AMA - Round Two - Tax and Tax Return Questions - Ask Me Anything - GO!

Associatednicolemcmilllon @ Titanium Accountants & Advisors on 31/05/2017 - 09:15
Last edited 05/07/2017 - 10:20 by 2 other users

Edit % June 2017

I have now closed this thread.

I will think about posting a third round on the last week of June depending on how many people want me to do it.

I will be ready to prepare everyone's 2017 returns in July. I look forward to hearing from you.

For everyone else, thank you for participating and I hope you appreciated our answers.

Hi All,

I did a tax AMA a few weeks ago and got an overwhelming response (close to 700 replies).

I am going to do another one that will go from today 31 May to Sunday 4th June.

If you have any tax or tax related questions then ask below and I will do my best to get back to you as soon as possible.

Disclaimer: Any advice or answers given will be general in nature and you may need to speak to a tax adviser for more personalised advice.

P.S Please see my previous forum post as we tried to avoid duplicate questions.

I will reply to this thread with a link to the previous post.

Look forward to answering all your tax queries.

Lets do this!

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closed Comments

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 10:04

      You really need an accountant as it seems you are not really aware of the best way to minimise your tax going forward in the long term.

      Claiming the entire amount as a deduction is not always a good thing. In fact, if Uber is your only source of income, it will almost certainly be a bad strategy to claim the entire amount of the car in the first year.

      • ultra64 on 04/06/2017 - 18:36

        Thanks Nicole. Uber is a side income.
        I will definitely consult an accountant.

        Thanks ozbargain 3!

  • Skinnycap on 03/06/2017 - 11:01

    Hi Nicole,

    Thanks for doing this AMA. It's been incredibly informative! I'm hoping you could please help my wife and I out with the below;

    I'm PAYG ~$65,000, my wife has an ABN and invoices ~$10,000 doing office admin work. Due to a medical condition I can't see her working full time, but we're fortunate in what she does earn. We've also always wanted to start a product based business.

    • Are joint savings that we use to purchase things for a potential business able to be deducted from my income? i.e costs of prototypes.

    • What sort of business would I be looking at setting up if I want to distribute profits more towards my wife?

    • Are there any simpler ways where I can essentially level out our incomes?

    Thanks

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 10:02

      Depending on what type of business you guys are running, if you satisfy the personal services tests on the ATO website and those tests determine that you are a personal services business, then you could open up a company or a trust.

      The company can pay wages and or dividends to your wife.

      A trust would make distributions to your wife.

      Regards

      P.S I hope her medical condition isn't too serious. Best Regards

      • Skinnycap on 04/06/2017 - 11:05

        Hi Nicole,

        Thanks for your reply.

        So let's say we start a company while I keep working full time. Is money I invest into the company tax deductible from my income that same year, or is it treated as a capital gains/loss when the company is sold or ended?

        And what happens if a business idea fails before its started? Say someone invests in prototypes but there's no interest to justify a business? It wouldn't be money spent in order to earn my income, but with intent to start a business. Deductible?

        Thanks again, and my wife is doing well thanks. She's a pretty avid user of ozbargain so we're still saving despite circumstances :)

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 11:07

          The money invested into the company can be capital or a loan to the company, but is not deductible.

          If the company fails and all is lost, you will get a capital loss, never deductible.

        • Skinnycap on 04/06/2017 - 11:49

          Thanks Nicole, I was hopeful that I could basically negative gear a business against my income until it was off the ground, but better to know now. You've been a great help! :) Thanks

  • IWoNdEr on 03/06/2017 - 11:02
    +1

    Hi nicolemcmilllon, thanks for all the Q&A.

    Not sure if this can be answered by an accountant but even personal pointers would be great.

    My wife has superannuation in SMSF. The SMSF has 4 member including her parent and it was setup before we are married.

    We planning of starting a new SMSF soon (2 member me and her) and wonder if her portion in the previous family SMSF can be rolled into this new one.

    Thanks in advance!

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 10:00

      Yes you can definitely roll over the balance into your new Fund.

