Dendra Accounting Group

July Tax Update

A Personal Note From George

A new financial year is now upon us and we have some exciting improvements that have occurred.

This month we welcome two new staff to our team. Helen Goltsios has joined us in the position of Business Operations Manager. Helen comes to us with over 15 years experience in a management role.

In the next week, we also welcome Nick Merritt who as a qualified Chartered Accountant joins our tax team as a Business Advisor. He comes to us with over 9 years of experience in Business Services and has accumulated a number of years of specialist superannuation advice.

We are also excited to announce the launching of our new and improved website. Every client will be progressively issued with personalised login details which will allow you to view past copies of tax returns, assessments and provide additional features as they become available.

There are also a number of useful tools and some interesting information that is relevant to most clients and I encourage you to take some time and use some of the functions available.

Personalised Tax Calendar

Over the last few years, we have found that many clients are confused with regards to the lodgement dates for tax returns, BAS statements.

So that we assist our clients to pro-actively meet all their obligations, over the next few weeks, every business client will receive a personalised tax calendar from our office that will identify all the relevant lodgement dates. This calendar will also include the date that we require all your information to prepare your financial accounts for the year ending 30 June 2011.


Carbon Tax

The Government recently released the Carbon Tax which effectively will impose a tax on carbon emissions by some of our largest polluters. This will in turn create an increase in the cost of goods and services to the everyday consumer.

In an attempt to negate the increased cost of living, a number of Centrelink benefits are proposed to be increased, However the most dramatic proposed change from a tax point of view is the major increase in the tax free threshold.          

These changes will effectively allow most individuals to earn $20,542 of income tax free as opposed to $16,000 currently.

It will also marginally reduce the amount of tax payable by every other individual due to the lower rate increase.

However, with the increased margin in the lowest threshold, the Government also proposes to increase the tax rates on the second and third levels from 15% to 19%, and 30% to 32.5% respectively.


Entrepreneurs Tax Offset (ETO)

Effective 1^st July 2012, the ATO has abolished the ETO and replaced it with a number of new incentives for all eligible small businesses.

Firstly, any motor vehicle purchased by an eligible small business will be entitled to immediately deduct the first $5,000 in addition to the standard depreciation claim for the year. Note that this amount is not in addition to the total cost of the car.

The depreciation rules have been further relaxed allowing an immediate claim for any assets that are less than $5,000 (previously $1,000).

In addition, the current Long Life Pool which depreciates assets at that have an effective life of more than 25 years (5% depreciation per year) has been abolished and all assets over $5,000 will now be included in the General Pool (which calculates depreciation at 15% for the first year and 30% thereafter).


PAYG Payment Summaries

PAYG Payment Summaries should have handed out by 14^th July 2011, and your PAYG withholding payment summary annual report (for employers preparing without our involvement) by 14^th August 2011, all others by 30^th September 2011. 


Fuel Tax Credit

Effective 1^st July 2011 the fuel tax credit rate has decreased from 15.543 cents per litre to 15.043 cents per litre for vehicles greater than 4.5 tonne GVM travelling on a public road (diesel vehicles acquired before 1^st July 2006 can equal 4.5 tonne GVM)


PAYG Withholding Rates

Effective 1^st July 2011 PAYG Withholding rates have changed, visit the ATO website (http://www.ato.gov.au/businesses/content.aspx?doc=/content/33283.htm&alias=taxtables) or contact our office for more details.

 Obviously many of the above Tax Planning Tips will apply differently to every individual and business. You should contact Dendra to discuss how any of the above strategies may apply to your particular circumstances.