Fequently Asked Questions

What You Need To Know

Paul and the team at Carrazzo Consulting have been providing impeccable accounting services for over a decade. We have compiled frequently asked questions from our different services to help you on journey to success.

BUSINESS ADVISORY

What you need to know

I am a share trader. Must I pay GST when I sell shares?

No. The sale of shares is a financial supply and therefore input taxed.

What should I consider in determining the business structure I should use?

The business structure used should be chosen having regard to the following:

What type of business is it (business income or personal services)?;
Who will be the principals?;
What assets does the professional and his family own?;
What debts does the professional have?;
Do the principals want to borrow money from the company?;
Are new partners to be admitted into the future?;
Marriage status (children, etc) of the business owner?;
Rules of regulatory bodies?; and
How old are the principals? Is superannuation a major issue?

A taxpayer in business acquires an ABN, but due to turnover and projected turnover being less than $75,000, chose not to register for GST. If that taxpayer turnover subsequently exceeds $75,000, must he or she register for GST immediately? Is GST payable

The taxpayer must immediately register for GST when sales exceed $75,000. GST is payable on the sale proceeds and tax credits can be claimed only from the date of registration.

Many small businesses will be caught out by this requirement. Accordingly, I strongly suggest that registration take place well in advance of the turnover exceeding $75,000 - at least 10% GST can be added to the sale prices and the taxpayer will not be "out of pocket" for 1/11th of the sale proceeds.

Can GST registration be cancelled within 12 months of being registered?

Yes - a new law allows the ATO to cancel voluntary registration from as early as 1 July 2000, subject to certain conditions.

A taxpayer has two small businesses, each with an annual turnover of $30,000. As the turnover of each small business is under $75,000, does he or she have to register for GST?

Yes. If your total (or projected) annual turnover from all businesses is $75,000 or more, you must register for the GST. You do not look at each business in isolation. In terms of completing the BAS, the details of both businesses are consolidated by the entity.

Must a tax invoice show the amount of GST payable separately?

No. The tax invoice must show the GST inclusive price and need not show the GST separately if the GST payable is merely 1/11th of the GST inclusive price. If it is not 1/11th of the GST inclusive price, for example it is a mixed supply, the GST must be shown separately.

What tax rate does my superfund pay when I contribute deductible super contributions?

In last year's Budget, the government announced that, with effect from 1 July 2012, the rate of tax that applies to the concessional contributions for people with income above $300,000 would be increased from 15 percent to 30 percent.

If your income is less than $300,000 or less, the tax rate is only 15%.

What are reportable employer superannuation contributions?

Reportable employer superannuation contributions are contributions made by an employer under a salary sacrifice arrangement or contributions for an employee above the minimum amount required by law.

A reportable employer superannuation contribution for an individual for an income year is an amount contributed:

  1. by an employer of the individual, or an associate of the employer, for the individual to a superannuation fund or RSA
  2. to the extent that the individual has the capacity, or might reasonably be expected to have capacity to influence:
    1. the size of the amount, and/or
    2. the way the amount is contributed so that their assessable income is reduced
What is the timing for contributing superannuation for deductibility purposes?

The time an employer contribution is made is important because the employer can only deduct a contribution "for the income year in which you made the contribution".

The timing of a contribution is not only significant for an employer's deduction entitlement, but may also affect:

  • When an employer's superannuation guarantee contribution is made
  • A member's entitlement to a tax deduction for a year
  • A member's liability to excess contributions tax
  • Eligibility for a government co-contribution in year, and
  • The inclusion of the contribution in a fund's assessable income for the year

The ATO view on when a contribution is made is that a superannuation contribution is made when the capital of the fund is increased. This may be when an amount is received, when ownership of an asset is obtained or when the fund otherwise obtains the benefit of an amount. In the ordinary case:

  • A contribution in cash is made when received by the fund
  • A contribution by EFT or internet banking is made when the amount is credited to the fund's bank account – this may occur sometime after the contributor has done what is necessary to effect the payment, and
  • A contribution by cheque is made when the cheque is received by the fund, unless it is subsequently dishonored
Are any employees excluded from superannuation requirements?

The time an employer contribution is made is important because the employer can only deduct a contribution "for the income year in which you made the contribution".

The timing of a contribution is not only significant for an employer's deduction entitlement, but may also affect:

  • When an employer's superannuation guarantee contribution is made
  • A member's entitlement to a tax deduction for a year
  • A member's liability to excess contributions tax
  • Eligibility for a government co-contribution in year, and
  • The inclusion of the contribution in a fund's assessable income for the year

The ATO view on when a contribution is made is that a superannuation contribution is made when the capital of the fund is increased. This may be when an amount is received, when ownership of an asset is obtained or when the fund otherwise obtains the benefit of an amount. In the ordinary case:

  • A contribution in cash is made when received by the fund
  • A contribution by EFT or internet banking is made when the amount is credited to the fund's bank account – this may occur sometime after the contributor has done what is necessary to effect the payment, and
  • A contribution by cheque is made when the cheque is received by the fund, unless it is subsequently dishonored
How is the required superannuation calculated?

Employer superannuation support under this scheme is measured in terms of a percentage of an employee's notional earnings base/salary and wages. For the current year, the percentage of that base that must be contributed is 9.25%.

The government has announced changes that will gradually increase the superannuation guarantee rate (charge percentage) from 9% to 12% between the 2013-14 and 2019-20 years. We will publish updated guidance if these announced changes become law, given that the coalition have flagged the deferral of these increases by 2 years.

I am thinking of commencing business. In what circumstances do I need to pay employee superannuation under the Superannuation Guarantee Scheme?

The superannuation guarantee scheme is designed to encourage employers to provide a minimum level of superannuation support for employees.

Where an employer provides less than the required level of support, they will be liable to pay a non-deductible charge called the Superannuation Guarantee Charge (SGC).

An "employee" for superannuation guarantee purposes is anyone who is an employee at common law. Generally, the degree of control exercised by the "employer" over the "employee" and the degree to which the "employee's" services are an integral part of the "employer's" business will be significant whether an employer-employee relationship exists.

I elect to lodge my GST return monthly. Does this mean I must pay my FBT, PAYG etc monthly?

No. You look at each tax separately and pay it according to its own payment rules. Even though you will be lodging a BAS each month, you will not be completing the PAYG boxes if you only have to pay PAYG quarterly.

What types of Super Funds are there?

There are several different types of superannuation funds. The mains ones are:

  • Employer / Corporate / Staff funds – (funds established by an employer for the benefit of their staff)
  • Personal Funds
  • Industry Funds
  • Self-managed super funds
If you would like more information about the different types of super funds, speak to one of our Matrium Financial Advisers.
Can I withdraw the money that I have in super?

Usually, you are restricted from accessing your super money until you reach your preservation age. Your preservation age is based on your date of birth and ranges between 55 and 60. In very specific circumstances you may be able to access your super funds on compassionate grounds, however, these situations are limited. For more information talk to our financial adviser’s or go to the APRA website.

When can I access my super?

Generally, you can only access your super savings when you reach preservation age. This is to ensure your super savings are used for when you reach retirement.

Your ‘preservation age’ determines when you can access your money, even if you have not retired. It is based on your date of birth and ranges between 55 and 60.

Superannuation and Self Managed Super Funds

What you need to know

How can a Financial Adviser help you?

With all that’s happening in financial markets at the moment, it’s only natural to be looking for help to make sense of it all. Like all of us, you want to know what the changing markets mean for you, your family, your savings and your future. That’s why it’s a good idea to speak to a qualified Matrium Financial Services (http://www.matriumfs.com.au) adviser, a firm we work closely with to assist our clients' needs in this area.

A financial adviser can help you assess your current financial position and work out whether you’re in good shape to meet you personal and financial goals. Knowing what your goals put you in a better position to make choices that are right for you. It also helps your financial adviser develop or update your plan so it is tailored to your needs. The sort of things you should think about are your goals for:

  • Building savings and investments,
  • Protecting your family and lifestyle,
  • Planning for changes in your life like the birth of a child,
  • Saving for your retirement

A financial plan based on your goals and priorities puts you in control of your financial future and helps you create a secure and comfortable future. Matrium can also help you understand what to expect from your first meeting and give you tips on how to prepare so you are comfortable and confident with the planning process.

Can I choose my super fund?

The short answer is yes. Since 1 July 2005, employees, with some exceptions, have been able to choose the super fund their contributions are paid to. The good thing about this is it puts you in control of what could be your biggest source of retirement savings.

For help in making decisions about super talk to our financial advisers. We can help you identify your goals and recommend the super strategies best suited to your individual situation.

Is compulsory super enough to meet my needs?

Most Australian employers are required to contribute at least 9% of your salary to super; this is known as compulsory super. Even though compulsory super is intended to help fund your retirement, it may not provide you with enough money in retirement for the lifestyle that you want.

Before you decide that you can solely rely on compulsory super contributions, speak to our Matrium financial advisers.

How much super is enough?

The amount of super you’ll need will depend on your individual circumstances, such as your current age, current income, desired retirement age, desired retirement income and current super balance.

It’s a good idea to speak to our financial advisers, as they can help you with tips and strategies to make the most out of your super and save more for your retirement.

When can I access my super?

Generally, you can only access your super savings when you reach preservation age. This is to ensure your super savings are used for when you reach retirement.

Your ‘preservation age’ determines when you can access your money, even if you have not retired. It is based on your date of birth and ranges between 55 and 60.

Can I withdraw the money that I have in super?

