2017 FEDERAL BUDGET HIGHLIGHTS 2017 STATE BUDGET june 2017.pdf · tax offset, equal to 15% of before tax (employer and salary sacrifice) superannuation contributions, up to $500

1Cootamundra | Young | Harden | Cowra

2017 FEDERAL BUDGET HIGHLIGHTS• Extend the $20,000 immediate write-off for depreciable assets for

businesses with an turnover of less than $10 million to 30 June 2018

• Limiting plant and equipment depreciation deductions to outlays actually incurred by investors in residential properties from 9 May 2017. Investors who purchase plant and equipment for their residential investment property will be able to claim depreciation over the effective life of the asset. However, subsequent owners of the property will be unable to claim depreciation deductions for plant and equipment purchased by a previous owner of that property

• No deduction will be allowed for travel expenses relating to inspecting, maintaining or collecting rent for a residential investment property from 1 July 2017

• Increase the Medicare levy from 2% to 2.5% from 1 July 2019

• First homebuyers will be able to make voluntary superannuation contributions of up to $15,000 per year and $30,000 in total from 1 July 2017. Concessional contributions and earnings on contributions will be taxed at 15% in the fund. Contributions and associated earnings can be withdrawn for a first home deposit from 1 July 2018 onwards. Concessional contributions and earnings that are withdrawn will be taxed at the taxpayer’s marginal rate less a 30% offset.

• Individuals aged 65 and over will be allowed to make a non-concessional contribution to superannuation of up to $300,000 from the proceeds of selling their home.

• The Taxable Payments Reporting System will be extended to contractors in the Courier and Cleaning industries from 1 July 2018

• From 1 July 2018, purchasers of newly constructed residential properties or new subdivisions will be required to remit the GST directly to the ATO as part of settlement

• From 9 May 2017, foreign residents will be denied access to the CGT main residence exemption

• Foreign owners of residential property will be charged at least $5,000 per year if their property is not occupied or genuinely available for rent for at least six months per year

• Foreign ownership in new property developments will be capped at 50% from 9 May 2017

• The CGT discount will be increased from 50% to 60% for investors in affordable housing

• The HECS and HELP repayment threshold will decrease to $42,000 with a 1% repayment rate from 1 July 2018. The threshold is currently $55,874 with a minimum 4% repayment rate.

NEWSLETTER | MARCH 2013NEWSLETTER | JUNE 2017

2017 STATE BUDGET PRE-ANNOUNCEMENTAhead of the 2017 State Budget, the NSW Government announced a housing affordability package. This includes a range of measures to support first home buyers, such as:

• abolishing stamp duty on all homes (existing and new) up to $650,000

• reducing stamp duty for all homes (existing and new) between $650,000 and $800,000

• providing a $10,000 grant for the building of a new home worth up to $750,000 (including building a home on vacant land)

• providing a $10,000 grant for the purchase of a new home worth up to $600,000

• abolishing insurance duty on lenders mortgage insurance


NEWSLETTER | JUNE 2017HAVE YOU VISITED OUR WEBSITE? www.twomeys.com.au

NSW QUAD SAFETY REBATE PROGRAM• The NSW Quad Bike Safety Improvement Program is offering rebates that will give eligible farmers and their workers up

to two rebates worth $1000 each to implement harm prevention measures in the workplace. This program is funded by SafeWork NSW.

• Three eligible safety solutions are offered as part of the rebate package:

> Up to $1,000 towards the purchase of each side-by-side vehicle.

> Up to $500 towards the purchase of each Quadbar ™ Operator Protective Device (OPD) or ATV Lifeguard OPD.

> Up to $90 towards the cost of each helmet compliant with NZS 8600:2002, AS/NZS 1698:2006 and/or UNECE22.05.

• An eligible business can access two rebates worth up to $1,000 each for any combination of the abovementioned eligible safety solutions.

• Workers employed by eligible businesses can access a rebate for a maximum of 1 helmet each.

• From 8 May 2017, free training places are also available to complete Unit of Competency (UOC) AHCMOM212 - Operate Quad Bikes. The one day quad bike safety course is tailored to the farming community and counts as an eligible educative interaction. Eligible participants also receive a free compliant helmet.

For more information visit www.safework.nsw.gov.au or www.nswfarmers.org.au/nsw-quad-bike-safety-improvement-program

PENALTY RATE REDUCTIONSThe Fair Work Commission has confirmed that penalty rate reductions will take effect in the retail, hospitality, pharmacy and fast food sectors as follows:

Award 1 July 2017 1 July 2018 1 July 2019 1 July 2020

Retail (permanent) 195% 180% 165% 150%

Retail (casual) 195% 185% 175% 175%

Fast Food - Level 1 Only (permanent) 145% 135% 125% 125%

Fast Food - Level 1 Only (casual) 170% 160% 150% 150%

Hospitality (permanent) 170% 160% 150% 150%

Pharmacy (permanent) 195% 180% 165% 150%

Pharmacy (casual) 220% 205% 190% 175%

Public holiday penalty rates will be reduced from 1 July 2017 without any transitional arrangements for these sectors.



