Tax Time is upon us yet again, and this year the landscape has changed in relation to the way some employees receive their Payment Summary.
The introduction of Single Touch Payroll means that for this year, those who work for larger employers may not receive a Payment Summary. Instead, you will have an Income Statement which will be accessible via your MyGov account. As your tax agent we will also have access to this information. However, before being able to complete your tax return, we need to ensure that the data status becomes “Tax Ready” rather than “Year to Date”. This is in case the employer needs to make end of year adjustments to your income or tax withheld amounts.
If you are employed by a smaller company (less than 20 employees) you should still receive your Payment Summary in the usual way. Please note as of 1st July 2019, Single Touch Payroll is compulsory for all Employers, so come tax time 2020 the above information will apply to everyone.
For our clients that are Employers, there is an article later in the newsletter that you will need to read!!
Personal Income Tax Change
For low and middle income earners there is a new tax offset (LAMITO) available that is worth between $200 and $530 for those earning up to $125333. (This legislation has already passed.)
However, there is a new legislation yet to be passed through parliament that will see an increase in this tax offset for the 2019 year. What this means is, if you lodge your tax return before the legislation is passed you will only receive the amount between $200 to $530, however if you wait and lodge your tax return after the legislation has passed you will receive the increased amount of this tax offset in your refund. If your tax return is lodged before this date, then we believe the ATO will automatically amend your tax return to increase this tax offset in due course. (This increase to the LAMITO is subject to the new legislation passing through parliament).
The LAMITO is an additional tax offset to the Low Income Tax Offset, effectively giving those earning below $21595 nil tax to pay.
Small Business Asset Write-Off
The Government has extended the duration for the $20000 Asset Write-Off for small businesses. They have not only extended the duration to 30th June 2020 but they have also increased the threshold to $30000 for assets purchased after budget night (2 April 2019). The limit was $25000 for a small period of time between January and April 2019.
The rate has changed for claiming your motor vehicle using the cents per kilometre method. This rate is now 68c per kilometre (up from 66c per kilometre).
The Home Office rate is now 52c per hour (previously 45c per hour).
Additionally, this year the ATO will require more details in regard to work related deductions. In previous years the ATO could only see the total amounts claimed. However, this year they will have access to the full breakdown of the deductions. This means that we may have to enter more details into your tax return. The most common target will be work related expenses.
Personal Superannuation Contributions
Since 1st July 2017 you have been able to claim a tax deduction for personal superannuation contributions even if you are an employee. These contributions must remain under the $25,000 concessional contribution cap. This cap includes contributions made by your Employer. If you have some spare money, and would like to make a contribution to your super fund, please check with your super fund first, but do so by the 30th June 2019.
Following are some tips to help you claim your super contribution as a deduction:
- Make sure the contribution is received by the super fund by 30th June 2019.
- Complete a “Notice of Intent to Claim” Form and send off to your super fund.
- Wait for an acknowledgement letter from your super fund. This is what we will need before lodging your tax return.