The ATO has announced its three key focus areas for this Tax Time:
ATO Assistant Commissioner Tim Loh said the ATO is continuing to prioritise areas where they often see mistakes being made:
“Within these areas, we have identified common mistakes, and are particularly focused on addressing these and supporting taxpayers and registered tax agents to get their claims right this year.”
However, the ATO also recognises that many people are “doing it tough” this year, and expects fewer people will receive a refund, or they may receive smaller refunds than they were expecting, and more may have tax debts to manage.
Mr Loh also recommends that any taxpayers feeling overwhelmed, or getting behind with their tax, should let the ATO know as early as possible or “have a chat with your registered tax agent so we can work with you to find a solution. Don’t bury your head in the sand”. Please contact your Hughes O’Dea Corredig tax accountant if you need assistance.
On 9 May 2023, Treasurer Jim Chalmers handed down the 2023/24 Federal Budget.
Some of the measures announced by the Government (including some which were actually announced prior to the Budget), include:
In addition to these, one of the most important aspects of this Budget was that the Government has provided some further depreciation relief for small businesses once temporary full expensing comes to an end on 30 June 2023.
Specifically, from 1 July 2023 until 30 June 2024, the Government will temporarily increase the instant asset write-off threshold for small businesses (with an aggregated annual turnover of less than $10 million) from $1,000 to $20,000. Assets valued at $20,000 or more (which cannot be immediately deducted) can continue to be placed into the small business simplified depreciation pool.
Also, the provisions that prevent small businesses from re-entering the simplified depreciation regime for five years if they opt-out will continue to be suspended until 30 June 2024.
Other important measures the Government announced include:
The ATO has advised that, in the lead up to 30 June, trustee clients who wish to make beneficiaries presently entitled to trust income for the 2023 income year should ensure their trustee resolutions are effective.
This includes where trustees may want to make beneficiaries ‘specifically entitled’ to franked dividends and capital gains included in that income (i.e., where trustees want to ‘stream’ those classes of income to certain beneficiaries).
It is important that trustee clients:
The ATO is increasingly trying to bring more modern techniques of money-making into its tax net.
‘Side hustles’ have really grown over the past few years — everything from the gig economy and drop shippers, to content creators and influencers.
The ATO recognises that it can be hard to know how to treat income when earning money from side hustles, especially when an individual has several, so the ATO has prepared some tips.
First, the individual needs to know if they are ‘in business’. If so, they may need to think about registration and tax obligations. If they are not in business, but are looking to start one, they should know how to “set themselves up for success”.
Also, if a side hustle means the individual is now a director of a company, they must make sure they apply for a director ID (which is free).
Please contact our office if you require any assistance in relation to your ‘side hustles’.
The ATO will acquire ride sourcing data relating to approximately 200,000 individuals to identify individuals that may be engaged in providing ride sourcing services during the 2022/23 financial year.
The data items include:
The data will be used to identify and inform ride sourcing providers of their tax obligations as part of information and education campaigns.
The intelligence obtained will increase the ATO’s understanding of the behaviours and compliance profiles of individuals and businesses that provide ride sourcing services, and may also be used as part of the methodologies by which the ATO selects taxpayers for compliance activities.
Please Note: Many of the comments in this publication are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances
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