MINIMUM WAGE INCREASEThe Fair Work Commission has recently announced a 3.3% increase to minimum wages from the first full pay period starting on or after 1 July 2017.

The 3.3% increase applies to employees who are paid the national minimum wage or under a modern award.

The national minimum wage applies to employees who are not covered by an award or agreement.

AUDIT SHIELDThe recent Federal budget allocated an additional $32 million in funding for ATO audit and compliance programs.

Twomeys is pleased to be able to offer our clients Audit Shield insurance which covers professional fees (up to prescribed limits) in the event that you receive one of the following audits: income tax, record keeping, capital gains, fringe benefits, workers compensation, payroll tax, GST/BAS, SMSF and employer obligations.

If you would like to participate in the Audit Shield service, please contact your local Twomeys office.

COMPANY TAX CUTSProgressive reductions in the company tax rate have now been legislated:

• 27.5% in 2017 for companies with a turnover less than $10 million



• 27% in 2025 for companies with a turnover less than $50 million



SMALL BUSINESS RESTRUCTURE ROLLOVER RELIEFThe small business restructure rollover allows small businesses to transfer active assets from one entity (the transferor) to one or more other entities (transferees), on or after 1 July 2016, without incurring an income tax liability.

This rollover applies to the transfer of active assets that are CGT assets, trading stock, revenue assets or depreciating assets.

To be eligible for this rollover, the transaction must not result in a change to the ultimate economic ownership of transferred assets. The ultimate economic owners of an asset are the individuals who, directly or indirectly own an asset. Where there is more than one individual with ultimate economic ownership, there is an additional requirement that each individual’s share of ultimate economic ownership be maintained.

The following apply to transferred CGT assets:• Pre-CGT assets will retain their pre-CGT status after the

transfer.

• To be eligible to claim the CGT discount for any subsequent sale of the asset, you will need to wait at least 12 months before a CGT event happens to that asset.

• For the purposes of determining eligibility for the 15 year CGT exemption, the transferee is taken as having acquired the asset when the transferor acquired it.



SUPERANNUATION UPDATETax Deduction for Employee Superannuation ContributionsFrom 1 July 2017 employees will be eligible to claim a tax deduction for contributions personally made to a superannuation fund. The total of all deductible contributions, including superannuation guarantee, salary sacrificed contributions and personal deductible contributions is capped at $25,000 per annum.

Low Income Superannuation Tax OffsetEligible taxpayers who earn up to $37,000 a year will get a tax offset, equal to 15% of before tax (employer and salary sacrifice) superannuation contributions, up to $500. The offset will be paid directly to the superannuation fund.

Spouse rebateA tax rebate of 18% is available to individuals who make an after tax contribution of up to $3,000 for the benefit of a low income earning spouse. From 1 July 2017 the income the receiving spouse can earn is increasing from $10,800 to $37,000 for full eligibility with the phase out limit increasing from $13,800 to $40,000

Superannuation Co-ContributionA government co-contribution is available to individuals who make an after tax superannuation contribution of up to $1,000. The co-contribution of $0.50 for each dollar contributed up to $500 is available for individuals under 71 with income under $36,021. The level of co-contribution phases out up to an income of $51,021.

Superannuation contribution splittingSpouses are able to split up to 85% of concessional contributions (superannuation guarantee and salary sacrifice contributions) to their spouse’s superannuation fund. The receiving spouse must be under 65 and not retired.

Section 293 From 1 July 2017 individuals with adjusted taxable income of more than $250,000 will be liable for an additional 15% tax on concessional contributions made on their behalf. This income limit is being reduced from its current level of $300,000.

FARM MANAGEMENT DEPOSITS (FMD’S)The cap on making deposits to FMDs for primary producers has increased from $400,000 to $800,000 per individual.FMDs give primary producers the ability to defer income by allowing a deduction on money contributed.

HOW MUCH TAX WILL YOU PAY IN 2017?You have until 30 June to book an appointment with your Accountant to review your 2017 profit, to estimate your tax payable and to put in place tax minimization strategies.The last thing we want for you is a nasty surprise when we prepare your 2017 income tax returns. Having an estimate of your tax liability enables you to plan ahead and be in control of your cash flow.

BEWARE OF SCAMS AND HACKERSScammers are becoming increasingly sophisticated and believable in their approach. A current phone scam is circulating whereby the fraudster purports to be from the ATO or a debt collection company and tells the taxpayer that if they do not pay the debt owed to the ATO immediately, the sheriff will be on their doorstep that afternoon to arrest them. This particular scam even leaves a message on your answering machine with a number to call back on.

