Chesterton Accounting

Welcome to our October monthly newsletter!

There are exciting things happening for the Chesterton Accounting team this October, a new baby will be joining us! Our managing senior accountant, Zoe Chesterton, will be taking some time off to enjoy her newest bundle of joy. During this period, the team will still be able to continue to provide services as usual to you and your business. However, if you require more complicated business or taxation advice then Zoe will be available for phone appointments or correspondence via email.

Monthly tax tip:

The first quarter of the year is over, which means that it’s now a great time for small business entities to have their tax completed. The skills and technology boost was announced in the federal budget last year but is definitely not a tax incentive to forget about. The boost allows small business entities to claim an extra 20% tax deduction on skills and training expenditure for employees and technology expenditure. E.g. a business pays $1,000 for an employee to complete a course for skills used in their job so they are able to claim a total tax deduction of $1,200 under this incentive. Please see below for the list of eligible expenditure:

Small Business Technology Investment Boost:

• digital enabling items – computer and telecommunications hardware and equipment, software, internet costs, systems and services that form and facilitate the use of computer networks
• digital media and marketing – audio and visual content that can be created, accessed, stored or viewed on digital devices, including web page design
• e-commerce – goods or services supporting digitally ordered or platform-enabled online transactions, portable payment devices, digital inventory management, subscriptions to cloud-based services and advice on digital operations or digitising operations, such as advice about digital tools to support business continuity and growth
• cyber security – cyber security systems, backup management and monitoring services.

Small Business Skills & Training Boost:

The bonus deduction is available for expenditure for the provision of training to one or more employees of your business. The training provider must meet certain registration criteria for the bonus deduction.
You can check for registered providers at:

• training.gov.au
• teqsa.gov.au/national-register

This incentive became active from 29 March 2022 (budget release date), however cannot be claimed until the 2023 tax return is prepared. This means that business owners (with the help of their accountants) will need to now go through these expenses to ensure that they are not forgotten about. As usual, there are many rules, exclusions and caps that will be applied to these incentives so please contact our office before getting too excited about it so we can let you know exactly how this will affect your tax claims.

If you would like to schedule a consultation with us then please jump onto our website where you can see our availabilities and book a time that suits you.

Important Dates!

21 October:

• Lodge and pay September 2023 monthly business/instalment activity statement

28 October:

• Lodge and pay quarter ending 30 September 2023 activity statement if lodging by paper
• Make super guarantee contributions for quarter ending 30 September 2023 to funds by this date

31 October:

• Final date to sign up with a tax agent to receive the lodgement concession for the 2023 tax return
• Lodge 2023 tax return if lodging without a tax agent by this date

Welcome to our September monthly newsletter!

The ATO have recently come across an issue in their accounts. Taxpayers who have a debt-on-hold with the ATO are still receiving refunds. It is required by law that any refunds issued whilst a debt is on hold, should be applied to the debt instead of being paid out to the taxpayer. The ATO are currently working to resolve this issue in their system and have no plans to pursue any refunds that have automatically been paid out.

Monthly tax tip:

Are you like the many individuals around that spend plenty of money on work expenses but seem to always misplace those receipts? Well lucky for you, the ATO allows a deduction of up to $300 to cover those expenses. Yes, you heard right that you do not have to show receipts for work-related deductions up to $300. However, this does not mean that you are automatically entitled to a $300 tax deduction. You do have to explain how you calculated your deductions if the ATO choose to audit your tax return. For example, if you spent $100 on tools for work, $75 on protective clothing and $10 on sunscreen but cannot find the receipts, then you can claim $185. Please contact our office if you are unsure how to calculate deductions without receipts.

If you would like to schedule a consultation with us then please jump onto our website where you can see our availabilities and book a time that suits you.

Important Dates!

21 September:

• Lodge and pay August 2023 monthly business/instalment activity statement

30 September:

• Lodge annual TFN withholding report for 2023 financial year if a closely held trust has been required to withhold amounts from payments to beneficiaries

Welcome to our August monthly newsletter!

