Category: Business


Uber Is Not A Taxi Service for Fringe Benefit Tax purposes

By Heaney Business Group

Good News, the outdated FBT rules for Uber Drivers are set for a legislative change.

Treasury has released an exposure draft under the Treasury Laws Amendment Bill 2019.  It seeks to replace the word “taxi” and change it to read “a car used for taxi travel (other than a limousine)”.

The ATO confirmed that the ruling needed to be more exact and therefore required a change. The ruling in question is that the FBT taxi travel exemption only applies to travel undertaken in vehicles licensed to operate as a taxi. This does not extend to a ride-sharing service who provide vehicles that are not licensed as a taxi.

Just to be clear, this does not directly affect Uber drivers themselves. There are no changes to the GST obligations for Uber drivers.  The 2017 Federal Court case that held that Uber drivers were required to be registered for GST, on the basis that they were supplying taxi travel remains unaltered.

The Institute of Public Accountants general manager of technical policy Tony Greco said the proposed legislative fix would end the “red-tape nightmare” for employers.

“The inconsistent treatment of Uber and other ride-sharing services for FBT and GST purposes has created lots of practical issues for employers,” Mr Greco said.

Ride-sharing services do not qualify as taxi travel for FBT purposes, and therefore, the costs of the services are not exempt from FBT, as the FBT legislation turns on whether the vehicle is licensed to operate as a taxi.

As the ATO could not fix it in an administrative manner, it now needs to be changed via a legislative change

Good News Ahead

The good news is the change will mean there will be one less FBT issue to combat for employers. With the modern world changing so fast these antiquated FBT rules could need a bigger overhaul.

Consultation for the draft bill is currently open until 27 September.

Interested stakeholders can provide their views on the proposed amendments on the Treasury’s website, www.treasury.gov.au

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The team at HBG Tax and Accounting are your local Rockingham Accountants. With extensive experience in all areas of Accounting and Tax.

Call us on 08 9594 1963 or visit us at Unit 7, 12 Belgravia Terrace, Rockingham.

Our purpose is to build healthy long-lasting relationships with our clients, staff and within the local community.

At HBG Tax and Accounting, we are passionate about giving our clients that extra much needed support.

HBG Tax and Accounting
www.hbgtax.com.au
https://www.facebook.com/hbgtax
17th September 2019.

The material and content provided in this article is of informative nature only. It is not intended to be advice and you should not act specifically on the basis of this information alone. If expert assistance is required, professional advice should be obtained. 

Director Penalty Notices (DPNs)

By Heaney Business Group
Above view of business team sitting around table and working
Reminder

Director Penalty Notices (DPNs) are a way of the ATO collecting companies outstanding tax liabilities. These penalties make directors legally responsible if their company has any unpaid Superannuation Guarantee (SGC) or Pay As You Go (PAYG). Although personal liability doesn’t expand to GST that hasn’t yet been recorded or paid, receipts can still be handed out by the ATO at their own judgement including to companies previously liquidated.

To ensure a companies’ director isn’t issued with a DPN it is important to:

  • Ensure a Companies Reporting is a Priority
  • Understand the Types of DPN
  • Know the Fore Warnings
  • Act Immediately

Ensure a Companies Reporting is a Priority

If a companies’ PAYG is overdue by more than 3 months or their SGC has not been given to the ATO by the deadline, a director will not be able to put a company into voluntary administration or liquidation. This is often done so the director can be cleared of any personal liability. Paying the outstanding amount owed, is the only way to stop a director being personally responsible.

The ATO can use an estimate to give a DPN to a company with overdue lodgements. Once the required information has been reported, the ATO’s estimate can be reduced if the amount owing is less, however the DPN must still be paid.

Understand the Types of DPN

The ATO can issue two types of DPN’s – lockdown and non-lockdown. These notices can be given to companies concurrently depending on their debt. A non-lockdown DPN can be cancelled if the debt is paid, the company is under administration or is in the process of being closed. A lockdown DPN will only be cancelled if the required reporting is completed and debts owing paid.  

Directors Warning

If a company has past, unresolved PAYG or SGC liabilities, it is important for a new director to understand these liabilities can be passed on to them 30 days after their employment. If a director resigns during this time, it does not mean they are no longer liable for the debt either. Settling any amounts owing, appointing an administrator or the company being put into liquidation within the 30 days is the only way to stop a director being personally responsible.

Act Immediately

When receiving a DPN, a director must act immediately as the 21 days given to resolve the issue is not calculated from when a director receives the notice, but the date of issue. Although the ATO may send a copy of a DPN to the director’s accountant, this cannot be relied upon, meaning companies must make updating and reporting any changes to a director’s address a priority. It is encouraged to promptly seek expert advice when receiving a DPN.