If you are in doubt about the legitimacy of any debt collection requests, please phone your local Twomeys office to confirm before providing any details to the caller.

Many companies, including Xero, Google and Apple are overcoming the risk of hacking by introducing a two-step verification when you login to your account.

The verification process combines something you know (eg your email address and password) with something you have (eg an app on your phone). Either an SMS with a code is sent to your phone or you use an authentication code that is created by an authentication app on your phone. If you cannot access your device, you can often still login using backup security questions.

We strongly recommend that you use two-step verification wherever possible to help protect you against identity theft.



RAA FARM INNOVATION FUNDThe Farm Innovation Fund is a loan based initiative to assist farmers within NSW to identify and address risks to their farming enterprises, improve permanent farm infrastructure, ensure long term productivity and sustainable land use plus aiding in meeting changes to seasonal conditions.

Funding by way of a loan is available to meet the cost of carrying out permanent capital works in four main categories: drought preparedness, environment, farm infrastructure and natural resources.

For more information: www.raa.nsw.gov.au/assistance/farm-innovation-fund.

TWOMEYS CLIENT PORTALTwomeys have recently added Client Document Portal functionality to our website.

You can now login to your own personalised secure area to access your documents, files, income tax returns and financial reports. You can also use the portal to send us data files or other documents to assist us with, for example, the preparation of your Financial Statements and income tax returns. The portal also enables us to send you documents for electronic signing.

Registration for the Client Document Portal is not automatic and you need to request access. If you are interested, please go to our website and request access at www.twomeyscomau.sites.acclipse.com/client_login

SIMPLER BASSmall businesses will have less information to report on their BAS from 1 July 2017. The only GST information required will be:

G1 Total Sales

1A GST on Sales

1B GST on purchases

Businesses will not longer have to report Export sales, GST free sales, Capital purchases and Non-Capital purchases.

SINGLE TOUCH PAYROLLSingle Touch Payroll will be mandatory for employers with 20 or more employees from 1 July 2018.

Employers will be required to report salary or wages, PAYG withholding and superannuation information directly to the ATO at the same time that payment is made to their employees. Employers who report through Single Touch Payroll will not be required to provide employees with Payment Summaries at the end of the year.

Single Touch Payroll will begin to be incorporated into payroll software from 1 July 2017.

TWOMEYS COMMUNITY INVOLVEMENTTwomeys held two successful Pathway after Retirement Information Days in Young and Cootamundra in March/April.

The information days showcased exhibitors from a variety of local aged care service providers and featured guest speakers from Centrelink, Twomeys, local legal firms and aged care providers. Please like us on Facebook to ensure that you are aware of any upcoming Twomeys events.

The management of all NSW workers compensation insurance policies will be centralised with icare Workers insurance over the coming months.

Their purpose is to protect, insure the people and business assets leaving the insurance companies to focus on providing small business and workers with claims management services.

Cootamundra | Young | Harden | Cowra

TWOMEYS NEWSCONGRATULATIONS Congratulations to Stephanie Doswell our Para-planner who was recently awarded a Charles Sturt University Executive Deans Award. Steph received this award due to her outstanding results in her Bachelor of Business (Finance) studies during 2016.

Steph is pictured here with her very proud father, Grant.

WELCOMEMatilda Bucknell

Accountant

Cootamundra Office

SUBSCRIBE TO OUR NEWSLETTER ONLINE AT: www.twomeys.com.au

FIND US ON FACEBOOK: www.facebook.com/twomeys.com.au


^Services provided as an Authorised Representative of Count. Twomeys ABN 62 128 381 868 is a Member of Count Financial Limited (AR 324761). ‘Count’ and Count Wealth Accountants® are trading names of Count Financial Limited ABN 19 001 974 625 Australian Financial Services Licence Holder Number 227232 a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. Count is a Professional Partner of the Financial Planning Association of

Australia Limited. Count advisers are authorised representatives of Count. www.count.com.au *Lending services are authorised by Finconnect (Australia) Pty Ltd ABN 45 122 896 477 Australian Credit Licence No. 385888 a wholly owned subsidiary of ‘Count’ Count Financial Limited is not responsible for any accounting & tax services.

For further information or advice, please contact your nearest Twomeys office.

Cootamundra .................................................. 02 6942 0300

Young .................................................................. 02 6381 4200

Cowra ................................................................. 02 6342 3728

Harden ............................................................... 02 6386 2485

Liability limited by a scheme approved under Professional Standards Legislation. Please note that any taxation and accounting services are not endorsed nor the responsibility of Count Financial Limited. The articles contained in this newsletter are intended for information only and not for advice.

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2017 FEDERAL BUDGET HIGHLIGHTS 2017 STATE BUDGET june 2017.pdf · tax offset, equal to 15% of before tax (employer and salary sacrifice) superannuation contributions, up to $500