Usually, you are restricted from accessing your super money until you reach your preservation age. Your preservation age is based on your date of birth and ranges between 55 and 60. In very specific circumstances you may be able to access your super funds on compassionate grounds, however, these situations are limited. For more information talk to our financial adviser’s or go to the APRA website.

What types of Super Funds are there?

There are several different types of superannuation funds. The mains ones are:

  • Employer / Corporate / Staff funds – (funds established by an employer for the benefit of their staff)
  • Personal Funds
  • Industry Funds
  • Self-managed super funds
If you would like more information about the different types of super funds, speak to one of our Matrium Financial Advisers.
 
How does Super work?

To understand how super works, it’s important to keep in mind that super is a framework for holding investment assets. It’s not an investment in itself. Super funds can offer a range of investment options and asset classes that may include cash, property, shares and fixed interest.

What is Superannuation?

Superannuation, or super as most of us know it, is a good long-term savings plan, which will provide you with an income when you retire. For many Australians, super will be their main form of retirement income.

What tax rate does my superfund pay when I contribute deductible super contributions?

In last year's Budget, the government announced that, with effect from 1 July 2012, the rate of tax that applies to the concessional contributions for people with income above $300,000 would be increased from 15 percent to 30 percent.

If your income is less than $300,000 or less, the tax rate is only 15%.

What are reportable employer superannuation contributions?

Reportable employer superannuation contributions are contributions made by an employer under a salary sacrifice arrangement or contributions for an employee above the minimum amount required by law.

A reportable employer superannuation contribution for an individual for an income year is an amount contributed:

  1. by an employer of the individual, or an associate of the employer, for the individual to a superannuation fund or RSA
  2. to the extent that the individual has the capacity, or might reasonably be expected to have capacity to influence:
    1. the size of the amount, and/or
    2. the way the amount is contributed so that their assessable income is reduced
What is the timing for contributing superannuation for deductibility purposes?

The time an employer contribution is made is important because the employer can only deduct a contribution "for the income year in which you made the contribution".

The timing of a contribution is not only significant for an employer's deduction entitlement, but may also affect:

  • When an employer's superannuation guarantee contribution is made
  • A member's entitlement to a tax deduction for a year
  • A member's liability to excess contributions tax
  • Eligibility for a government co-contribution in year, and
  • The inclusion of the contribution in a fund's assessable income for the year

 

The ATO view on when a contribution is made is that a superannuation contribution is made when the capital of the fund is increased. This may be when an amount is received, when ownership of an asset is obtained or when the fund otherwise obtains the benefit of an amount. In the ordinary case:

  • A contribution in cash is made when received by the fund
  • A contribution by EFT or internet banking is made when the amount is credited to the fund's bank account – this may occur sometime after the contributor has done what is necessary to effect the payment, and
  • A contribution by cheque is made when the cheque is received by the fund, unless it is subsequently dishonored
Are any employees excluded from superannuation requirements?

A limited category of employees are excluded and need not be provided for under the Superannuation Guarantee scheme, including:

  • employees aged 70 years or over;
  • employees paid less than $450 a month;
  • non-resident employees paid for work done outside Australia;
  • resident employees employed by non-resident employers for work done outside Australia;
  • part time employees (that is, employed to work not more than 30 hours per week) under 18 years of age; and
  • a person employed for not more than 30 hours per week to carry out work of a domestic or private nature.
How is the required superannuation calculated?

Employer superannuation support under this scheme is measured in terms of a percentage of an employee's notional earnings base/salary and wages. For the current year, the percentage of that base that must be contributed is 9.25%.

The government has announced changes that will gradually increase the superannuation guarantee rate (charge percentage) from 9% to 12% between the 2013-14 and 2019-20 years. We will publish updated guidance if these announced changes become law, given that the coalition have flagged the deferral of these increases by 2 years.

I am thinking of commencing business. In what circumstances do I need to pay employee superannuation under the Superannuation Guarantee Scheme?

The superannuation guarantee scheme is designed to encourage employers to provide a minimum level of superannuation support for employees.

Where an employer provides less than the required level of support, they will be liable to pay a non-deductible charge called the Superannuation Guarantee Charge (SGC).

An "employee" for superannuation guarantee purposes is anyone who is an employee at common law. Generally, the degree of control exercised by the "employer" over the "employee" and the degree to which the "employee's" services are an integral part of the "employer's" business will be significant whether an employer-employee relationship exists.

Bookkeeping

What you need to know

How will Key Factor and Break-Even analysis enhance my business?

These techniques can be utilised as shown below:

Key Factor Monitoring

Financial statements are not just a set of numbers; numbers in relation to other numbers tell the story.

To faciliate proper financial monitoring, the business person should have access to periodic profit and loss statement and balance sheet.

Using numbers from financial statements, financial ratios can be developed which provides tests that measure the short-term solvency, long-term solvency and profitability of a business.

The following business ratios should be regularly checked by the business owner:

  • Return on Capital Employed (ROCE)
  • Profitability Ration
  • Asset Turnover (or Activity ratio)

Break-Even analysis

Break-Even analysis is used to determine how much sales/fees needs to be derived, in order to cover the fixed and variable costs of generating that income and all domestic financial commitments.

In calculating break-even it is important to differentiate between fixed and variable costs. Fixed costs don't change with the level of activity or output, whilst variable costs do.

The benefit of break-even analysis is obvious; it provides the proprietor with a benchmark to aim for in terms of deriving a minimum rate of return.

Will MYOB software assist me with my GST reporting obligations?

Even the most basic of MYOB's software range will greatly assist the business person preparing monthly or quarterly BAS returns. The software accommodates businesses no matter what their chosen GST accounting method, i.e. Cash or Accruals.

All reports required to generate a BAS are found in the "GST Reports" area.

Do all entities have to prepare Financial Statements fully compliant with Australian Accounting Standards?

No. Entities that can be classified as "Non-Reporting Entities" need not prepare fully compliant Financial Statements. The following will often be Non-Reporting Entities:

  • Small proprietary companies;
  • Family trusts;
  • Partnerships;
  • Sole Traders; and
  • Wholly owned subsidiaries of Australian reporting entities.

Tax Controversy

What you need to know

Must a tax invoice show the amount of GST payable separately?

No. The tax invoice must show the GST inclusive price and need not show the GST separately if the GST payable is merely 1/11th of the GST inclusive price. If it is not 1/11th of the GST inclusive price, for example it is a mixed supply, the GST must be shown separately.

What is the “margin scheme” basis of calculating GST on a property sale?

If the margin scheme is applied to the sale of property, the GST is generally calculated on the difference between the price at which the property is sold and its acquisition cost. GST is, therefore, only payable on the vendor's "margin" for the sale.

However, if the property was acquired before 1 July 2000, then the GST is usually based on the difference between the price at which it was sold and the market value of the property at 1 July 2000 (this is known as the "valuation" method).

Note – the margin scheme is not available to vendors who were able to claim an input tax credit on the property when it was originally acquired.

According to the ATO, a vendor intending to use the margin scheme must choose to do so at or before the sale of the property, which is usually settlement.

A car is used partly for business. Can input tax credits be claimed?

If you are not registered for GST because, for example, you are an employee, you cannot claim input tax credits. Even if you are registered for GST, you cannot claim input tax credits in respect of the use of your car for employment purposes. If you run your business as a sole trader and are registered for GST, you will be entitled to input tax credits if you use your car for business purposes.

Can an entity that accounts for GST on a cash basis, pay the GST up front on a motor vehicle hire purchase and claim the input tax credits immediately?

No. The common consensus is that the hirer cannot make a lump sum payment for future GST up front and say all future monthly payments are simply the remaining GST exclusive amounts. The amount of input tax credit should simply be 1/11th of any amount paid.

Reminder - GST credits cannot be claimed for any new motor vehicles acquired before 1 July 2001.

What are the new small business depreciation write-offs from 2012/2013?

Beginning with the 2012-2013 tax year, businesses with a turnover of under $2 million can instantly write off any depreciating assets which cost $6500 or less. From a technology standpoint, that means that virtually any laptop you purchase can be written off immediately, rather than over a number of years. Many server systems would also fall under that threshold.

The limit applies to each individual item; if you purchased four $3000 notebooks for work, they would all be immediately written off, rather than being depreciated over a period of three or four years.

You still need to write off higher-priced assets over a number of years, but the rules are also simpler there; assets are added to a general pool and depreciated at 15 per cent for the first year and 30 per cent for each subsequent year.

From the 2012-2013 income year, a small business using the simplified depreciation rules can claim up to $5,000 as an immediate deduction for a motor vehicle costing $6,500 or more that it starts to use, or have installed ready for use, for taxable purpose.

I am about to go overseas on work, which records should I keep to substantiate my travel expenses?

If you received a bona fide travel allowance and the deduction exceeds the Commissioner's reasonable allowance amount, you must fully substantiate all travel claims by providing the following records:

  1. details and evidence to support the type and specific amounts of allowance received for travel expenses, such as accommodation, meals and incidentals
  2. details of specific overnight travel undertaken, including:
    1. dates or period travel was undertaken
    2. specific purpose of travel
    3. if the travel involves being away from home for six or more nights in a row, a travel record (diary) is required to be kept
  3. evidence that you actually undertook the travel and incurred the accommodation and meal expenses, such as receipts or other documents.

    If you did not receive a bona fide travel allowance or received a token travel allowance, you will be asked to keep the following records:

    details of specific overnight travel undertaken, including:

    1. dates or period travel was undertaken
    2. specific purpose of travel
    3. if the travel involves being away from home for six or more nights in a row, a travel record (diary) is required to be kept.
    4. sufficient information to ascertain how specific expenses were incurred in the course of earning assessable income
In what circumstances can I claim Home Office Expenses?

