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Welcome to Twomey Talk where you can take advantage of the specialist knowledge of our team & learn their thoughts on various issues that may
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AUDIT SHIELD

The recent Federal budget allocated an additional $130.8 million in funding for ATO to increase compliance activities targeting individual taxpayers and their tax agents.

Twomeys is pleased to be able to offer our clients Audit Shield insurance which covers professional fees (up to prescribed limits) in the event that you receive one of the following audits: income tax, record keeping, capital gains, fringe benefits, workers compensation, payroll tax, GST/BAS, SMSF and employer obligations.

If you would like to participate in the Audit Shield service, please contact your local Twomeys office.

Changes to Youth Allowance for students from rural and remote areas came into effect on 1 January 2018.

Previously students had to work for 18 months before they could be considered independent. Students from a rural and remote area now only have to work for 14 months since leaving school and earn 75% of wage level A (75% is $24,836) to be classified as independent. Parental income must be less than $150,000.

NB: Students not from rural or remote areas or students whose parental income exceeds $150,000 still need to work full-time (average 30 hours per week) for at least 18 months within a 2 year period to be considered independent.

The Australian Business Register (ABR) is phasing out Trading Names and from November 2018, the ABR will only list Business Names that are registered with ASIC.

If you conduct business under a name other than your own, you need to register a Business Name. You don't need to register a business name if you trade under your own name (eg John Smith), but you'll need to have a business name if it's anything else (eg John Smith Plumbing).

You cannot apply for a business name that is identical to one already on the register. Before you apply, you can check the Business Name availability on the ASIC website. The fees for registering a business name are $35 for one year and $82 for three years.

Further information is available at https://asic.gov.au/forbusiness/registering-a-business-name/

From mid-2018, the Heavy Vehicle National Law (HVNL) will require that every party in the heavy vehicle transport supply chain does all that is reasonably practicable to eliminate or minimise potential harm or risk.

If you consign, pack, load or receive goods as part of your business, you could be held legally liable for breaches of the Heavy Vehicle National Law (HVNL) even though you have no direct role in driving or operating a heavy vehicle. This includes farmers who contract a heavy vehicle operator to collect or receive produce or livestock to their farms.

CoR could apply when:

• heavy vehicle driver breaches fatigue management requirements or speed limits

• heavy vehicle driver breaches mass, dimension, or loading requirements

• where any instructions, actions or demands to parties in the supply chain causes or contributes to an offence under the HVNL. That includes anything done, or not done (directly or indirectly) that has an impact on compliance, for example:

> schedulers whose business practices place unrealistic timeframes on drivers which cause them to exceed their work rest options

> loading managers whose business practices, including loading/unloading times, cause the driver to exceed the speed limit.

Parties in the chain must also make sure the terms of consignment or work/employment contracts will not result in, encourage, reward or provide an incentive for the driver or other party in the supply chain (e.g. a scheduler) to break the HVNL.

Further information is available at www.nhvr.gov.au/safetyaccreditation-compliance/chain-of-responsibility/about

The HECS-HELP repayment thresholds have been reduced substantially from 1 July 2018, with people now required to start repaying their HECS-HELP debts once their repayment income reaches $45,000 (previously this limit was $55,874).

The new repayment income thresholds range from 1% for people with repayment incomes between $45,000 - $51,956, up to 10% for people with incomes over $131,989.

The NSW Government has announced a new Drought Transport Fund that will provide up to $20,000 in low interest loans, with a two-year interest and repayment free period.

The loans, available through the Rural Assistance Authority are intended to help with the cost of transport for water, feed and livestock. The loan term is 7 years. While available to offset the cost of transport, farmers are required to have a pre-approved loan before organising transport.

The Drought Transport Further information and application forms can be found at www.raa.nsw.gov.au/assistance/drought-transport-fund

From 1 July 2018, purchasers of new residential premises or subdivision of potential residential land will be required to withhold an amount from the contract price, and pay that amount to the ATO on or before settlement.

The amount a purchaser must withhold and remit to the ATO is:

• 1/11th of the contract price (for fully taxable supplies)

• 7% of the contract price (for margin scheme supplies)

• 10% of GST exclusive market value of the supply (for supplies between associates for a price less than GST inclusive market value).

A supplier must provide a notice in writing to the purchaser before selling any residential premises or potential residential land stating whether the purchaser needs to withhold or not. The supplier's notice may either be in the contract for sale, or in a separate document. A failure by the supplier to provide the notice doesn't affect the purchaser's obligation to withhold an amount if the property is a taxable sale of new residential premises or potential residential land.

The amendment is aimed as property developers who fail to remit GST to the ATO despite claiming input tax credits. However it will require all mum and dad buyers who are not carrying on a business and who have no knowledge of the GST system to withhold and remit GST.

Purchasers or their representatives must lodge two online forms to advise the ATO of their purchase:

• The GST property settlement withholding notification form is used to advise the ATO that a contract has been entered into for new residential premises or potential residential land that requires a withholding amount. This form can be submitted any time after a contract has been entered into and prior to the settlement date.

• The GST property settlement date confirmation form is used to confirm the settlement date and can be submitted at the time of settlement and when the payment has been made to the ATO.

Further information is available at https://www.ato.gov.au/Business/GST/In-detail/Your-industry/Property/GST-property-settlement-online-forms-and-instructions/

From 1 July 2018, if you are 65 years old or older and meet the eligibility requirements, you may be able to choose to make a downsizer contribution into your superannuation of up to $300,000 from the proceeds of selling your home.

Your downsizer contribution is not a non-concessional contribution and will not count towards your contributions caps. The downsizer contribution can still be made if an individual has a total super balance greater than $1.6 million.

You can only make downsizing contributions for the sale of one home. You can't access it again for the sale of a second home. You or your spouse must have owned the home for 10 years or more prior to the sale.

Downsizer contributions are not tax deductible and will be taken into account for determining eligibility for the age pension.

If you sell your home, are eligible and choose to make a downsizer contribution, there is no requirement for you to purchase another home.

A one-off, 12-month amnesty period for historical underpayment of the superannuation guarantee has been announced by the government, foreshadowing tougher penalties once the Single Touch Payroll regime kicks in fully next year.

The amnesty will set aside employer penalties for late payment that are normally paid to the government, with employers needing to pay all super that is owed to their employees, including the rate of nominal interest.

Subject to the passage of legislation, the amnesty will run from 24 May 2018 to 23 May 2019 and will allow:

• catch-up payments to be tax-deductible

• the penalties that normally apply to late payments to be waived

• the administration component of the SG charge to be waived.

The amnesty does not apply to Superannuation Guarantee payments due after 1 April 2018.

From the 1st of July 2017, for the first time, employees are eligible to claim a tax deduction for personal contributions made to superannuation. Until this year only self-employed people were eligible to claim this type of deduction.

To be eligible to make the claim employees must be under 65 or under 75 and still working and contributions must be received by the superannuation provider prior to the 30th of June 2018. Employees must inform their superannuation fund of their intention to claim the deduction prior to lodging their 2018 personal income tax return.

The concessional contribution cap for the 2018 financial year is $25,000. This means that the total of all superannuation guarantee contributions made by a person's employer, plus their salary sacrifice superannuation

contributions, plus their personal contributions to superannuation that they are claiming a tax deduction for, must not total more than $25,000.