Latest News
Expenses incurred to obtain employment were non-deductible
The Administrative Review Tribunal (‘ART’) recently held that medical expenses incurred by a taxpayer to obtain (or regain) employment were not deductible as they were not incurred in gaining or producing his assessable income. The taxpayer was an airplane pilot. In July 2021, the Civil Aviation Safety Authority advised the taxpayer of the steps that […]
Taxable payments annual report lodgment reminder
Businesses that pay contractors for ‘Taxable payments reporting system services’ may need to lodge a ‘Taxable payments annual report’ (‘TPAR’) by 28 August each year. Editor: This includes businesses paying contractors in the building and construction, cleaning and IT industries (among others). The ATO will apply penalties to businesses that have not lodged their TPAR […]
Hybrid vehicles and FBT changes
Employers that provide plug-in hybrid electric vehicles (‘PHEVs’) to employees (or associates) for personal use should remember the following. Home-charging expenses — new shortcut method The ATO has updated its guidelines to include a new method to make it easier to calculate PHEV electricity costs when a vehicle is charged at an employee’s home. To […]
When a hobby becomes a business
Taxpayers may not think they are running a business from their hobby or ‘side hustle’ activities. However, if they start to earn money from doing these activities regularly, they may be carrying on a business without realising it. Generally, carrying on a business involves ongoing and repeated activities with the intention of making a profit. […]
Know when a new logbook is required
Editor: Keeping a car logbook may be required to accurately calculate the business-use percentage of vehicle expenses (e.g., fuel, registration, insurance and depreciation) for tax deductions. Taxpayers can keep the same logbook for their car for five years, but there are circumstances where they may need a new one during that period. Relying on a […]
Work-related expense claims rejected by Administrative Review Tribunal (‘ART’)
The Administrative Review Tribunal (‘ART’) recently disallowed a taxpayer’s claims for many different types of work-related expenses. The taxpayer was employed full-time as an engineer, working from home two days a week. For the 2023 income year, he claimed deductions totalling over $61,000, in relation to (among other things) car expenses, travel expenses, clothing expenses, […]
Choosing the right PAYG instalment method
The ATO advises that Pay as you go (‘PAYG’) instalments are calculated using either the instalment amount method or the instalment rate method. It recently provided the following two case studies to illustrate the two methods: Case study 1: Kelly the DJ Kelly is a DJ, working at festivals from November to January. She chooses […]
Taxpayers need to get their ‘rental right’
The ATO reminds rental property owners and their tax agents to take care when lodging their tax returns this tax time. When preparing their tax returns, taxpayers should make sure all rental income is included, including income from short-term rental arrangements, renting part of a home, and other rental-related income. Rental income must be reported […]
Luxury car tax: determining a vehicle’s principal purpose
The ATO recently explained how to determine the principal purpose of a car for ‘luxury car tax’ (‘LCT’) purposes (since LCT is not payable on the supply or importation of cars whose principal purpose is the carriage of goods rather than passengers). Broadly, a luxury car (i.e., a car subject to LCT) is a car […]
NALI provisions did not apply to loan structure
The Administrative Appeals Tribunal (‘AAT’) has held that interest income derived by a self-managed superannuation fund (‘SMSF’) as the sole beneficiary of a unit trust was not non-arm’s length income (‘NALI’), and so this income could still be treated as exempt current pension income. During the 2015, 2016 and 2017 financial years, the unit trust […]
Different meanings of ‘dependant’ for superannuation and tax purposes
On a person’s death, their superannuation benefits can only be paid directly to one or more ‘dependants’ as defined for superannuation purposes, unless they are paid to the deceased’s legal personal representative to be distributed in accordance with the deceased’s Will. Super death benefits can be tax-free to the extent that they are paid (either […]
ATO gives ‘green light’ to lodge
The ATO is giving taxpayers with simple affairs the ‘green light’ to lodge their annual income tax returns. ATO Assistant Commissioner Tim Loh said that most taxpayers with simple affairs will find the information they need to lodge has now been pre-filled in their tax return. Mr Loh also reminded taxpayers that some income may […]