Welcome
TaxEd has been providing a dedicated taxation support service for the government and non-profit sector since 2003. For what membership could do for your organisation please see the membership details. If you would like to be included in our communications regarding sector specific tax issues, updates and training please email us at admin@taxed.com.au
News
Further clarification on the new Div 81 rules
8 May 2012
On 2 May 2012, the Assistant Treasurer released a draft Regulation for public consultation specifying the GST treatment of certain Australian taxes, fees and charges. The draft regulation and explanatory material are on the Treasury...
FBT - the Otherwise Deductible Rule (ODR) in the spotlight
7 May 2012
During the NTLG FBT subcommittee meeting held in February 2012 the ATO was specifically asked to address the application of the otherwise deductible rule ('
Payroll and employment implications of LAFHA changes
7 May 2012
The federal government’s proposed changes to the living-away-from-home allowance (LAFHA) are expected to take effect from 1 July 2012, and new data reveals employers are deeply concerned about the impact on recruiting,...
FBT Q&A - Contract Access Fee and Base Value
7 May 2012
Question
The Victorian Government has introduced a Contract Access Fee (CAF) which is to be paid by all relevant Government Agencies, when they purchase a motor vehicle through the Government vehicles contract. This...
GST Q&A - GST free...really?
7 May 2012
Question:
We have a customer (not for profit organisation) whom has supplied an invoice to us with no GST included in their invoice (they have stated their items we are paying them for are...
GST Q&A - on-charging of water rates
7 May 2012
Question:
The University is leasing premises. The lessor also pays for rates in this case water rates. The water rates are on-charged to the University.
Despite the fact that the water rates are GST-free the lessor adds...
Refunds of overpaid GST
7 May 2012
On 11 April 2012, the ATO issued a Draft Practice Statement PS LA 3521 which deals with the consequences of the Commissioner exercising the discretion under s 105-65 of
Increase in Tax Free Threshold
7 May 2012
Raising the tax free threshold to $18,200 will free up to a million people from having to lodge a tax return from 2012-13. This will make life easier for many low-income earners who currently have...
The Dual Cab FBT Trap - the ATO's MCG stakeout
7 May 2012
A couple of years back a number of ATO staff had a Saturday excursion and spent the day at the MCG, but not in a corporate box watching the footy. They spend the day in the...
NFPs – Still No Draft Legislation to Introduce Tax on Commercial Activities
5 May 2012
The Federal Government has bowed to concerns expressed by the NFP sector and announced that it has delayed the commencement of operation of amendments which will tax earnings generated by ‘unrelated commercial activities’ of NFPs. The...
Media release - local government landfill and carbon tax
24 April 2012
local government landfill a chance to cut pollution and earn carbon credits
The Australian Government will join forces with the Australian Local Government Association (ALGA) today to address questions from local government across Australia about...
FBT - important changes for your 2012 FBT return
10 April 2012
WE have set out below the relevant legislative and regulatory fringe benefits tax changes for the year ended 31 March 2012, including new rates and thresholds for quantifying an employer’s FBT liability for the this...
GST treatment of exit payments by retirement village residents
10 April 2012
- Draft GST Ruling GSTR 2012/D2
This Draft GST Ruling (released on 29 February 2012) sets out the Commissioner's views on the treatment of exit payments that a resident becomes...
GST and Health Supplies - The new Tax and Superannuation Laws Amendment (2012 Measures No 1) Bill 2012
10 April 2012
GST-free health supplies
The Tax and Super Bill proposes to amend the GST Act to ensure that certain supplies made by a health care provider to an insurer, a statutory compensation scheme operator, a compulsory third...
GST and Appropriations - The new Tax and Superannuation Laws Amendment (2012 Measures No 1) Bill 2012
10 April 2012
Appropriations
As often can be the "case" (excuse the pun) when the government does not like the outcome of a court decision it will change the associated legislation. This is the case with the recent journey of appropriations through the Federal Court. Following is...
GST Q&A - overseas project
10 April 2012
Question:
Our organisation (A) has entered into a contract with a company based overseas (B) to perform some work in a third country (C). The majority of the work is to be completed...
GST Q&A - penalty fee
10 April 2012
Question:
A school charges a fee to parents for failure to give adequate notice of a student leaving the school. Generally this equates to a term of tuition fees (which of itself doesn’t attract GST). Does...
FBT Q&A - Minor Benefit - Work related study
10 April 2012
Question
Hi there
I have a question on the minor benefit exemption.
Council provides study assistance to...
Payroll Q&A - Salary and SMSF
10 April 2012
Question
Can you please advise if an employee has a self funded superannuation fund – can it be the same account as their salary account. They have provide a copy of the trust deed.
Answer
Although there is...
Payroll - New reforms to paid parental leave - “Dad and Partner leave”
10 April 2012
In November last year, the Federal Government introduced proposed legislation to amend both the Paid Parental Leave Act 2010 and the Fair Work Act 2009. This first round of proposed reforms sought to, among other...
Novated Leases and Budgeted Kilometres
4 April 2012
It is only the 4thof April and already we are hearing stories of staff having unexpected FBT liabilities due to their actual kilometres being less than what they have...
Local Government and Shires Association - training opportunities
5 March 2012
TaxEd is delighted to announce a training partnership with the LGSA's (Local Government and Shires Association) education division Local Government Learning Solutions.
Although the name suggests a focus on Local Government many of the events will be highly relevant...
NTLG FBT sub committee - important points to note
5 March 2012
The minutes of the 10 November 2011 NTLG FBT Sub-committee meeting have been released by the ATO. Many significant compliance issues were discussed including those noted...
Payroll case study
5 March 2012
The case study concern the termination of an employee who was employed fulltime from 1968 to 26 February 2012. Thus 44 years service. This equates to 286 days accrual of long service leave (
FBT - Q&A - Depreciation and interest rates
2 March 2012
Question
What is depreciation rate for FBT year 2011-2012?
What is deemed interest rate for FBT year 2011-2012?
Answer
Deemed Depreciation rate for period ending 31 March 2012 is 25%.
