Adams Accounting Blog

  • Cryptocurrencies and tax

    CRYPTOCURRENCIES & AUSTRALIAN TAX So you’ve put some hard earned cash into the newest investment sector known as cryptocurrencies, made a gain but not sure what, if any, tax implications investing in cryptocurrencies has. Unfortunately for those lucky enough to be in the green there are tax implications, similar to that of share investing, which I will touch on later. Firstly, cryptocurrencies were made famous by Bitcoin and it’s extreme volatility. Overall the value of Bitcoin has soared since Bitcoins inception in 2009 from USD$0.003 March 2010 to currently USD$10,313. That is a staggering 3,437,666% increase! In amongst that huge gain is several times where Bitcoin has dropped up to 50-75% value in a matter of days, meaning investment is not for the feint hearted. Meaning USD$10 in March 2010 then would get you 3,333.33333333 Bitcoins, those Bitcoins would right now be worth USD$34,376,666.67 if you managed to stave off the temptation to sell along the way or lik...
  • Can I claim my work clothes as a tax deduction?

    Over the past five years, claims for uniform and laundry deductions have increased by around 20%. This has made the ATO sit up and take notice. The ATO assistant commissioner Kath Anderson has stated that too many taxpayers’ beliefs around how to claim clothing deductions are wrong. She described these taxpayers as “confused” and sought to clarify and remind them that you can only claim deductions for occupation-specific clothing. There are a clear set of guidelines for business owners, employees and the self-employed regarding claiming clothing. Anderson said, “You have to have spent the money yourself and can’t have been reimbursed, two - the claim must be directly related to earning your income, and three - you need a record to prove it.” This has been a hot topic over the past year. A government discussion paper has proposed that all non-compulsory work uniforms could be removed from the list of acceptable tax claims. This would include those uniforms worn by ...
  • ATO myDeductions app for your smartphone

    For those taxpayers who have difficulty keeping all their deductible receipts together, the ATO ‘myDeductions’ app may be the answer. Simply download the ATO app to your smart device and choose whether you'd like to use the tool as an individual, sole trader, or both. The app allows you to record work/business expenses, other tax deductions such as donations, vehicle trips and income (if you are a sole trader). It also allows you to upload photos of your invoices and receipts. At tax time you can simply email the file to your tax agent. Make sure you record your information on a single device throughout the year because you can only upload once per financial year. Back up your data regularly in case your device is broken, lost or stolen.
  • Can I claim a tax deduction for sponsorship?

    As our local summer sports are starting to wind up and the winter sports start ramping up, local sporting clubs may approach your business during the year asking for sponsorship and/or donations. The question some of you may ask – is sponsorship and/or donations a tax deduction? Donations are not a tax deduction unless the sporting club is registered as a deductible gift recipient (DGR), and most sporting clubs cannot be a DGR. Sponsorship, however is tax deductible. Sponsorship is the financial or in-kind support of an activity. It is not advertising but it promotes a company in association with the club. ATO ID 2005/284 deals with deductions and expenses in relation to sponsorship. If a taxpayer provides sponsorship in the belief that the exposure from that sponsorship will benefit the business in the form of advertising and will generate future income then the expenditure should be deductible. This will be the case even if it turns out that the sponsorship didn’...
  • Claiming a tax deduction for super contributions

    A new era of superannuation deduction commenced on the 1st of July 2017. People who work for a wage or are required to have superannuation contributed for them by an employer to a superannuation fund are now allowed to potentially claim a taxation deduction for contributions they make to a complying super fund from 1st July 2017 from their own after-tax funds. Example John Saver works for V/line and his employer contributed to his super fund over the 2017/18 financial year $ 6,650 John contributes from his own savings direct to his super fund $300 a week (after tax) $15,600 Total contributed for year is $22,250 The maximum that John can contribute to superannuation & get a tax deduction for is $25,000 for the 2017/18 year. Because John’s contributions are below the $25,000 limit ...

