The ATO has reminded businesses that provide road freight, information technology ('IT'), security, investigation, or surveillance services that they need to lodge a Taxable payments annual report ('TPAR') each year to tell the ATO about the payments they make to contractors who use an Australian business number ('ABN') (even if these services are only part of their business activities).
Such clients' first TPAR will be due by 28 August 2020 for payments made from 1 July 2019 to 30 June 2020.
Issues on the ATO's radar
The ATO has updated its list of 'What attracts our attention', with six items that specifically relate to fringe benefits tax ('FBT'), as follows:
Using non-commercial parking rates; or
Parking rates not being supported by adequate evidence.
Mismatches between the amount reported as an employee contribution on an FBT return compared to the income amounts on an employer's tax return.
Claiming entertainment expenses as a deduction but not correctly reporting them as a fringe benefit, or incorrectly classifying entertainment expenses as sponsorship or advertising.
Not reporting fringe benefits on business assets that are provided for the personal enjoyment of employees or associates.
Not lodging FBT returns (or lodging them late) to delay or avoid payment of tax.
Record-keeping exemption threshold & Benchmark interest rate
The exemption threshold for the FBT year commenced 1 April 2019 is $8,714 (up from the amount of $8,552 that applied in the previous year).
The benchmark interest rate for the FBT year commenced 1 April 2019 is 5.37% per annum (up from the rate of 5.20% that applied for the previous FBT year).
This rate is used to calculate the taxable value of:
A fringe benefit provided by way of a loan; and
A car fringe benefit where an employer chooses to value the benefit using the operating cost method.
From 1 July 2019, Single Touch Payroll (STP) will apply to all businesses in Australia with 19 or less employees.
Single Touch Payroll (STP) is a change to the way you report payroll information to the ATO. Each time you pay your employees you will also be sending your employee salary and wage information, pay as you go (PAYG) withholding and super information to the ATO. These will be year-to-date amounts.
You will need to make sure your current payroll software is updated by your digital service provider (DSP) to offer STP reporting or choose payroll software that is STP-enabled. If you don’t currently use payroll or accounting software, get in touch today 9584 2277.
The box client portal is a File Sharing platform that allows us to securely send documents and files to you, and for you to send to us. This is a way for us to work together with you around shared content quickly and easily.
If you have registered for box our client portal you would have received a link to access your shared VAT folder. This folder will allow you to easily download any files we send or to upload any files we will require to a secure area. To ensure our staff have access to the files you share with us, the files must be placed or dropped into the folder created by VAT named My VAT Documents or your Entity Name, see image below.
A quick way to see if we will be able to access the files or folders is to look under sharing (to the right of your screen) and check that VAT is listed (see image below). If we are not listed there, you are not in the shared area and we are unable to access or see the file.
If you have not registered for box but would like to be able to download and upload a copy of your files, please contact our office and our staff will provide you with a link to get started.
As we near the end of the tax year, if you have a Self-Managed Super Fund in pension mode make sure you have drawn your minimum pension payments.
Failure to draw your minimum pension results in your pension losing its tax free status and the earnings being taxed at 15%.
Strong business financials are just part of what we do. We believe effective partnering promotes better business.
That’s why we deliver a full spectrum of financial solutions that are tailored to your specific business needs.