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tHE CGT IMPLICATIONS OF SUBDIVIDING AND BUILDING ON THE FAMILY PROPERTY

Given the state of the property market in Australia these days, a not-uncommon situation can arise where a residential property owner seeks to demolish and subdivide the block containing the family home and build residential units.

If you have the available land of course, the above is a solid strategy. However it can cause headaches from a tax perspective - and in some cases the ability to access the main residence exemption and even the CGT discount can be compromised.


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SELLING UP YOUR BUSINESS? DONT FORGET THE "GOING CONCERN" GST EXEMPTION            

The concept of a "going concern" exemption for the purposes of the goods and services tax (GST) can still cause confusion when businesses are sold.

The sale of a business may be GST exempt if the enterprise is deemed to be a "going concern" - which refers to an enterprise's ability to continue trading.

                                                     
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ARE PERSONAL CARER TRAVEL COSTS CLAIMABLE? IT DEPENDS...

A recent Administrative Appeals Tribunal decision has ramifications for taxpayers with disabilities and who are in need of a personal carer.

The decision centres around what is or is not acceptable as a tax deduction in relation to the costs that arise with regard to that carer under certain conditions.

                                  
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BUSINESS COSTS AND DEDUCTIBILITY OF INTEREST EXPENSES

If a business racks up an interest bill from borrowing funds to pay for the expenses of running the business, or to acquire other income-producing assets or investments, this expense is generally allowed as a tax deduction for the relevant year.

For the business taxpayers under the accruals accounting method, a claim can be made for the calculated interest liability to the end of the income year (usually June 30), provided the interest on the debt accrues on a daily basis (which would usually be the case).

            
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COMPANY TAX FRANKING IMPLICATIONS

The recent cut to the tax rate for incorporated businesses that turnover less than $50 million a year, while generally welcomed, can bring with it some important considerations when it comes to distributing franked credits.

The rate change to 27.5% is to be staggered, starting with companies that turnover up to $10 million a year, with retrospective effect from July 1, 2016. It will then apply to companies turning over up to $25 million in 2017 - 18, and to $50 million turnover companies for 2018-19. Note: These tax cuts only apply to companies that actively "carry on a business".    

                     
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FINANCIAL SOLUTIONS

 
Insurance – protect your most valuable asset

How would your family or loved ones cope if you suffered an accident or illness? Would you be able to survive a forced retirement? Nearly a third of Australians over the age of 45 retire early due to ill health.  You have worked hard to support your family and have built up a healthy level of savings. A serious injury or illness could put these life savings and retirement plans in jeopardy.

Australians insure their homes and cars, often with barely a second thought, but only a minority protect themselves and their loved ones should something happen to them. In fact, we're one of the most under-insured countries in the developed world with many families suffering financially if something happened to one of the breadwinners.

Let us help protect you and your loved ones. Contact us today to arrange a complimentary meeting to discuss your personal life insurance needs.

·         How much cover do I need?

·         Should I hold insurance inside or outside of super?

·         Stepped vs level premiums?

·         Any vs own occupation?

·         I'm paying a large premium now, do I need to be?

·         I've got existing cover in my super but don't know if it's appropriate?

·         I'm a SMSF trustee but haven't considered the insurance needs of the members.

Visit our website for more information or contact Erich or En to organise a introductory meeting.