      We do specialise in SMSF accounts and tax returns, PM me if you need additional information or assistance with your new SMSF :)

  • No ONE on 03/06/2017 - 11:30

    Hi Nicole,
    Any chance of claiming relocation cost after obtaining a job and you're required to relocate.
    Thanks.

  • salubrious77 on 03/06/2017 - 12:15

    My partner and I bought an investment property together a couple of years ago. Since we haven't done our previous tax return I want to get up to date. She's not ready to do her previous years tax return yet but I am. Can I still do my tax return without her and with a different tax agent to hers? Will it complicate things? Or is it quite easy?

    Another question is,I get a car allowance from my work. Do I have to keep a log book for 3 months for every financial year? Or just during the first year for 3 months? And does it matter whether I keep the 3 month log in the middle of the year or the end or the beginning of it? Can I keep the log for 12 months and then calculate the percentage of usage of my car for tax purposes since that is a more accurate representation of the work usage of my car?

    If I have car repairs can that be a tax deduction, or is it meant to be considered covered by the car allowance?
    I have this scenario to consider: If for example I started a new job 3 months before the end of the financial year. They pay me say $2500nett in bank (85% paid, 15%taxed) for the car allowance in the 3 months. I used my car 85% of the time for work. I have a car repair worth $1000. Can that cost of repair be a tax deduction?

    Hope that sound clear.
    Thanks very much for answering this!

    • chumlee on 03/06/2017 - 12:24

      I can help you on car allowance as I have been receiving one for years. Just keep a log book for 3 typical months of work. It doesn't matter if it's during the year so long as 3 months and then you are allowed to extrapolate that over 12 months to work out % use for business and non business.

      Repairs and maintenence are tax deductible so keep all receipts. 85% of repair is deductible in your example

      • techboy on 03/06/2017 - 12:44

        If claiming via the "logbook' Method then you record opening /closing odometer readings for the year.
        Record 12 weeks of use (work v personal) to get your percentage. This needs to be done every 5 years or sooner if your work v personal usage changes significantly.
        You can claim all the running costs of the car; petrol,oil, service,repairs, automobile association membership, registration, insurance, tyres, car washes and depreciation on the vehicle over 8 years. Depreciation is tricky to work out. You need to know cost paid, when you paid for it and when you started to use it for work.

        You also have the 5,000 km method that would give you a standard $3,300 deduction (if claiming the maximum 5,000 km's) - you just need to show how you arrived at the number of Kilometres.

        It is always best to keep all records and then chose the method that gives you the greatest refund. This can change each year.

      • salubrious77 on 04/06/2017 - 15:31

        Thanks chumlee for your answer.
        Just wondering, what if i didn't keep a log book in my first year, can I start one in the 2nd year for 3 months and it's still ok?

        Cheers!

        • chumlee on 04/06/2017 - 15:37

          I did a log book 10 years ago and haven't done one since. If i get audited by the ATO i will quickly make one up i guess but I'm just as PAYG taxpayer with no investment properties etc so i guess my chances of being audited are low. I don't claim anything dodgy either

        • salubrious77 on 04/06/2017 - 15:39

          @chumlee:
          Thanks chumlee!

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 20:37

      PM me if you want and we can discuss preparing and lodging your returns to avoid ATO penalties/fines :)

      • salubrious77 on 04/06/2017 - 15:33

        Thanks Nicole,
        Just wondering is it still possible to lodge my tax return without my partners since we share an IP?
        Cheers

        • techboy on 04/06/2017 - 15:56

          It is possible, as long as you know all of their taxable income to record on your tax return.
          Generally it is better to do both at the same time.

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 18:57

          Yes it is possible. PM me if you wish to discuss.

  • justwii on 03/06/2017 - 12:41

    OK, OP asked me to do my homework before asking, now I have done some, please help me to correct any part that I am wrong:

    For a PAYG employee with a homemaking partner, having the employer to pay to a family trust and then distribute the income between both, trying to take advantage of both the tax-free thresholds does not have any tax advantage because the distribution from the trust is another income to the family members and will need to be taxed again (for any parts above the tax-free threshold)?

    Wouldn't that double taxed (first the PAYG then the accessible income from the trust)? And I thought double taxing is a wrong thing in Australia taxation system?

