Leenane Templeton – Newcastle Business Accountants, Business Advisors & Financial Planners

Tag: COVID-19

  • Last Chance To Apply As COVID-19 Tax Deduction Deadlines Approach

    Last Chance To Apply As COVID-19 Tax Deduction Deadlines Approach

    Tax deductions introduced by the Australian Taxation Office to lessen the impact of COVID-19 are approaching the end of their eligible timeframe.  To ensure that you or your business do not miss out, here are some of the deductions you could claim at the end of this financial year (if eligible).

    Loss-Carry Back Rules

    Eligible businesses with an aggregated turnover of less than $5 billion or corporate tax entities that meet an alternative $5 billion total income test are able to use the temporary fill-expensing measure again this year. This will allow them to deduct the full cost of eligible depreciating assets acquired from 6 October 2020 and first used or installed ready for use by 30 June 2023. The original deadline of 30 June 2022 was extended for an additional year, so make sure to make use of this in your business!

    Shortcut Method

    If you have had to work from home over the last year between 1 July 2021 to 30 June 2022, you can claim a deduction for working from home.

    This is to address expenses that you may have had to make in order to work from home, such as paying for electricity or equipment to work from home. These expenses cannot have been paid by your employer, you need to have paid for them yourself.

    You can claim $0.80 for every hour that you worked from home, but you are not able to claim for anything else if using this method.

    To claim this, you need to:

    • keep a record of how many hours you worked from home
    • work out your deduction amount
    • write the deduction amount in your tax return in the ‘Other work-related expenses’ section
    • write ‘COVID-19 hourly tax rate’ in your tax return.

    If you are consulting with a registered tax agent like Leenane Templeton for your return, they may recommend this as your best course of action.

    For more information please feel free to contact the LT team.

  • Understanding JobKeeper Payment

    Understanding JobKeeper Payment

    Your business may be eligible for the new JobKeeper Payment which was announced on 30 March 2020 to assist businesses to continue to pay their employees.

    We are waiting on legislation to support the measures so it is unclear at this stage how the mechanics of the JobKeeper payment system will work. We expect that the devil will be in the detail and we will update you once further clarification is provided.

    Here is what we know so far.

    Amount and timing of subsidy

    The JobKeeper payment is a subsidy of $1,500 per fortnight per eligible employee from 30 March 2020 for a maximum period of 6 months. The first payment will be received by employers from the ATO in the first week of May.

    Eligibility

    Employers will be eligible for the subsidy if their business has a turnover of less than $1billion and their turnover will be reduced by more than 30% relative to a comparable period a year ago (of at least a month).

    Employers with a turnover of $1 billion or more will be eligible if their turnover will be reduced by more than 50% relative to a comparable period a year ago (of at least a month).

    Eligible employees

    Eligible employees are employees who:

    • are currently employed (including those stood down or re-hired);

    • were employed at 1 March 2020;

    • are full-time, part-time, or long-term casuals (a casual employed on a regular basis for longer than 12 months as at 1 March 2020);

    • are at least 16 years of age;

    • are an Australian citizen, the holder of a permanent visa, a Protected Special Category Visa Holder, a non-protected Special Category Visa Holder who has been residing continually in Australia for 10 years or more, or a Special Category (Subclass 444) Visa Holder; and

    • are not in receipt of a JobKeeper Payment from another employer.

    If your employees receive the JobKeeper Payment, this may affect their eligibility for payments from Services Australia as they must report their JobKeeper Payment as income.

    Mechanics and Application process

    Employers will be required to:

    • register an intention to apply on the ATO website (ato.gov.au) from 30 March 2020 and assess their eligibility based on turnover decline;

    • subsequently apply on line;

    • ensure eligible employees will receive, at a minimum, $1,500 per fortnight, before tax. It will be up to the employer if they want to pay superannuation on any additional wage paid because of the JobKeeper Payment.

    • provide information to the ATO on eligible employees. This includes information on the number of eligible employees engaged as at 1 March 2020 and those currently employed by the business (including those stood down or rehired). For most businesses, the ATO will use Single Touch Payroll data to pre-populate the employee details for the business.

    • notify all eligible employees that they are receiving the JobKeeper Payment.

    • continue to provide information to the ATO on a monthly basis, including the number of eligible employees employed by the business.

    LT can assist

    LT can assist in the application process if you think your business may be eligible for the JobKeeper payment.

    Please don’t hesitate to contact us.

  • ATO supporting COVID-19 impacted businesses

    ATO supporting COVID-19 impacted businesses

    The Australian Taxation Office (ATO) issued a special edition Business Bulletin yesterday, 16 March 2020, which contains information about how the ATO can support your business during the COVID-19 crisis.

    How the ATO can assist

    The ATO will implement a series of administrative measures to assist Australians experiencing financial difficulty as a result of the COVID-19 outbreak. 

    The options available to assist businesses impacted by COVID-19 include:

    • deferring by up to four months the payment date of amounts due through the business activity statement (including PAYG instalments), income tax assessments, fringe benefits tax assessments and excise;
    • allowing businesses on a quarterly reporting cycle to opt into monthly GST reporting in order to get quicker access to GST refunds they may be entitled to;
    • allowing businesses to vary PAYG instalment amounts to zero for the March 2020 quarter. Businesses that vary their PAYG instalment to zero can also claim a refund for any instalments made for the September 2019 and December 2019 quarters;
    • remitting any interest and penalties, incurred on or after 23 January 2020, that have been applied to tax liabilities; and
    • working with affected businesses to help them pay their existing and ongoing tax liabilities by allowing them to enter into low interest payment plans.

    Outside of business, the ATO will also work with individuals experiencing financial hardship, and their tax agents, and will apply appropriate tax relief measures for serious and exceptional circumstances, such as where people cannot pay for food or accommodation.

    The ATO acknowledges that this is a time of significant uncertainty and has undertaken to be flexible in its approach to assisting taxpayers.

    Employers’ ongoing obligations

    Employers will still need to meet their ongoing super guarantee obligations for their employees.

    Applying for relief

    Unlike the bushfire relief measures, which applied automatically to particular geographic areas, assistance measures for those impacted by COVID-19 will not be automatically implemented.  Businesses impacted by the corona virus are encouraged to get in touch with the ATO to discuss relief options on its Emergency Support Infoline 1800 806 218. 

    How LT can assist

    We encourage you to review your situation and, if you think you are eligible, please contact our office so that we can apply for relief on your behalf and work with the ATO to tailor a support plan for your needs and circumstances.

    The ATO’s ongoing support

    The ATO has said that it will continue to work with the tax profession, other government agencies and local organisations to make sure other impacted communities are also supported during this time. It will ensure its services are tailored to the needs of the community and will work with taxpayers and their tax agents to tailor support to their individual circumstances.

    Contact the LT team to discuss your tax and business planning throughout this challenging period.