The ATO will generally not allow a taxpayer to claim for expenses associated with their home office unless their employer considers it necessary for them to work from home and the following criteria can be established:

It is normal practice in the employee's industry to perform some work duties from home;

It is a part of their current job specification; and

It is a condition of their employment, although not necessarily evidenced/documented in writing.
Generally speaking, "running expenses" are able to be claimed by salary and wage earners who satisfy the above criteria, "Occupancy expenses" may be claimed by people running a business from home. For discussion as to what the ATO considers to be a "place of business", refer to Paul Carrazzo's feature article on this issue, published in the June 1999 issue of The Australian Bloodhorse Review.

Does a car log book have to be kept for every year?

A log book does not have to be kept every year. The business percentage is valid for five years. That is, the year that the log book is kept and the subsequent four years. Once you have established the business use percentage, you are not required to complete a new log book unless required to do so by the legislation, or otherwise directed in writing by the ATO. This business percentage is used as a basis for you to arrive at your reasonable estimate of the business use percentage in each income year as noted above.

Note: You must keep odometer records every income year.

 
I want to claim a deduction for using my car in my business or for employee duties. What is business travel?

Business travel is travel which is undertaken in gaining or producing your assessable income or carrying on a business for that purpose. Travel between home and a person's regular place of employment or business is ordinarily private travel. While travel to work is a necessary prerequisite to earning income, it is not undertaken in the course of earning that income. Put at its simplest, travel to work is private; travel on work is business.

What are the new small business depreciation write-offs from 2012/2013?

Beginning with the 2012-2013 tax year, businesses with a turnover of under $2 million can instantly write off any depreciating assets which cost $6500 or less. From a technology standpoint, that means that virtually any laptop you purchase can be written off immediately, rather than over a number of years. Many server systems would also fall under that threshold.

The limit applies to each individual item; if you purchased four $3000 notebooks for work, they would all be immediately written off, rather than being depreciated over a period of three or four years.

You still need to write off higher-priced assets over a number of years, but the rules are also simpler there; assets are added to a general pool and depreciated at 15 per cent for the first year and 30 per cent for each subsequent year.

From the 2012-2013 income year, a small business using the simplified depreciation rules can claim up to $5,000 as an immediate deduction for a motor vehicle costing $6,500 or more that it starts to use, or have installed ready for use, for taxable purpose.

I am about to go overseas on work, which records should I keep to substantiate my travel expenses?

If you received a bona fide travel allowance and the deduction exceeds the Commissioner's reasonable allowance amount, you must fully substantiate all travel claims by providing the following records:

  1. details and evidence to support the type and specific amounts of allowance received for travel expenses, such as accommodation, meals and incidentals
  2. details of specific overnight travel undertaken, including:
    1. dates or period travel was undertaken
    2. specific purpose of travel
    3. if the travel involves being away from home for six or more nights in a row, a travel record (diary) is required to be kept
  3. evidence that you actually undertook the travel and incurred the accommodation and meal expenses, such as receipts or other documents.

    If you did not receive a bona fide travel allowance or received a token travel allowance, you will be asked to keep the following records:

    details of specific overnight travel undertaken, including:

    1. dates or period travel was undertaken
    2. specific purpose of travel
    3. if the travel involves being away from home for six or more nights in a row, a travel record (diary) is required to be kept.
    4. sufficient information to ascertain how specific expenses were incurred in the course of earning assessable income
In what circumstances can I claim Home Office Expenses?

The ATO will generally not allow a taxpayer to claim for expenses associated with their home office unless their employer considers it necessary for them to work from home and the following criteria can be established:

It is normal practice in the employee's industry to perform some work duties from home;

It is a part of their current job specification; and

It is a condition of their employment, although not necessarily evidenced/documented in writing.
Generally speaking, "running expenses" are able to be claimed by salary and wage earners who satisfy the above criteria, "Occupancy expenses" may be claimed by people running a business from home. For discussion as to what the ATO considers to be a "place of business", refer to Paul Carrazzo's feature article on this issue, published in the June 1999 issue of The Australian Bloodhorse Review.

Does a car log book have to be kept for every year?

A log book does not have to be kept every year. The business percentage is valid for five years. That is, the year that the log book is kept and the subsequent four years. Once you have established the business use percentage, you are not required to complete a new log book unless required to do so by the legislation, or otherwise directed in writing by the ATO. This business percentage is used as a basis for you to arrive at your reasonable estimate of the business use percentage in each income year as noted above.

Note: You must keep odometer records every income year.

I want to claim a deduction for using my car in my business or for employee duties. What is business travel?

Business travel is travel which is undertaken in gaining or producing your assessable income or carrying on a business for that purpose. Travel between home and a person's regular place of employment or business is ordinarily private travel. While travel to work is a necessary prerequisite to earning income, it is not undertaken in the course of earning that income. Put at its simplest, travel to work is private; travel on work is business.

Hospitality

What you need to know

A taxpayer in business acquires an ABN, but due to turnover and projected turnover being less than $75,000, chose not to register for GST. If that taxpayer turnover subsequently exceeds $75,000, must he or she register for GST immediately? Is GST payable

The taxpayer must immediately register for GST when sales exceed $75,000. GST is payable on the sale proceeds and tax credits can be claimed only from the date of registration.

Many small businesses will be caught out by this requirement. Accordingly, I strongly suggest that registration take place well in advance of the turnover exceeding $75,000 - at least 10% GST can be added to the sale prices and the taxpayer will not be "out of pocket" for 1/11th of the sale proceeds.

A taxpayer must conduct an enterprise to be able to register for GST. What are the current enterprise tests?

For GST purposes, you must demonstrate that you are conducting the activity in the "form of business", with a reasonable expectation of profit or gain, and that the activity is not a private recreational pursuit or hobby. This is especially important for those who wish to claim GST paid in relation to a horse breeding activity (and also those who wish to claim income losses for horse breeding activities).

The ATO has a number of tests to determine whether an entity is engaged in a viable business enterprise. Some of the more important criteria include:

  • whether the activity has a significant commercial purpose or character;
  • whether the taxpayer has a purpose of profit as well as a prospect of profit from the activity;
  • whether there is repetition and regularity of the activity;
  • whether the activity is of the same kind and carried on in a businesslike manner such that it is directed at making a profit;
  • the size, scale and permanency of the activity;
  • the keeping of proper records;
  • the existence of a Business Plan evidencing viability;
  • are the goods and services being regularly sold in order to generate a profit; and
  • the use of experts and consultants.
Can GST registration be cancelled within 12 months of being registered?

 Yes - a new law allows the ATO to cancel voluntary registration from as early as 1 July 2000, subject to certain conditions.

 
A taxpayer has two small businesses, each with an annual turnover of $30,000. As the turnover of each small business is under $75,000, does he or she have to register for GST?

Yes. If your total (or projected) annual turnover from all businesses is $75,000 or more, you must register for the GST. You do not look at each business in isolation. In terms of completing the BAS, the details of both businesses are consolidated by the entity.

I elect to lodge my GST return monthly. Does this mean I must pay my FBT, PAYG etc monthly?

No. You look at each tax separately and pay it according to its own payment rules. Even though you will be lodging a BAS each month, you will not be completing the PAYG boxes if you only have to pay PAYG quarterly.

I am a share trader. Must I pay GST when I sell shares?

No. The sale of shares is a financial supply and therefore input taxed.

Thoroughbred

What you need to know

If I conduct a legitimate business of thoroughbred breeding and/or racing, can I claim a depreciation deduction for racehorses that I acquired?

Yes, depreciation of a racehorse business plant commences from birth, not age 2 as noted in a previous 1993 ATO ruling.

 
I keep hearing that I need a Business Plan to support the claiming of my tax losses in the early years of my breeding activities. Who says so?

The ATO have made it quite clear in the past 5 or so years that the preparation of a Business Plan is very important if a taxpayer wants to demonstrate that they are conduction a taxation thoroughbred breeding business.

The requirement for a Business Plan was reinforced when it was referred to as an important business factor in the 1997 ATO ruling, TR 97/11, titled "What is a business of Primary Production".

I've heard that there are new rules in relation to taxation breeders being able to claim losses in the year that they are incurred? When do they apply from?

These new rules apply from 1 July 2000. They only apply to individuals and partnerships.

For more information, refer to Jennifer Stynes' interview with Paul Carrazzo which was published in the November 1999 "Financial Review" article, Tax Crackdown Ready to Fall on Breeders.

Can I offset a capital loss on the sale of a broodmare against the capital gain I realised on the sale of one of my rental properties?

No. The real inequity for hobby breeders arises where a capital loss is realised on disposing of a horse - capital losses on horses are not recognised under the current Tax Act. Thus a capital loss on one horse cannot be used to offset a capital gain on another, which differs from the tax laws relating to normal capital assets.

I own a share in a racehorse. Do I pay CGT if I sell it for profit?

If the share in the horse was acquired for $10,000 or less, and it was disposed of on or after 1 July 1998, it is exempt from CGT on disposal.

I have a legitimate taxation thoroughbred breeding business and want to know more about the mare and stallion write down provisions. Can you help?

If a breeder uses the Special Closing Value method for valuing closing stock, broodmares can be written down on a straight line basis until they are $1 by the age of 12 years. Mares acquired at the age of 12 years or greater can be written down to $1 in the year of purchase.

Stallions (or shares therein) can be written off by up to 25% per annum.

