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Applying for an R&D Tax Incentive grant - what you need to know

If you are just starting out in business you may not be familiar with the Research and Development (R&D) Tax Incentive scheme available from the Australian government. Or you may just need a refresher before submitting a new claim. It’s that time of year again where deadlines start to creep up on us, so I thought I’d update last year’s wrap up and share the latest on this subject.   The grants offer help to businesses by offsetting some of the costs of performing R&D. Many startups are not aware of what constitutes as research and development, therefore potentially missing out on a substantial cash injection for their business. If your startups runway is an issue this might be the time to act.   The R&D Tax Incentive currently has two core components:   ●      45% refundable tax offset for eligible entities with a turnover of less than $20 million per annum provided they are not controlled by income tax exempt entities. ●   ...
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Are your superannuation savings goals on track?

Are your superannuation savings goals on track? Superannuation should never be a “set and forget” strategy. With the new calendar year here, now is a good time to review your circumstances and perhaps set some new goals to help boost retirement savings. There have been a few changes to superannuation which applied from 1 July 2014 and it is important to understand how they may apply to you. The following are some considerations. Making extra contributions The general concessional contributions cap is $30,000 for 2014–2015 (up from $25,000 for 2013–2014). For people aged 50 and over, there is a higher concessional contributions cap of $35,000 for 2014–2015. Checking super savings It is a good habit to check your superannuation balance regularly. In addition to getting to know your super better, you may also want to protect your super from identity crime. For example, you may want to change passwords for accounts that can be viewed online. Consolidating multiple super ...
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GETTING IT RIGHT! ..... NEW YEAR PLANNING FOR YOUR BUSINESS in 2015 Seeing the rewards of planning and the effects of not planning in my years as a Business Coach; below is a compilation of my 5 must have TIPS for "Resetting the Bar" in your business for 2015. 1.            Set & Clearly document your Business Goals for 2015  a)  Ensure they are Specific, Measurable, Achievable, Results oriented, within a set Timeframe b)  Know your Company Vision and where you are taking the business c)  Document your Goals & Vision d)  Share, Share, Share..... You can't achieve success on your own! 2.            Define the Areas of Improvement a)  Financial Dashboard, People Performance, Marketing for ROI, Delivery & Distribution Improvement, Customer Care & Communication b)  Accountability - Monitor your b ...
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Is an SMSF right for your small business?

Is an SMSF right for your small business? Follow these 10 smart steps before making the move. Owners of small-to-medium enterprises  (SMEs) can gain a lot from running their own self-managed superannuation fund (SMSF), although it’s not without its challenges.   Here we outline a few of the positives as well as some of the negatives. THE UPSIDE  1.    You’re in control of your retirement  Most people who run their own business like to be in control of their working life; chances are they enjoy making their own business decisions. Big business holds little or no attraction for them – most of the time the big end of town is politics on steroids as well as slow to react and glacial at making business decisions.  It’s … well, big business! It’s a similar thing with retirement savings. Why trust your retirement savings to large organisations where you’re just a number? Running your own super fund allows ...
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Couple refused small business tax concession

Couple refused small business tax concession The AAT has recently affirmed a decision of the Tax Commissioner refusing a couple’s request to apply a capital gains tax concession in relation to the sale of their business. The husband and wife were the sole shareholders and directors of a private healthcare company which they had sold, via their shareholding, for some $14 million in the 2007 income year. They claimed they were entitled to the tax concession in respect of the capital gain they made on the sale of their shares. In particular, they claimed they satisfied that relevant asset test to be eligible for the concession on the basis that the company had a liability just before the sale to pay them eligible termination payments totalling some $2.75 million. In rejection of the couple’s argument, the AAT confirmed that the eligible termination payments paid to the couple were not to be taken into account for the purposes of the relevant asset test in determining whether they qualified ...
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Will the tax man celebrate your Christmas party ?

