Boston Blog

Stay informed with tax, business and accounting news

Christmas Holiday celebrations:

The Boston Accounting team would like to wish everyone a Merry Christmas. We hope you all have a safe and festive time. Be careful on the roads. Don’t drink too much and post things on the internet. The office will be closed from 22 December 2017 and will re-open Monday 8 January...

Real Life changes – Budget 2017:

Budget 2017 – The Medicare Levy is increasing by 0.5% to 2.5%. This is to pay for the NDIS. Doesn’t sound like much but the govt increased the Levy from 1.5% to 2% just a couple of years ago, again to fund the NDIS. Prediction: Medicare Levy at 5% within a decade to pay for NDIS (unless politicians cap their travel and superannuation perks). PS if you earn $80,000 then an increase of 0.5% means you will pay $400 more per year, or if you normally get a tax refund then your refund will be $400 less than it used to be. This starts in the 2020 tax year so don’t get angry yet. HECS income repayment threshold lowered to $42,000. If you are lucky enough to be earning over $42,000 get ready to start paying back your HECS/HELP debt. The old threshold was $55,874. This starts in the 2019 tax year. Reduced deductions for rental property owners. From 1 July 2017 travel expenses to inspect your rental property will no longer be claimable. Also new rental property owners won’t be able to claim depreciation on assets that were purchased with the property. This measure will see a huge reduction in the deductions claimed for rental property owners. Each year the Federal Budget is handed down it takes more and more from the worker. What will next years budget...

Backpackers Tax

The tax rates for working holiday makers (backpackers tax) on a 417 or 462 visa changed on 1 January 2017. They now pay 15% tax on all income up to $37,000 after which foreign resident tax rates apply. So if you employ backpackers on your farm or business you will need to register with the ATO otherwise they may issue...

People don’t like to be sold:

Have you gone to your old accountants this year and see there’s a new name on the door? Or received a letter/email advising you that you’ve been sold to a new accountant? We have had about 50 new clients this year alone due to people coming to us after realising they had been sold to a new accountant. Apparently people don’t like to be treated as commodities. At this rate we will need a bigger office. We welcome all quality...

Government brings forward Farmers deductions:

In a surprising and welcome update to the recent budget announcements, the government has brought forward its change in depreciation for farmers for fences, water assets and fodder storage assets. The immediate deduction for fences and water assets and the three year life depreciation for fodder storage assets will now commence from budget night i.e 7:30pm on 12 May 2015. This is great news as they had originally slated this to start in the 2017 financial year. After bringing this to Treasury’s attention in my previous post it looks like they have seen the light. Well...

Federal Budget quick breakdown:

Ok so the 2015/2016 Federal budget has been handed down. There’s not much to it, was a bit of a dud, but it’s nice to see some ads on the tv promoting the small tax savings for small business. Let’s have a quick look:   – $20,000 immediate deduction for assets – We are fielding a lot of calls about this one. Some people believe that they can buy an asset like a 2nd hand car for $20,000 and the govt is going to give them $20,000 back. That’s not how it works!! So if you don’t need a new asset or replacement asset in your business then don’t get one!! If you were genuinely considering replacing a worn out asset or upgrading etc regardless of this new measure then that’s great but don’t just go and buy something that you don’t need! It won’t help your business or cash flow situation. Definitely do not go into debt to buy an unneeded asset.   – Small Companies tax rate reduced by 1.5% – This is good news. Small business incorporated entities now have a reduced income tax rate of 28.5% (from the 2016 tax year) which has been reduced from 30%. There’s no cap on the total tax savings either other than the $2 million turnover restriction. So if you’re lucky enough to run your small business through a company, have a turnover of $2 million, have no expenses, then your total income tax saving could be $30,000!! That scenario granted is not likely but at least the tax saving is not capped at $1,000 which it is for...

Australia to join Asian Infrastructure Investment Bank:

With nothing of interest to post over the past few months it is with great surprise that the Australian government has developed a backbone and broken away from its US masters by intending to join the newly established Asian Infrastructure Investment Bank (AIIB) created by China.   Australia could have been a founding member of the bank but the US govt applied pressure and our politicians folded. It was only after the UK signalled its intention to join that good old Aussie politicians told the US where to go. Why didn’t the US want Australia (or any other of its colonies) to join? They wanted every other country to use their bank (Washington based World Bank).   This is a great move for our country as the AIIB is designed to assist in the development of infrastructure throughout the region, Buildings, roads, bridges etc, which will have a positive flow on effect for our exports and terms of trade. Speaking of trade, the next thing our politicians need to do is open up transparency on the Trans Pacific Partnership agreement so we can all see what exactly is being negotiated away.   http://www.internationalaffairs.org.au/australian_outlook/australia-now-expected-to-join-asian-infrastructure-investment-bank/ https://www.getup.org.au/campaigns/tpp/tpp/the-dirtiest-deal-youve-never-heard-of http://www.dfat.gov.au/trade/agreements/tpp/Pages/trans-pacific-partnership-agreement-tpp.aspx...

Specialised payment systems data matching program:

The ATO has announced a data matching program in relation to electronic payments made to businesses through specialised payment systems. For the period 1 July 2013 to 30 June 2014, it will collect data from the following businesses:   – Ausfit – BillBuddy – Debit Success – eDebit – Ezidebit – EzyPay – Integrapay – IP Payments – Paymate – PayPal Australia – PaySmart – POLi Payments – Quickpay – ANZ Bank (BPAY data) – Commonwealth Bank (BPAY data) – National Australia Bank (BPAY data) – St George Bank (BPAY data) – Westpac (BPAY data)   The ATO says that this data is analysed in conjunction with data collected through its credit and debit card data matching program to assess businesses’ compliance with tax obligations. The ATO will collect details of merchant and biller business names, contact details, settlement amounts, and transaction records. Records relating to approximately 25,000 individuals will be matched. Those identified as being at risk of potentially running part of their business ‘off-the-books’, or in other ways not reporting all their income, will be asked to explain any discrepancies that are...

Dumb Taxes:

In the days of ancient Rome, it was tradition for the upper class to liberate their slaves after a set number of years. The Roman government, however, looked at this as an opportunity to generate revenue, and they taxed the newly freed slave on his freedom.   In 1696, the English government under William III (William of Orange “King Billy”) passed a new law requiring subjects to pay a tax based on the number of windows in their homes. It was abolished 156 years later. Not willing to pay such a scandalous tax on something as basic as sunlight, many English/Welsh/Scottish simply reduced the number of windows in their homes. This obviously led to less light and ventilation and a rise in associated health problems. To get around the dark houses people were using more candles, so to save on candle costs they started to make their own, but..   England introduced a tax on candles in 1789. Making your own candles was outlawed unless you first obtained a licence and paid tax on your own homemade candles. Nice.   Television Tax – In the UK if you own a television in your home, you must pay an annual fee, formally called a television licence (not a tax but a licence), for each television you own. The funds are used to finance programming on BBC, whether you watch those channels or not. Colour TV’s are taxed at a 145.50 pounds annually, whereas black and white TV sets are taxed at 49 pounds per year. Blind people still have to pay the tax, but at a reduced rate of 50%....

Tax Refund Time is here:

That’s right, it’s that time of year again when hard working Australians have a chance to get a little something back from the government. That ‘little something’ of course is your tax refund and it is your money to begin with so it only makes sense to get as much back as legally possible. Do you trust the tax office to find every deduction for you? Come to Boston Accounting this year, a truly independent accounting firm dedicated to getting you your money back. Maximum refunds, too...