The Federal Budget for 2023 announced plenty of changes, however there is one area that has confused most taxpayers. The middle-income tax offset was not extended by the Government and was never actually announced or advertised by them either which has left many individuals puzzled by their reduced refunds for 2023. The offset would allow taxpayers (in the middle-income bracket) a reduction of up to $1,500 of their income tax liability. If you have noticed that your refund has reduced by around $1,500 or less when compared to last year and you are in the middle-income bracket, then the reason would most likely be due to this offset. Please contact our office should you require further information or are unsure if your tax refund/liability is correct.

Monthly tax tip:

The Federal Budget for 2023 also announced the new Small Business Instant Asset Write-off which is now capped at $20,000 per eligible asset. This may affect business taxpayers that are going to be selling and replacing a business asset. For example, if a business has fully deducted a motor vehicle in a previous year and then decides to trade it in for an upgraded vehicle during this income year, there is going to be an unexpected tax liability. The trade (sale) of the vehicle would need to be included as taxable income and then the replacement vehicle could not be fully deducted if it is valued at over $20,000. If we assume that the old vehicle was sold/traded for $50,000 and the new vehicle is valued at $60,000, we will calculate the increase of taxable income below (this is just an estimate, every taxpayer will be different due to different tax rates and capital gains offsets available to them):

• $50,000 taxable income (selling the old vehicle)
• $5,000 – $10,000 depreciation expense for new vehicle (depending on purchase date and depreciation method)
• Total of $40,000 – $45,000 increase in taxable income
• Between $10,000 – $11,250 extra income tax liability if the business is operating as a company

This is something to be aware of and consider if selling and replacing a business asset that was previously fully deducted. If this is something that you are considering, then please contact our office to discuss the potential tax liability.

If you would like to schedule a consultation with us then please jump onto our website where you can see our availabilities and book a time that suits you.

Important Dates!

21 August:

• Lodge and pay July 2023 monthly business/instalment activity statement

25 August:

• Lodge and pay quarter ending 30 June 2023 activity statement

28 August:

• Lodge and pay quarter ending 30 June 2023 superannuation guarantee charge statement if the contributions were not paid on time*
• Lodge TPAR (taxable payments annual report) for the year ending 30 June 2023 if you paid contractors*

* Superannuation guarantee charge is not tax deductible
* Required if your business provides the following services: building and construction, cleaning, road freight and courier, information technology, security and investigation

Welcome to our June monthly newsletter!

The 2023 Federal Budget was announced last month, focussing on cost-of-living relief, and modernising our economy. There were a few tax and superannuation changes announced that will affect small business. This is the final month now to plan for the upcoming financial year and create a tax plan for this financial year that is about to end. We recommend booking this in with us to ensure you are in the best position surrounding income tax.

Monthly tax tip:

The end of the financial year is just around the corner so now is the time to complete those trust resolutions for those entities operating under a discretionary or family trust. They will need to be completed by the 30th of June to distribute profits for the 2023 financial year. A trust distribution allows a trust to distribute profits among its beneficiaries which can help to decrease a family’s overall tax liability. For example, a family with two adults and two children would be able to distribute $416 to each child, then the remaining profits split between the two parents to take advantage of individual tax rates and the tax-free thresholds for each adult. If a trust resolution is not prepared, then any profits made will be taxed at top tax rates which is 45% for the 2023 financial year.

If you would like to schedule a consultation with us then please jump onto our website where you can see our availabilities and book a time that suits you.

Important Dates!

5 June:

• Lodge 2022 tax return by this date to avoid failure to lodge on time penalties when lodgement due date is 15 May

21 June:

• Lodge and pay May 2023 monthly business/instalment activity statement

25 June:

• Lodge and pay annual FBT return for 2023 if lodging electronically

30 June:

• Superannuation contributions must be paid by this date to claim a tax deduction for the 2023 financial year
• 2022 tax return must be lodged by this date to continue receiving childcare subsidy and family tax benefit payments
• Trust distribution resolutions must be prepared and signed by this date to avoid paying top tax rates