Data matching to begin on cryptocurrecy transactions
The Commonwealth Gazette has posted notice that the ATO will acquire account identification and transaction data from cryptocurrency designated service providers for the 2021 financial year through to the 2023 income year inclusive. The data items include client identification details (names, addresses, date of birth, phone numbers, social media account and email addresses) as well as transaction details (bank account details, wallet addresses, transaction dates, transaction time, transaction type, deposits, withdrawals, transaction quantities and coin type). The data will be acquired and matched to ATO systems to identify and treat clients who failed to report a disposal of cryptocurrency in their income tax return.
Guidance provided for taxpayers faced with the maze of COVID-19 support measures
The wide variety of COVID-19 disaster payments can be hard to keep track of, especially where geographical differences and varied state and territory government responses add to the plethora of options. To help taxpayers (and practitioners), the ATO has provided guidance on the taxation implications of COVID-19 disaster payments provided to eligible individuals. Federal Government assistance, plus state, territory and local government assistance is covered.
Have your say on the treatment of intangible assets under international arrangements
The ATO is seeking comments on draft practical compliance guideline PCG 2021/D4, which sets out its compliance approach to international arrangements connected with the development, enhancement, maintenance, protection and exploitation of intangible assets and/or the migration of such assets. Comments can be emailed to IntangiblesArrangements@ato.gov.au until 16 July.
Recommendation that Revenue NSW office is empowered to collect missing payroll tax
Criminalisation of wage theft has been recommended by the Legislative Council committee reviewing the NSW legislation Tax Administration Amendment (Combating Wage Theft) Bill 2021. Such a move would require amending the legislation as it has been presented. The committee says Revenue NSW “should be empowered to identify and investigate instances of wage theft and be effectively resourced” to take action where necessary.
Parliamentary Budget Office provides budget summary in graphic form
Budget at a Glance is a publication from the PBO that provides a new graphical summary of information contained in the 2021-22 Budget. This new combined product replaces the previous Budget Snapshot and Budget Chart Pack publications. For more information about the terms in this publication see the PBO Online budget glossary.
Single touch payroll showbag
For some clients, STP needs a lot of explaining. To help, the ATO has put together a combined resource of factsheets, videos and podcasts, webinars and media releases about STP that you can share with affected clients.
Self-certifications required for all reporting financial institution new accounts
It is a requirement under the common reporting standard rules that a reporting financial institution (RFI) needs to obtain self-certifications for all new accounts. The ATO says there are two key requirements when collecting self-certifications — to ensure the self-certification is valid, and to confirm the reasonableness of the self-certification.
In other news…
Rebooting the NSW economy
A new white paper from the NSW Productivity Commission outlines a new productivity reform agenda for New South Wales that could lift productivity growth and boost real wages, without raising the tax burden.
COVID-19 vaccination digital certificate announced
The Federal Government has announced that digital certificates are planned that will prove COVID-19 vaccination, issuing via Services Australia. A vaccination provider needs to report vaccination information to the Australian Immunisation Register before it will appear on a user’s statement, however the Government says with the new certificate, people will be able to control over the level of vaccination history they share, as the certificate only shows COVID-19 vaccination status.
Victoria to get round two of Business Costs Assistance Program
A further $2,000 top-up payment will be available to businesses in metropolitan Melbourne that are closed due to extended restrictions announced Wednesday 9 June 2021. Keep an eye on this Business Victoria web page for more details soon.
Temporary full expensing draft ruling issued
The draft law companion ruling LCR 2021/D1 provides detailed guidance on the application of the provisions for temporary full expensing of depreciating assets. The draft ruling supplements the ATO’s existing web guidance. It provides further explanation on how the provisions operate and interact with other measures (for example, instant asset write off, and backing business investment rules) and provides certainty on the Commissioner’s view on a number of interpretive matters raised by practitioners, including consolidation interaction issues.
Data matching rules and privacy protocols legislated
Treasury has registered an instrument that regulates the matching of data under the Data-matching Program (Assistance and Tax) Act 1990, and provides for the monitoring of technical standards for data matching programs and establishes privacy safeguards for individuals affected by data matching outcomes.