Need expert advice – Contact HBG Tax and Accounting

HBG Tax and Accounting work closely with their clients and are passionate about giving them extra and much needed support. Contact the team today on 9594 1963 or visit their office at Unit 7, 12 Belgravia Terrace, Rockingham.

The material and contents provided in this article is of informative in nature only.  It is not intended to be advice and you should not act specifically on the basis of this information alone.  If expert assistance is required, professional advice should be obtained

New Pay Rates effective as of 1st July 2019

By Heaney Business Group
Coins increasing
Happy employees

The start of the 2019/2020 financial year sees new pay rates be implemented. The first full pay period of the new financial year will see a minimum wage increase of 3%. New rates of $740.80 per week or $19.49 per hour apply to the national minimum wage. These rates are applicable to employees not covered by an award or agreement.

The Penalty rates have also been amended in the Hospitality and Fast Food awards industries.

This article was written based on information supplied from Knowledge Shop Newsletter July 2019.

The material and contents provided in this article is of informative in nature only.  It is not intended to be advice and you should not act specifically on the basis of this information alone.  If expert assistance is required, professional advice should be obtained.

What Do I Need For Single Touch Payroll?

By Heaney Business Group
Single Touch

Listen to HBG Tax and Accounting’s Directory Gemma Heaney as she discusses;
What You Need to Know about Single Touch Payroll on The Small Business Talk Podcast with Cathy Smith .
Or read on to find out more.

Single Touch Payroll (STP) is a new way of reporting tax and super information to the ATO. Employee’s tax and super information is sent directly to the ATO every time payroll is processed, via a third-party provider or from your own software.

Business administration is time consuming and often complex for those not experienced in the field. The introduction of Single Touch Payroll by the Australian Government (ATO) aims to streamline the process of payroll reporting with the aim to provide real-time visibility of businesses to all small businesses with employees. It may seem a little extreme to some businesses to submit formal reports every pay run, however this process aims to improve compliance and increase transparency in the payroll process of Australian business.

So what do you need to make sure you are running your STP efficiently and correctly before the 1st July 2019 cut off?

  • How Will You Report ?
  • Who Will Report For Your Business?
  • What Software Is Best For You?

How Will You Report?

The ATO will have issued you with an Implementation Guide and Transmission Protocol, which basically means a ‘how-to guide and sending procedures’, to assist you in submitting your STP information to them.

The first step is to determine how you will report through STP. This may depend on the size of your business, and if you currently use payroll or accounting software.

You can choose one of the following options:

  • Report through payroll or accounting software that offers STP reporting
  • Ask a third party, such as a registered tax or BAS agent, or a payroll service provider, to report through STP for you, (however, you must be aware that it’s your responsibility as an employer to make sure they use STP-enabled software)

Who Will Report For Your Business?

Regardless of whether you utilise your own software or you use a third party to report, you must nominate an employee (or yourself) to be the contact for the ATO, to lodge and to authorise STP reports each cycle. This contact is listed in the STP pay events and is usually someone who understands your payroll amounts and how it is calculated, such as your accounts or payroll manager. If you choose to utilise the services of a third party, you will need to link this relationship at a role level with the ATO.

What Software is Best for You?

Find out how your current payroll software provider will offer STP reporting. This may be through an update to your existing software, or an additional service. Older software products may not be updated to offer STP reporting.

HBG Tax and Accounting can take the stress out of STP reporting and are completely STP enabled, with secure electronic platforms that ensure efficiency and compliance every time you process your payroll functions.

Take the guesswork out of payroll and call HBG Tax and Accounting today.

Prepare for Life, Are You Ready?

By Heaney Business Group
Estate Planning

Estate PlanningIf you don’t plan you could learn a hard lesson with assets being lost, family feuds or even money being handed to the government due to you not having made a Will or instructions on where it should be distributed.

For the Australian population, estate planning has become even more important as collectively our wealth has exploded over the last 25 years and looks set to continue.

14.5% of Australian are now 65 years old or over (approx. 3.8 million people). 55% of the country’s wealth is distributed to the Baby Boomer generation who only make up of 25% of the population. Australia is seeing a wealth distribution intergeneration change.

Estate Planning

Estate planning is critical to identify what will happen to your assets and liabilities if something happens to you. Estate planning will give everyone involved piece of mind and make sure your wishes are followed protecting your business partners and beneficiaries.

All of this planning will come in handy when tax outcomes are reviewed and if legal matters are required at a later date.

Being a business owner, you will need to consider a number of different issues that could be caused if you were no longer able to carry out your current role. These issues could include:

  • Who would perform your role?
  • Will your beneficiaries take a share of the business?
  • Will the business need to be sold?

These questions and many more can be considered as part of your estate planning requirements. This kind of planning is very important to help protect your beneficiaries and any business partners attached to the business, plus relieve any anxiety that could be associated with business structure going forward.