Property

What you need to know

How is the sale of a subdivided backyard treated for tax?

The usual outcome where you subdivide the backyard of your main residence and sell the vacant block of land is that the sale of the land would be considered a "mere realisation" of the asset, and the gain is assessable under the CGT provisions. GST would also not apply to such a sale.

In contrast, if you arranged for the construction and sale of a building on the subdivided block of land, then it would be argued by the ATO that the transaction has a "profit-making" purpose, and it would be taxed as a normal taxable profit. This is likely to be the case, regardless of whether you have undertaken a property development before. GST is generally payable on 1/11th of the proceeds received. Of course, exceptions to this exist, including where the taxpayer is eligible for, and has applied, the margin scheme in respect to the sale.

If we rent our main residence in the future, how do we calculate its capital gains tax “cost base” when we eventually sell it?

Ordinarily, a main residence is exempt from CGT when sold, however not so where the property was previously used for income producing purposes, i.e. rented. In this instance, a partial main residence exemption is appropriate.

Where you move out of your main residence and rent it for the first time after 20 August 1996, the new cost base of the property is its market value at that time. However, the market value rule will only apply where:

The vendor would only obtain a partial main residence exemption when the dwelling is eventually sold, because it was used for income producing purposes; and
The vendor would have obtained a full main residence exemption if the dwelling was sold immediately before it was first rented.
Note – for CGT purposes, the vendor is deemed to have acquired the property at the time it was first rented, not when originally acquired.

What are reportable employer superannuation contributions?

Reportable employer superannuation contributions are contributions made by an employer under a salary sacrifice arrangement or contributions for an employee above the minimum amount required by law.

A reportable employer superannuation contribution for an individual for an income year is an amount contributed:

  1. by an employer of the individual, or an associate of the employer, for the individual to a superannuation fund or RSA
  2. to the extent that the individual has the capacity, or might reasonably be expected to have capacity to influence:
    1. the size of the amount, and/or
    2. the way the amount is contributed so that their assessable income is reduced
What is the “margin scheme” basis of calculating GST on a property sale?

If the margin scheme is applied to the sale of property, the GST is generally calculated on the difference between the price at which the property is sold and its acquisition cost. GST is, therefore, only payable on the vendor's "margin" for the sale.

However, if the property was acquired before 1 July 2000, then the GST is usually based on the difference between the price at which it was sold and the market value of the property at 1 July 2000 (this is known as the "valuation" method).

Note – the margin scheme is not available to vendors who were able to claim an input tax credit on the property when it was originally acquired.

According to the ATO, a vendor intending to use the margin scheme must choose to do so at or before the sale of the property, which is usually settlement.

Are any employees excluded from superannuation requirements?

The time an employer contribution is made is important because the employer can only deduct a contribution "for the income year in which you made the contribution".

The timing of a contribution is not only significant for an employer's deduction entitlement, but may also affect:

  • When an employer's superannuation guarantee contribution is made
  • A member's entitlement to a tax deduction for a year
  • A member's liability to excess contributions tax
  • Eligibility for a government co-contribution in year, and
  • The inclusion of the contribution in a fund's assessable income for the year

The ATO view on when a contribution is made is that a superannuation contribution is made when the capital of the fund is increased. This may be when an amount is received, when ownership of an asset is obtained or when the fund otherwise obtains the benefit of an amount. In the ordinary case:

  • A contribution in cash is made when received by the fund
  • A contribution by EFT or internet banking is made when the amount is credited to the fund's bank account – this may occur sometime after the contributor has done what is necessary to effect the payment, and
  • A contribution by cheque is made when the cheque is received by the fund, unless it is subsequently dishonored
What is the “margin scheme” basis of calculating GST on a property sale?

If the margin scheme is applied to the sale of property, the GST is generally calculated on the difference between the price at which the property is sold and its acquisition cost. GST is, therefore, only payable on the vendor's "margin" for the sale.

However, if the property was acquired before 1 July 2000, then the GST is usually based on the difference between the price at which it was sold and the market value of the property at 1 July 2000 (this is known as the "valuation" method).

Note – the margin scheme is not available to vendors who were able to claim an input tax credit on the property when it was originally acquired.

According to the ATO, a vendor intending to use the margin scheme must choose to do so at or before the sale of the property, which is usually settlement.

I’ve just bought a rental property, what deductions can I claim?

1. Rental Properties Checklist

The following is a list of the common types of expenses which landlords may generally claim as deductions, with additional clarifying comments where appropriate.

Advertising
Agent's commission
Bank charges
Borrowing expenses
The deduction is spread over five years or the term of the loan, whichever is the shorter.
Building allowance
When a rental property is purchased, a deduction (referred to as a "building write-off") may be available for capital expenditure incurred in constructing the property. Building write-off deductions are generally available at a rate of 2.5% p.a. (i.e. over 40 years) on the construction expenditure of the building. "Construction expenditure" is basically expenditure on the construction of the building itself, or the construction of any extension, alteration or improvement to the building.

For residential property, this write-off is only available where construction of the building commenced on or after 18 July 1985. For commercial property, the deduction is available where construction of the building commenced on or after 20 July 1982. In relation to structural improvements, where construction commenced on or after 27 February 1992.

Note – it is common for the original construction costs of the building not to be available to the purchaser, where this occurs the ATO allows the purchaser to obtain the estimate of an appropriately qualified person, such as a quantity surveyor.

Cleaning
Depreciation on furniture, whitegoods etc

When a rental property is purchased, part of the overall purchase price relates to the acquisition of depreciating assets, such as curtains and blinds, carpets, and an oven.

It is quite common for (especially with second hand properties) for no value to have been allocated to these assets in the purchase contract or any other legal documents associated with the purchase.

In attributing a "cost" to depreciating assets in the above circumstances, the ATO advises that the taxpayer can either:

a) obtain an independent valuation that establishes reasonable values for these assets - normally a quantity surveyor; or

b) estimate their own reasonable value for these assets. In estimating these values, consideration should be given to the market value of the asset compared to the purchase price of the property.

Gardening
Insurance

Although mortgage insurance is capital in nature and therefore not deductible, it is deductible as a borrowing expense (see above).

Interest

Interest can be claimed even in the property's construction phase, as long as the intention was to always use the property for rental.

Land tax
Lease incentives
Lease preparation, registration, stamping
Legal expenses in recovering arrears of rental, evicting defaulting tenants, investigating creditworthiness and in preparing leases.
Postage
Power supplied (gas/electricity)
Rates
Registration of lease
Rent collection
Repairs

Repairs on the property are 100% deductible if they are essentially the replacement or renewal of a worn out or dilapidated part of something, but not of the entirety (i.e. the whole).

By contrast, if the expenditure is capital in nature and thus the repair is not deductible (i.e. it is an "improvement), it may qualify as a depreciable item or subject to the "building allowance" write-off (see above). Further it may also be included in the cost base of the property for Capital Gains Tax purposes.

Initial repairs

A deduction is not available for expenditure to remedy defects, damage or deterioration in existence at the date of acquisition (i.e. initial repairs).

Replacement of crockery, linen etc
Safe deposit box fees
Secretarial, bookkeeping fees
Servicing expenses
Stationery
Telephone
Travel

Note – The costs incurred in inspecting properties with a view to purchase for letting were of a capital nature intended to gain an asset for an enduring nature.

Water rates
2. Holding costs deductions allowed when property "genuinely available to rent"

If a rental property is vacant for any reason, deductions for holding costs (e.g. interest, land tax and rates) and non-holding costs (e.g. repairs) are still deductible if the property is considered to be "genuinely available for rent." Such efforts may include:

Listing the property with one or more real estate agents;
Placing advertisements in newspapers; or
Letting of the property to friends or relatives (at commercial rates).

It is worth noting that a recent case held that merely placing an "available to rent" sign on a property was not sufficient to demonstrate "genuinely available for rent", thus rental and interest deductions were not available to the owner during the vacant period.

Is the sale of a farm property GST-free?

The sale of a farming property will be GST-free if:

  • there has been a farming business carried on, on the land, for at least the five years preceding the sale, and
  • the purchaser intends that a farming business be carried on, on the land.

 

This concession is limited to the land, including fixtures and improvements. It does not apply to livestock, plant or equipment.

It is, however, not necessary that the seller of the land be the entity that was carrying on that business or that the recipient be the entity that will carry on that business.

If I run a business from home, do I have to pay GST when I sell it?

Generally no, because the house will not be sold in the course or furtherance of an enterprise. If it was being sold as business premises, or as part house part business premises, then GST may be payable.

Medicine

What you need to know

I am a share trader. Must I pay GST when I sell shares?

No. The sale of shares is a financial supply and therefore input taxed.

What should I consider in determining the business structure I should use?

The business structure used should be chosen having regard to the following:

What type of business is it (business income or personal services)?;
Who will be the principals?;
What assets does the professional and his family own?;
What debts does the professional have?;
Do the principals want to borrow money from the company?;
Are new partners to be admitted into the future?;
Marriage status (children, etc) of the business owner?;
Rules of regulatory bodies?; and
How old are the principals? Is superannuation a major issue?

A taxpayer in business acquires an ABN, but due to turnover and projected turnover being less than $75,000, chose not to register for GST. If that taxpayer turnover subsequently exceeds $75,000, must he or she register for GST immediately? Is GST payable

The taxpayer must immediately register for GST when sales exceed $75,000. GST is payable on the sale proceeds and tax credits can be claimed only from the date of registration.