    Can you not ask the employer to pay in full (i.e. remove the PAYG portion) into your family trust, then you can make use of all the family members income tax-free thresholds? Hence making family trust useful for any ordinary PAYG employees?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 20:36

      Do some research on personal services income.

      You are a PAYG employee as you put it, that usually means what you are receiving is personal services income and you will most likely not be able to distribute to your partner. Funnelling it through a trust won't change this.

  • oztite on 03/06/2017 - 12:57

    Hi, thank you so much for doing this. I have two questions:

    1. With regards to a small business, how to determine if an expense (say < $20000) is for an instant write-off/ depreciation v.s. a cost-base which is only deducted against capital gain when the business is sold eventually? I've received very mixed advice from non-professionals regarding items such as engineer design fee, land survey fee, architect fee, renovation etc. And what happens to "cost-base" if the business is never sold? Can I nominate a time to write-off these expenses?

    2. With regards to superannuation, can I keep both a SMSF (for investment properties) and a industry superfund (for other investment packages) at the same time? Also, can I draw out everything in my superannuation when I turn 65 in one go? What if I am still working?

    Thank you so much in advance.

    • techboy on 03/06/2017 - 13:16
      +1

      1, The $20,000 applies to physical assets not expenses. The fees would be an expense and claimed in the year that you incurred them. Renovation to a property is probably going to be claimed as a capital works deduction at 2.5% per year.
      It all depends on what the renovation involved; complete replacement would be a capital works deduction and anything that was merely 'repaired' can be claimed outright.

      • oztite on 03/06/2017 - 14:41

        Thank you for the reply. That's what I thought too, but I have definitely been told by people that things like council permit application (for a particular business use permit), architect drawing of what a potential new renovation for the business would look like, and then the renovation itself etc form part of "business planning" and "business cost base" and therefore cannot be written-off/ depreciated. Which seems crazy to me because to set up a business, most of the initial cost goes into what would be classified as "business planning" and therefore not deductible apparently…

        • techboy on 03/06/2017 - 15:43

          Have a read of this : https://www.ato.gov.au/business/depreciation-and-capital-exp…

          and also click on the 'black-hole expense link and read it.

          Some setup costs can be claimed immediately whilst others can be claimed over a 5 year period.

          Immediate claims can be those incurred in obtaining advice or services relating to the proposed structure or proposed operation of the business or a payment to an Australian government agency of a fee, tax or charge incurred in relation to setting up the business or establishing its operating structure.

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 09:59

          The best thing to do is make a note of all the expenses you have incurred in an excel spreadsheet, it can be as simple as putting down the date, the amount, and the reason for the expenditure.

          Then taking that spreadsheet to your accountant and they can tell you which expenses incurred are to be written off or depreciated or added to cost base.

          PM me if you need more details :)

  • n3o on 03/06/2017 - 15:19

    Hi - thanks for doing this, super helpful - I had the following question - my friend (Aus citizen) has been living and working overseas (US) for the entire FY 16-17, no Australian assets/income just a super account from previous years when he used to work here - does he need to submit a tax return in Australia?

    Thanks in advance!

  • SGrvr on 03/06/2017 - 15:45

    Hey, thanks for your time on this.

    I'm a full time student and also work in my uni around 10 hours per week with an extra shift here and there. Recently I have started providing online study options to fellow students who struggle with specific subjects and charge them on an hourly basis, as a result of which i would be crossing the threshold of $18K. I don't have an ABN, how do i go about disclosing this new income?

    Thanks :)

    • techboy on 03/06/2017 - 17:29

      You don't need an ABN.
      You would declare it as business Income.
      You should also consider any deductions that you may be able to make to reduce this income.
      How much over the $18,200 threshold?

      • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 20:34

        He is running a business. Why wouldn't he need an ABN? He is charging them an hourly basis and making more than $18,000 a year. That is a business. He will need an ABN.

        • techboy on 03/06/2017 - 20:40

          There are advantages in having an ABN but it is not compulsory, as far as I know.
          I also didn't think that income was a measure, if you are running a business regardless of income you still need to lodge a tax return. Seeing you're back i'll log off.