FBT - Q&A - Pooled car
2 March 2012
Question
Regarding shared use reporting exclusion for pool/shared cars. We have several staff members who regularly use company cars for commuter travel. We endeavour to make sure that 2 or more people share...
GST - Q&A - Donation with strings attached
2 March 2012
Question
Council recently received a cheque for $10,000. This was received as a donation, however the company did put some conditions on how the funds were allocated. The conditions are:
The funds are...
GST and Real Estate in the spotlight
2 March 2012
The start of 2012 saw a renewed focus on GST and real estate, and once again highlighted the need to ‘get it right’ when dealing with the GST consequences of acquiring, disposing of or developing...
GST - Q&A - Penalty fee for outstanding payment
2 March 2012
Question:
Council has an agreement with Stock Agents who use Councils Livestock Exchange Facility for a fee. There is a commitment as part of the agreement to punctually pay all fees complying with our normal payment...
Reportable Fringe Benefits – Employee Implications
1 March 2012
Although reportable fringe benefits are not included in assessable income, care should be taken by employees as IT DOES affect certain government obligations and benefits. Reportable fringe benefits are included in the following:
Medicare levy surcharge
Medicare...
Fairwork Resources Still Under-utilised By Payroll Personnel
1 March 2012
The Fair Work Ombudsman has produced Best Practice Guides to assist small to medium-sized organisations in implementing best practice initiatives. Working at best practice helps employers and employees achieve happier, fairer and...
Personal tax changes (clean energy)
1 March 2012
From 1 July 2012, the Government will deliver tax cuts to low and middle-income individuals by increasing the tax-free threshold and adjusting the first two marginal tax rates over two phases
The tax office web site has...
Key superannuation rates and thresholds
27 February 2012
The key rates and thresholds that apply in relation to contributions and benefits, employment termination payments, superannuation guarantee and co-contributions.
http://ato.gov.au/content/60489.htm...
Contractors / Employees – Payroll tax distinction
1 February 2012
For employers that have an exposure to pay payroll tax for prior years, it is also worth considering making voluntary disclosures to their relevant State Revenue Office and potentially considering opportunities to restructure their...
LAFHA changes
31 January 2012
The Assistant Treasurer has released a consultation paper on 29 November 2011 proposing a fundamental reform to how Living Away From Home Allowance (LAFHA) and other associated benefits will be taxed from 1...
FBT - Q&A - "Commercial" vehicle
31 January 2012
Question
An employee has recently salary package (novated lease) a used volkswagen Transporter (LWB) van. Part of the employees contribution is pre tax and post tax. Should...
Payroll Q&A - Flood Levy
31 January 2012
Question
In NAT70980-05.2011 "Tax table for employment termination payments" states:
"Calculating an amount for the flood levy
If you pay:
- ETPs
- an amount of unused leave with...
Warning on Retrospective Salary Sacrifice Arrangements
27 January 2012
A legitimate salary sacrifice arrangement cannot be made retrospectively for salary or wages which have already been earned.
For example, an effective salary sacrifice arrangement cannot include annual or long service leave you have accrued before...
GST treatment of retention bonds clarified
25 January 2012
On 14 December 2011, the Tax Office published GST Determination GSTD 2011/4 which considered the GST treatment of accommodation bond retention amounts or accommodation charges paid by residents of an aged care...
Amendments to the GST treatment of Appropriations...again
24 January 2012
As often happens when an outcome from a court case changes the intention of legislation, the government changes the original legislation. This is the process underway regarding GST and Appropriations.
On 23 November 2011, Treasury released draft legislation proposing changes to...
GST Q&A - purchasing goods from overseas
24 January 2012
Question:
What is the ruling when we purchase goods from overseas? Do we need to pay any GST on any amount that we purchase or is there a limit e.g. $1000?
Answer:
When purchasing goods...
GST Q&A - WET, WEG and GST
24 January 2012
Question:
Wine Invoice - I have just received an invoice from a local winery and I am confused with their Tax Codes. They have the codes WET, WEG and GST. I do not...
GST Q&A - residential house for the CEO
24 January 2012
Question:
Council owns a residential house which it provides to our CEO rent free (remote area housing). Is it proper that Council doesn't claim GST credits for any related purchases (e.g. payment to...
GST - Draft legislation about health insurance claims
24 January 2012
The 2011-12 Budget included an announcement to amend the GST law to ensure that certain supplies made to health insurers in the course of settling health insurance claims would be GST-free. On 21 November 2011,...
GST treatment of new residential premises and financial supply provisions
24 January 2012
Tax Laws Amendment (2011 Measures No 9) Bill 2011
This bill was introduced in the House of Representatives on 23 November 2011 and contained two main amendments to the GST provisions, namely:
GST treatment of new residential...
Australia’s Clean Energy Future - Gov't Update 2
24 January 2012
As part of the Clean Energy Future plan, the Australian Government is undertaking complementary work on energy. In December 2011, two major discussion papers were released:
the Department of Resources, Energy and Tourism (
Fringe benefits tax (FBT) reform – Living-away-from-home allowance and benefits
7 December 2011
The Government announced that it will introduce reforms to stop individuals from being able to exploit the tax exemption for living-away-from-home allowance and benefits.
This tax exemption is being increasingly misused by a narrow group of...
ATO - Fuel tax credit calculator
7 December 2011
The fuel tax credit calculator is an easy to use tool that calculates your fuel tax credit entitlements to be claimed on your business activity statement (BAS).
http://ato.gov.au/content/76519.htm...
August 2011 NTLG FBT Subcommittee meeting minutes
7 December 2011
The Australian Taxation Office has released minutes of the National Tax Liaison Group (NTLG) FBT subcommittee meeting held on 11 August 2011. Matters discussed include:
lodgment concession
FBT...
Q&A - FBT - eligible seminar
7 December 2011
Question
Good afternoon
The University is organising many seminars which are held on University premises.
The University provides food & drink at these seminars and sometimes this includes a small...
Q&A - FBT - new statutory fraction rates for motor vehicles
7 December 2011
Question
Hi there
I have a question on the new statutory fraction rates for motor vehicles.
If a new lease is entered into after 10 May 11, with a lease term of 3 years,...
