Latest Accounting News

Quarter 2 of, 2017 archive

  • ‘Bank-like heists’ make way for new wave of cyber crime
  • ATO reports on key contraventions for 2016-17
  • ATO, mid-tiers warn on common expenses myths
  • SMSF trustees told to take action on contributions
  • Higher instant asset write-off threshold for small business extended
  • Australian population figures
  • New data points to spiralling retirement costs
  • Personal insolvency numbers spike across Australia
  • ATO cracking down on taxable fringe benefits
  • Intangible capital improvements made to a pre-CGT asset
  • The three core pillars of this year's budget
  • Federal Budget - 2017-18 - Overview
  • Does your business import or export goods and services?
  • Federal Budget - 2017-18 - Budget documents
  • When does an asset cost less than $20,000? Depreciating assets: composite items
  • ATO finalises guidance for capped defined income streams
  • Warning on trap with trust deed updates
  • 2011 Census - what was the make up of your area?
  • It’s no secret that Australians have some of the largest houses in the world.
  • Resources on our site to help you and your family.
  • ATO defends approach to SG compliance
  • Essential steps for SMSF clients before 30 June
  • New tax incentives for early stage investors
  • FBT Reminder – Odometer Reading
  • ATO on 'aggressive' debt recovery hunt
  • More ATO downtime looms ahead of tax time
  • Tax debt release applications refused
  • Troublesome tax system overhaul picks up speed
  • Government to ‘put to bed’ uncertainties with TRIS
  • Travel expense and transport of bulky tools claim denied
  • New law sheds light on global tax issues
  • Report tips housing price spikes to wipe out super savings
  • ATO, mid-tiers warn on common expenses myths

    BE CAREFUL - As the ATO continues to ramp up its focus on scrutinising work-related expense claims this year, two mid-tier firms are urging SMEs to educate themselves on common tax time myths that commonly catch out their clients.

           

     

    This year the ATO is using real-time data to compare taxpayers with others in similar occupations and income brackets, to identify higher-than-expected claims according to ATO assistant commissioner Kath Anderson.

    “It is important to know what you’re eligible to claim before lodging your tax return and to make sure you don’t claim more than you’re entitled to. Many taxpayers don’t have a good understanding of what deductions they can claim, and believe they can claim for items which they in fact can’t,” Ms Anderson said.

    “The ATO scrutinises every return. We have the technology and experience to detect non-compliance and we are continuing to catch taxpayers who are deliberately doing the wrong thing.”

    Moore Stephens business advisory partner Matthew Free told Accountants Daily that SMEs have a number of common misconceptions about work-related expense claims and that his advice to businesses is “if in doubt, then ask the question”.

    Mr Free said that common misconceptions exist around training and home office expenses.

    “Self-education and/or staff training can be claimed either by the business as training or by the employee as a self-education cost, but only where the employee incurs the expense. The study must have the necessary nexus to the income currently being earned by the employee,” he said.

    “For home office expenses, you can only claim a set rate per hour of usage to cover outgoings such as electricity and heating. Do not claim a percentage of mortgage interest or rent based on the size of the home office.”

    HLB Mann Judd partner Peter Bembrick also spoke to Accountants Daily about claims where businesses often stumble such as insurance and business trips.

    “While income protection insurance is an important tax-deductible item, other insurance premiums for TPD, trauma and life cover are not deductible,” he said.

    “When you travel interstate or overseas you are allowed to claim the reasonable allowance rates for food, accommodation and incidentals. This amount is often overlooked and without substantiation you can claim up to the ATO rates published.”

    Mr Free and Mr Bembrick have both seen some strange claims over their time as accountants.

    Some of the less conventional but allowed claims Mr Free is aware of include Xbox consoles, Foxtel, ping pong tables and pool tables by businesses to boost team morale and efficiency, swords by professional sword swallowers, and make-up to prepare dead bodies by funeral parlours.

     

     

    LARA BULLOCK
    21 Jun 2017
    accountantsdaily.com.au

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