EAGAR EXTRA ARCHIVESFeb 09 Mar 09 May 09 June 09 July 09 August 09

EAGAR AUDIT ARCHIVESFeb 07Feb 09

Oxfam Australia Trailwalk - 29 - 31 August 2008

Oxfam Trailwalker is the world's greatest team challenge. And it's also one of the toughest. The challenge is to get your team of four across 100km of Australian bush in less than 48 hours - and, collectively, to raise at least $1,000,000 to help to overcome poverty and suffering around the world.

Phillip Browne, David Sharp, Peter Davis and Angus Kingon are The Midnight Ramblers! They entered the Oxfam Trailwalk and would like to thank you for your support! They're Team Target for raising funds is $20,000 and there finishing total was $37,770!! A fantastic effort!! The boys finished in 4 hours and 16 minutes, and came 225th our of 519 for teams that finished with all 4 team members!

Congratulations!!

Click here to DONATE

CLUBS’ FINANCIAL STRAIN GROWS  1 August 2008
Extract: Clubs NSW Press Release, Jeremy Bath 1 August 2008

NSW clubs have suffered their worst financial year ever, with overall club income falling by $385 million during the financial year 2007/08. This represents a fall of 11% on the previous 12 months. The downturn is largely the result of the indoor smoking ban which commenced on July 2 last year.

The overall financial impact upon clubs is much greater with clubs spending $422 million building outdoor smoking areas which have prevented smokers from moving to the footpath or street when wishing to light up.  The year also saw the closure or amalgamation of another 25 clubs, bringing the total number of clubs lost during the past decade to 270.

The worst affected region during 2007/08 was the Sydney CBD, where club income fell by 21.7%. The second worst affected area was outer western Sydney where revenue fell by 15.5%. Sydney’s eastern suburbs was close behind, with club income falling by 14.2% for the 12 months.

For information relating to how clubs across NSW have suffered during the past 12 months, please contact Jeremy Bath on 0419 267 789 or jbath@clubsnsw.com.au.

Young or Old at Heart - Money for Nothing, from the Government

'This superannuation co-contribution is too good and to be true!'. If you are under 71 and over 16 and work or are in business then the Government may give you up to $1500 if you satisfy some income tests etc. If eligible all you need to do is make an extra contribution to your Superannuation Fund. This is definitely worth checking on eligibility. You can go to the ATO website and use the co-contribution calculator or you can call Nicola on 02 9954 3409 and ask her to work out the amount you need to contribute before 30 June 2008 so as to be eligible. If you are reading this and saying it doesn't apply to me, ask the question "might this apply to my kids?"

IT'S NOW THE LAW, YOU CAN GEAR YOUR SUPER!
Editorial by Nicola Le Couteur, Accountant at Browne&Co

Have you been reading headlines like this over that past couple of months?  Well, it’s true: the new borrowing regime introduced in September 2007 is said to be the most significant change to super since the introduction of the Self-Managed Super Fund regime itself.  Technically, the borrowing takes place by means of an instalment warrant, which is simply an agreement that enables the fund to purchase an asset over time.  Instalment warrants are commercially available; however, it is now possible to customise an instalment warrant, enabling the fund to borrow for any asset that a super fund is currently permitted to acquire.

So imagine your Super Fund wanted to buy a commercial property for $1 million, but you only have $500,000 available cash resources.  How does a customised instalment warrant work?

• A fixed trust is created
• The trust holds legal ownership of the asset; the Super Fund has a 100% beneficial interest
• The Super Fund borrows money from any lender that will offer a non-recourse loan (that is, the lender’s rights in the event of default are limited to the particular asset, not to other assets within the Super Fund)
• The Super Fund buys the asset. (Yes, it has to be a new asset)
• The Super Fund collects the entire rental, pays all the interest and pays off the borrowings as the trustee see fit. 
• In the fullness of time, the Super Fund can pay out the debt from earnings and future contributions, and take full ownership. Or the asset can be sold.

Is this too good to be true?  Well there’s no getting away from the inherent risks with geared products: it is a great way to amplify the gains, but the losses can be all the more painful. This profile needs to sit well with the fund members and the fund’s investment strategy.  There are significant establishment costs involved, and the interest rate may be higher given the non-recourse nature of the loan.  The old adage is as relevant as ever: Buyer Beware.
 
This is an exciting opportunity if you are thinking about growing your super through a Self-Managed Super Fund.  It is crucial to get good quality advice and to avoid the pitfalls.  Call Nicola on 9954 3409 for more information.

 

PHILLIP BROWNE APPOINTED EXTERNAL EXAMINER BY THE LAW SOCIETY OF NSW.