Employee versus contractor: Beware the traps
7 December 2011
The Fair Work Ombudsman has released the findings of his office's audit into sham contracting in the cleaning services, hair and beauty, and call centre industries. He raised a number of issues...
Q&A - Payroll - Volunteers
7 December 2011
Question
The Department makes payments to a group of 7 volunteers who volunteer to be available every 3rd weekend (when the
New Draft Ruling on grants of financial assistance
5 December 2011
Draft GST Ruling GSTR 2011/D4, released on 2 November 2011, once again addresses the vexed question of how GST applies to financial assistance payments. This draft ruling is of...
Q&A - GST - overseas purchases
5 December 2011
Question:
What is the ruling when we purchase goods from overseas? Do we need to pay any GST on any amount that we purchase or is there a limit eg: $1000?
Answer:
When purchasing goods...
Q&A - GST - NFP community education courses
5 December 2011
Question:
My question relates to whether/when GST is chargeable on training workshops. We are a NFP social services and counseling organisation which sometimes provides community education /skills training workshops to...
WA Health salary packaging investigation draws to a close
5 December 2011
WA Health has completed its investigation into fraudulent salary packaging claims, which has resulted in the termination or resignation to date of 17 administrative staff, two health professionals, 23 doctors and 18 nurses from across...
Australia's Clean Energy Future - Local Government Matters
18 November 2011
Australia’s Clean Energy Future
UPDATE 01
Dr Damien L Lockie
Barrister and Mediator
In an historic vote on 8 November 2011, the Clean Energy laws package[1]passed the Senate. There...
Taxation Ruling 2011/3 Car fringe benefits:
9 November 2011
This Ruling, issued on 17 August 2011, sets out the Commissioner's opinion on how various arrangements may affect "the expenditure incurred by the person that is directly attributable to the acquisition or delivery of the...
FBT - Minutes of recent NTLG Sub-committee meeting
9 November 2011
The periodically held NTLG FBT Subcommittee meetings represent a forum where industry, professional bodies and taxpayers can bring anomalies and unfair or unclear applications of FBT...
FBT - Q&A - Determining what is an exempt vehicle
9 November 2011
Question
Could you tell me if the VW Caddy Life would be considered exempt from FBT? It is a 5 seat car with a pay load of 700kg.
GST - Q&A - Recouping cost of utility bills
9 November 2011
Question
If we pay a utility account, which includes GST, & we then recoup part of this cost from another body because the building is shared, are we right to be recovering the GST inclusive...
GST - Contributions and “consideration” - Clubs, community groups etc
9 November 2011
We frequently get asked whether GST applies to contributions towards (for example) capital works. The answer (as is so often the case) is ‘it depends’.
For GST to apply, there must inter alia be a supply...
GST: apportioning the consideration for a mixed supply
9 November 2011
Draft Addendum to GST Ruling GSTR 2001/8
A Draft Addendum, released on 26 October 2011, proposes amendments to GST Ruling GSTR 2001/8, which deals with the matter of apportioning...
Calls for changes to Fair Work rejected
9 November 2011
Senior government ministers have rejected union calls for changes to the Fair Work Act following the forced termination of industrial action at Qantas.
The ACTU has said a Fair Work Australia decision proved...
Superannuation - Federal bid to end workforce age discrimination
9 November 2011
People who choose to keep working after they turn 75 will be entitled to superannuation contributions from employers, under a plan to end discrimination against older workers.
The surprise announcement came as the government unveiled legislation...
Slippery When Wet: Employer Not Liable for Lunchtime Fall
9 November 2011
The Administrative Appeals Tribunal has upheld a decision that a worker was not injured in the course of employment or at her place of work when she slipped on wet ground during her lunch break...
Consultation paper released: A definition of charity
9 November 2011
The government has released a consultation paper on the definition of charity as part of a consultation process. The closing date for submissions is 9 December 2011.
http://ato.gov.au/content/00297407.htm...
ACNC Taskforce launches its website
9 November 2011
The Australian Charities and Not-for-profits Commission (ACNC) Taskforce has launched its website to keep you up-to-date on their activities.
http://ato.gov.au/content/00297534.htm...
Public holidays and sick leave
8 November 2011
Should employees get paid for a public holiday if they take sick leave either side of it? They should, but employers can ask for evidence that they were sick.
An entitlement to paid time off work...
Death of an Employee
7 October 2011
An employer is not required to withhold amounts from these payments for work or services made after the death of the worker. This includes income that was earned prior to death, but paid after the...
Salary packaging - iPads – Slow take up rate
7 October 2011
Despite the ATO acknowledging that iPads can be treated in the same way as mobile phones for tax purposes it appears that employers are exercising a fair amount of caution before...
Q&A - FBT - Mobile phones private use
7 October 2011
Question
Where employees are issued with mobile phones for use in the employee's employment duties is there a business and private % ratio that determines when FBT will be charged?
Or is all...
Q&A - FBT - Rates for vehicles pre/post April 2011
7 October 2011
Question
What is the FBT rate for vehicles purchased for private use after April 2011?
What is the FBT rate & kilometres for vehicles purchased after...
FBT - Reporting fringe benefits on employees’ payment summaries...Confused?
7 October 2011
There is often confusion amongst employers on the specific requirements around reporting fringe benefits on employees’ payment summaries and the impact thereof on employee benefit and tax concession entitlements. We have set out below a...
Q&A - Payroll - RFBA
7 October 2011
Question
On the 1 January 2012, our entity will be amalgamating with a state department. Our ABN will be cancelled as from this date.
My question relates to RFBA for...
Employment Contracts - Playing the Right Instrument
7 October 2011
The Federal Court has recently rejected an employee’s argument that his contract of employment is a “workplace instrument” giving rise to a workplace right under the Fair Work Act 2009 (Cth) (the...
Payroll - Change to government paid parental leave scheme
7 October 2011
The Australian Government has announced that new dads will receive about $1180 as part of the federal government's national paid parental leave scheme.
In particular, from January 2013, fathers or partners will get
GST - is the very basis of our GST system under siege?