Fee increase for SA land tax certificates
The South Australian Government Gazette contains notice (see page 2006) that the fee for land tax certificate, which shows the amount of tax payable in respect of land under section 23 of the act, will be $36.50 from 1 July 2021.
BAS lodgment time is optimal chance to try new online service
With quarterly BAS due 28 July and the Business Portal decomissioning soon, the ATO says now is the time for your business clients to lodge their BAS in Online services for business. It has provided guidance for lodging this way, and reminds users that when they use these online services they’ll get reminder messages as they complete their BAS to help get it right and avoid errors.
Roadmap to end of 2021-22 income
year for super changes
The Superannuation Changes Industry roadmap is an overview of the changes affecting the super industry up until the end of June 2022. This information will be updated every quarter or when there are major changes or announcements.
Tax and property development revenue and capital considerations
The ATO seems to be always looking over the shoulder of property developers to make sure they are complying with their tax obligations.
Small business concession access cross-checklist
There are various tax concessions available for businesses based on the level of turnover, but some come with additional eligibility criteria and so may not be readily identifiable to some otherwise eligible clients. To help, the ATO has come up with a handy “Concessions at a glance” table. The concessions have various start dates beginning from 1 July 2016.
Lodge that return or miss out on family assistance payments
Your clients and their partners may need to lodge their 2019-20 income tax return by 30 June 2021 to make sure they don’t miss out on family assistance payments such as the Child Care Subsidy and Family Tax Benefit payments from Services Australia. The ATO says lodgment deferrals do not alter this requirement.
LCT “principle purpose” determination being developed
Luxury Car Tax (LCT) is not payable on cars with a “principal purpose” that is not the carriage of passengers. The ATO is working on a draft determination that will set out the Commissioner’s preliminary view on how to determine whether a car is a commercial vehicle that is not designed for the principal purpose of carrying passengers. The draft determination will address specific issues regarding vehicle modifications purporting to alter the principal purpose of a luxury car. It is expected to be completed by the end of July, and comments can be emailed to William Reid at the ATO’s Private Wealth section.
Objection time limits published, which vary with the assessment or decision objected to
The ATO has listed the decisions and assessments a taxpayer is able to object to, and the time limits that are imposed on these objections. By law a taxpayer can object to tax assessments (except for the Diverted profits tax assessment) and most other decisions the ATO makes, within the appropriate time limits. Limits for lodging objections vary from 60 days to four years, and are listed here by types of decisions.
COVID-induced tax rate changes for seasonal workers law amendment
Due to COVID-19, the visa status of workers in the Seasonal Worker Program may have changed, resulting in their employers withholding tax at a higher rate. The law has now been changed (and the ATO has issued a fact sheet) so that employers can continue to withhold 15% on payments made to workers where they have been participating in the program and continue to do so, were previously on a subclass 403 visa, and are now on a different temporary visa (such as subclass 408 visa).
Business Portal hangers-on be warned
Just in case you still have business clients who may be rusted on to the ATO’s Business Portal, it may pay to remind them that this service is due to retire at the end of July. After that, clients won’t be able to use the service, and instead of the Business Portal the current service is Online services for business.
Whacky Tax Fact
British PM in 1783 William Pitt the Younger levied income tax as a “temporary measure” to raise funds for the Napoleonic War, but he also imposed taxes on wigs and wig powder, which were social status symbols of wealthy men. His attempts at extorting the wig wearing rich backfired in the end when the majority of men took to either powdering their real hair, if they had sufficient, or opted for wearing a hat. The wig and wig powder tax was repealed 1869 as these had almost completely gone out of fashion and hats had once again become part of general attire.
Sneeze guard boom calls for effective life determination
The ATO has started a review of plastic safety screens (commonly referred to as “sneeze guards”) used to prevent the spread of COVID-19 with a view to making effective life determinations. With so many of these screens installed around the country, the need to have a capital allowance determination for them was only a matter of time, even though it may have been assumed the instant asset write-off could have been the go-to option for eligible taxpayers.
