YEAR END TAX PLANNING
The rule here is that you need to ensure that your financial records pass the good housekeeping award.
OTHER YEAR END JOBS
INSTANT ASSET WRITE OFF
This is a great benefit but has been made complicated by parliament. It only applies to entities that carry on a business. A vague and often contested term. In the 2019/2020 year there were 3 relevant dates during the year.
For the 2020/2021 year, it is important if the asset was acquired before or on and after 6 October at 7.30pm.
You then have to consider the aggregated turnover of your business. Another complex issue, if you have trusts, partnerships or overseas associated businesses. There are different rules for turnover limits of $5 billion, $50 million and $10 million and if the asset is new. The term “held and first used or installed ready for use for a taxable purpose” needs to be considered.
2021 FEDERAL BUDGET
Most of the announcements will only commence from 1 July 2022 and still need to pass parliament and the turmoil of the next election and the 2022 budget.
The only two points worth mentioning are that superannuation will now have to be paid for all employees where previously if the employee received below $450 per month no super payment was required. The planned start date is 1 July 2022. This represents a 10% increased cost to employers and a 10% increase in ‘wages’ for these employees.
Also full expensing of purchase of depreciable assets has been extended to 30 June 2023. You can now plan your purchases of assets in line with your cash availability without the need to rush into these transactions. The asset must be held and used or ready for use by that date.
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