Many small businesses will be caught out by this requirement. Accordingly, I strongly suggest that registration take place well in advance of the turnover exceeding $75,000 - at least 10% GST can be added to the sale prices and the taxpayer will not be "out of pocket" for 1/11th of the sale proceeds.

A car is used partly for business. Can input tax credits be claimed?

If you are not registered for GST because, for example, you are an employee, you cannot claim input tax credits. Even if you are registered for GST, you cannot claim input tax credits in respect of the use of your car for employment purposes. If you run your business as a sole trader and are registered for GST, you will be entitled to input tax credits if you use your car for business purposes.

Can an entity that accounts for GST on a cash basis, pay the GST up front on a motor vehicle hire purchase and claim the input tax credits immediately?

No. The common consensus is that the hirer cannot make a lump sum payment for future GST up front and say all future monthly payments are simply the remaining GST exclusive amounts. The amount of input tax credit should simply be 1/11th of any amount paid.

Reminder - GST credits cannot be claimed for any new motor vehicles acquired before 1 July 2001.

Can GST registration be cancelled within 12 months of being registered?

Yes - a new law allows the ATO to cancel voluntary registration from as early as 1 July 2000, subject to certain conditions.

A taxpayer has two small businesses, each with an annual turnover of $30,000. As the turnover of each small business is under $75,000, does he or she have to register for GST?

Yes. If your total (or projected) annual turnover from all businesses is $75,000 or more, you must register for the GST. You do not look at each business in isolation. In terms of completing the BAS, the details of both businesses are consolidated by the entity.

Must a tax invoice show the amount of GST payable separately?

No. The tax invoice must show the GST inclusive price and need not show the GST separately if the GST payable is merely 1/11th of the GST inclusive price. If it is not 1/11th of the GST inclusive price, for example it is a mixed supply, the GST must be shown separately.

Will MYOB software assist me with my GST reporting obligations?

Even the most basic of MYOB's software range will greatly assist the business person preparing monthly or quarterly BAS returns. The software accommodates businesses no matter what their chosen GST accounting method, i.e. Cash or Accruals.

All reports required to generate a BAS are found in the "GST Reports" area.

Do all entities have to prepare Financial Statements fully compliant with Australian Accounting Standards?

No. Entities that can be classified as "Non-Reporting Entities" need not prepare fully compliant Financial Statements. The following will often be Non-Reporting Entities:

Small proprietary companies;
Family trusts;
Partnerships;
Sole Traders; and
Wholly owned subsidiaries of Australian reporting entities.

Does a car log book have to be kept for every year?

A log book does not have to be kept every year. The business percentage is valid for five years. That is, the year that the log book is kept and the subsequent four years. Once you have established the business use percentage, you are not required to complete a new log book unless required to do so by the legislation, or otherwise directed in writing by the ATO. This business percentage is used as a basis for you to arrive at your reasonable estimate of the business use percentage in each income year as noted above.

Note: You must keep odometer records every income year.

I want to claim a deduction for using my car in my business or for employee duties. What is business travel?

Business travel is travel which is undertaken in gaining or producing your assessable income or carrying on a business for that purpose. Travel between home and a person's regular place of employment or business is ordinarily private travel. While travel to work is a necessary prerequisite to earning income, it is not undertaken in the course of earning that income. Put at its simplest, travel to work is private; travel on work is business.

I am setting up my own small business, what are the available tax structures I can use?

ole Trader: A sole trader is the simplest business structure. The structure is inexpensive to set up because there are few legal and tax formalities.

If you operate your business as a sole trader, you trade on your own and control and manage the business. You are legally responsible for all aspects of the business - debts and losses cannot be shared.

The business income is treated as your individual income and you are solely responsible for any tax the business must pay. This means that, after claiming a deduction for all allowable expenses, you include all your business income with any other income and report it on your individual tax return.

As a sole trader, you are responsible for your own super arrangements. You may also be able to claim a deduction for any personal super contributions you make. Before you can claim a deduction, you have to notify the fund of your intention to claim the amount as a deduction and wait until the fund confirms that you can claim the amount as a deduction. Once you receive this confirmation, you can claim the super as a personal deduction on your tax return.

Partnership: For tax purposes, a partnership is an association of people who carry on a business as partners or receive income jointly. A partnership is relatively inexpensive to set up and operate. A formal partnership agreement is common, but not essential.

If you operate your business as a partnership, control or management of the business is shared. Income and losses are shared among the partners. Each partner is responsible for the debts of the partnership, even if you did not directly incur or cause the debt.

A partnership is not a separate legal entity and doesn't pay income tax on the income it earns. Instead, you and each of your partners pay tax on the share of net partnership income you each receive.

While the partnership doesn't pay tax, it does have to lodge an annual partnership tax return to show all income earned by the partnership and deductions claimed for expenses incurred in carrying on the partnership business. The tax return also shows each partner's share of the net partnership income

As a member of a partnership, you are responsible for your own super arrangements because you are not an employee of the partnership. You may also be able to claim separately a deduction for personal super contributions you make. If you have any eligible workers, you must pay a minimum of 9% of their ordinary time earnings as super guarantee contributions on their behalf.

Company: An incorporated company is a distinct legal entity, regulated by the Australian Securities & Investment Commission (ASIC).

A company is a complex business structure, with higher set-up costs and administrative costs because of additional reporting requirements.

A company's operations are controlled by its directors and the company is owned by its shareholders. A company provides some asset protection but directors can be legally liable for their actions and, in some cases, the debts of a company.

A company can register for GST if it is carrying on an enterprise. It can do this on the ABN application form. A company must be registered for GST if its annual GST turnover is $75,000 or more. The registration threshold for non-profit organisations is $150,000.

If the company has any eligible workers, it must pay a minimum of 9.25% of their ordinary time earnings as super guarantee contributions on their behalf. This includes you, if you are a director of the company, and any other company directors.

Trust: A trust is an obligation imposed on a person - a trustee - to hold property or assets (such as business assets) for the benefit of others. These others are known as beneficiaries.

Setting up a trust can be expensive, as a formal deed is required and there are formal yearly administrative tasks for the trustee to undertake. A trust deed outlines how the trust is to operate.

If you operate your business as a trust, the trustee is legally responsible for its operations. A trustee of a trust can be a company, providing some asset protection.

If the trust is carrying on an enterprise, you can register for GST as trustee of the trust. You can do this using the ABN application form. A trust must be registered for GST if its annual GST turnover is $75,000 or more.

Whether or not a trust is liable to pay tax depends on what type of trust it is, the wording of its trust deed and whether any of the income the trust earns is distributed to its beneficiaries.

Where the whole of the net trust income is distributed to adult resident beneficiaries, the trust is not liable to pay tax. The trust may be able to access some tax concessions.

If the trust has any eligible workers, it must pay a minimum of 9.25% of their ordinary time earnings as super guarantee contributions on their behalf. This may include you as the trustee if you are also employed by the trust.

Joint Venture: A joint venture is when 2 or more businesses combine resources, knowledge and skills to achieve a goal. It is similar to a business partnership, with one key difference: a partnership generally involves an ongoing, long-term business relationship, whereas a joint venture is based on a single business transaction.

All joint ventures are initiated by the parties' entering a contract or an agreement that specifies their mutual responsibilities and goals. The contract is crucial for avoiding trouble later; the parties must be specific about the intent of their joint venture as well as aware of its limitations. All joint ventures also involve certain rights and duties. The parties have a mutual right to control the enterprise, a right to share in the profits, and a duty to share in any losses incurred.

For the Commissioner to be satisfied that a joint venture exists for GST purposes, the first feature, ie sharing a product or output, must be present.

A joint venture must lodge an annual tax return in the same way a partnership would.

When do I need to register my new business for WorkCover? How much will it cost me? Can you briefly summarise the rules?

WorkCover is Victoria's injured workers' compensation system.

If you are a Victorian employer and your annual remuneration is $7,500 or more, you must take out a WorkCover policy and pay WorkCover premiums for your workers (refer definition below).

An employer's WorkCover premium depends on a number of factors:

the size of your payroll (remuneration);
your safety or claims experience; and
your previous premium rate (which, for small employers is mainly based on the risk rating of their industry).
Your insurer must be advised of your annual remuneration to calculate the premium. The premium can be payable yearly in advance (a discount applies) or by instalments.

In what circumstances can I claim Home Office Expenses?

The ATO will generally not allow a taxpayer to claim for expenses associated with their home office unless their employer considers it necessary for them to work from home and the following criteria can be established:

It is normal practice in the employee's industry to perform some work duties from home;

It is a part of their current job specification; and

It is a condition of their employment, although not necessarily evidenced/documented in writing.
Generally speaking, "running expenses" are able to be claimed by salary and wage earners who satisfy the above criteria, "Occupancy expenses" may be claimed by people running a business from home. For discussion as to what the ATO considers to be a "place of business", refer to Paul Carrazzo's feature article on this issue, published in the June 1999 issue of The Australian Bloodhorse Review.

I am about to go overseas on work, which records should I keep to substantiate my travel expenses?

If you received a bona fide travel allowance and the deduction exceeds the Commissioner's reasonable allowance amount, you must fully substantiate all travel claims by providing the following records:

details and evidence to support the type and specific amounts of allowance received for travel expenses, such as accommodation, meals and incidentals
details of specific overnight travel undertaken, including:
dates or period travel was undertaken
specific purpose of travel
if the travel involves being away from home for six or more nights in a row, a travel record (diary) is required to be kept
evidence that you actually undertook the travel and incurred the accommodation and meal expenses, such as receipts or other documents.

