Monthly Archives

January 2017


More about Superannuation

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By James Nott, B.Com, CA, CTA

Most taxpayers who have a Self-Managed Superannuation Fund are aware that significant changes to the rules will start on 1 July 2017.

• Individual concessional contributions will be limited to $25,000 per annum
• Non-Concessional contributions will be limited to $100,000 per annum

Furthermore when a Superannuation member has accumulated a $1.6 million balance, no further non-concessional contributions can be made.

If you have a balance in excess of $1.6 million and are in receipt of a pension from the Fund, you are required to transfer the excess to an accumulation account in the Fund. The income from this new accumulation account will be taxed at 15% with any capital gain taxed at 2/3rds of the gain, provided the asset has been held for at least 12 months.

Taxpayers in receipt of a pension from the fund are likely to suffer a reduced pension as the balance of their pension account will reduce as a result of the new measures.
So the Government has given some relief to compensate those disadvantaged by only taxing the growth from 1 July 2017. This works by the Fund revaluing the assets at 1 July 2017. The details must be reported to the ATO by the due date for lodgment of the income tax return for the year ended 30 June 2017.

The new measures are potentially helpful, but are complicated, and will require careful thought in the months ahead.

Quad bike

Rebates Available for Quad Bike Safety Upgrades

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Are you considering replacing your quad bike for a safer option or adding rollover protection to your bike?
Well if you farm in Victoria you are in luck, as rebates are available for up to $1,200 to purchase a safer vehicle or $600 to add rollover protection devices. You have until October 2018 to submit your application for the rebate, but get in early as once the allocated funds are exhausted the rebates will stop.  Following this link for more details.
This is great way to improve safety on your farm for your family and staff – well done to the Victorian Government for such a great initiative, if you know of other states providing similar services, why not share it here……


Australian Taxation Office Penalties

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Many of us feel pressure when we are obliged to lodge documents and make payments to the Australian Taxation Office.

Of course the Government needs the funds to try to make ends meet and requires the ATO to collect as much revenue as possible.

One measure that also threatens all taxpayers is the possibility of penalties being imposed. This is another means of collecting revenue and the ATO seems to regard this as a “growth revenue”.

Penalties are calculated on the basis of “penalty units”.
An automated system applies these penalty units when documents are not lodged on time. The documents referred to include not only income tax returns, but also activity statements, PAYG withholding annual reports, fringe benefits tax returns and others.

A penalty unit is $180,00. The Taxation Office can apply up to 5 penalty units for each outstanding document.

Taxpayers sometimes make the mistake of not lodging a document as they do not have the funds to pay the outstanding tax which is due.

It is normally best to lodge documents on time and then negotiate a payment plan with the Taxation Office. Any interest payable to the ATO may be very significantly less than running the risk of penalty units being imposed.

By James Nott, B.Com, CA, CTA