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 09:57

          @techboy:

          It is not compulsory, but as he is running a business (the $18,000 income proves that the business is very regular and not a hobby) we would recommend getting an ABN. Just legitimises your business in the real world.

  • Ci3reR on 03/06/2017 - 16:07

    Hi Nicole,

    Is software deduction calculated the same as computer? ie spread across the computer life cycle year?

    For example, I bought a macbook in March and use it partially for work.
    This month, I want to purchase the Apple Protection Plan for this Mac and also a software which will be used for work only.

    How to calculate the deduction?

    Thanks very much for your help!

    • techboy on 03/06/2017 - 16:33
      +1

      Computers are depreciated over 2 years normally using the diminishing method so depreciation if bought march 1 2017 for $3,000 and used 50% for work would be:

      $3,000 x (122 days/365) x 100% x 50% = $502 this year.

      Software if under $300 is claimed in full x business use. If over $300 then it is depreciated over 5 years using the prime cost method.

      So if you bought software at $1,000 on March 1st 2017 and used it 100% for work it would be:

      $1,000 x (122 days/365) x 20% x 100% = $134 this year.

      The Apple Protection Plan would be cost x business use.

      • Ci3reR on 03/06/2017 - 16:50

        Hey techboy, thanks for your reply!

        The Apple Protection Plan would be cost x business use.

        Oh, so the Protection Plan doesn't need to be spread across 2 years (considered one-off)?

        • techboy on 03/06/2017 - 17:24
          +1

          applecare should be claimed outright x business use.
          It's not software but insurance.

  • ark1 on 03/06/2017 - 16:33

    I am currently in Perth and I am planning to buy an off the plan property in Canberra with my brother (who lives in Canberra). He will apply for FHOG under his name and live in the property for >1year.
    1) as long as my brother lives in it and I don't earn any income from the property, is that considered as a residential property for taxation purposes ?
    2) If I were to acquire another property in the future (say in Perth), for taxation purposes, how will this affect my other property that i’ve jointly bought with my brother in Canberra?

    Thanks in advance for your help!

    • techboy on 03/06/2017 - 16:37

      (1) Do you currently own any other properties?
      (2) Is the title in his name or both?
      (3) Owning two properties then one must be your principal place of residence and the other you will pay Capital Gains tax on.
      You don't have to decide now only when you sell one. Normal choose the one with the least amount of gain.

      • ark1 on 03/06/2017 - 18:00

        thanks @techboy for your reply
        1) no
        2) both
        i have another quick question, if my brother applies for FHOG under his name in ACT, am I still eligible for FHOG in WA for another residential property?

        • techboy on 03/06/2017 - 18:27

          If you don't own any other properties then this shared one is your principal place of residence so no CGT.

          If you buy another property then it may be best to claim that one as your principal place of residence as the other one you will only pay 25% of the Capital Gain Tax (50% share and then if held more than 12 months another 50%) when it is sold, but it all depends really on how much profit each one is likely to make. You don't need to make the choice until you sell one.

          I have absolutely no experience with FHOG I would suggest you ask Google.

  • dragon7 on 03/06/2017 - 18:27

    Hi, sorry if this has been asked before but I have a question on used car depreciation. If i bought a used car for $10000 on 01 Dec/ 2016, the car was first registered in 10 Jul 2012, then how to depreciate using linear and accelerated method? car is 80% for business and 20% private.

    • techboy on 03/06/2017 - 18:31

      Cost ($10,000) x (days left in financial year / 365) x 25% x Business Use %

      $10,000 x 212/365 x 25% x 80% = $1,161

      This is assuming that it is a normal car and not a ute or a vehicle with a load carrying capacity greater than 1 tonne.

      Then it is Cost ($10,000) x (days left in financial year / 365) x 26.67% x Business Use %

      $10,000 x 212/365 x 26.67% x 80% = $1,239

      Most people claim using Diminishing Method (as you call it accelerated) as they get a better refund in the first few years.

      • dragon7 on 03/06/2017 - 19:46

        Thanks for the fast reply, so is the 25% comes from 100%/ effective asset life, for new car it is 8 y and since i bought when it is 4y old, it has 4y of life left? What if i use diminishing method, can i use 50% instead of 25%?