If you did not receive a bona fide travel allowance or received a token travel allowance, you will be asked to keep the following records:

details of specific overnight travel undertaken, including:
dates or period travel was undertaken
specific purpose of travel
if the travel involves being away from home for six or more nights in a row, a travel record (diary) is required to be kept.
sufficient information to ascertain how specific expenses were incurred in the course of earning assessable income

What tax rate does my superfund pay when I contribute deductible super contributions?

In last year's Budget, the government announced that, with effect from 1 July 2012, the rate of tax that applies to the concessional contributions for people with income above $300,000 would be increased from 15 percent to 30 percent.

If your income is less than $300,000 or less, the tax rate is only 15%.

What are reportable employer superannuation contributions?

Reportable employer superannuation contributions are contributions made by an employer under a salary sacrifice arrangement or contributions for an employee above the minimum amount required by law.

A reportable employer superannuation contribution for an individual for an income year is an amount contributed:

  1. by an employer of the individual, or an associate of the employer, for the individual to a superannuation fund or RSA
  2. to the extent that the individual has the capacity, or might reasonably be expected to have capacity to influence:
    1. the size of the amount, and/or
    2. the way the amount is contributed so that their assessable income is reduced
What is the timing for contributing superannuation for deductibility purposes?

The time an employer contribution is made is important because the employer can only deduct a contribution "for the income year in which you made the contribution".

The timing of a contribution is not only significant for an employer's deduction entitlement, but may also affect:

  • When an employer's superannuation guarantee contribution is made
  • A member's entitlement to a tax deduction for a year
  • A member's liability to excess contributions tax
  • Eligibility for a government co-contribution in year, and
  • The inclusion of the contribution in a fund's assessable income for the year

The ATO view on when a contribution is made is that a superannuation contribution is made when the capital of the fund is increased. This may be when an amount is received, when ownership of an asset is obtained or when the fund otherwise obtains the benefit of an amount. In the ordinary case:

  • A contribution in cash is made when received by the fund
  • A contribution by EFT or internet banking is made when the amount is credited to the fund's bank account – this may occur sometime after the contributor has done what is necessary to effect the payment, and
  • A contribution by cheque is made when the cheque is received by the fund, unless it is subsequently dishonored
Are any employees excluded from superannuation requirements?

The time an employer contribution is made is important because the employer can only deduct a contribution "for the income year in which you made the contribution".

The timing of a contribution is not only significant for an employer's deduction entitlement, but may also affect:

  • When an employer's superannuation guarantee contribution is made
  • A member's entitlement to a tax deduction for a year
  • A member's liability to excess contributions tax
  • Eligibility for a government co-contribution in year, and
  • The inclusion of the contribution in a fund's assessable income for the year

The ATO view on when a contribution is made is that a superannuation contribution is made when the capital of the fund is increased. This may be when an amount is received, when ownership of an asset is obtained or when the fund otherwise obtains the benefit of an amount. In the ordinary case:

  • A contribution in cash is made when received by the fund
  • A contribution by EFT or internet banking is made when the amount is credited to the fund's bank account – this may occur sometime after the contributor has done what is necessary to effect the payment, and
  • A contribution by cheque is made when the cheque is received by the fund, unless it is subsequently dishonored
How is the required superannuation calculated?

Employer superannuation support under this scheme is measured in terms of a percentage of an employee's notional earnings base/salary and wages. For the current year, the percentage of that base that must be contributed is 9.25%.

The government has announced changes that will gradually increase the superannuation guarantee rate (charge percentage) from 9% to 12% between the 2013-14 and 2019-20 years. We will publish updated guidance if these announced changes become law, given that the coalition have flagged the deferral of these increases by 2 years.

I am thinking of commencing business. In what circumstances do I need to pay employee superannuation under the Superannuation Guarantee Scheme?

The superannuation guarantee scheme is designed to encourage employers to provide a minimum level of superannuation support for employees.

Where an employer provides less than the required level of support, they will be liable to pay a non-deductible charge called the Superannuation Guarantee Charge (SGC).

An "employee" for superannuation guarantee purposes is anyone who is an employee at common law. Generally, the degree of control exercised by the "employer" over the "employee" and the degree to which the "employee's" services are an integral part of the "employer's" business will be significant whether an employer-employee relationship exists.

I elect to lodge my GST return monthly. Does this mean I must pay my FBT, PAYG etc monthly?

No. You look at each tax separately and pay it according to its own payment rules. Even though you will be lodging a BAS each month, you will not be completing the PAYG boxes if you only have to pay PAYG quarterly.

What types of Super Funds are there?

There are several different types of superannuation funds. The mains ones are:

  • Employer / Corporate / Staff funds – (funds established by an employer for the benefit of their staff)
  • Personal Funds
  • Industry Funds
  • Self-managed super funds
If you would like more information about the different types of super funds, speak to one of our Matrium Financial Advisers.
Can I withdraw the money that I have in super?

Usually, you are restricted from accessing your super money until you reach your preservation age. Your preservation age is based on your date of birth and ranges between 55 and 60. In very specific circumstances you may be able to access your super funds on compassionate grounds, however, these situations are limited. For more information talk to our financial adviser’s or go to the APRA website.

When can I access my super?

Generally, you can only access your super savings when you reach preservation age. This is to ensure your super savings are used for when you reach retirement.

Your ‘preservation age’ determines when you can access your money, even if you have not retired. It is based on your date of birth and ranges between 55 and 60.

Primary Productions

What you need to know

I am a share trader. Must I pay GST when I sell shares?

No. The sale of shares is a financial supply and therefore input taxed.

Is the sale of a farm property GST-free?

The sale of a farming property will be GST-free if:

there has been a farming business carried on, on the land, for at least the five years preceding the sale, and
the purchaser intends that a farming business be carried on, on the land.

This concession is limited to the land, including fixtures and improvements. It does not apply to livestock, plant or equipment.

It is, however, not necessary that the seller of the land be the entity that was carrying on that business or that the recipient be the entity that will carry on that business.

What should I consider in determining the business structure I should use?

The business structure used should be chosen having regard to the following:

What type of business is it (business income or personal services)?;
Who will be the principals?;
What assets does the professional and his family own?;
What debts does the professional have?;
Do the principals want to borrow money from the company?;
Are new partners to be admitted into the future?;
Marriage status (children, etc) of the business owner?;
Rules of regulatory bodies?; and
How old are the principals? Is superannuation a major issue?

A taxpayer in business acquires an ABN, but due to turnover and projected turnover being less than $75,000, chose not to register for GST. If that taxpayer turnover subsequently exceeds $75,000, must he or she register for GST immediately? Is GST payable

The taxpayer must immediately register for GST when sales exceed $75,000. GST is payable on the sale proceeds and tax credits can be claimed only from the date of registration.

Many small businesses will be caught out by this requirement. Accordingly, I strongly suggest that registration take place well in advance of the turnover exceeding $75,000 - at least 10% GST can be added to the sale prices and the taxpayer will not be "out of pocket" for 1/11th of the sale proceeds.

A car is used partly for business. Can input tax credits be claimed?

If you are not registered for GST because, for example, you are an employee, you cannot claim input tax credits. Even if you are registered for GST, you cannot claim input tax credits in respect of the use of your car for employment purposes. If you run your business as a sole trader and are registered for GST, you will be entitled to input tax credits if you use your car for business purposes.

Can an entity that accounts for GST on a cash basis, pay the GST up front on a motor vehicle hire purchase and claim the input tax credits immediately?

No. The common consensus is that the hirer cannot make a lump sum payment for future GST up front and say all future monthly payments are simply the remaining GST exclusive amounts. The amount of input tax credit should simply be 1/11th of any amount paid.

Reminder - GST credits cannot be claimed for any new motor vehicles acquired before 1 July 2001.

Can GST registration be cancelled within 12 months of being registered?

Yes - a new law allows the ATO to cancel voluntary registration from as early as 1 July 2000, subject to certain conditions.

A taxpayer has two small businesses, each with an annual turnover of $30,000. As the turnover of each small business is under $75,000, does he or she have to register for GST?

Yes. If your total (or projected) annual turnover from all businesses is $75,000 or more, you must register for the GST. You do not look at each business in isolation. In terms of completing the BAS, the details of both businesses are consolidated by the entity.

Must a tax invoice show the amount of GST payable separately?

No. The tax invoice must show the GST inclusive price and need not show the GST separately if the GST payable is merely 1/11th of the GST inclusive price. If it is not 1/11th of the GST inclusive price, for example it is a mixed supply, the GST must be shown separately.

Will MYOB software assist me with my GST reporting obligations?

Even the most basic of MYOB's software range will greatly assist the business person preparing monthly or quarterly BAS returns. The software accommodates businesses no matter what their chosen GST accounting method, i.e. Cash or Accruals.

All reports required to generate a BAS are found in the "GST Reports" area.

Do all entities have to prepare Financial Statements fully compliant with Australian Accounting Standards?

No. Entities that can be classified as "Non-Reporting Entities" need not prepare fully compliant Financial Statements. The following will often be Non-Reporting Entities:

Small proprietary companies;
Family trusts;
Partnerships;
Sole Traders; and
Wholly owned subsidiaries of Australian reporting entities.

Does a car log book have to be kept for every year?

A log book does not have to be kept every year. The business percentage is valid for five years. That is, the year that the log book is kept and the subsequent four years. Once you have established the business use percentage, you are not required to complete a new log book unless required to do so by the legislation, or otherwise directed in writing by the ATO. This business percentage is used as a basis for you to arrive at your reasonable estimate of the business use percentage in each income year as noted above.