The Legal Profession Act was altered requiring designation of persons by the Law Society where an external examination is undertaken of a Solicitors Trust Account. Phillip Browne, a Registered Company Auditor is designated as an External Examiner to report on trust records. Phillip recently attended a full day education course at the Law Society in readiness for trust account audits by our firm. The skills learnt have a flow on benefit where we audit real estate, strata managing agent and other trust accounts.
Congratulations to Phil, appointed by the Law Society of NSW as an External Examiner (Number 379) pursuant to Section 272 of the Legal Profession Act 2004.. Exams are coming up this year in April and May.

TAX TIPS FOR SMALL BUSINESSES

Source: Australian Taxation Office website www.ato.gov.au
The Tax Office has some useful tips and information to help businesses start the new year on the right foot.
There are some important things all small businesses need to remember, including good record keeping practices, meeting GST obligations and reporting and paying tax and superannuation.

Record keeping
Good record keeping practices include:

• recording all information from business transactions in a cash book, either electronically or manually
• recording payment summaries for salary, employment termination payments, and reportable fringe benefits
• storing all documents in a safe place for a period of five years, and
• withholding tax according to the pay as you go (PAYG) withholding rules, recording all GST obligations and paying superannuation contributions to a superannuation fund on behalf of eligible employees.

FWA Eagar&Co can assist businesses to keep good records for their business as well as explaining the tax obligations and requirements. If you would like advice on this please contact the office directly.

Relevant dates for 2008*

BAS
Monthly activity statements due: 21st of each month.
Quarterly activity statements due: 28 Feb 2008, 28 Apr 2008, 28 Jul 2008, 28 Oct 2008.

GST
Quarterly GST due: 28 Feb 2008, 28 Apr 2008, 28 Jul 2008, 28 Oct 2008.
GST annual return due: the same date as income tax returns, or before 28 February for those who are not required to lodge an income tax return.

FBT, PAYG and superannuation
FBT return due: 21 May 2008.
PAYG two instalment payers: 21 Apr 2008, 21 Jul 2008.
Super contributions due: 28 Jan 2008, 28 Apr 2008, 28 Jul 2008, 28 Oct 2008.
*As FWA Eagar&Co are Tax Agents and we work on your behalf, many of these dates are extended.

 

LABOR TAX POLICIES

LABOR Tax Policies

• Tax plan - tax cuts of equal value to those proposed by the Government for those individuals earning up to $180,000 p.a, but deferral of the Government's proposed tax cuts for individuals earning over $180,000 p.a. (see proposed longer term tax brackets and rates at www.eagar.com.au/newsevents)
• Increase in the Low Income Tax Offset;
• GST - Labor opposed any increase in the GST Rate or expansion of the GST base;
• Introduce a BAS Easy option for Small & Medium Enterprises;
• A 50% Education Tax Refund on education expenses for families eligible for Family Tax Benefits, refunds up to $375 per child per year for primary school children, and $750 per child per year for secondary school children;
• Increasing child care tax rebate to 50%;
• Rental tax incentive offering institutional investors annual tax incentives and financial support for building homes and renting them out at 20% below market rents;
• HECS Changes - halving the fees for Maths and Science students and graduates.

Christmas Parties and FBT

Although not a separate ruling on Christmas Parties in particular, there may be a minor benefit and exemption from FBT if the cost of the party is less than $300 per employee and certain conditions are met. The benefit provided to an associate of the employee may also be a minor benefit and exempt if the cost of the party for each associate of an employee is less than $300. For the FBT year beginning 1 April 2006 and prior years, the minor benefits threshold was less than $100 rather than less than $300. For more information. click here

TAX Changes to Legislation for Small Business Owners

According to the new tax declaration form, from 1 July 2007, small business owners must provide all employee tax file numbers to the superannuation fund accepting contributions from them. The tax declaration form states that the payer must provide employee tax file numbers (TFN) for superannuation purposes, to the superannuation fund accepting contributions from the employer. The Tax Office will be checking for compliance when performing their field visits.

CLUBS News

NEW REPORT FINDS CLUBS PROVIDE $1 BILLION ANNUAL COMMUNITY BENEFIT
Source: ClubsNSW Media release, 3 March 2008 by Jeremy Bath

ClubsNSW welcomes a draft report by IPART (Independent Pricing and Regulatory Tribunal) which has determined the community value of clubs at almost $1 billion every year.
The report, which was commissioned by the NSW Government, also found that clubs which operate without poker machines are only able to do so due to the willingness of volunteers and members to carry out the work usually performed by paid employees.
The $893 million annual community value of clubs calculated by IPART does not include the many intangible benefits such as the health benefits of playing club funded or supported sports, the improvement in life quality for the elderly that attend clubs and reducing social isolation.
The NSW Government requested IPART undertake the review with the intention of using the report to develop a plan to ensure the long term survival of the NSW Club Movement.

