HomeBuilder Scheme Announced

The Commonwealth Government announced a new HomeBuilder scheme to provide economic support during the Coronavirus pandemic.

The HomeBuilder scheme is available to eligible owner-occupiers (including first home buyers) with a grant of $25,000 to build a new home or substantially renovate an existing home.

Further information, including a frequently asked questions fact sheet is available on the Commonwealth Government’s Treasury website.

COVID-19 Resources

ATO - Information for businesses & Individuals

ACT Government - Information for businesses

NSW Government - COVID-19 help for small business

VIC Government - COVID-19 business support

SafeWork Australia - business resources

Employsure - FAQ and resource hub for employers

Australian Signals Directorate - Cyber security and COVID-19

Resources & Posters

Bushfire Tax Assistance tax exempt for volunteer firefighters

The Federal Government has passed legislation to compensate volunteer firefighters for loss of employment income when working for a state or territory fire service during the 2019/20 income year.

The Bill is designed to provide financial relief for volunteer firefighters working within small or medium businesses. These businesses may not have enough resources to support their employee’s firefighting efforts.

The payments to volunteer firefighters, as well as disaster recovery assistance payments from the government, will be tax exempt this income year.

Calculating the payments

There is a 10 days’ minimum period of service, which the firefighter cannot get compensated for. The firefighter can claim compensation each day after the 10th day. There is no maximum or minimum period for each day’s shift, and the days need not be consecutive.

The payments are not means tested and will cap at $300 per day, with a total cap of $6,000, and be made available for the 2019/20 income year.

The payments will have to be applied for through the different State or Territory governments.

Applying for the payment

NSW - https://www.service.nsw.gov.au/transaction/apply-volunteer-firefighter-payment

myGovID replacing AUSkey

The government will cease using AUSkey to transaction with their online services by late March 2020. To get ready for the change and switch over to myGovID, you will need to follow the steps below.

myGovID is an authentication service that allows the users to prove who they are online. It is available as an app through the Apple App Store or Google Play Store and is compatible with Apple devices using iOS 10 or above and any Android device using Android 7.0 or above.

myGovID is separate from the more familiar myGov and cannot be used to access myGov yet.

In order to setup your myGovID, you will need:

• smart device (iOS 10 or later, or Android 7.0 or later)

• An email address, that is unique to you, and not shared with other people.

The steps required to set up myGovID are as follows:

1. Download and open the myGovID app, entering your details such as full name, date of birth and email address on startup.

2. Attach the necessary identity documents through the myGovID app.

The following are relevant Australian identity documents for myGovID:

• driver’s license

• passport

• birth certificate, and

• Medicare card.

Once the myGovID is setup, you can link your myGovID to a business via Relationship Authorisation Manager (RAM), by logging to the RAM website.

Once in there, you can link your business’ Australian Business Number (ABN) to your myGovID account. (Note: If your business is new and not yet on the ABR, you may need to wait until this process is completed first.)

The principal authority of the business will have to link their myGovID to their ABN in RAM first. Then they can set up and import authorisations for other employees via RAM.

If you want our assistance with setting this up for you, please call me and I will walk through the process with you. However, you will need to have a copy of the documents listed above ready.

What’s the difference between a Taxi and Uber?

Knowing the difference could save you tax

You may be aware of an FBT exemption available for taxi travel which either begins or ends at an employee’s place of work. What this means is that a business can pay for the cost of a single journey for an employee that begins or ends at work and claim a tax deduction with no FBT obligation. With the arrival of ride sharing services such as Uber, the question arises if this exemption extends to Uber services as well as taxis.

The ATO has recently issued guidance that the FBT exemption does not apply to ride sharing services in a vehicle that is not licensed to operate as a taxi. This position is based on the definition of ‘taxi’ in the FBTAA and is consistent with prior ATO statements. Therefore, if an Uber is taken for travel starting or ending at work, and the employer pays for the expense, FBT may apply.

There are other exemptions that could be applied to reduce the FBT where an Uber is taken, such as the minor benefits exemption or otherwise deductible rule. However, the facts of the situation would need to be examined to determine whether these exemptions may apply.

Want to know more about what you can claim at tax time?

The ATO publishes occupation and industry specific guides for a range occupations which are useful to help find out the types of deductions that can be claimed for certain occupations.

To claim a work-related deduction:

• you must have spent the money yourself and weren't reimbursed

• it must directly relate to earning your income

• you must have a record to prove it

If the expense was for both work and private purposes, you can only claim a deduction for the work-related portion. Work expenses reimbursed to you by your employer are not deductible.

Have a look to see if your occupation or industry has a guide and if you have any questions get in touch to find out how Momentum can help ensure you get your deduction claims right.

Find out if you're eligible to receive $1,080

The proposed changes to the low and middle income tax offset (LMITO) announced in the recent Federal Budget are now law. From the 2018–19 income year:

• The LMITO increases from a maximum amount of $530 to $1,080 per annum and the base amount increases from $200 to $255 per annum.

• Taxpayers with a taxable income:

  • of $37,000 or below can now receive a low and middle income tax offset of up to $255

  • above $37,000 and below $48,000 can now receive $255, plus an amount equal to 7.5% to the maximum offset of $1,080

  • above $48,000 and below $90,000 are now eligible for the maximum low and middle income tax offset of $1,080

  • above $90,000 but is no more than $126,000 are now eligible for a low and middle income tax offset of $1,080, less an amount equal to three per cent of the excess.

Get in touch today to claim your LMITO and for all your individual tax needs.

Federal Election: Proposed tax changes

Following the Coalition victory in the recent federal election, the tax changes that were to occur under a Labor elected government will now not occur. The proposed Labor policy changes that will not take place include:

• No cash refunds of excess imputation credits

• Limit on negative gearing

• The reduction of the capital gains discount from 50% to 25%

• A $3,000 deduction cap on the cost of managing tax affairs

Meanwhile what is likely to occur as a result of the re-election of the Coalition are the following tax related changes (subject to legislation passing in the Senate):

1. Increase to the low-and-middle income tax offset from $530 to $1,080 from 1 July 2018

2. Lowering of the 32.5% marginal tax rate to 30% from 1 July 2024

3. An increase to the instant asset write-off to $30,000 (already law)

4. Defering the start date of the proposed Div 7A changes to 1 July 2020

5. Enabling those approaching retirement to put more money into their superannuation

6. The proposed First Home Loan Deposit Scheme that will help eligible first home buyers to purchase a house with a deposit as low as 5% (thereby potentially saving such taxpayers around $10,000 in lenders mortgage insurance)

Buying for small business? Instant asset write-off extended by one year

For businesses with turnover of less than $10m, the government has announced that it is increasing the small business instant asset write off to $25,000 (for assets purchased after 29 January 2019) and extending the scheme to 30 June 2020. A cap of $20,000 remains for assets purchased before this date.

This means that small businesses that purchase assets costing less than $25,000 can immediately claim a deduction rather that depreciating the asset over the effective life and claiming a part deduction each year.

Working from home just got better – increased home office deductions

The ATO has increased the hourly rate for claiming home office running expenses from 45 cents to 52 cents per hour from 1 July 2018.

The hourly rate incorporates expenses such as lighting, heating, cooling, cleaning and decline in value of home office items such as furniture in the area used to work.

The hourly rate does not include computer consumables, stationery and decline in value of electronic devices.

If the hourly rate method is used, taxpayers will need to keep a record of how many hours they work from home. This can be done over the course of the year or if the hours that are worked at home are regular, a diary over a representative 4 week period is sufficient.