7 October 2011
In this month's update we tackle a couple of cases and ask you to consider the implications for your organisation. The articles are technical and although you may not initially see the...
GST - Just what is a “supply”?
7 October 2011
Just what is a “supply”?
A recent court decision again highlighted the difficulty we face in Australia because of the wide-ranging definition of “supply” in s 9-10 of the GST Act. The Full Federal Court unanimously...
GST - Draft Addendum looks at a supply of rights
7 October 2011
Draft Addendum looks at a supply of rights
Hold into your hat and get the coffee out to read through this one! It is complex but again we encourage you to read it through and consider...
GST - Q&A - Festival entry donation
7 October 2011
Q - We hold a large festival each year and this year we are allowing patrons the option to place a donation into a bucket at the entrance to help offset the cost.
What...
GST - Q&A - Dishonour & Admin Fee
7 October 2011
Q - Dishonour & admin Fee
When Council is charged a dishonour fee by the bank for a dishonoured cheque or direct...
GST - The Group of 91
7 October 2011
In case you missed it, the Tax Office recently published a large horde of GST public rulings - 91 to be exact. They are to be found in its Legal Database in a new grouping...
Australia's Clean Energy Future - Support for Local Government
8 September 2011
I am delighted to announce Damien
Q&A - GST - ITCs on outgoings (rates)
6 September 2011
Question:
Council has entered into an agreement to lease land and buildings for a term of 10 years with a 10 year option. (Community / commercial occupation)
Under clause 2.1.5 of the lease agreement the Shire is...
Q&A - GST - Margin Scheme
6 September 2011
Question:
We have subdivided some Council land that has been owned pre 2000. We have been using the margin scheme to calculate and remit GST on the sale of the blocks. However, at a recent PD...
Q&A - GST - Cliaming ITCs on reimbursment
6 September 2011
Question:
We are reimbursing a customer for windscreen repairs for his motor vehicle. He provided us with a quote (not a tax invoice) for the amount we needed to reimburse him.
If the customer provides us with...
GST-free threshold on imports to stay
6 September 2011
On 4 August 2011, the Productivity Commission released the Draft Report of its inquiry into the economic structure and performance of the Australian retail industry. Among other things, it looked at the sustainability and appropriateness...
GST financial supply amendments - draft legislation released
6 September 2011
In the 2010-11 Budget, the Government announced that it would amend the financial supply provisions of the GST Act to clarify the operation of the legislation and reduce compliance and administrative costs with effect from...
GST - The inconvenience of court decisions
6 September 2011
The Government has moved quickly to clarify how residential property is to be treated under the GST, following a Full Federal Court decision last year that found GST was not payable on the full value...
Q&A - FBT - Corporate Health Plan
6 September 2011
Question
Just a quick question. Pleasant View Council has provided Health Link Consultants with a request for proposal for Pleasant View Council Corporate Health Plan (part of our loyalty program for employees). The Local Government...
Q&A - FBT - iPad accessories
6 September 2011
Question
I have a query in regards to salary packaging of additional items with an iPad. The staff member has requested that the following items be packaged: Smart Cover, Adapter, Dock, Connector and Wireless Keyboard. The...
FBT - natural disasters affecting employees
6 September 2011
Many members and their staff were affected by the recent floods and other natural disasters.
Three recent ATO interpretative decisions have looked at the application of Fringe Benefits Tax (FBT)...
Making the Superannuation Contribution Caps Fairer in Australia
6 September 2011
People who make excess concessional contributions to their superannuation may benefit from changes contained in a consultation paper released last week by the Assistant Treasurer and Minister for Financial Services and Superannuation.
Individuals who...
$19,000 fine for false payment records
6 September 2011
A recent decision show what a tightrope employers walk when they do no keep proper records.
Perth company Professional Gyprock Solutions (PGS) and its director Lin Qiao...
Low income earners to get up to $35,000 extra super
6 September 2011
Workers earning $37,000 per year or less will have the taxation on superannuation contributions abolished, under new guidelines released by treasury.
Currently, the lowest income-earning bracket receives no taxation benefit from contributing to their super, due...
Q&A - Payroll - ETPs
6 September 2011
Question
When taxing an employee's final pay, what are our responsibilities with regard to tax applied? That is, are leave entitlements such as long service leave and annual leave taxed as an ETP...
The role of Local Government in Australia's Clean Energy Future
6 September 2011
The Gillard Government plans to introduce key legislation for Australia’s clean energy future into the September sittings of Parliament.[1]A start date of 1 July 2012 means planning for its introduction and...
Salary Sacrifice and Activity Statement Errors
5 September 2011
A common error when completing the BAS is the overstatement of W1 where salary sacrifice arrangements are in place.
Often payroll summary reports include the salary sacrifice in the gross wages total. If...
Contractors – Fair Work Crack Down
5 September 2011
A sham contracting arrangement occurs when an employer attempts to disguise an employment relationship, or proposed employment relationship, as an independent contracting arrangement. This is usually done to avoid having to give the employee their...
GST - New Appropriations Ruling - Sting in the tail
8 August 2011
Now you have an idea of what is contained in the new ruling let's look at what it actually means.
As we see it there are two key changes arising out of the
TaxEd search function - a GREAT time saver
3 August 2011
TaxEd has recently upgraded the search facility for members. Using a specific Google search algorithm created for TaxEd, members can now instantly search the general ATO...
GST - GSTR 2011/2 new ruling on Appropriations
3 August 2011
Appropriations to government-related entities
The new GST Ruling[1]dealing with the treatment of appropriations was released on 13 July 2011. The Ruling deals with payments made between government-related entities that are specifically covered by...
Q&A - FBT Cars - what 'new contract' actually means
3 August 2011
Hi - My question relates to the new rules around FBT in relation to Motor Vehicles.
In the 2011-12 budget released in May, new rates would be phased in over 4...
FBT - Cars - new legislation outlined
3 August 2011
As most readers may be aware, the Federal Government recently enacted measures changing the application of Fringe Benefits Tax to cars. These measures were first mooted during the Federal Budget announcements in May 2011. We...
