Donations and gifts made by businesses

Donations and gifts made by businesses to various organisations that are made purely for business purposes, e.g. as a form of advertising, may be deducted in full even though the recipient is not registered as a Deductible Gift Recipient (DGR) with the Australian Taxation Office.

Donations and gifts of $2 or more

(a)          Within approved general categories such as the following, for example:

–           public or non profit hospitals

–           public benevolent institutions

–           public authorities or institutions engaged in research into diseases

–           buildings for government, semi government, private non profit colleges or schools

–           public universities

–           charitable purposes to promote education.

(b)          Those organisations registered with and listed by the ATO on its website as Deductible Gift Recipients (DGRs).

It is essential you have evidence of  donations and gifts, e.g. receipt.  Please note purchase of raffle tickets or similar is not considered a donation by the ATO even though the raffle may be conducted by a charitable organisation.

For more information about donations or other tax deductible expenses  CONTACT US now at BSN & Co!

Temporary full expensing replaces the $150,000 instant asset write off

Temporary full expensing replaces the $150,000 instant asset write off for businesses acquiring new assets.  Apart from subsidies for hiring additional younger staff (16 to 35 years) under the Jobmaker plan, the $150,000 instant asset write off has been replaced with a more generous temporary full expensing incentive for businesses acquiring assets!

Ordinarily, assets acquired for use in your business are depreciated over a period of years so that, in the main, a full tax deduction for the capital purchase is progressively obtained. Various incentives have been provided in recent years to encourage business expenditure as a boost to the economy and the “temporary full expensing” tax deduction, available for businesses until 30 June 2022, has been extended for a further 12 months in the 2021 federal budget, to 30 June 2023!

Where businesses acquire eligible depreciating assets such as plant and equipment, the business may claim an immediate outright tax deduction for the business use proportion of the expense!  In the case of non-commercial passenger motor vehicles, however, “temporary full expensing” will be limited to the luxury car limit for depreciation, being $59,136 for the current 2020/2021 year.

If you want to know more about temporary full expensing or anything else from Budget 2021 then CONTACT US now at BSN & Co!

The transfer balance cap is increasing to $1.7 million!

The superannuation transfer balance cap was introduced in 2016 and took effect from 1 July 2017.  Apart from changes to concessional and non-concessional contribution amounts, the legislation limited the lifetime amount which could be transferred from accumulation mode to pension mode to $1.6m.  However, indexation is increasing this to $1.7m on 1 July 2021.

The legislation also precluded further non-concessional contributions where your superannuation balance exceeded $1.6m.

While you are unable to transfer more than the prescribed transfer balance cap amount into pension mode, the pension account may continue to grow and exceed $1.6m.

Any monies you are unable to transfer into pension mode may remain in the accumulation mode within the fund.

Essentially, there would be two accounts within the fund, one being the tax free pension account and the other the accumulation account, subject to the 15% income tax ordinarily applied in the superannuation environment!

If you have any queries or need advice then CONTACT US now at BSN & Co!

Employing more staff?
Find out about your eligibility for the JobMaker Hiring Credit scheme.

The JobMaker hiring credit scheme has been backdated to start from 7 October 2020 to 6 January 2021 (and has now been extended, so read on!).

The scheme provides eligible employers with payments for new jobs created for young workers:

–  $200 per week for hiring a worker aged 16 to 29 years, for at least 20hrs per week

–  $100 per week for hiring those aged 30 to 35 years.

Conditions apply such as:

–  Employer must have an ABN

–  Employer is registered for PAYGW

–  Employer is reporting through STP

–  Employer is up to date with lodgements

–  Employer must have hired additional eligible employees (i.e. employee head count +1 at least)

–  Employer demonstrates increased payroll for the reporting period, compared with the 3 months to 30 September 2020.

GREAT NEWS! The JobMaker hiring credit scheme has been extended and now continues until 6 October 2022!

For more information or assistance with registering for the JobMaker scheme CONTACT US now!

Working from home still? Good news! You can still use the shortcut claim method.

The shortcut method of claiming deductions for working from home has been extended to 30 June 2021 and is therefore available for the period 1 March 2020 to 30 June 2020 and for the full 2020/2021 financial year.

The new arrangement will allow people to claim a rate of 80 cents per hour for all their running expenses, rather than needing to calculate costs for specific running expenses.  The shortcut method covers all your working from home expenses, such as:

phone expenses

internet expenses

the decline in value of equipment and furniture

electricity and gas for heating, cooling and lighting

Taxpayers must have spent the money themselves and not have been reimbursed, and the claim must be directly related to earning income.

Taxpayers wishing to utilise this simple and straightforward method of claim are required to maintain a record of hours and days worked at home over the period.

 If you have any queries or need advice then CONTACT US now at BSN & Co!