Blog Page 3

CGT exemptions have been scrapped. What does that mean for you?

0
CGT exemptions have been scrapped. What does that mean for you?
CGT exemptions have been scrapped. What does that mean for you?

Are you an Australian living or working overseas with a family home in Australia? Or you know someone who is? If so, be sure to consider the impacts of the capital gains tax (CGT) on you from 30 June 2020.

Since 1985, the exemption of Australian expatriates from the CGT tax has been available for homes which have never been rented out for more than six years at a time. However, following the scrapping of the CGT exemption under the A$581m federal government plan, Australians working overseas will have to sell their property before the 30th of June 2020 to avoid CGT and still be eligible for CGT main residence exemption.

With the removal of CGT exemption past June 2020, Australian expats who own property in Australia will be required to pay CGT dating all the way back to when they first bought the property. That is, if an ex-pat was to have bought their property in 1985, they would have to pay an accumulation of their tax owing in CGT from 1985 to 2020. The only way to avoid such hefty tax payments would be to sell your property on or before the 30th of June or to re-establish Australian residency before selling the property.

Understandably, the new change will impose a sizable cost on Australian expats and has come as a result of the influx of speculative foreign investors as well.

As every situation is unique, taxation planning customised to every taxpayers specific circumstances are advised. In order to avoid the accumulated CGT payments, Australian expats need to be aware of their financial standings and be ready to make a quick decision regarding the selling or keeping of their Australian property.

Seeking out tax advice from knowledgeable tax specialists, employing organised bookkeeping services and detailed financial statements written up by accountants in preparation for making such an important decision regarding your Australian property is heavily recommended to ensure the new CGT laws don’t cause you financial problems.

What deductions can you claim on your website?

0
What deductions can you claim on your website?
What deductions can you claim on your website?

Most businesses nowadays have some sort of website, but designing, creating and maintaining a website for your business can be complicated. Many businesses use website services to develop and design their website for them if they don’t have the expertise or time to do it themselves.

Often, this can be an expensive venture. Not only is there a fee to create the website, but there are often the continual costs of tweaks, maintenance and upgrades after the website are already up and running. small businesses can claim deductions for website development costs.

Businesses that incur the cost of developing a website before they begin running their business can typically claim 20% of the cost each year over five years upon starting up.

Businesses that are already up and running with an aggregated turnover of less than $2 million can use the simplified depreciation rules:

  • If the cost of the website development is less than the instant asset write-off threshold of $20,000, you can claim a deduction for the full expense amount in the income year they acquire the expense.
  • If the website costs are equal to or more than the instant asset write-off threshold, owners can allocate it to a general small business pool for accelerated depreciation deductions.

However, it should be noted that you cannot use the simplified depreciation rules if you choose to allocate expenditure on the software to a software development pool.

You can also claim an outright deduction for specific running and maintenance costs, such as server hosting fees, domain name and registration fees in the same income year the expenses are incurred.

What does the coronavirus stimulus package mean for businesses?

0
What does the coronavirus stimulus package mean for businesses?
What does the coronavirus stimulus package mean for businesses?

Amidst the chaos of the COVID-19, better known as the coronavirus, and concerns for Australia’s weakening economy, the Morrison government most recently released a “coronavirus stimulus package” largely targeted at stimulating the Australian economy through cash payments and tax relief for small to medium-sized businesses.

Worth more than $17 billion, the stimulus package is planned to be spread across this financial year as well as the next, with half of the package scheduled for release into the economy before June 30th. In order for an immediate boosting effect on the economy, some changes have already been implemented and here’s a breakdown for you below:

  • Businesses can access an expanded instant asset write-off, from $30 000 to $150 000. This is to encourage immediate spending by businesses to improve cash flow.
  • Small businesses with an annual turnover of less than $50 million can claim tax deductions. Such tax deductions can go up to $30 000 for company vehicles, tools, office equipment and the like.
  • Small to medium businesses will receive cash payments between $2000 and $25 000 to help pay wages and increase the ability to employ extra staff. 700 000 small businesses will be given these cash payments, making up a significant portion of the package.
  • Businesses hiring apprentices will also benefit from the support package – with $1.3 billion in support payments aimed to keep hundreds of thousands of apprentices employed.
  • Larger businesses can also claim tax deductions. Up to $150 000 can be tax deducted for businesses with an annual turnover rate of up to $500 million.
  • Cash payments of up to $500 will also be paid to welfare recipients and pensioners to encourage more spending.

Pin It on Pinterest

Share This