Estate planning does not have to be hard work, but it does have to be planned.

Other things to consider when planning your estate other than money could be

  • The care and maintenance of minor children.
  • Managing the respective rights and expectations of beneficiaries, particularly with blended families.
  • Avoiding disputes between family members.
  • Relationships outside of the immediate family.
  • Managing liabilities of the estate.
  • Assets which may not be capable of immediate realisation or where value will be diluted by realisation.
  • The transfer of assets through generations.

Need Help with Your Estate Planning?

For specific advice on your estate planning needs call the team at HBG Tax & Accounting on 9594 1963 and discuss your situation and requirements.

This article was written based on information supplied from Knowledge Shop Newsletter February 2019.

 

Single Touch Payroll – Free Training

By Heaney Business Group
Single Touch

RKCC - FREE Business Training Workshop

Business Workshop – Single Touch Payroll Reporting

Gemma Heaney, CPA of HBG Tax and Accounting and Rockingham Kwinana Chamber of Commerce would love you to attend the Business Training Workshop on Tuesday the 2nd of April from 7:30 to 9:00am. This workshop will provide you with all the information you need about your requirements as a small business plus what your reporting obligation to the Australian Taxation Office are.

Single Touch Payroll or ‘STP’ has now been made law and will apply to all small business owners from 1st July 2019.

“STP is merely an electronic system that will report your gross wages paid, tax withheld and superannuation. Each time you click pay now, this information will be sent to the ATO. Software providers will be ready before this date and you can simply opt in and start using STP as soon as possible. I know for Xero, MYOB and Quickbooks users it is up and live already. For those employers that are not currently using an electronic system, MYOB and Xero have already come out and said they will have a low cost software option they can implement. For these employers the time is now to get this up and running.

The ATO have said they will give business owners until the 30 September 2019 to be ready. Employers with 1-4 staff will have transitional arrangements and will be able to get their BAS or Tax Agent to lodge wage figures quarterly for the first 2 years. We can implement STP for you. Please give us a call on 9594 1963″. Gemma Heaney CPA HBG Tax and Accounting.

Single Touch Payroll – Free Training
Tuesday 2nd of April
7:30 to 9:00am
At Rockingham Kwinana Chamber of Commerce
19 Kent St Rockingham

Book your ticket to this free workshop

RKCC Workshop – Single Touch Payroll

Rising Star Accounting Business Category in THEPAC 2018 Awards

By Heaney Business Group
Rising Star Accounting Business

Rising Star Accounting Business Award Photos

Colin Dunn Co Founder and Head of Content of Panalitix Nicole HBG Tax & Accounting, Gemma Director HBG Tax & Accounting, Aimee HBG Tax & Accounting Mark Ferris CEO of Panalitix

HBG Tax & Accounting (HBG), from Rockingham Western Australia has been awarded for being the embodiment of excellence in a definitive aspect of the accounting business and industry in general.

At the recent Panalitix Annual Conference held at the San Diego, California, USA HBG Tax & Accounting was awarded Rising Star Accounting Business 2018.

Panalitix represents a global community of accountants. Members must demonstrate a consistent level of excellence in being ‘proactive with their clients’. The conference awards ceremony was held at the Paradise Point Resort & Spa. Gemma Heaney HBG Tax & Accounting’s Director along with Nicole Nie, Business Services Manager and Aimee Osman, Accountant were there to celebrate the win. It was a truly unforgettable experience.

This award recognised that as a business in accounting the recipient must have exceeded their business targets and goals through their commitment and dedication. They need to have demonstration implementation in their business with improved strategies to provide high service standards to their clients.

The team at HBG offer their services to a whole range of clients large and small, from preparing a single annual tax return to structuring businesses; they have you covered. Being highly experienced in different accounting software packages, they have the skills and experience to help keep their clients up to date with technological advancements and tax law changes.

HBG Tax & Accounting with Steve Forbes

Nicole HBG Tax & Accounting, Steve Forbes – Forbes Publishing Gemma Director HBG Tax & Accounting, Aimee HBG Tax & Accounting Mark Ferris CEO of Panalitix

Committed to making life easier for Businesses just starting up or to large well-established businesses, HBG will keep your goals in mind. Covering all areas of self-managed super funds, future tax planning, buying and selling of business and estates incorporating trusts, having all your business managed in the one area you will know it is handled right the first time every time.

Speak with the professionals who love working with you to see you and your business succeed!

Congratulations to HBG Tax & Accounting on winning The Panalitix, Rising Star Accounting Business Award.

Cleaners and couriers latest black economy target

By Heaney Business Group

From 1 July 2018, the taxable payments reporting system will extend beyond the building industry to cleaning and courier businesses. This means that these businesses will need to report payments they make to contractors (individual and total for the year) to the ATO. By ‘payment’ the ATO means any form of consideration including non-cash benefits and constructive payments.