Payroll - QLD Ruling
3 August 2011
The Queensland Office of State Revenue has recently issued a revenue ruling on the payroll tax nexus provisions. The nexus provisions of the Payroll Tax Act determine in which Australian jurisdiction (state or territory) payroll...
Q&A - GST - Lease surrender payment
3 August 2011
Question
We are paying a contractor a lease surrender payment for approx $80,000. We will therefore be including GST in our payment to them.
The contractor however is not registered for GST.
In terms of...
Q&A - GST - Sale of library
3 August 2011
Question
We are a Local Government body (Council) and we are selling an unused Library, that was held prior to 1 July 2000 and it was valued at that date. The library does have a residential...
Q&A - GST - Funding from overseas for conference
3 August 2011
Question
A New Zealand based entity wishes to contribute funds to an Australian University who will be conducting a conference here in Australia. It is considered a joint effort although all the income will be treated...
GST - Meaning of "residential premises" and "commercial residential premises"
3 August 2011
In our June newsletter, we referred to the new Draft Ruling issued by the Tax Office which addresses the meaning of “residential premises” and “commercial residential premises”.
We thought it might be useful to provide some...
GST - Ex gratia payments by insurers
3 August 2011
GST - It isn’t often that we see largesse from insurance companies, but during the recent spate of natural disasters, there have been examples of insurers making payments that are not strictly due under the...
Salary Packaging and On Costs
3 August 2011
We have been receiving a number of enquiries in relation to the effect of salary sacrifice arrangements on on-costs such as Payroll Tax and Work Cover insurance.
There is a misconception is that the
Work Cover and Contractors
3 August 2011
Even where someone is engaged as a contractor and they render there account by invoice you may be required to pay Work Cover premiums. The definition of an employee for work cover purposes differs to...
Fuel tax credit rate change for heavy vehicles from 1 July 2011
8 July 2011
From 1 July 2011, the fuel tax credit rate for fuels such as diesel or petrol for use in heavy vehicles on public roads is reduced to 15.043 cents per litre. This...
Paid Parental Leave in Practice - and Toolkit link
7 July 2011
We have a number of members that are now putting into place the paid parental leave scheme. It is worth taking a look at an issue that we have come across in practice.
The Issue:
We already...
FBT rates, thresholds and other amounts for 2011-12
7 July 2011
- Taxation Determinations TD 2011/2-6, 14
The Tax Office has released 6 determinations dealing with FBT rates, thresholds, etc for the 2011-12 FBT year...
FBT Q&A - Calculation of Reportable Fringe Benefits
7 July 2011
Question
We have been questioned by an employee regarding the calculation of their Reportable Fringe Benefit, and want to confirm we are treating this correctly.
For a car benefit using the statutory formula the statutory...
FBT Q&A - which relocation expenses are FBT exempt as per FBT legislation
7 July 2011
Question
Can I please ask for which employees relocation expenses are FBT exempt as per FBT legislation.
1)Where the current employer requires a staff member to work at another...
Reportable employer superannuation contributions - exclusion
7 July 2011
In TLA Bill No. 4 of 2010 the Government proposes to amend the definition of "reportable employer superannuation contributions" (RESC) in s 16-182, Sch 1 to...
Salary Sacrifice - over payment?
7 July 2011
What happens where the amount salary sacrificed does not equate to the amount actually spent?
An employee with a novated lease that did significantly less kilometres per annum than what...
FBT - updated list of exempt motor vehicles (Dual Cabs)
4 July 2011
Eligibility criteria
Vehicles included in this listing are not automatically exempt from FBT. You must meet the eligibility criteria below for the exemption to apply.
An employee's use of a taxi, panel...
Fuel tax credits rates and eligible fuels
4 July 2011
Rates from 1 July 2011
Use the rates in this table to find out how much you can claim. The fuel tax credit rate varies according to...
Division 81 Bill Passed
1 July 2011
The Bill changing the rules for Division 81 (fees and charges) was passed by the Senate on 15 June and received Royal Assent on 27 June. It is now Act No 41 of 2011.
Over the...
GST - New draft Ruling on the meaning of “residential premises" and "commercial residential premises"
1 July 2011
Draft GST Ruling GSTR 2011/D2, released on 21 June 2011, sets out the Commissioner's views on the meaning of "residential premises" and "commercial residential premises" for the purposes of Subdiv 40-B (residential rent), Subdiv 40-C...
GST - Excursions and Field Trips
1 July 2011
Supplies of excursions and field trips are GST-free under s 38-90 of the GST Act provided they are directly related to the curriculum of an education course and are not predominantly recreational.
Whether an excursion or...
Q&A - Hobby Artist
1 July 2011
Question
We are wanting to buy some artwork from an artist who is only 10. The total amount owing is $120 for 3 separate pieces ($65, $25 and $30 each). Do we require a statement by...
GST Q&A - Sponsorship
1 July 2011
Question
Sponsorship - I have been asked to raise an invoice for sponsorship of 2011 business achievement awards and am unsure of the GST implications. The business will have their logo on all promotional merchandise, recognition...
Salary Packaging of Cars - Budget Changes
31 May 2011
Given the changes announced in the Federal Budget to the statutory formula, now is the time for employers and employees alike to review all car packages as this will affect the 2011-12 FBT year.
Employers Should?
Consider using...
Payroll - Notice of Termination
31 May 2011
Notice of Termination
A notice period is the amount of notice an employer must give an employee if they plan to terminate the employee's employment.
Under the NES if an employer terminates the employment of a permanent...
FBT - the world of car benefits are about to change
31 May 2011
The current approach
Employers will generally be taken to determine the taxable value of car benefits under the statutory formula method, unless they specifically elect to use the operating cost method.
Essentially, using the statutory formula method,...
GST - Contractors and agency - are you getting it right?
31 May 2011
Reimbursing Contractors’ Expenses
We are often asked about the GST treatment of reimbursements to contractors who incur expenses during a contract. As with most GST questions, the answer is “it depends”.
The issue is whether the contractor...
FBT Budget Q&A - Cars - Flat 20% Valuation
31 May 2011
Question
The term "new vehicle contracts" - will this be deemed as the invoice date of the contract or the date of possession of the vehicle?
Does this also apply to vehicles under a lease...