Note: You must keep odometer records every income year.

I want to claim a deduction for using my car in my business or for employee duties. What is business travel?

Business travel is travel which is undertaken in gaining or producing your assessable income or carrying on a business for that purpose. Travel between home and a person's regular place of employment or business is ordinarily private travel. While travel to work is a necessary prerequisite to earning income, it is not undertaken in the course of earning that income. Put at its simplest, travel to work is private; travel on work is business.

I am setting up my own small business, what are the available tax structures I can use?

ole Trader: A sole trader is the simplest business structure. The structure is inexpensive to set up because there are few legal and tax formalities.

If you operate your business as a sole trader, you trade on your own and control and manage the business. You are legally responsible for all aspects of the business - debts and losses cannot be shared.

The business income is treated as your individual income and you are solely responsible for any tax the business must pay. This means that, after claiming a deduction for all allowable expenses, you include all your business income with any other income and report it on your individual tax return.

As a sole trader, you are responsible for your own super arrangements. You may also be able to claim a deduction for any personal super contributions you make. Before you can claim a deduction, you have to notify the fund of your intention to claim the amount as a deduction and wait until the fund confirms that you can claim the amount as a deduction. Once you receive this confirmation, you can claim the super as a personal deduction on your tax return.

Partnership: For tax purposes, a partnership is an association of people who carry on a business as partners or receive income jointly. A partnership is relatively inexpensive to set up and operate. A formal partnership agreement is common, but not essential.

If you operate your business as a partnership, control or management of the business is shared. Income and losses are shared among the partners. Each partner is responsible for the debts of the partnership, even if you did not directly incur or cause the debt.

A partnership is not a separate legal entity and doesn't pay income tax on the income it earns. Instead, you and each of your partners pay tax on the share of net partnership income you each receive.

While the partnership doesn't pay tax, it does have to lodge an annual partnership tax return to show all income earned by the partnership and deductions claimed for expenses incurred in carrying on the partnership business. The tax return also shows each partner's share of the net partnership income

As a member of a partnership, you are responsible for your own super arrangements because you are not an employee of the partnership. You may also be able to claim separately a deduction for personal super contributions you make. If you have any eligible workers, you must pay a minimum of 9% of their ordinary time earnings as super guarantee contributions on their behalf.

Company: An incorporated company is a distinct legal entity, regulated by the Australian Securities & Investment Commission (ASIC).

A company is a complex business structure, with higher set-up costs and administrative costs because of additional reporting requirements.

A company's operations are controlled by its directors and the company is owned by its shareholders. A company provides some asset protection but directors can be legally liable for their actions and, in some cases, the debts of a company.

A company can register for GST if it is carrying on an enterprise. It can do this on the ABN application form. A company must be registered for GST if its annual GST turnover is $75,000 or more. The registration threshold for non-profit organisations is $150,000.

If the company has any eligible workers, it must pay a minimum of 9.25% of their ordinary time earnings as super guarantee contributions on their behalf. This includes you, if you are a director of the company, and any other company directors.

Trust: A trust is an obligation imposed on a person - a trustee - to hold property or assets (such as business assets) for the benefit of others. These others are known as beneficiaries.

Setting up a trust can be expensive, as a formal deed is required and there are formal yearly administrative tasks for the trustee to undertake. A trust deed outlines how the trust is to operate.

If you operate your business as a trust, the trustee is legally responsible for its operations. A trustee of a trust can be a company, providing some asset protection.

If the trust is carrying on an enterprise, you can register for GST as trustee of the trust. You can do this using the ABN application form. A trust must be registered for GST if its annual GST turnover is $75,000 or more.

Whether or not a trust is liable to pay tax depends on what type of trust it is, the wording of its trust deed and whether any of the income the trust earns is distributed to its beneficiaries.

Where the whole of the net trust income is distributed to adult resident beneficiaries, the trust is not liable to pay tax. The trust may be able to access some tax concessions.

If the trust has any eligible workers, it must pay a minimum of 9.25% of their ordinary time earnings as super guarantee contributions on their behalf. This may include you as the trustee if you are also employed by the trust.

Joint Venture: A joint venture is when 2 or more businesses combine resources, knowledge and skills to achieve a goal. It is similar to a business partnership, with one key difference: a partnership generally involves an ongoing, long-term business relationship, whereas a joint venture is based on a single business transaction.

All joint ventures are initiated by the parties' entering a contract or an agreement that specifies their mutual responsibilities and goals. The contract is crucial for avoiding trouble later; the parties must be specific about the intent of their joint venture as well as aware of its limitations. All joint ventures also involve certain rights and duties. The parties have a mutual right to control the enterprise, a right to share in the profits, and a duty to share in any losses incurred.

For the Commissioner to be satisfied that a joint venture exists for GST purposes, the first feature, ie sharing a product or output, must be present.

A joint venture must lodge an annual tax return in the same way a partnership would.

When do I need to register my new business for WorkCover? How much will it cost me? Can you briefly summarise the rules?

WorkCover is Victoria's injured workers' compensation system.

If you are a Victorian employer and your annual remuneration is $7,500 or more, you must take out a WorkCover policy and pay WorkCover premiums for your workers (refer definition below).

An employer's WorkCover premium depends on a number of factors:

the size of your payroll (remuneration);
your safety or claims experience; and
your previous premium rate (which, for small employers is mainly based on the risk rating of their industry).
Your insurer must be advised of your annual remuneration to calculate the premium. The premium can be payable yearly in advance (a discount applies) or by instalments.

In what circumstances can I claim Home Office Expenses?

The ATO will generally not allow a taxpayer to claim for expenses associated with their home office unless their employer considers it necessary for them to work from home and the following criteria can be established:

It is normal practice in the employee's industry to perform some work duties from home;

It is a part of their current job specification; and

It is a condition of their employment, although not necessarily evidenced/documented in writing.
Generally speaking, "running expenses" are able to be claimed by salary and wage earners who satisfy the above criteria, "Occupancy expenses" may be claimed by people running a business from home. For discussion as to what the ATO considers to be a "place of business", refer to Paul Carrazzo's feature article on this issue, published in the June 1999 issue of The Australian Bloodhorse Review.

I am about to go overseas on work, which records should I keep to substantiate my travel expenses?

If you received a bona fide travel allowance and the deduction exceeds the Commissioner's reasonable allowance amount, you must fully substantiate all travel claims by providing the following records:

details and evidence to support the type and specific amounts of allowance received for travel expenses, such as accommodation, meals and incidentals
details of specific overnight travel undertaken, including:
dates or period travel was undertaken
specific purpose of travel
if the travel involves being away from home for six or more nights in a row, a travel record (diary) is required to be kept
evidence that you actually undertook the travel and incurred the accommodation and meal expenses, such as receipts or other documents.

If you did not receive a bona fide travel allowance or received a token travel allowance, you will be asked to keep the following records:

details of specific overnight travel undertaken, including:
dates or period travel was undertaken
specific purpose of travel
if the travel involves being away from home for six or more nights in a row, a travel record (diary) is required to be kept.
sufficient information to ascertain how specific expenses were incurred in the course of earning assessable income

What tax rate does my superfund pay when I contribute deductible super contributions?

In last year's Budget, the government announced that, with effect from 1 July 2012, the rate of tax that applies to the concessional contributions for people with income above $300,000 would be increased from 15 percent to 30 percent.

If your income is less than $300,000 or less, the tax rate is only 15%.

What are reportable employer superannuation contributions?

Reportable employer superannuation contributions are contributions made by an employer under a salary sacrifice arrangement or contributions for an employee above the minimum amount required by law.

A reportable employer superannuation contribution for an individual for an income year is an amount contributed:

  1. by an employer of the individual, or an associate of the employer, for the individual to a superannuation fund or RSA
  2. to the extent that the individual has the capacity, or might reasonably be expected to have capacity to influence:
    1. the size of the amount, and/or
    2. the way the amount is contributed so that their assessable income is reduced
What is the timing for contributing superannuation for deductibility purposes?

The time an employer contribution is made is important because the employer can only deduct a contribution "for the income year in which you made the contribution".

The timing of a contribution is not only significant for an employer's deduction entitlement, but may also affect:

  • When an employer's superannuation guarantee contribution is made
  • A member's entitlement to a tax deduction for a year
  • A member's liability to excess contributions tax
  • Eligibility for a government co-contribution in year, and
  • The inclusion of the contribution in a fund's assessable income for the year

The ATO view on when a contribution is made is that a superannuation contribution is made when the capital of the fund is increased. This may be when an amount is received, when ownership of an asset is obtained or when the fund otherwise obtains the benefit of an amount. In the ordinary case:

  • A contribution in cash is made when received by the fund
  • A contribution by EFT or internet banking is made when the amount is credited to the fund's bank account – this may occur sometime after the contributor has done what is necessary to effect the payment, and
  • A contribution by cheque is made when the cheque is received by the fund, unless it is subsequently dishonored
Are any employees excluded from superannuation requirements?

The time an employer contribution is made is important because the employer can only deduct a contribution "for the income year in which you made the contribution".

The timing of a contribution is not only significant for an employer's deduction entitlement, but may also affect:

  • When an employer's superannuation guarantee contribution is made
  • A member's entitlement to a tax deduction for a year
  • A member's liability to excess contributions tax
  • Eligibility for a government co-contribution in year, and
  • The inclusion of the contribution in a fund's assessable income for the year

The ATO view on when a contribution is made is that a superannuation contribution is made when the capital of the fund is increased. This may be when an amount is received, when ownership of an asset is obtained or when the fund otherwise obtains the benefit of an amount. In the ordinary case:

  • A contribution in cash is made when received by the fund
  • A contribution by EFT or internet banking is made when the amount is credited to the fund's bank account – this may occur sometime after the contributor has done what is necessary to effect the payment, and
  • A contribution by cheque is made when the cheque is received by the fund, unless it is subsequently dishonored
How is the required superannuation calculated?