        • techboy on 03/06/2017 - 19:51

          8 years depreciation regardless of age.
          Diminishing Method (accelerated) x 25%, Prime Cost (straight line) x 12.5%

          CALCULATING DECLINE IN VALUE %

          Diminishing value method rate is: 200% / assets effective life (200% / 8 years = 25%)

          Prime Cost value method is: 100% / assets effective life (100% / 8 years = 12.5%)

  • RonT on 03/06/2017 - 18:31

    Hi

    Thank you in advance.
    If my conference is happening in the next financial year but I paid for it in the current financial year, should I claim it this year or next year?

    • techboy on 03/06/2017 - 18:32

      Deductions are claimed in the year that you incurred them so include it in the current 2016-17 tax return.

      • RonT on 03/06/2017 - 18:33

        Thats quick. Thanks techboy!

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 09:52

      Be sure that 1. your employer is not going to reimburse you for the conference and 2. that you end up going and paying for it (i.e if something goes wrong and they refund you the amount).

      The best way of ensuring this is all fine is waiting until the actual conference before lodging your tax return. :)

  • Hamlet on 03/06/2017 - 18:35

    Hello, thank you for your post.

    I am a school teacher and I was wondering whether I'd be able to get tax refunded if I go overseas during the school break partly for holiday and partly to visit another school that my friend works in. Some of my colleagues have mentioned that I can although I am a little skeptical. What kind of evidence would I need to keep to claim the flight expenses, accommodation, etc.?

    • techboy on 03/06/2017 - 18:41

      It seems to me like a private holiday so no deductions.
      If you can prove 100% that the visit is fact finding and work related then it would be apportioned for that part.
      This would certainly get the attention of the ATO…

      • Hamlet on 03/06/2017 - 18:51

        Would teaching resources (textbooks, activities, observation notes) be prove of the visit being 'work-related'?

        • techboy on 03/06/2017 - 19:39

          Possibly, but it would be better to get a letter from your employer to state that you are there for work related purposes. It would certainly be looked at very carefully by the ATO.

          If you are intent on claiming it I would keep all receipts, a diary of activities and any other thing that will suggest you were there for a work related purpose.

          If you were there for 10 days and 1 day is spent at this school then it would be 10% of accommodation. flights etc. If you caught a taxi/bus/train directly to and from the school then that would be 100% claimable.

          It all depends on how much you would get back versus the risk that you may be audited.
          If it was only a minor refund I would always strongly suggest against it. But If you are 100% confident then go for it, ultimately it will be you that will be asked to prove it…

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 20:31

          @techboy:

          This will def be deemed a private holiday regardless of how you try to frame it. There is no reason to go and view another school away from yours especially one that your friend works in.

          Textbooks will be work related and you can get a deduction for them.

  • [Deactivated] on 03/06/2017 - 19:15

    Hi, thank you for this post my friend!
    My friend is working casually and earning dirty income.
    She is paid under minimum wage, no super contribution benefits and hence no workers compensation insurance covered.
    She is paid cash on hand and makes monthly cash deposits into her bank account; roughly <1000/month
    Will there be tax implications? Her overall annual income is <15,000AUD so she shouldn't be paying tax right?
    Can like the ATO track her down since she is technically earning income but there's no super :( ?
    I LOVE GETTING EXPLOITED!! /s
    Thanks for your time.

    • techboy on 03/06/2017 - 19:41

      Any income should be reported, but ifs she is earning under the threshold (< $18,200) then there is no obligation to lodge a tax return.

      • [Deactivated] on 03/06/2017 - 20:07

        But how does she report income when u said there is no obligation to lodge a tax return??

        • techboy on 03/06/2017 - 20:11

          If there is no obligation to lodge a return (because her total income for the year including centrelink, bank interest, dividends and any other job is less than $18,200) then she doesn't need to lodge a tax return but does need to let the ATO know that there is no obligation to lodge one because her total income for the year was below the threshold. However if she has paid any tax then she has to lodge a tax return and include all income.

        • sintro on 05/06/2017 - 16:14

          Read The War On Cash: Why Now?

          Why They Hate Cash in Hand?