    TAX & BUSINESS SERVICES ACCOUNTANT Adams Accounting is an accounting firm located in Maffra and offers a broad range of services to a large variety of clients. We have a position available in our team for a full-time and/or part-time accountant. To be successful in this role you need to have a tertiary qualification in accounting (or almost qualified) and be a self-starter with initiative to ask questions and solve problems. Key responsibilities: - Preparation of income tax returns and financial statements - Preparation of Business Activity Statements and Instalment Activity Statements - Liaise with the tax office on a range of matters - Assist clients with record keeping - Preparation of taxation advice, including researching topics as required Key skills - Strong communication, written and interpersonal - Ability to work within a team and autonomously - Time management - Ability to work under pressure and within deadlines - Excellent computer skills...
  • 8 Reasons To Know Your Business Value

    8 reasons you need to know the value of your business “I’m not planning on selling my business any time soon. So I don’t need to know what it is worth, right?” Wrong. If you value your business, you need to value your business. Every business owner should have an up-to-date business valuation — not just those preparing to sell. Do you: - own all or part of a business? - intend to someday retire, sell or leave your business? - think you might die one day, or become disabled? - have key employees or business partners who you’re trying to motivate to be more efficient, productive or profitable? - have creditors, predators, or soon-to-be ex-spouses who might someday want a piece of your business? If you answered “Yes” to any of these questions, you should consider getting your business valued. Here are eight reasons why you need to know what your business is worth: 1. Planning to grow – Provides the best benchmark to compare periodic growth 2. Sel...

    CAPITAL GAINS TAX AND DECEASED ESTATE ASSETS What happens with income tax when a person is deceased? When a person passes away their executors are required to lodge a final income tax return (ITR) up to the date of their death in order to finalise their income tax affairs (this ITR will not be able to be lodged until after the following 30th June). This ITR will include all taxable income and deductable expenses from the previous 1st July up until the date of death (DOD). From the DOD onwards a new taxpayer is recognised, being the Estate of the deceased. A new tax file number (TFN) is required for the Estate and the Estate will lodge an ITR taking into account all taxable income and deductable expenses from the first day after the DOD through to the following 30th June. Further ITR’s may be needed if the Estate continues on for further periods. Capital gain tax (CGT) and Estate assets. The first thing to be aware of is that the death of a taxpayer does not trigger ...
  • Increase to lost super threshold

    The Superannuation (unclaimed money and lost members) Act 1999 was recently amended* so that, from 31 December 2015, the small lost threshold for super accounts is increasing from $2,000 to $4,000. Inactive and un-contactable superannuation accounts with a balance below this threshold (now $4,000) are required to be transferred by APRA-regulated funds to the ATO. This law applies to members of a fund that have reached age 65 and are uncontactable by the super fund. Super funds are expected to start preparing to identify, report, and transfer lost accounts below $4,000 as part of their Unclaimed Super Money (USM) Statement due on or prior to 30 April 2016. Message – make sure you know who your super $ are with & that the fund has your current address. Then look into your tax & financial situation to ascertain if you need to withdraw the funds or leave them in a fund. How do you find your lost super? If you think you may have lost track of your super then you hav...
  • Pay superannuation on time or loose deduction!

    Did you know? As a business, if you do not pay your employee superannuation guarantee contributions by the quarterly cut-off date, you are not able to claim a tax deduction for the superannuation amount! Even just one day late means you are unable to claim a tax deduction! In addition, if superannuation is paid later than the cut-off date the employer needs to lodge a "Superannuation guarantee charge statement" for each late quarter. This includes the original SGC, an admin fee of $20 per employee per quarter plus 10% interest on the total from the first day of the quarter. To avoid all of this, and in order to claim a full tax deduction for the payments, super must be paid and received by the superannuation fund by the quarterly cut-off dates below: Quarter Period Payment cut-off date 1 1 July – 30 September 28 October 2 1 October – 31 December 28 January 3 1 January – 31 March 28 April 4 1 April – 30 June 28 ...
  • Cheap loans for farm energy efficiency

    NAB is offering a 0.70 per cent cut on financing for farmers and related agri businesses looking to improve energy efficiency. NAB has advised Adams Accounting that as well as irrigation systems, the bonus also applies to qualifying equipment such as some light vehicles, variable speed drives, industrial/commercial refrigeration, heating ventilation and air-conditioning, solar & solar thermal, biogas, waste diversion, process equipment upgrades, building monitoring systems, voltage optimisation assets, lighting, bundled technologies etc. The following article is from The Land news Written by ANDREW MARSHALL on 11 June, 2015 “DISCOUNT borrowing costs are being promoted by National Australia Bank (NAB) for farmers and related agribusinesses looking to improve energy efficiency or invest in renewable options such as solar, biogas or wind power. NAB has teamed up with the government-backed Clean Energy Finance Corporation (CEFC) in a $120 million funding program which allow...
  • Murray Goulburn Share Restructure Progress