Indexation to thank for 1 July increases in support payments
Family Tax Benefit A and B payments will increase from 1 July, and will put up to an additional $94.90 into the pockets of eligible families with one child, up to $156.95 for families with two children and up to $226.30 for families with three children and even more for larger families during 2021-22. About 1 million part rate pensioners and carer payment recipients will also see a small rise in their rate of payment through an increase to income and asset limits. The Federal Government also said more families would become eligible for Paid Parental Leave and Dad and Partner Pay with the income cap increasing for the first time from $150,000 per year to $151,350.
Collectables and personal use assets guidance updated
If your client’s SMSF invests in collectables or personal use assets – such as artworks, jewellery, wine, vehicles or boats – related parties aren’t allowed to use these assets or store them in their home. The ATO has re-issued its guidance on collectables as well as valuation guidelines.
General interest charge rates now updated
Daily Update mentioned yesterday that the ATO has updated the shortfall interest charge (SIC) rates, as announced for the first quarter of the 2021-22 income year. The SIC replaces, at a lower rate, the general interest charge (GIC) applied to income tax shortfalls for the period before assessments are amended. The ATO has also updated the GIC rates for the July to September 2021 quarter.
Delivering on an e-bike effective life determination
E-bike and e-scooters seem to be taking over some of our capital city streets lately, and writing from locked-down Melbourne, Daily Update can attest to the on-going proliferation of e-powered food delivery operatives. Now the ATO is taking the booming employment related e-vehicle factor seriously, and has started a review of the capital allowance regime pertaining to e-bicycles and e-scooters. It expects to complete its review of these assets within 12 months, with new effective life determinations applying from 1 July 2022, but says draft effective lives will be issued for public comment well before final decisions are made.
Compliance for meal and travel allowance expenses not changing, but guidance will
The ATO was considering an update to the ruling that covered the Commissioner’s compliance approach to overtime meal allowances and to travel allowance expenses. But after review, the ATO found that the taxation ruling TR 2004/6 covering these allowances expresses a view that has not changed. The ATO therefore says a planned and previously announced replacement ruling will not proceed, but website guidance will be updated instead.
Super bill passes lower house, with amendments
The “Your Future, Your Super” bill has been passed through the House of Representatives, with amendments to remove changes to trustee investment and payment powers. Other amendments have however been left in place, such as limiting multiple funds, an annual performance test, and other “best financial interests” measures.
Valuation guidelines for SMSFs
This new guide replaces Superannuation Circular 2003/1. It is designed to help SMSF trustees when valuing assets for superannuation purposes, but is not a comprehensive handbook about valuations. This guide does not take away the responsibility to manage investments prudently, and trustees must ensure the fund’s investment strategy is reviewed regularly and takes into account the retirement goals of its members.
Shortfall interest rates updated
The ATO has updated the shortfall interest charge (SIC) rates, as announced for the first quarter of the 2021-22 income year. The SIC replaces, at a lower rate, the general interest charge (GIC) applied to income tax shortfalls for the period before assessments are amended.
Refresher resource on event-based reporting for SMSFs
A self-managed super fund is required to report certain events in the event-based reporting framework for SMSFs to the ATO by the due dates. To aid trustees, the ATO has provided a summary of the requirements to remain compliant under the framework.
ACCC’s latest report on scams over pandemic period
Targeting Scams, the ACCC annual report on scamming activities, compiles data from Scamwatch, ReportCyber, other government agencies and 10 banks and financial intermediaries, and is based on more than 444,000 reports. The latest report shows that Australians lost over $851 million to scams in 2020, a record amount, as scammers took advantage of the pandemic to con unsuspecting people. The average loss was $7,224, with the majority being aged between 55 and 64. The lowest losses were made by 18 to 24 year olds.
Data collection tool APRA Connect testing site imminent (webinar this week)
APRA’s new data service APRA Connect, mentioned last month in Daily Update, is to launch its test environment page on 17 June so that users can become familiar with the service. The APRA Connect Guide provides comprehensive information to assist users accessing, navigating and using APRA Connect. The guide should be used in conjunction with taxonomy artefacts when preparing and submitting data to APRA. A webinar is scheduled for 10 June 2021 to provide entities with an overview of available information and support and will include a demonstration of APRA Connect.