GST AND MEMBERSHIP SUBSCRIPTIONS TO NON-RESIDENTS
ISSUE: Is an organisation making a GST-free supply (i.e no GST applied), when it supplies a professional membership subscription to a non-resident subscriber who is not in Australia?
DECISION: Yes, the entity is making a GST-free supply when it supplies a professional membership subscription to a non-resident subscriber who is not in Australia.

This ruling by the Australia Taxation Office (ID 2002-868) may have broader application for example Club memberships.

SOURCE: ATO website www.ato.gov.au

CLUBSNSW SPONSORS WORLD MASTERS GAMES
ClubsNSW will today hand over a cheque for $500,000 to the Sydney 2009 World Masters Games as part of its continuing support of NSW sport. The World Masters Games will see 30,000 athletes descend upon Sydney for nine days in a festival of sport that will inject more than $100 million into the NSW economy. Individual clubs will in addition provide many of the competition venues, as well as actual athletes and volunteers, and the accommodation and hospitality for visitors and athletes. Source: www.clubsnsw.com.au

PREMIER RULES OUT SECOND CASINO
ClubsNSW welcomes today's announcement by Premier Morris Iemma that NSW will continue to remain a one casino state. ClubsNSW has always opposed a second casino in NSW on the grounds that such an expansion in gambling facilities could only cause an adverse effect on registered clubs and their ability to serve the community. Source: www.clubsnsw.com.au

Super Return Pty Ltd - A New Neighbour in the Office

We are proud to announce that Phil Browne recently bought a company by the name of Super Return Pty Ltd. The company assists travellers, backpackers, working holiday makers and students to apply for their tax and super back. The company is located down the hall from FWA Eagar&Co and is managed by Ian Ryall. The customer service representatives are Aimi Roberts, Lee Otukolo and Claire Lind. If you come by the office please feel free to drop in and meet the Super Return team at the other end of the hall. You'll find them by following the BRIGHT YELLOW signs!!
Check us out at SUPER RETURN

Information on Claiming Expenses

You may have recently received a letter from the Tax Office titled 'new entrant pre-lodgement advisory'. This is for taxpayers who are new to work-related expenses. The letter is intended to assist you in correctly claiming your work-related expenses. If you have any questions or require assistance please contact the office.

Small Business Amendments

The Tax Laws Amendment (Small Business) Bill 2007, which was introduced into Parliament on 10 May 2007 and was passed unamended on 13 June 2007 provides for the standard eligibility criterion that is to apply across the small business concessions. This bill will increase the GST cash Accounting turnover threshold from $1 million to $2 million.
From Taxation in Australia, Volume 42/1 July 2007

Deemed Dividends - Companies with asset loan accounts

Recent changes made to Div 7A has simplified Deemed Dividend situations. While Div 7A has not gone and Company tax payers will still need to consider it every year, it will apply in less situations (for example, marriage breakdown is now excluded), it is clearer (for example, where the shareholder is also an employee), it has been made less onerous (refinancing), it allows for more situations to be rectified (interposed entities) and, most importantly where it does apply the penalties will either be less onerous (no franking debit or only the shortfall amount being a deemed dividend) or the penalties have been done away with altogether (the Commissioner's discretion).
From Taxation in Australia, Volume 42/1 July 2007

Financially Fit - from the Institute of Chartered Accountants, Australia

With the arrival of the end of the 2006/ 2007 financial year, the Institute of Chartered Accountants in Australia is launching its 'Financially Fit' series, advising Australians to take this time to review and assess their finances. The Institute's Manager for Financial Planning and Superannuation, Hugh Elvy said "Just as regular exercise is essential to staying healthy, maintaining a realistic financial plan as part of a weekly or daily budget is the only way to becoming financially fit long term." Institute 'Financially Fit' checklist:

• Review budget - detail how much you earn and spend.
• Question expenses - have they changed due to external sources and are they needed?
• Review goals - what do you want to achieve - pay the bills on time, kids education, retire etc?
• Risk management - assess what can impact the achievement of your goals and review insurance
• Review savings - save first, spend later, assess savings plan and ensure it will help reach your goals
• Review estate planning - ensure your family's financial needs are catered for in all circumstances

"With recent external factors impacting on the finances for many Australians including recent interest rate rises and increasing petrol prices, the end of financial year along with recent superannuation reforms make this the ideal opportunity for many to take control of their finances. A licensed financial adviser can provide the tailored and comprehensive advice to ensure that Australians are 'Financially Fit' now and in the future, " Mr Elvy concluded.