FBT Q&A - Definition of 'Pooled Vehicle'
31 May 2011
Question
Concerning the definition of 'Pooled Vehicle', we had previously understood a vehicle that was pooled for Business Use was exempt from reportable value but reading notes and it appears to be sharing of Private Use....
GST Q&A - School supplies
31 May 2011
Question
A school has asked whether or not they should charge GST on the following:
Camping & horse riding excursions whereby the school has been charged GST.
VCER levy whereby the school is charging pupils for art supplies...
GST Q&A - Buying artwork
31 May 2011
Question
We are wanting to buy some artwork from an artist who is only 10. The total amount owing is $120 for 3 separate pieces ($65, $25 and $30 each). Do we require a statement by...
FBT Budget - Cars – Flat 20% Valuation Rate to Apply
11 May 2011
The Government announced what would amount to implementation of a Henry Tax Review recommendation that the current statutory rates for valuing car fringe benefits be replaced with a single statutory rate of 20%, regardless...
Draft regulations to specify taxes, fees and charges still subject to GST
11 May 2011
With the impending changes to Division 81, the Assistant Treasurer has released draft regulations to specify those taxes, fees and charges that will still be subject to the GST.
In a recent article, we referred to the...
GST - Budget - Reporting Government grants and payments
11 May 2011
The Government will provide $43.3m over four years to the Tax Office to allow it to monitor the accurate accounting of government grants and payments. The increased funding will enable the Tax Office to collect...
GST - Budget - Deferral of Board of Taxation recommendations
11 May 2011
The Government has announced the deferral of a number of measures announced in the 2009-10 Budget which were to implement the Board of Taxation recommendations relating to the administration of GST. The measures were to...
FBT checklist for 2010-11
10 May 2011
The following link will display a checklist to assist you with your FBT return for the 2010-11 FBT year.
http://www.taxed.com.au/documents/2011FBTCHECKLIST.docx
Simply save the document.
Good luck for all those going through the joys of this year FBT return.
...
GST Q&A - Rent - donation or consideration
4 May 2011
Question
Entities are able to rent facilities of an entity but it is suggested to them that they are free to contribute a token amount. They don't have to pay anything if they don't want to.
If...
GST Q&A - scholarships with strings attached
4 May 2011
Question
An organisation wants to provide our Department with a scholarship. There are a number of criteria associated with the scholarship, for example, naming rights.
Are we correct in invoicing the organisation the amount plus GST as...
GST calculation on mixed supply - Luxottica case: ATO view
4 May 2011
On 19 April 2011, the ATO released a Decision Impact Statement giving its view on the Full Federal Court's decision in FCT v Luxottica Retail Australia Pty Ltd[1]]. The case concerned the...
FBT risk and compliance update
4 May 2011
FBT risk and compliance update
The ATO has previously advised that there are a number of risk areas that are being focused on. The current status of that work with these risks is as follows.
Car fringe...
Division 81 Changes - here we go
7 April 2011
Introduction
The recently released Tax Laws Amendment (2011 Measures No. 2) Bill 2011 proposes to change the way we determine those Australian fees and charges that are to be exempted from GST in future. These amendments...
FBT - Travel on stand-by duty
7 April 2011
Travel to work which is required of an employee on stand-by duty may not be private use of a vehicle. It will not be private if the employee is effectively required to start work prior...
FBT - Vehicles - What is ‘private' use’?
7 April 2011
A car benefit can arise if there is private use of the vehicle by an employee or associate of an employee.
'Private use' is defined in the FBT Act to mean:
… in relation to...
FBT - Remote Area Benefits - please read this if you are in a regional location!
7 April 2011
We recently ran training on Remote Area Benefits. It has come to our attention that many TaxEd members/contacts are in locations classified by the Tax Office as being remote but they didn't realise this was...
Featured QA - FBT - exempt vehicle - all or nothing
7 April 2011
Question
We have a utility vehicle which is usually exempt from FBT as it only has commuter use, however in August the usage of this vehicle temporarily changed to include full private use until March (although...
Featured QA - GST - Family Day Care
7 April 2011
Question
I have two questions in relation to our Family Day Care operations.
Firstly, the family day care centre owns a playgroup area. The area is currently being rented out to a third party for a playgroup...
Featured QA - GST - on-charging expenses
7 April 2011
Question
We recently received a Tax Invoice from a consultant that Council engaged. On the Tax Invoice there is a charge for accommodation expenses. The accommodation expenses are input taxed and therefore the consultant has not...
Featured QA - GST - School charges
7 April 2011
Question
A school has enquired about whether they should charge GST on the following items:
GST on billing for compulsory camps.
GST on books and materials.
GST on tuition fees.
GST on capital levy charged (a compulsory amount charged per...
FBT Entertainment Technical Paper
7 March 2011
At this time of year FBT is high on everyone list. For Tax Exempt bodies, entertainment is always an issue and we receive many questions. As part of the recent FBT training series we held...
Featured QA - FBT - providing transport options for staff
7 March 2011
Question
Our Council are trying to encourage 'greener' ways of getting to work. We are considering reimbursing employees for the cost of items such as a bicycle and public transport tickets and then they will have...
Featured QA - GST on committee grants
7 March 2011
Question
I have received some requests to issue cheques to various committees within our shire and I need clarification on what paperwork I require, if any, from the Committees from a GST perspective.
The funding is for...
Featured QA - GST on sponsorship
7 March 2011
Question
Council has entered into a sponsorship agreement with a company for a public event. The company will provide $1,000.00 and Council will allow them the following promotion opportunities:
- A short speech at the event (2...
GST - The new “Division 81” rules
24 February 2011
Under s 81-5(1) of the GST Act, certain taxes, fees and charges imposed by the Commonwealth, States and Territories can be treated as the provision of “consideration” for a taxable supply unless specifically exempted under...
The Flood Levy
24 February 2011
The Federal Government have recently announced a levy, applicable for the year ended June 2012, to assist in infrastructure rebuild after the devastating flood in the Eastern States.
The proposed levy of 0.5 per cent will...
GST - Out of scope
11 February 2011
Question 1.
