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EOFY 2021 – Final Reminder Superannuation Contributions

The end of the 2020-2021 financial year is nearly here.  This is a reminder about getting a tax deduction in the current financial year for superannuation contributions.

Generally, to get a tax deduction for a superannuation contribution for your employee, the superannuation fund must have received the payment by 30 June.  Making the payment before 1 July will not guarantee that this has happened.

If you want to get a tax deduction for the contributions, make sure they are paid well before 1 July 2021 so there is time for the money to be received by your employees’ superannuation funds.  Otherwise, the deduction will have to be claimed in the year ending 30 June 2022.

There is a slightly different position if you use the ATO’s Small Business Superannuation Clearing House (“SBSCH”).   If you make the superannuation contributions to the SBSCH on or before close of business on 30 June, the ATO will consider that the payment has been received by the employees’ superannuation funds and you will get a tax deduction.  This concession only applies to the SBSCH and not other clearing houses.

Also, please remember that the super contribution rate increases to 10% from 1 July 2021.  Payments of wages on or after this date will be subject to this superannuation contribution rate, even if some of the wages have been earned in the current financial year.

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End Of Financial Year 2021 Tips For Managers and Business Owners

Author: Harry Hoang CPA | CEO of Tailored Accounts

End of financial year can be a stressful time for executives and business owners. But think of it this way—you’re running a marathon, it’s not far from the finish line, you just need to push through to achieve your personal and business goals. Here’s a quick checklist to help you get your financial affairs in order before the 30 June deadline. 

  • Undertake analysis - To see if you will achieve your budget in the last quarter. If you haven’t made budget, consider what you can do? Cut costs? Improve sales? Or lower your expectations?
  • Review your financial performance from July to end of financial year - The best report in any accounting software is multiple period profit and loss. This report compares monthly performance so you can see which month is the best and which one is the worst. It also helps you to monitor recurring costs and highlights if costs have spiraled in any particular month.
  • Cash is king - Review your cash flow to include big ticket items so you don’t get any surprises towards the end of the financial year. Make sure your cash flow includes last quarterly BAS; last quarterly super; FBT; company tax return; personal tax return; accounting and/or auditing costs.
  • Revisit your business plan - Review or prepare your business plan for the next year and 5 years.

Last but not least, pay attention to these critical due dates:

  • 21 June - Lodge and pay May 2021 Business Activity Statement (BAS) if you pay monthly.
  • 23 June - Payments for super guarantee contributions should be made on this day.
  • 30 June - Super guarantee contributions must be received by your employees' fund by this date to qualify for a tax deduction in the 2020–21 financial year.
  • 1 July - Sole traders can lodge your individual tax return from this day until 31 October if you're preparing it yourself.
  • 1 July - The minimum super contribution rate on ordinary times earnings paid to your employees is to increase from $9.5% to 10%. If your payroll system is not a computer-based software package, you will need to make the calculations yourself. Do you want your business to fund the increase in contributions? Or do you want your employees to fund the increase, thus lowering the take-home pay of your employees? You may need to obtain legal advice on your employee's employment contracts.
  • 14 July - STP finalisation is due to be lodged.

It is important that you should arrange an appointment with your accounting advisors. EOFY period is a great time to review your business performance and financial goals. Make an appointment with your accountants to discuss what could be done better in a new FY. At Tailored Accounts, our team of accounting and tax agent professionals are ready to help you achieve your goals. Contact us today for accounting and compliance assistance. 

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End of Financial Year Tax Tips For Individuals 2019-2020

The following tax planning measures should be considered in respect to your own individual circumstances. For specific guidance please refer to the ATO website or consult your Tailored Accounts accountants.

End-Of-Financial-Year Tax preparation often seems a bit daunting for many people. The COVID-19 outbreak this year has generated a range of impacts on the community and individual well-being. Tailored Accounts will help you overcome the burden of individual tax return complexities. The following tips provide a comprehensive list of important items for your coming tax return.