    Murray Goulburn Share Restructure Progress What’s happened so far? On the 29th May 2015 MG announced its Initial Public Offer (IPO) price range which is $2.10 to $3.20 per unit in the MG Unit Trust. MG will announce its final IPO price in late June and it will be somewhere in the range indicated above. Under the existing share structure all shares are valued at $1. The restructure is based around two principals 1/ The companies shareholders that can vote remain in the dairy farmers hands. 2/ The remaining shareholders are entitled to the same rights as dairy farmer shareholders except they cannot vote. Dairy farmer shareholders are able to sell shares in the company but this is in a staged process over three years after the float. What might happen to the share price in the future? This is the 69 dollar question. Public company share prices live or die based on the meeting of financial targets. If in the first six to twelve months the company achieves it profit...
  • 2015/16 Federal Budget - effect on your business

    Parliament announced the budget changes last night 12th May 2015 with some exciting news for many small business owners. CHANGES EFFECTIVE 7:30pm 12th MAY 2015 UNTIL 30 JUNE 2017 - Accelerated depreciation for small business is back. Allowing small businesses with aggregate annual turnover of less than $2 million to immediately claim a tax deduction in the year they start to use or the item is installed ready for use, provided the asset costs less than $20,000 net of GST (currently, an immediate write-off is generally available for assets costing less than $1,000). This will apply for assets acquired and installed ready for use between 7.30pm (AEST) 12 May 2015 and 30 June 2017. From 1 July 2017 the limit will revert back to the existing $1,000 threshold. CHANGES EFFECTIVE 1 JULY 2015 - Tax rate cuts for small business If aggregated annual turnover of less than $2 million the following apply; (a) Company tax rate reduced by to 28.5% (currently 30%) (b) Non company ent...
  • Running a home based business

    If you operate your business from home, you may be able to claim some of the costs in doing this: • if you work from home occasionally and your place of business is somewhere else (for example, a tradie who does most of his work on clients’ premises) • have an area of your home set aside that is only used for your business (for example, a naturopath who has converted her garage to a reception area and consulting rooms). You may be able to claim tax deductions for: • a proportion of the cost of your electricity, gas and phone use • purchase of office furniture and equipment. You may also be able to claim a percentage of expenses like rent or mortgage interest, rates and insurance. To be eligible, the area where you conduct your business must be: • used exclusively for business purposes • be clearly identifiable as a place of business, and • not be easily adapted for private purposes. If you are unsure of what you may be entitled to claim, speak to one of ...
  • Unpaid superannuation

    The ATO receives around 18,000 complaints a year about employers failing to pay staff superannuation and approximately 70% of the complaints relate to small businesses. If you have a business and do not pay employees’ superannuation guarantee contributions (SGC) within 28 days of the end of a quarter, you will incur interest at 10% per annum on the missed payments as well as an administration fee of $20 per employee. You are also required to lodge a Superannuation Guarantee Statement and remit the payment directly to the ATO. On top of this the business will also lose the tax deduction because the super guarantee charge is not tax deductible. To make matters worse even if you operate thorugh a company, the government green lit directors liability for unpaid super guarantee. Meaning if you operate your business through a company (or trust with corporate trustee) the limitations of corporate liability will be waived and the directors of the company will be held personally liable...
  • Fuel Tax Credit rates increase

    Fuel Tax Credit rates increase bi-annually from 1 February 2015 The Government announced in the 2014-15 Budget that it would be reintroducing bi-annual indexation on all fuels except aviation fuels. What this means is that the Fuel Tax Credit (FTC) rates to claim on eligible fuel purchases is set to increase in February and August each year, based on the Consumer Price Index (CPI). So, if you claim the credit you need to make sure you are using the correct rates. Any eligible fuel purchased in January 2015 will be claimed at the old FTC rate and eligible fuel purchased from 1 February 2015 to 31 July 2015 will be claimed at the rate as indicated below. Each year in February & August we will post a blog article indicating the new FTC rates. Business use In a heavy vehicle (including emergency vehicles) for travelling on public roads From 1 July 2014..................12.003 From 10 November 2014....12.46 From 2 February 2015.........12.76 All o...
  • Superannuation tax deduction for the self-employed