Do you consider payments made to entities that are not registered for GST as 'out of scope' or GST free?
Answer 1.
Out of scope. Supplies are only GST-free if they are contained in Div 38...
RCTI Agreements
11 February 2011
Question
In regard to RCTI agreements - We have community organisations that apply for Council grants. There are at least two grant rounds in each financial year and some organisations apply each time.
Currently, Council creates a...
GST Q&A - residential premises
11 February 2011
Question
I note in NAT 72957-07.2010, it says "if you purchase existing residential premises, the sale is input taxed, so GST cannot be claimed on the purchase".
Does this include the Title Office Searches, Land Tax Search,...
Meal Entertainment - 50/50 method under section 37BA and section 152B of the FBTAA
10 February 2011
Background
Section 37BA refers to (50% of) the expenses incurred by the employer in providing meal entertainment for the FBT year as part of the taxable value valuation of meal entertainment. An income tax exempt employer...
Australian disaster relief fund
9 February 2011
A number of members have been impacted significantly by the recent weather events around Australia. As part of their response to donations coming in there have been questions around their capacity to accept them from...
It isn’t just you – GST is complicated
1 February 2011
Deloitte has released its GST Adviser Survey 2010, GST ten years on - Reinventing the wheel?. The survey tested the views of the in-house advisers in Australia's largest taxpayers. Some key points from the...
GST and Property - Common sense finally prevails
1 February 2011
In a decision handed down in the Sunchen case,[1]the Full Federal Court unanimously dismissed the taxpayer's appeal and held that whether a property was “residential premises to be used predominantly for residential...
Government consultation - national not-for-profit regulator
1 February 2011
On 21 January 2011, the Assistant Treasurer and Minister for Social Inclusion released a consultation paper on the design of a new national regulator for the not-for-profit sector.
The consultation paper seeks your views to determine...
GST on water termination fees: rules to be amended
13 December 2010
The Government has announced that it will amend the termination fee rules applying in the Murray Darling Basin to allow operators to add GST to termination fees.
The termination fee rules will be backdated to 1...
GST business systems checklist guide from the ATO
13 December 2010
According to the ATO, outdated or unreliable business systems could be costing small businesses time and money due to incorrectly reporting GST. Last year, the ATO identified $21m in unreported GST liabilities after contacting 503...
Is student accommodation taxable?
1 December 2010
We are often asked about the GST status of student accommodation – is the supply of student accommodation a taxable supply or is it input taxed?
A recent ATO Interpretative Decision[1]has clarified the...
GST Q&A - Name missing on Tax Invoice, can we claim GST
29 November 2010
Question
We received a tax invoice from a supplier. The supplier did not write our name on the invoice. They wrote " To Cash". I guess they were expecting be paid cash when delivering the good....
GST Q&A - confusion over cemetery fees and charges
29 November 2010
Question
I have a query with regard to GST on cemetery fees and charges. I have conflicting advice in my possession on the GST treatment of burials plot and memorial site sales in particular. I received...
FBT Case - Virgin Blue
29 November 2010
Virgin Blue Airlines Pty Ltd v FC of T2010 ATC 20 – 188, [2010] FCA 631 – car parking benefit – statutory interpretation of ‘in the vicinity of’ – Fringe Benefits Tax Assessment Act 1986.
The taxpayer leased...
FBT - ATO relaxes attitude on Travel Diaries and No-Private-Use Exemption
29 November 2010
Background
Many employers require their employees to travel on business that extend for more than five nights and have strict policies that it will only ever pay for work-related expenses. As such, the taxable value of such...
GST & Real Estate - the saga continues
29 November 2010
It is difficult to imagine an area of Goods and Services Tax (GST) where mistakes are more costly than those involving supplies of real property. Dealings in real property typically involve very large sums of...
Claiming deductions for education expenses against youth allowance
23 November 2010
On 11 November 2010, the High Court dismissed the Commissioner's appeal against the decision of the Full Federal Court in Federal Commissioner of Taxation v. Anstis. The Full Federal Court had decided that Ms...
GST - in-kind transaction between Council and non-for-profit organisation - Not so kind
7 November 2010
Re: an in-kind transaction between Council and non-for-profit organisation, noting that one of the invoices is for $7,000 plus GST, and the other for $7,000 with no GST applicable.
Council's supply to the non-for-profit organisation is...
FBT liability for Council for State Gov't employee?
7 November 2010
Council has a partnership with the State Government for providing Museum resources in our area.
The partnership involves the Council funding 2/3rds of the annual operating budget. A Museum development officer working in the area has...
FBT and prize money
7 November 2010
A staff member has received a prize provided by the employer. The recipient intends to use the prize money to travel overseas and do some work related activity in conjunction with 5 weeks annual leave....
Alternate transport to work an FBT winner - Scooter
7 November 2010
Can you advise whether FBT is liable if we provide a staff member on an occasional basis with a scooter to use to get to and from work?
Answer
As the provision of the scooter cannot constitute...
FBT Developments - Paid Parental Leave
7 November 2010
Legislation
Paid Parental Leave (Consequential Amendments) Bill 2010 received royal assent on 14 July 2010 as Paid Parental Leave (Consequential Amendments) Act 2010 (105 of 2010). The Fringe Benefits Tax Assessment Act 1986 (FBTAA) was amended so that:
What is an agency arrangement?
7 November 2010
From a strictly legal point of view, an agency arrangement is simply one where one person (the agent) is given the authority to act on behalf of another person (the principal). The important point though...
FBT - ATO Considers Provision of Internet Access Under 58X Exemption
4 November 2010
The subject of our discussion in last month’s FBT article was the primarily work use requirement of a laptop computer for purposes of the section 58X exemption. Another aspect is whether the scope of such...
Attribution of GST
4 November 2010
Council has sold a road reserve to the adjacent owner. An agreement has been raised to pay by 2 instalments the purchase price, which is $7,700. I have been informed that the full GST amount...
Contractor reimbursements – do they attract GST?
4 November 2010
Introduction
We often get asked whether GST needs to be added to a reimbursement of an expense incurred by a contractor.
Example
Wombat Council hires John, a computer programmer to write a program for them. In order...