  • Salary Sacrifice Arrangements

If employed, you may wish to review your remuneration arrangements with your employer and forego future gross salary in return for receiving exempt or concessionally taxed fringe benefits and/or making additional superannuation contributions under a valid salary sacrifice arrangement.

Please review your contributions including Superannuation Guarantee (SG) and Salary Sacrifice to assess whether you have over/under contributed. It is now a good time to adjust your contributions.

  • Additional Superannuation Contributions

Voluntary superannuation contributions would help grow your super balance quicker and reduce your personal tax liabilities.

  • Work-Related Deductions

For employees who are working from home during the period 1 March to 30 June 2020, the ATO is allowing a temporary simplified method of calculating deductions for additional running expenses. There are 3 alternatives including:

  1. 80 cents per hour for all additional running expenses incurred after 1 March 2020 until 30 June 2020; or
  2. 52 cents per work hour for heating, cooling, lighting, cleaning and the decline in value of office furniture, plus the work-related portion of phone and internet expenses, computer consumables, stationery and the decline in value of a computer, laptop or similar device; or
  3. The actual work-related portion of all running expenses, which will need to be calculated on a reasonable basis.
  • First Home Super Saver (FHSS) Scheme

The FHSS scheme essentially allows an individual to make additional voluntary salary sacrificed superannuation contributions or after-tax contributions to a complying superannuation fund from 1 July 2017 up to a maximum amount of up to $15,000 per year (and $30,000 in total) which can be withdrawn to help finance a first home deposit from 1 July 2018. In addition, where the buyer’s partner also has never owned real property, the couple can effectively withdraw an amount of up to $60,000 to jointly fund a home deposit.

  • Early Access To Your Superannuation

You may be able to withdraw up to $10,000 from your superannuation balance in Financial Year 2019/20 and a further $10,000 in 2020/21. You do not need to declare those amounts in your tax return, in other words, they are tax-free. In order to be eligible, you must pass one of the following tests:

  1. You are unemployed; or
  2. You are eligible to receive a JobSeeker payment, youth allowance for jobseekers, parenting payment (which includes the single and partnered payments), special benefit or farm household allowance; or
  3. On or after 1 January 2020:
  • You were made redundant; or
  • Your working hours were reduced by 20 per cent or more; or
  • If you are a sole trader and your business you suspended or there was a reduction in your turnover of 20 per cent or more. 

If you are unsure of your current tax status or need assistance and advice for your EOFY preparation, please contact Tailored Accounts for a 20-minute of free consultation. Alternatively, you can access the Tailored Accounts - Sharing Is Caring Page for a free download of an individual cashflow assessment plan. 

Tailored Accounts - Sharing Is Caring Page

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End of Financial Year Tax Tips For Business Owners 2019-2020

This information is intended as general guidance only.  For specific guidance please refer to the ATO website or consult your Tailored Accounts accountants.

Uncertainty about the continuing spread of the noble coronavirus makes people fear for their health and their lives. If you are doing business in one of the industries, which are most susceptible to health and economic problems, such as tourism, food services, retail, or healthcare, the pandemic has struck your disproportionately hard. Under high uncertainty, funding and immediate government grants have been made available for eligible businesses to navigate the road to recovery. This End-Of-Financial Year Tax Tips will help you reach out and effectively leverage a range of existing support measures for business survival and growth.

Covid-19 Stimulus Measures

The government released a number of economic measures in response to COVID-19. Some of them may impact your FY 2020 tax return. 

  • Enhancing the instant asset write-off

The cost threshold for which entities can access an immediate deduction for depreciating assets and certain related expenditure has been increased from $30,000 to $150,000 for the period 12 March 2020 to 31 December 2020. The turnover threshold of businesses eligible for the instant asset write-off during this period has also been increased to include businesses with an annual turnover of less than $500 million (up from the existing cap of $50 million).