Will the tax man celebrate your Christmas party ? So you are busy organising your Christmas Party, considering what gifts you might give to your clients and staff.  Do you have to pay the tax man for that Christmas cheer ? 1. The Christmas Party a) If the party is off business premises and you spend less than $300 per employee, there is no Fringe Benefits Tax (FBT) but also no tax deduction or GST claim. If clients are invited, there is no tax deduction or GST claim for their allocated portion as the cost is entertainment. b) If the party is on business premises on a work day, there is no limit on spend for employee or clients, but again no tax deduction or GST claim. 2. Gifts a) If you give a gift that is not included as part of the Christmas Party; categorised as a “Non-entertainment gift”; it is exempt from FBT where the total value is less than $300 inclusive of GST. It is also tax deductible and the GST credit can be claimed.  Gifts of entertainm ...
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Why didn't my BAS come in the mail this Quarter ?

From 1 July 2014, the ATO will continue to send paper activity statements until they receive an electronic lodgement.

Once you have lodged an activity statement via an electronic medium (Tax Agent Portal, Business Portal, Small Business Reporting (SBR)), the ATO will cease generating a paper return and whichever medium was used to lodge that statement is where the next activity statement will be made available.

People who elect to receive their activity statements electronically will generally receive them three to four days after the generation date. The generation date is usually the middle of the month prior to the end of the quarter. If you have elected to use the Business Portal or SBR you are notified by email that your activity statement is available to access and complete online. You must have a valid email address recorded with the Business Portal and SBR. If Tactica Partners receives an electronic activity statement on your behalf we will notify you of this via email.

The ATO will continue to send paper activity statements for the following form types because they cannot currently despatch them electronically:

• Annual GST Report

• Quarterly PAYG Instalment Notice

• Quarterly GST Instalment Notice

• Quarterly GST and PAYG Instalment Notice
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Property developers and use of trusts under scrutiny

Property developers and use of trusts under scrutiny

The ATO is examining arrangements where property developers use trusts to return the proceeds from property development as capital gains instead of income on revenue account. ATO Deputy Commissioner Tim Dyce said the ATO has “begun auditing property developers who are carrying out activities which conflict with their stated purpose of capital investment”. He said a “growing number of property developers are using trusts to suggest a development is a capital asset to generate rental income and claim the 50% capital gains discount”.

Mr Dyce warned that penalties of up to 75% of the tax avoided can apply to those found to be deliberately using special purpose trusts to mischaracterise the proceeds of property developments. The ATO said it has made adjustments to increase the net income of a number of trusts. It said penalties will be significantly reduced if taxpayers make a voluntary disclosure

Data-matching offshore bank accounts

Data-matching offshore bank accounts

The ATO is widening the breadth of data it obtains on individuals from financial institutions, possibly revealing hidden or undisclosed offshore income. The ATO has recently announced a data-matching program targeting offshore bank accounts. Under the program, the ATO will collect account details of bank customers from various financial institutions to identify Australian resident taxpayers with offshore bank accounts which may indicate evidence of undeclared income and/or gains.

TIP: The Tax Commissioner earlier this year announced a tax “amnesty” called Project DO IT which aims to encourage individuals to disclose previously undeclared offshore income or assets. Under the program, individuals could be offered reduced penalties for disclosing their offshore income. The ATO has been warning individuals to come forward before 19 December 2014, which is when the project will end.

Residency depends on facts and circumstances of each case

The ATO has issued a Decision Impact Statement following an individual’s legal win in arguing that he was not a tax resident of Australia during the 2009 to 2010 income years.

The taxpayer had moved to Saudi Arabia to work on a project for a number of years before moving back to Australia. Key factors that were taken into account by the AAT in deciding in favour of the taxpayer were the man’s intentions at the relevant time to live and work indefinitely in Saudi Arabia. The ATO said the decision was reasonably open to the AAT. However, it said the decision does not change its approach to residency cases. It said these matters involve questions of fact and degree and different facts may result in different conclusions as to residency.

The ATO said it will continue to approach residency cases by weighing all the relevant facts and circumstances and applying the relevant tax law and authorities to those facts