Salary Sacrifice and Award Pay Levels
4 November 2010
Recently a college refused to accept a salary sacrifice arrangement requested by one of its teachers, until they received permission from Fair Work Australia. The salary sacrifice arrangement requested by the teacher would see her...
Time limits for refunds of unclaimed input tax credits
31 August 2010
The court has recently confirmed that the Taxation Administration Act 1953 (which deals with time limits for claiming tax refunds) applies to refunds of unclaimed input tax credits. In the case of Australian Leisure Marine...
New Tax Invoice Requirements
17 August 2010
Summary
Schedule 3 of the Tax Laws Amendment (2010 GST Administration Measures No. 2) Act 2010 amends the current rules that determine when a document can be treated as a “tax invoice”. The new...
Division 81 - July 2010 Update
9 July 2010
Although the Budget promised changes to the way Division 81 will operate we still have the pleasure of working with it for some time yet.
Following is a link to the latest instalment from...
iPads and the ATO
29 June 2010
For income tax purposes, the ATO considers iPads are laptops.
For FBT purposes, it doesn’t really matter whether iPads are considered laptops, PDAs or even mobile phones as the exemption and salary packaging concession no...
Taxation Administration Act Withholding Schedules 2010
29 June 2010
The PAYG withholding tables effective 1 July 2010 have been released and can be found at:http://law.ato.gov.au/atolaw/view.htm?docid=OPS/OPS20101/00001...
Exempt vehicles
29 June 2010
Following some potentially misleading advertising during the period of the investment allowance, the ATO has concerns about the potential extent of non-compliance in relation to exempt vehicles. The ATO has updated the web page information...
Tax law change for overpayments on fuel tax credits
17 June 2010
Amendments recently announced by the Australian Government affect the law on fuel tax credits. These amendments arose from the Board of Taxation review into the administration of the goods and services tax (GST). Most of...
Expense payments reimbursed in a later FBT year
4 June 2010
The ATO has ruled this month to the effect that where an expense payment benefit is provided as a reimbursement of an employee’s expenses incurred in a previous year, does not affect the availability of...
Exempt Fees and Charges (Division 81) to change – budget
4 June 2010
The GST law will be amended to replace the current mechanism for exempting Australian taxes, fees and charges with a principles-based legislative exemption, with effect from 1 July 2011.The GST law currently specifies that Australian...
Budget - GST Margin Scheme
4 June 2010
The margin scheme provisions will be restricted to clarify and simplify the current provisions, effective from 1 July 2010. The current margin scheme provisions are quite complex. The proposal to simplify the margin scheme provisions...
ATO funding will drive more GST audits
4 June 2010
All GST registered entities should ensure their GST affairs are in order before the Australian Taxation Office comes knocking following the Budget measures to increase GST compliance.Using the $337.5 million provided the ATO will target...
Car parking threshold for the fringe benefits tax year
4 June 2010
The car parking threshold for the fringe benefits tax (FBT) year commencing on 1 April 2010 is $7.46. This replaces the amount of $7.25 that applied in the previous year commencing 1 April 2009....
Benchmark interest rate to be used for the fringe benefits tax year commencing on 1 April 2010
8 April 2010
The benchmark interest rate for the fringe benefits tax (FBT) year commencing on 1 April 2010 is 6.65 per cent per annum. This rate replaces the rate of 5.85 per cent that has applied for...
Rates to be applied on a cents per kilometre basis for calculating the taxable value of a fringe benefit arising from the private use of a motor vehicle other than a car for the fringe benefits tax year commencing on 1 April 2010
8 April 2010
The rates to be applied where the cents per kilometre basis is used for the fringe benefits tax (FBT) year commencing on 1 April 2010 are: Engine capacity Rate per kilometre 0 - 2500cc 45...
Reasonable food component of a living-away-from-home allowance for expatriate employees for the fringe benefits tax year commencing on 1 April 2010
8 April 2010
The amounts listed below are acceptable as a food component for the fringe benefits tax (FBT) year commencing 1 April 2010. The amounts result from the indexation of the previous year's food component. Per week...
Indexation factors for valuing non-remote housing for the fringe benefits tax year commencing on 1 April 2010
8 April 2010
The indexation factors for the purpose of valuing non-remote housing for the fringe benefits tax (FBT) year commencing 1 April 2010 are: New South Wales 1.068 Victoria 1.057 Queensland 1.071 South Australia 1.050 Western Australia...
Exemption threshold for the fringe benefits tax year commencing on 1 April 2010?
8 April 2010
The exemption threshold for the fringe benefits tax (FBT) year commencing 1 April 2010 is $7,190. This replaces the amount of $7,063 that applied in the previous year commencing 1 April 2009.Two conditions must be...
FBT – Exempt Vehicle listing
21 March 2010
New information from the ATO explains when the use of certain motor vehicles is exempt from fringe benefits tax (FBT), and lists vehicles that may qualify for the exemption and vehicles that do not. This...
New tax agent services regime and in-house tax advisors
21 March 2010
The Assistant Treasurer announced that the Government will pass regulations to exclude ‘in-house' tax advisors from being required to register as tax agents. According to the Assistant Treasurer, in-house tax advisors were specially referred to...
Common causes of GST errors
21 March 2010
The ATO has released details of where they have found the most common causes of GST errors.These are:• when preparing activity statements, claiming GST credits without a valid tax invoice;• understanding GST law – incorrectly classifying sales...
Will the Henry changes affect charities, PBIs etc?
21 March 2010
The Henry tax review recommendation to end Fringe Benefits Tax concessions, which allows charity-run hospitals and nursing homes to top up payment to staff, could strip salary perks of some of the lowest-paid workers. The...
Reportable Employer Super Contributions
21 March 2010
From 1 July 2009, paying salary sacrifice and extra super for your employees may affect your reporting and payroll system. This information will assist employers to work out how much of the super contributions they...
GST law on tax invoices to be amended: draft legislation
21 March 2010
The government has released draft legislation proposing further reforms to GST laws. The measures in the draft legislation form part of a package of reforms that were originally announced in the 2009 – 10 Federal...
|