From Media Releases July 2007. www.charteredaccountants.com.au

Some Super News

Superannuation Fund Tax File Numbers

Since 1 July 2007 TFNs should b provided to your Superannuation Fund. Without a TFN, contributions will be taxed at the highest marginal tax rate of 46.5% rather than 15%. Employers should note this as superannuation funds are seeking advice of TFNs for all employees. A further restriction is a superannuation fund cannot accept Voluntary member contributions from a member without a TFN.

Pension Changes
The Better Super changes as they are marketed by the Government, also impact Age Pensions from 20 September. The personal asset threshold is increasing and this means more in pensions for some and also that currently ineligible pensions due to asset levels may become eligible or re-eligible.

Tax Free Super Payouts from 60

Anyone aged 60+ who has paid tax in their super (most workers) can now take a lump sum or pension payout without any tax. The amount taken isn't even declared on tax returns. From now on the rules for taking superannuation are much more flexible. The rules regarding continuation of part-time work are also relaxed.

Superannuation Contributions

Just a reminder that super contributions must be paid quarterly. Contributions due for the June 2007 quarter must have been paid by 28 July 2007.

Lost Super

The Government is introducing a new easier system for tracking lost super called SuperSeeker.

Self Employed Super Contributions

From 1 July 2007 there is no longer partial reduction in super contributions for the self employed. Yay!!

 

Claim the COST of Managing Your TAX Affairs

Did you know that you can claim the expenses you incur when you manage your own tax affairs? When preparing your tax return and other tax documents you can claim expenses relating to:

• Preparing and lodging your tax return and activity statements
• Travel associated with obtaining tax advice
• Appeals to the Administrative Appeals Tribunal or courts; and
• Obtaining a valuation needed for a deductible gift or donation of property or for a deduction for entering into a conservation covenant.

The expenses relating to preparing and lodging your tax return and activity statements include costs associated with:

• Buying tax reference material
• Lodging your tax return through a registered tax agent or the TAXPACKEXPRESS service.
• Obtaining tax advice from a recognised tax adviser, and
• Dealing with the Tax Office about your tax affairs

You can also claim fees paid to a recognised tax adviser (e.g. Browne&Co) for preparing your return, however they can only be claimed in the year after you have paid them i.e. you can only claim expenses from your 05-06 tax return in your 06-07 return.

Source: ATO website www.ato.gov.au

Low Income Offset

From 1 July 2007, the low income tax offset will increase from $600 to $750 per year. In addition, the income threshold at which the offset begins to reduce will increase from $25,000 to $30,000. As a result, some offset can be claimed up to an income of $48,750 compared to $40,000 currently. Those eligible for the full income tax offset will not pay tax until their annual income exceeds $11,000 (up from $10,000 currently).

Source: ATO website www.ato.gov.au

Current and Proposed Tax Thresholds - 2008 and 2009

2006/2007 Income Range $	Rate %	Current 2007/2008 Income Range $	Rate %	Proposed 2008/2009 Income Range $	Rate %
0 - 6,000	0	0 - 6,000	0	0 - 6,000	0
6,001 - 25,000	15	6,001 - 30,000	15	6,001 - 30,000	15
25,001 - 75,000	30	30,001 - 75,000	30	30,001 - 80,000	30
75,001 - 150,000	40	75,001 - 150,000	40	80,001 - 180,000	40
150,001+	45	150,001+	45	180,001+	45

Source: Tax Vine, 9 May 07, www.taxinstitute.com.au

Increase in the GST Registration Turnover Threshold

The annual turnover thresholds for registration for the GST will be raised to $75,000 for businesses and to $150,000 for non profit bodies, with effect from 1 July 2007. As a result of this measure, businesses and non profit bodies with a turnover between the present threshold ($50,000 or $100,000) and the proposed threshold ($75,000 or $150,000) will no longer be required to register for GST. Those that voluntarily register for GST will have the option of remitting GST annually, rather than quarterly or monthly.

Source: Tax Vine, 9 May 07, www.taxinstitute.com.au

Increase in the Threshold for Requiring an Approved Tax Invoice for GST

Businesses will be allowed to claim input tax credits for purchases with a GST exclusive value of $75 or less without the need for an approved tax invoice, with effect from 1 July 2007. To claim an input tax credit, businesses currently have to obtain an approved tax invoice for all purchases with a GST exclusive value greater than $50. For purchases with a GST exclusive value of $50 or less, the documentation required for income tax purposes is sufficient to claim an input tax credit. This measure will also carry over to the "no ABN withholding" arrangements, increasing the threshold for "no ABN withholding" from $50 to $75.

Source: Tax Vine, 9 May 07, www.taxinstitute.com.au