Tax News, Views and Clues from Sutton Partners
ATO will inform certain tax agent
clients their information is “Tax ready”
- If tax agent clients’ employers report
through Single Touch Payroll (STP) and the clients are linked to ATO online
services through myGov, the ATO will send them a myGov Inbox message to let
them know that their end of year payment summary (income statement) has been
marked by their employer as “Tax ready” and can be used in their tax
return and they can access their income statement in ATO online services
through myGov, or the tax agent can give them the information.
- If tax agent clients do not already have
myGov accounts, agents should let them know they do not need one for the agent
to lodge their tax return. Tax agents can access their employment data and
lodge for them once their information is “Tax ready”.
Top mistakes to
avoid this tax time: ATO
- The ATO has revealed some of the most
common mistakes people make at tax time. Top mistakes include lodging before
all prefill data is available or failing to report all income and claiming the
wrong thing – work-related expenses is one area where people commonly make
mistakes. To help taxpayers work out what they can claim, the ATO has developed
30 occupation guides for specific occupations; forgetting to keep receipts; and
claiming for something never paid for.
rates cut from 1 July 2019
- The Government has announced that it
will lower the social security deeming rate from 1.75% to 1.0% for financial
investments up to $51,800 for single pensioners and $86,200 for pensioner
couples. The upper deeming rate of 3.25% will be cut to 3.0% for balances over
- The Minister for Families and Social
Services, Senator Anne Ruston, said the changes would benefit about 630,000 age
pensioners and almost 350,000 people receiving other payments. Under the new
rates, age pensioners whose income is assessed using deeming will receive up to
$40.50 a fortnight for couples, $1053 extra a year, and $31 a fortnight for
singles, $804 a year.
reduced deeming rates have been backdated to 1 July 2019. Any additional
pension payment will flow through into pensioners’ bank accounts from the end
of September 2019 in line with the regular indexation of the pension.
Personal tax cuts
Bill passed without amendment, now law
- The Treasury Laws Amendment (Tax Relief So
Working Australians Keep More Of Their Money) Bill 2019 fully implements the personal tax cuts measures
announced in this year’s 2019-20 Federal Budget. Starting immediately, low and
middle income earners with an income up to $126,000 will receive up to $1,080
in low and middle income tax offset (LMITO), or $2,160 for dual income couples, with the
increased tax relief to apply from the 2018-19 income year.
- As a result
of the amendments, the Treasurer said around 94% of Australian taxpayers are
projected to face a marginal tax rate of 30% or less in 2024-25.
ATO statement on
administration of the low and middle income tax offset (LMITO)
- The ATO announced on 5 July 2019 that
it is implementing the necessary system changes so taxpayers that have already
lodged their 2018-19 tax returns will receive any increase to the low and
middle income tax offset (LMITO) they are entitled to. Any tax refund will be
deposited in the taxpayers nominated bank account.
- The amount of the offset taxpayers may
be entitled to, and the amount of any refund, will differ for everyone
depending on individual circumstances such as income level and how much tax was
paid throughout the year.
irregularities: ATO contacting businesses
- The ATO has advised tax agents that it
is currently emailing Single Touch Payroll (STP) enabled employers who have
either ceased reporting for over 45 days; or have submitted employees under
multiple payroll or BMS IDs. Some of these businesses may be tax agent clients.
These reporting irregularities may cause their employees to see incorrect,
incomplete or multiple entries in their income statements.
Employees guide for
work expenses: ATO
- The ATO has released an employee’s
guide for work expenses to help employees decide whether their expenses are
deductible, and what records they need to keep to substantiate them. The Guide
says that not all expenses associated with employment are deductible and also debunks
some myths about work expense deductions.
FBT, taxi travel and
ride sourcing – ATO clarifies
businesses, taxi travel by an employee is an exempt benefit if the travel is a
single trip beginning or ending at the employee’s place of work. The ATO says
taxi travel can also be an exempt benefit if it is a result of sickness or
- For Not-For-Profits,
depending on the type of NFP organisation, certain benefits they provide to
employees may receive concessional treatment from FBT. However, some benefits
may be exempt from FBT altogether.
data-matching program – overseas movement data and HELP debt
- The ATO said
it will acquire overseas movement data from the Department of Home Affairs
(DHA) for individuals with an existing HELP, VSL or TSL debt. The data matching
program will be conducted for the 2019-20, 2020-21 and 2021-22 financial years.
- Those living
and working overseas with a Higher Education Loan Program (HELP), Vocational
Education and Training Student Loan (VSL) and/or Trade Support Loans (TSL) are
required to update their contact details and submit an overseas travel
notification if they have an intention to, or already reside overseas, for 183
days or more in any 12 months; and lodge their worldwide income or a
GST on low value
goods – “very successful initiative”, says ATO
- The ATO says
it has now collected over $250 million in additional GST since the GST on low
value goods measure began on 1 July 2018, outstripping forecasts by $180
businesses do not need to register unless they meet the A$75,000 GST turnover
requirements, most small independent operators do not need to register and have
not been affected by this measure.
contributions reach $1 billion: Minister
Assistant Treasurer, Michael Sukkar, has announced that older Australians
downsizing from their family homes have contributed $1 billion to their
superannuation funds. The downsizer measure, which commenced on 1 July 2018,
allows older Australians choosing to sell their home and downsize or move from
homes that no longer meet their needs, to contribute the proceeds from the sale
of their home into superannuation up to $300,000.
and overtime meal allowance amounts for 2019-20
Determination TD 2019/11, issued on 3 July 2019, sets out the amounts the
Commissioner treats as reasonable for the 2019-20 income year in relation to
employee claims for overtime meal expenses; domestic travel expenses; and
overseas travel expenses.
- For employee truck drivers who receive
a travel allowance and are required to sleep (take their major rest break) away
from home, TD 2019/11 provides separate meal expense amounts for breakfast,
lunch and dinner.