          The first reason: physical cash has the potential to evade both taxes as well as officially sanctioned theft via bail-ins and negative interest rates. In short, physical cash is extremely difficult for governments to steal.

  • gamechaser28 on 03/06/2017 - 19:24

    Hi there,
    I wanted to know if i need to do my tax i registered a business and have made any sales or expenses. i made it in November 2016 but havent done BAS or anything ive been to busy with my other job. What should i do?
    Thanks

    • techboy on 03/06/2017 - 19:42

      Anyone with a business needs to lodge a tax return regardless of income.
      You only need to do Bas if you are registered for GST.

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 09:51

      You will still be required to lodge a tax return, as you would any way as I am assuming you are employed as an employee. You can fill out the business section with nil amounts.

      Are you registered for GST? Since you are talking about BAS I am going to go ahead and assume you are?

      PM me your ABN and I can look it up for you if you like.

  • hm on 03/06/2017 - 19:57

    Working part time, how much can i claim without receipts?

    • techboy on 03/06/2017 - 20:12
      +1

      Regardless of working part-time or full time you can claim $300 without receipts but have to have spent that money.
      This will then reduce the taxable income and you will pay less tax. It is not a dollar for dollar amount and if you paid no tax then you will receive nothing back.

      • hm on 03/06/2017 - 20:37

        thanks

  • therealbn05 on 03/06/2017 - 20:57

    Is there anything I can list as tax deductible if I purchased a house in that financial year?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 09:50

      Is this house an investment property or are you living in it?

  • leekanghao on 03/06/2017 - 21:03

    Just became an Australian PR this FY. Is my rental income and associated depreciation and expenses from my Singapore properties taxable in Australia? Believe there is a DTA that cover this between AU and SG but not many qualified accountants out there can offer a POV. Insights appreciated.

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 09:50

      Usually you will be assessed in Australia too as you are now a resident for tax purposes.

      However there is a double tax treaty with Australia and Singapore which states that "Income derived from real estate property is eligible for taxation in the country where the property is located".

      Based on this I would say that it would not be assessable in Australia.

  • [Deactivated] on 03/06/2017 - 22:11

    I'm planning on buying a computer purely for work purposes (it will stay at work, etc). Work has provided me with a computer, though it's unbearably slow. Am I able to claim this and if so how much do I claim and how is it set out?

    I'm a little unsure as I don't really need it (as they provided a crappy slow one), but it would help me do my job more effectively.

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 22:18
      +1

      You can depreciate it over a few years. Doesn't matter that you dont need it.

  • jq3411 on 03/06/2017 - 22:53

    Hi Nicole,

    I installed a new dishwasher & washing machine in my rental investment property, in order to attract tenants. Is the cost of the 2 machines tax deductible?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 22:58

      Yes depreciate them over their effective life.

  • tiara on 03/06/2017 - 23:15

    My family Trust has just started a business, does a trust need to hire accountant for bookkeeping or I can do it myself.

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 23:33

      Bookkeeping can be done by anyone as long as you know what you're doing.

      The Trust tax return will have to be lodged by a registered tax agent.

      PM me if you are looking for a tax agent to prepare the return for you :)

      • tiara on 04/06/2017 - 02:14

        I couldn't find anywhere in ATO website that it needs to be lodged by tax agent. Are you sure about that?

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 08:23

          It is not that it has to be. But how else are you going to lodge a trust return?

          You can print out a paper form and lodge it to the ATO I believe, but you are risking not doing it properly.

          It is very complicated to do a tax return for a Trust.

  • Donaldhump on 03/06/2017 - 23:54

    If my company has 4 offices in qld, spread far apart, can I do a 3 week road trip working, visiting the other 3 offices and claiming on tax. Pretty much just want to do the drive for something to do.

    Completely voluntary. My boss thinks I'm insane

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 09:47

      No

  • whoopdeedoo on 04/06/2017 - 02:30

    I did the PSI test on the ATO website, and as a sole operator (mortgage broker, generating 100% of the income) under a company, apparently the PSI rules dont apply to me. is that correct?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 09:46

      I can't tell you if they apply to you without going through all the details. But as you said, if you did the tests on the ATO website and you are satisfied the rules don't apply to you then you are a personal services business.

