Practice Update August 2018
Ian Campbell • 30 August 2018
Further company tax cuts deferred (for now . . .)
The Bill aims to progressively extend the lower 27.5% corporate tax rate to all corporate tax entities by the 2023/24 financial year, and further reduce
the corporate tax rate in stages so that, by the 2026/27 financial year, the corporate tax rate for all entities would be 25%.
Opposition confirms it won't repeal already legislated company tax cuts
Editor: Just in case the tax cut situation wasn't confusing enough, the leader of the Opposition, Bill Shorten, announced at a doorstop interview that,
if elected, Labor would repeal the existing company tax cuts for companies with turnover between $10 and $50 million.
ATO guide to the 5 most common Tax Time mistakes
- leaving out some of their income (e.g., forgetting a temp or cash job, capital gains on cryptocurrency, or money earned from the sharing economy);
- claiming deductions for personal expenses (e.g., home to work travel, normal clothes or personal phone calls);
- forgetting to keep receipts or records of their expenses (around half of the adjustments the ATO makes are because the taxpayer had no records, or they were poor quality);
- claiming for something they never paid for – often because they think everyone is entitled to a ‘standard deduction’; and
- claiming personal expenses for rental properties – either claiming deductions for times when they are using their property themselves, or claiming interest on loans used to buy personal assets like a car or boat.
Single Touch Payroll Update
- They are not required to provide their employees with payment summaries for the information they report through STP (although they may choose to provide
payment summaries for the first year of STP reporting).
- Income statements' will replace payment summaries.
- Employees' income statements are available through pre-filling and myGov.
- The income statement has three categories: 'Tax ready', 'Not tax ready' and 'Year-to-date'. Only 'tax ready' income statements are complete and will be available through pre-filling.
- Income statements may not be tax ready until 14 August this year. Employers have until this date to finalise their STP data.
For example, employers that live in an area where there is no internet connection, or where the connection or service is intermittent or unstable, can
apply for a deferral or even (in very limited circumstances) an exemption.
Cents per Km Deduction Rate for Car Expenses from 1 July 2018
Suburban scammers pushing illegal early access to super
- should not sign any documents nor provide them with any personal details;
- stop any involvement with the scheme, organisation or the person who approached them; and
- seek advice from a professional advisor or the ATO.
Transacting with cryptocurrency
New CGT rules from 1 July 2027 The new rules at a glance
Tax time 2026: prepare before you lodge, not after the ATO asks The 2025–26 financial year has now ended. For many individuals, sole traders and small business owners, the first instinct after 1 July is to lodge quickly and wait for a refund. That can be tempting, but it is not always the best approach. This year, a safer approach is to slow down, check the records, confirm that pre-filled information is complete, and make sure any deductions are supported before lodgement. The Australian Taxation Office has access to more data than many people realise. It can compare your tax return with information from employers, banks, share registries, crypto exchanges, digital platforms, property managers and other third-party sources. Most tax issues do not arise because clients are trying to do the wrong thing. They often arise because income is forgotten, expenses are estimated, business and private costs are mixed, or records are not available when the ATO asks questions months later. This newsletter outlines the areas the ATO is likely to question in 2026 and what you can do now, after 30 June, to prepare properly. Why rushing after 1 July can create problems Lodging early can be useful if your records are simple and complete. However, many tax returns are not complete in the first few days of July. Employers, banks, health funds, government agencies, share platforms and investment providers may still be finalising their reporting. If you lodge before all information is available, you may miss income or claim deductions against incomplete data. That can lead to amendments, delays, ATO questions, interest charges or penalties. A better post-30 June approach
BUDGET 2026-27 BUDGET 2026-27 AT A GLANCE