  • Backing business investment

Entities with an aggregated turnover of less than $500 million in an income year who do not use the simplified depreciation rules for small business may be eligible for accelerated depreciation if the entity starts to hold the asset and the asset was first used or installed ready for use for taxable purposes between 12 March 2020 and 30 June 2021.

The tax implication on received stimulus payments:

  • The Cashflow boost you have received will be treated as non-assessable, non-exempt income and is therefore not taxable to the entity. However, JobKeeper payments received are assessable income of the entity. Deductions for payments to employees are available provided the general requirements for deductibility are satisfied.

Other tax-saving tips

  • Super Contribution

All contributions which are required to be received by the superfunds by 30 June 2020 need to be scheduled for payment within ClickSuper by 4 PM AEST on Monday, 24 June 2020.  Superannuation contributions paid after this date may or may not be received by the superannuation fund by 30 June 2020. 

  • Review your Debtors

Review your aged receivables and write off any recoverable debts before 30 June 2020. The bad debt written off can be claimed as a tax deduction for the 2020 financial year. 

  • Pre-pay your expenses

Small business entities may be able to prepay expenses and claim an immediate deduction in the financial year in which they are paid. 

  • Trust resolution

Document and sign the trust distribution resolutions before 30 June 2020.

JobKeeper tips

If your business was not eligible for the JobKeeper grant during the March-May period, it is recommended to re-assess your JobKeeper eligibility for the period of June-August. 

Tailored Accounts is committed to supporting businesses during this critical time. Please contact us for JobKeeper, EOFY, Tax and Advice supports. Our expertise and experience will put your business in the best possible position for sustainable success. 

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End Of Financial Year 2018: Get ahead of the game with Tailored Accounts

It's nearing end of financial year 2018. And because it’s super busy, Tailored Accounts would like to save your time by sharing some important dates in preparation for FY 17-18.

Super contributions

To be eligible for tax deduction in the current Financial year, your final superannuation guarantee payment for FY 17-18 should be made 7-10 days before 30 June 2018 (allow for delays) to ensure that super funds receive the contributions by 30 June 2018.

Salary Sacrifice Super payment will happen on the same date to ensure that the salary sacrifice super contribution appears in this financial year’s payment summary.

If your Super is being managed by Tailored Accounts, all the deadlines will be met so there won’t be any hassles! Super reports and reminders will be sent out well in advance so that you will have sufficient time to review and make super payments before the deadline.

Make sure you are aware of the following rules:

  • The concessional contribution cap is $25,000 for all the individuals regardless of age for this income year 2017-18.
  • Concessional contributions include employer contributions (including contributions made under a salary sacrifice arrangement) and employee personal contributions claimed as a tax deduction

Payment Summaries

Tailored Accounts will be preparing Payment Summaries on behalf of our clients and submit them to the ATO. By 14 July 2018, your employees should receive their payments summaries from our team. We will send payment summary annual report to the ATO by 14 August 2018.

If you are managing your own payroll, you will also need to have Payment Summaries ready for employees by 14 July 2018 and the ATO by 14 August 2018.

Final Business Activity Statements for FY 17 - 18

April – June 2018 BAS is not due until the 28 July 2018. Tailored Accounts will be asking our clients to send us the quarterly paperwork few days after 1 July 2018. This will help us with End of Year reconciliation and ensure that your BASs are complete before the due date.

Thank you for entrusting Tailored Accounts for your EOFY services – We guarantee 100 percent of your payment summaries are completed before the due date 14 July!

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Essential Tasks at End of Financial Year (EOFY)

End of the financial year is an important and busy time for small business owners, completing bookkeeping, tax returns and begin planning for the new financial year. Putting the hard work in each financial year can help you get your business organised and work smarter in the year ahead.

 End of financial year 2016

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5 end of financial year tips for small businesses

If you are a small business, it is highly likely that you need to do everything to manage your business, from administration, marketing to bookkeeping. It is running well and you believe you are able to manage it until the end of financial year approaches. One client shared with us that EOFY used to be her nightmare and she was always lost with massive paperwork. 

End of financial year bookkeeping tips 

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