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07 Sep 2016

Record Keeping

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When it comes to record keeping there are good practices and poor practices. I have compiled a list of good practices.

  • Separate tax invoice issued to every customer.
  • Work diary that links to customer invoices.
  • Invoice shows the customer’s name  and work performed.
  • Payment of invoice matches to bank statement.
  • All deposits into a bank account can be explained, e.g. a loan from family member.
  • All expenses are paid from a a bank account.
  • Cash expenses are all documented.
  • Income declared on a loan application agrees to tax returns.
  • Income declared when selling a business agree with tax returns.

Poor record keeping practices can leave you open to a tax audit. If you do not keep proper tax records the Australian Taxation Office can reassess your income and issue a new tax bill., Do not be caught out. If you need help with record keeping call me on 43231170. I am the tradie specialist, I can help you pass an audit. Send me an email susan@taxtime.net.au

03 Sep 2013

Now our savings accounts are at risk

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The Federal Government have made changes to the definition of “unclaimed money”. From 31st May 2013 if you have any money in savings accounts that you have not used in 3 years (previously 7 years) it will be transferred to the government.

How incredibly outrageous is that?

They can’t help themselves can they, “gimme, gimme, gimme” that should be their campaign logo. On the same day they changed the lost super law they brought in this law, boy they must think they are clever.

This applies to life insurance policies and any other similar financial product.

Here is my advice, deposit or withdraw at least 5 cents into your bank account every 2 years. Close down any unused bank accounts. Call your bank to find out if you have any accounts with them that you have forgotten about.

 

The Federal government announced that from 31st May 2013 all unclaimed super accounts with a balance less than $2,000 will be transferred to the tax office. “Lost” super used to be super that was sitting in an account and the whereabouts of the owner was unknown. Not any more. “Lost” means a super account that has had no transactions during a 12 month period. That is, no contribution, no rollover, no access to funds or if there has been no response by the member to any written correspondence.

So what they are saying is if you move, go overseas, are out of work or just don’t read one of the dozens of nothing letters that arrive in the mail the government takes YOUR money.

The tax office have a slogan to those who operate their own self managed fund, it goes like this “SUPER, its yours but not yet” what it means is that whilst super is your money you cannot access that money until you retire.

I have a slogan for The Federal Government “Keep your hands off MY money” It is your super not theirs!

 

Protect your identity. All new clients must bring in proof of identity with them to their first appointment. Due to an increase in fraud, it is a requirement of the Australian Taxation Office that I check your identity. This check protects you against fraud. Unfortunately it is not as uncommon as you may think that someone gets holds of your tax file number and lodges a tax return under your name and takes your refund. The process involved to rectify identity theft is a long one. It can mean that your refund that you are entitled to can be held up for as long as 6 months or longer while you go through an identity check with the Australian Taxation Office. So keep your tax file number safe.

Why do you need or not need private health insurance?  What do all of the ads mean? I can’t give you a simple answer but hopefully, I can answer the question simply. If you earn over $84,000 as a single person or over $164,000 as a family and you do NOT have private health insurance (PHI) the tax office will penalise you by making you pay extra Medicare. Having PHI is YOUR CHOICE. By this I mean that you can choose to have PHI because you do not want to get penalised by the tax office by paying extra Medicare, you can choose to have PHI because you want to be covered. YOUR CHOICE. So why the heavy tv advertising?  Apart from the obvious fact that the health funds want your money, if you take up PHI after your 31st birthday the premium you pay to the health fund will include a loading. It is called the lifetime healthcover loading (LHC). The loading is calulated at 2% per year. For example, if you wait until the age of 40 to take up PHI at 2% per year times 10 years the premium you pay to the health fund will be 20% more expensive than if you joined at 30.

The benefit in taking up private health insurance is no different to any other insurance. You are simply insuring against a loss of health. The premiums are not tax deductible.

Don’t forget the instant tax write off of assets (including motor vehicles) valued at less than $6,500.
For motor vehicles costing more than $6,500 there is an instant tax white off of $5,000 with the balance being depreciated.

From 1st October 2012 Living Away from Home allowances paid to an employee should be included in the employees assessable income.There have been no changes to the substantiaition legislation. That is, as long as the deduction claimed for accommodation, food and drink does not exceed the amounts allowed by the tax office. Receipts do not have to be retained.

We have our inaugural local Chamber business awards Friday night, 17th May 2013. I am proud to say I am a sponsor of this event. Always Taxtime is sponsoring The Young Entrepreneur of the Year award.
Erina and Gosford Chambers of Commerce have joined forces to hold a combined event at the Impact Centre Erina and it promises to be a great evening.

All winners are automatically entered into the Regional Business Awards. From there we have the NSW Business Chamber state awards.