  • downhillmtbr on 04/06/2017 - 03:13

    If one is self employed with their own business and takes an overseas trip, during which one or more clients are visited, how much of said trip expense can be deducted?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 09:45

      They will usually scrutinise the trip because people try to say its going to see a client overseas.

      Did that client generate any income? How much was that income? Realistically you're not going to spend thousands in flights and accommodation unless a client is going to be a big one. Do you get where I am coming from?

  • BinnyC on 04/06/2017 - 07:32

    Hi, just want to know that we own our house and it is on me and wife name. We are planning on buying an investment property.

    Wife only works casual at the moment with less than 10k income.

    Should we buy investment property on both our names? How can we smarter about saving tax on rental income and interest paid to maximise tax return? Thanks

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 09:44

      I can't advise on what decision to make about buying a house. I can give you the tax law only. IF the investment is in her name too, because she hasn't got any income, it won't benefit her if the investment property is negatively geared.

      In that regard, it would be better if it is in your name. However you may want to consider that she won't have ownership rights to the property so not sure how she feels about that.

      • BinnyC on 05/06/2017 - 10:00

        Is there any way that I can set a percentage on ownership of investment property between us?

  • yjun355 on 04/06/2017 - 08:02

    thanks for your time. I had 2 questions:

    A. I own my apartment and live in it. If i rent out my second room.
    Then does my apartment become 50% investment property?

    Say i bought it for $100,000 and now its worth $200,000.
    So say in 5 years from now i sell it for $300,000. Then i have to pay capital gains tax from its value today i.e. 200,000.
    Then obviously it's only 50% portion? Then again unless rules haven't changed i get 50% discount for holding investment for more than 12 months?
    So effectively my capital gains is for 25,000?

    B. I work in company and get income and pay taxes.
    I start a pty ltd company with my friend and say we put in $1,000 each in there. That is like start up cost of that company. Say company in worse case doesn't do anything and is failure.

    Now,
    i. Can i claim $1,000 in any way is investment loss against my income?
    Ii. Any idea when that .pty ltd company has cashflow. How to structure so i can claim deduction against my salary.
    How do people typically structure or any advice to maximise tax benefit.

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 08:56

      A. You work out the capital gains for the whole property, then you x it by the rented out portion. There are other ways around this in which you might not have to pay gains, but that's why you need to sit with your accountant.

      B. No you can't claim the $1,000 loss as a deduction. IF the company is later liquidated you can claim a $1,000 capital loss but that won't go against your income, only against any future capital gains.

      The rest of your question requires you to sit and discuss with your accountant.

  • Mad Max on 04/06/2017 - 09:14

    Hi
    Do you need to lodge a tax return or a notice of tax return not required for a minor (under 18 yo and has TFN) for interest income under $416?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 09:27

      1. Have you previously lodged a return with the ATO? Assuming so, as you have a TFN, they will be expecting a return or a return not necessary from you.

      2. Did you get any benefits from centrelink?

      3. If you can't to lodge a return, or a return not necessary we can do one for you if you would like. PM me for details :)

  • ashftc on 04/06/2017 - 11:19

    Hi. I just want to ask I forgot to claim my last year annual subscription paid to CPA Australia. Can I claim that this year?

    • techboy on 04/06/2017 - 11:26

      No, you need to do an amendment to your 2016 one.

      • ashftc on 04/06/2017 - 22:41

        How do I amend that. Do I have to do that before the EOFY?

        • techboy on 05/06/2017 - 09:14

          You have 2 years from the date on the Notice of Assessment that you would have received last year.

          https://www.ato.gov.au/general/correct-a-mistake-or-amend-a-return/correct-(amend)-an-income-tax-return/how-to-request-an-income-tax-amendment/

        • ashftc on 05/06/2017 - 10:29

          @techboy:

          Thanks so much for your help. I will have a look.

  • SeasonKiller on 04/06/2017 - 12:51

    I'm an international student and I am currently working with Uber. I have zero knowledge on tax in Australia. How do I pay my taxes or lodge a tax return?

    • techboy on 04/06/2017 - 13:03

      Go and see an accountant or tax accountants. There are many questions that need answering.

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