Employer superannuation support under this scheme is measured in terms of a percentage of an employee's notional earnings base/salary and wages. For the current year, the percentage of that base that must be contributed is 9.25%.

The government has announced changes that will gradually increase the superannuation guarantee rate (charge percentage) from 9% to 12% between the 2013-14 and 2019-20 years. We will publish updated guidance if these announced changes become law, given that the coalition have flagged the deferral of these increases by 2 years.

I am thinking of commencing business. In what circumstances do I need to pay employee superannuation under the Superannuation Guarantee Scheme?

The superannuation guarantee scheme is designed to encourage employers to provide a minimum level of superannuation support for employees.

Where an employer provides less than the required level of support, they will be liable to pay a non-deductible charge called the Superannuation Guarantee Charge (SGC).

An "employee" for superannuation guarantee purposes is anyone who is an employee at common law. Generally, the degree of control exercised by the "employer" over the "employee" and the degree to which the "employee's" services are an integral part of the "employer's" business will be significant whether an employer-employee relationship exists.

I elect to lodge my GST return monthly. Does this mean I must pay my FBT, PAYG etc monthly?

No. You look at each tax separately and pay it according to its own payment rules. Even though you will be lodging a BAS each month, you will not be completing the PAYG boxes if you only have to pay PAYG quarterly.

What types of Super Funds are there?

There are several different types of superannuation funds. The mains ones are:

  • Employer / Corporate / Staff funds – (funds established by an employer for the benefit of their staff)
  • Personal Funds
  • Industry Funds
  • Self-managed super funds
If you would like more information about the different types of super funds, speak to one of our Matrium Financial Advisers.
Can I withdraw the money that I have in super?

Usually, you are restricted from accessing your super money until you reach your preservation age. Your preservation age is based on your date of birth and ranges between 55 and 60. In very specific circumstances you may be able to access your super funds on compassionate grounds, however, these situations are limited. For more information talk to our financial adviser’s or go to the APRA website.

When can I access my super?

Generally, you can only access your super savings when you reach preservation age. This is to ensure your super savings are used for when you reach retirement.

Your ‘preservation age’ determines when you can access your money, even if you have not retired. It is based on your date of birth and ranges between 55 and 60.

Veterinary

What you need to know

I am a share trader. Must I pay GST when I sell shares?

No. The sale of shares is a financial supply and therefore input taxed.

What should I consider in determining the business structure I should use?

The business structure used should be chosen having regard to the following:

What type of business is it (business income or personal services)?;
Who will be the principals?;
What assets does the professional and his family own?;
What debts does the professional have?;
Do the principals want to borrow money from the company?;
Are new partners to be admitted into the future?;
Marriage status (children, etc) of the business owner?;
Rules of regulatory bodies?; and
How old are the principals? Is superannuation a major issue?

A taxpayer in business acquires an ABN, but due to turnover and projected turnover being less than $75,000, chose not to register for GST. If that taxpayer turnover subsequently exceeds $75,000, must he or she register for GST immediately? Is GST payable

The taxpayer must immediately register for GST when sales exceed $75,000. GST is payable on the sale proceeds and tax credits can be claimed only from the date of registration.

Many small businesses will be caught out by this requirement. Accordingly, I strongly suggest that registration take place well in advance of the turnover exceeding $75,000 - at least 10% GST can be added to the sale prices and the taxpayer will not be "out of pocket" for 1/11th of the sale proceeds.

Can GST registration be cancelled within 12 months of being registered?

Yes - a new law allows the ATO to cancel voluntary registration from as early as 1 July 2000, subject to certain conditions.

A taxpayer has two small businesses, each with an annual turnover of $30,000. As the turnover of each small business is under $75,000, does he or she have to register for GST?

Yes. If your total (or projected) annual turnover from all businesses is $75,000 or more, you must register for the GST. You do not look at each business in isolation. In terms of completing the BAS, the details of both businesses are consolidated by the entity.

Must a tax invoice show the amount of GST payable separately?

No. The tax invoice must show the GST inclusive price and need not show the GST separately if the GST payable is merely 1/11th of the GST inclusive price. If it is not 1/11th of the GST inclusive price, for example it is a mixed supply, the GST must be shown separately.

What tax rate does my superfund pay when I contribute deductible super contributions?

In last year's Budget, the government announced that, with effect from 1 July 2012, the rate of tax that applies to the concessional contributions for people with income above $300,000 would be increased from 15 percent to 30 percent.

If your income is less than $300,000 or less, the tax rate is only 15%.

What are reportable employer superannuation contributions?

Reportable employer superannuation contributions are contributions made by an employer under a salary sacrifice arrangement or contributions for an employee above the minimum amount required by law.

A reportable employer superannuation contribution for an individual for an income year is an amount contributed:

  1. by an employer of the individual, or an associate of the employer, for the individual to a superannuation fund or RSA
  2. to the extent that the individual has the capacity, or might reasonably be expected to have capacity to influence:
    1. the size of the amount, and/or
    2. the way the amount is contributed so that their assessable income is reduced
What is the timing for contributing superannuation for deductibility purposes?

The time an employer contribution is made is important because the employer can only deduct a contribution "for the income year in which you made the contribution".

The timing of a contribution is not only significant for an employer's deduction entitlement, but may also affect:

  • When an employer's superannuation guarantee contribution is made
  • A member's entitlement to a tax deduction for a year
  • A member's liability to excess contributions tax
  • Eligibility for a government co-contribution in year, and
  • The inclusion of the contribution in a fund's assessable income for the year

The ATO view on when a contribution is made is that a superannuation contribution is made when the capital of the fund is increased. This may be when an amount is received, when ownership of an asset is obtained or when the fund otherwise obtains the benefit of an amount. In the ordinary case:

  • A contribution in cash is made when received by the fund
  • A contribution by EFT or internet banking is made when the amount is credited to the fund's bank account – this may occur sometime after the contributor has done what is necessary to effect the payment, and
  • A contribution by cheque is made when the cheque is received by the fund, unless it is subsequently dishonored
Are any employees excluded from superannuation requirements?

The time an employer contribution is made is important because the employer can only deduct a contribution "for the income year in which you made the contribution".

The timing of a contribution is not only significant for an employer's deduction entitlement, but may also affect:

  • When an employer's superannuation guarantee contribution is made
  • A member's entitlement to a tax deduction for a year
  • A member's liability to excess contributions tax
  • Eligibility for a government co-contribution in year, and
  • The inclusion of the contribution in a fund's assessable income for the year

The ATO view on when a contribution is made is that a superannuation contribution is made when the capital of the fund is increased. This may be when an amount is received, when ownership of an asset is obtained or when the fund otherwise obtains the benefit of an amount. In the ordinary case:

  • A contribution in cash is made when received by the fund
  • A contribution by EFT or internet banking is made when the amount is credited to the fund's bank account – this may occur sometime after the contributor has done what is necessary to effect the payment, and
  • A contribution by cheque is made when the cheque is received by the fund, unless it is subsequently dishonored
How is the required superannuation calculated?

Employer superannuation support under this scheme is measured in terms of a percentage of an employee's notional earnings base/salary and wages. For the current year, the percentage of that base that must be contributed is 9.25%.

The government has announced changes that will gradually increase the superannuation guarantee rate (charge percentage) from 9% to 12% between the 2013-14 and 2019-20 years. We will publish updated guidance if these announced changes become law, given that the coalition have flagged the deferral of these increases by 2 years.

I am thinking of commencing business. In what circumstances do I need to pay employee superannuation under the Superannuation Guarantee Scheme?

The superannuation guarantee scheme is designed to encourage employers to provide a minimum level of superannuation support for employees.

Where an employer provides less than the required level of support, they will be liable to pay a non-deductible charge called the Superannuation Guarantee Charge (SGC).

An "employee" for superannuation guarantee purposes is anyone who is an employee at common law. Generally, the degree of control exercised by the "employer" over the "employee" and the degree to which the "employee's" services are an integral part of the "employer's" business will be significant whether an employer-employee relationship exists.

I elect to lodge my GST return monthly. Does this mean I must pay my FBT, PAYG etc monthly?

No. You look at each tax separately and pay it according to its own payment rules. Even though you will be lodging a BAS each month, you will not be completing the PAYG boxes if you only have to pay PAYG quarterly.

What types of Super Funds are there?

There are several different types of superannuation funds. The mains ones are:

  • Employer / Corporate / Staff funds – (funds established by an employer for the benefit of their staff)
  • Personal Funds
  • Industry Funds
  • Self-managed super funds
If you would like more information about the different types of super funds, speak to one of our Matrium Financial Advisers.
Can I withdraw the money that I have in super?

Usually, you are restricted from accessing your super money until you reach your preservation age. Your preservation age is based on your date of birth and ranges between 55 and 60. In very specific circumstances you may be able to access your super funds on compassionate grounds, however, these situations are limited. For more information talk to our financial adviser’s or go to the APRA website.

When can I access my super?

Generally, you can only access your super savings when you reach preservation age. This is to ensure your super savings are used for when you reach retirement.

Your ‘preservation age’ determines when you can access your money, even if you have not retired. It is based on your date of birth and ranges between 55 and 60.

Name