The building industry has had this form of “enhanced reporting” since 2012-13. The result was an additional $2.3 billion in income tax and GST liabilities collected through voluntary reporting in the first year alone.

 

What is a cleaning and courier service?

The terms ‘cleaning service’ and ‘courier service’ take their ordinary meaning.

Courier services include activities where items or goods are collected from, and/or delivered to, any place in Australia using a variety of methods including by truck, car, station wagon, van, ute, motorcycle, motorised scooter, bicycle or other non-powered means of transport, or on foot.  Freight services, blood and blood product couriers, and passenger transport are not affected.

A cleaning service is any service where a structure, vehicle, place, surface, machinery or equipment has been subject to a process in which dirt or similar material has been removed from it. This includes office cleaning, road sweeping or street cleaning, swimming pool cleaning, park and facilities cleaning, or cleaning for certain types of cultural or sporting events.

Mixed business that supply services including courier or cleaning services will also be affected.

 

What you need to do

The first annual report for affected cleaning and courier companies is due by 29 August 2019 for the 2018-19 year. The types of information reported to the ATO about contractors include:

  • ABN (where known)
  • Name
  • Address
  • Total paid to the contractor (including GST) for the financial year, and
  • Total GST included in the gross amount that was paid.

If an invoice you receive from a contractor includes both labour and materials, whether itemised or combined, you will need to report the total amount of the payment.

If your business is likely to be affected by the new requirements and you currently do not have systems in place that allow you to readily access the information required by the ATO, it’s important to start your planning now.

Tax benefits for investing in affordable housing

By Heaney Business Group

 

There are two aspects to these changes. Firstly, individuals who make a capital gain on residential dwellings that have been used to provide affordable housing can potentially qualify for an additional CGT discount of up to 10%, this could take the total discount percentage from the existing maximum level of 50% to 60%.  While the additional 10% CGT discount applies if you meet the eligibility criteria, the 60% discount rate is not automatic – it’s ‘up to’ and the final total discount could be less than 60%.

 

The increased discount will only be available if the dwelling has been used to provide affordable housing for at least 3 years after 1 January 2018. The 3 year period does need to have been continuous.

 

The additional discount needs to be apportioned to take into account periods when the individual was a non-resident or temporary resident as well as periods when the property was not used to provide affordable housing over its ownership period.

 

The second aspect to the rules allows individuals to also access an additional 10% CGT discount on their share of capital gains that are distributed by a certain trusts (e.g., managed investment trusts) where the gain is attributable to dwellings that have been used to provide affordable housing for at least 3 years.

 

There are a few compliance hoops to jump through to be ‘affordable housing’:

  • the property must be residential (not commercial);
  • the tenancy of the dwelling or its occupancy is exclusively managed by an eligible community housing provider;
  • the eligible community housing provider has given each entity that holds an ownership interest in the dwelling certification that the dwelling was used to provide affordable housing;
  • no entity that has an ownership interest in the dwelling is entitled to receive a National Rental Affordability Scheme (NRAS) incentive for the NRAS year; and
  • if the ownership interest in the dwelling is owned by a Managed Investment Trust, the tenant does not have an interest in the MIT.

 

If you have any enquiries on how the above may affect you, please feel free to give our office a call on 08 9594 1963.

Not your typical accountant

By Heaney Business Group

It seems this is a very common perception of an accountant, but it couldn’t be further from the truth! Tax and accounting inspires us at HBG – shocking we know. Helping people through a transitional phase of their finances, or finding a solution to a more complex case is certainly inspiring for us. Even the straight forward tax and accounting jobs encourage us to utilise our skills to get the best solution for our clients.

What we really do as accountants is take on an ever-growing business advisory role, which essentially caters to the full business needs of our diverse clients. We partner with our clients help solve their business problems and offer advice on how to create more wealth and opportunity in their business.

So how can an accountant, or HBG, help you? Well, we can provide that sigh of relief and assurance of a job well done. You know that feeling of relief when something is completely taken off your plate? This feeling is strengthened with long-term relationships that we look to build with each of our valued clients.

At HBG, we are here to make our clients’ lives easier and we really enjoy the relationships we have with our clients, staff and local community. We work with our clients to solve any problem they may have, from dealing with the ATO to managing cash flow to marketing and human resource management issues. We pride ourselves on being able to meet our clients’ needs and to be seen as a true and trusted advisor.

If you are thinking about seeking advice, don’t hesitate to contact us. We aren’t your average backroom accountants and we would love the opportunity to get to know you and your business.

Should you have any questions about the how we might be able to help you, please don’t hesitate to contact our trusted tax accountants and business advisors.

 

P: 08 9594 1963

E: admin@hbgtax.com.au