessed deferral is available.
Wednesday 28 May
• Fringe benefits tax annual return – due date for lodgment and payment (where required) – self-assessed deferral is available.
• Due date for ligament of the Superannuation guarantee charge statement – quarterly and payment of the superannuation guarantee charge for quarter 3 2007-08, if sufficient contributions were not paid on time. The superannuation guarantee charge is not tax deductible.
Tuesday 3 June
• Final date for lodgment of income tax returns for tax agent clients where the fund return was non-taxable or a refund in the latest year lodged as well as an actual non-taxable or refund in the current year excluding large/medium business clients and new registrants.
Thursday 5 June
• 2007 income tax return for individuals and trusts with a lodgment end date of 15 May 2008 provided payment is also made by this date. This is not a lodgment end date but a concessional arrangement where penalties will be waived if lodgment and payment are made by this date – self-assessed deferral is available, and to defer past 5 June you must apply before the lodgment date of 15 May.
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.
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