    Are you self-employed and plan on claiming a tax deduction for superannuation contributions? You are able to claim a tax deduction for contributions that you make to your superannuation fund, but only if you are self-employed. To be able to claim a deduction you need to do a couple of things. First, you need to complete a ‘notice of intent to claim a deduction for personal super contributions’ form from your superannuation fund. The notice simply states the amount you wish to claim as a tax deduction and confirms you haven’t lodged an earlier notice regarding the same contribution. Second, you must lodge the deduction notice with your superannuation fund before you lodge your personal tax return. Once the superannuation fund is satisfied that your deduction notice is valid, they must formally acknowledge its receipt. This acknowledgement will be in writing and should be provided to your accountant at tax time. Your accountant cannot lodge your Income Tax Retur...
  • Small business capital gains tax concessions

    SMALL BUSINESS CAPITAL GAINS TAX CONCESSIONS The CGT small business concessions can significantly reduce the CGT liability for small business owners upon the sale of their business or business assets. There are a number of concessions available to small businesses: 1. The 15 year ownership rule If you qualify, the business can disregard the entire capital gain from the sale of an asset if: • The asset has been continuously owned for 15 years or more; and • The owner is 55 years or over and retiring, or is permanently disabled at the time of the sale 2. The 50% reduction for the sale of active assets This test requires the CGT asset to be an active asset for: • 7 ½ years if owned for more than 15 years; or • Half the period of ownership if owned for less than 15 years If a small business satisfies the active asset test, it can reduce its capital gain by a further 50% 3. Retirement exemption This concession allows you to disregard a capital gain from a CGT...
  • Finding Lost Super

    Have you searched for lost super? Have you kept track of all your super? If you've ever changed your name, address, job, or done casual or part-time work, you may have lost track of some supe. The Australian Taxation Office's (ATO's) quick online search can help you see if you have any lost or unclaimed super. Do a quick search by providing your name, date of birth and tax file number. If the ATO’s Super Seeker tool lists any lost super it will give you further details on how to access the money and roll it in to your active superannuation fund account. Copy and paste the following link into your browser to start.
  • Have you considered Self-Managed Superannuation

    Have you considered a Self-Managed Superannuation Fund (SMSF)? As at 30 June 2014 there are roughly 534,000 Self-Managed Superannuation Funds in Australia totalling assets of $557 billion. That’s 1/3 of the Australian superannuation pool assets. SMSF provides the opportunity for you to have a say in what your fund invests in, as well as cut down on annual compliance costs. In order to make an SMSF affordable compliance wise, the estimated start-up balance required of the fund is $150,000. A SMSF can have up to 4 members, meaning you personally don’t need $150,000 to get started - split evenly you could get started on as little as $37,500 each (based on 4 members). You could engage financial planners or stock brokers to do the investing for you, or take full control and DIY. 24 September 2007 marked an important date in Australian superannuation history. This day marked the beginning of limited recourse borrowing arrangements (LRBA) for SMSFs. This allows SMSFs to bo...
  • ATO Debt Collection

    ATO CHANGING DEBT COLLECTION APPROACH Over the GFC period the ATO took quite a lenient approach to collecting both income tax & GST debts. Towards the end of the Labour Governments period in office this started to change and has now turned full circle. The ATO are now issuing garnishee notices to business clients in order to collect debts owing to them. The process the ATO go through; - Send out overdue notices - Make telephone contact with the taxpayer - Offer terms payment option over a period - Should the taxpayer not adhere to the terms payments conditions - Garnishee notice can be issued WHAT IS A GARNISHEE NOTICE? The ATO send a notice to your bank to advise them that you owe the ATO an amount and advise the bank that they are required to pay this amount to the ATO from any funds the taxpayer has in the bank. If the full amount can’t be paid then the ATO require the bank to pay 30% of the available funds in the bank to the ATO. This action by the ATO can have a...
  • Supporting staff through stress

    What should I do if one of my staff members seems to be suffering from stress? When a staff member seems out of sorts and you think they could be struggling to cope with stress, it can be difficult to know what to say. However, it is best not to ignore the situation as stress can snowball to more serious health issues. Stress affects everyone differently, but there are a number of common signs. These include headaches, upset stomachs, difficulty performing usual work tasks, irritability and tearfulness. Ongoing stress without support can lead to burnout or contribute to mental illness such as depression or anxiety. Mental health problems are common in the workplace, with about one in six people affected at any given time. How to help There are a number of things an employer can do to support a staff member affected by stress and other mental illnesses: - Time pressures: Check to see if you’ve set unreasonable and unrealistic demands on your employees’ time. If y...
  • Cloud Bookkeeping Solutions

    Bookkeeping and record keeping alike take a lot of time, effort and patience. That’s time, effort and patience invested into maintaining your business instead of growing it. Thankfully with today’s new age range of accounting software you can now safely prepare your records online. This means your records are available to you on your phone, tablet, laptop, desktop and the reception computer in Cairns so you can complete your bank reconciliation & BAS on time. It also means all your bank account & some credit card data can be sucked into the software slicing hours off your data entry & bank reconciliation process. The common question in regards to cloud accounting packages is; which one is right for my business? Unfortunately there is no straight answer for this as every business & user is different. Ultimately what you as the owner are looking for out of your software will direct you. If you’re simply looking for a cashbook each of the packages below covers your needs. How...
  • How to grow your business

    The following are some of the most recognised ways to grow a business. Increase the number of customers of the type you want to have. All business people have limited time & resources and that is why it is important to target the type of customers you want attract to your business. Increase the number of times customers come back. The more you can get clients to return to your business for additional sales the better your bottom line will be. Look closely at what your sales/service offer is and think about what you can offer to get clients coming back more often. Increase the average value of each sale made. Business often makes the mistake of thinking that selling items at a low price will increase sales and it often will, but being locked into lower prices means that your margin (difference between cost of goods & sales price) is always low and this leads to low profitability even though you are very busy. Look closely at your pricing and what the market will pay for you...
  • Do you need to lodge a tax return?

    Most people need to lodge a tax return each year, but there are some exceptions. If you had tax taken from any payment you received, whether it is wages or a Centrelink payment, you almost certainly need to lodge a tax return. You need to lodge a tax return unless you fall within certain exceptions. The ATO’s 'Do I need to lodge a tax return?' tool will help you work out whether or not you need to lodge. If you need to lodge a tax return but don't lodge it, you may have to pay a penalty. We can assist with preparing your Income Tax Return or notifying the ATO that you don’t need to lodge. Follow this link to open the ATO’s tool
  • How much tax are Aussies paying?

    Given we are in the middle of tax season have you ever wondered how much tax Aussies are paying compared to other developed nations? Thankfully the nerdy staff over at the Organisation for Economic Co-operation and Development (OECD) have compiled a list of its member countries using total tax revenue as a percentage of their national gross domestic production (GDP). (Figures based on 2012 or latest available year) The result is quite favorable; Australia is the fourth-lowest taxed nation of the 34 OECD members measuring in at 26.5%. Only the USA (24.3%), Chile (20.8%) and Mexico (19.7%) are lower. At the higher end of the spectrum Denmark (48%), France (45.3%) and Italy (44.4%) are well above the average OECD rate of 34.6%. So next time you think we’re hard done by, think of the unlucky taxpayer’s in Denmark! Full report. Now the fun part, how long does it take to earn a 500ml local beer? Swiss bank UBS surveyed...
  • Heyfield Convenience

    We are proud to announce that Adams Accounting has an office in Heyfield, located within Gippsland Real Estate at 4 Temple Street. The new office aims to provide our existing clients and the broader Heyfield community with; • Convenient and trusted location to drop off confidential documents that is staffed 9am-5pm Monday to Friday • Convenient in-town tax return preparation • Convenient in-town meeting location Appointments are by booking only, please contact our Maffra office on (03) 5147 1525 for further details.
  • Welcome to Adams Accounting

    The exciting launch of our website is complete. Here you can find all the latest news, services, resources & much more. Adams Accounting Blog will keep you up to date with relevant individual and business news, from taxation to finance and our own Adams Accounting updates on new services and seminars. If anyone has any queries or issues they’d like brought up feel free to let us know. We also provide a quarterly newsletter to our clients free of charge, to get your free copy please subscribe on any page of the website. If you already receive the newsletter by mail or email please subscribe below to simplify the merge of our databases and create an eco-friendly process. Adams Accounting will be running various seminars which can be found under the News tab, please register your interest as if a topic receives higher demand we will bring forward the delivery date. Enjoy our website and all it has to offer!


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