Last AMA of The Financial Year - Tax and Tax Return Questions - Ask Away!

Associatednicolemcmilllon @ Titanium Accountants & Advisors on 18/06/2017 - 16:25
Last edited 05/07/2017 - 10:16 by 1 other user

Hi All,

With the end of financial year coming up - most of you will be looking at lodging your returns in July and getting those refunds as soon as possible.

If you have any tax or tax related questions then ask below and I will answer them for you.

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 two previous forum post as we try to avoid duplicate questions.

I will reply to this thread with a link to the previous posts. Please go through them to make sure you're not asking the same questions.

Look forward to answering all your tax queries.

Ask Away!

Mod: Removed solicitation.

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Comments

- techboy on 20/06/2017 - 09:53
  
  See if you have any distinct PayPal/visa transactions for this purchase or if the seller can provide a copy of the receipt also.
jessnn on 19/06/2017 - 21:31

HI,
Is it possible to claim on damaged clothes? I work in a laboratory and over the year have multiple pairs of pants and tops that have hole marks due to use with corrosive chemicals. Even though we wear lab coats, it does not protect us fully.
From reading ATO's page, it is only uniforms and PPE that can be claimed, but nothing about damaged clothes.
Thanks
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 19/06/2017 - 22:20
  
  No unfortunately not. You could ask your employer to give you an allowance for damaged clothes.
gimli on 19/06/2017 - 21:47

-4

Do the police get involved with tax ?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 19/06/2017 - 22:19
  
  What do you mean.
  - gimli on 19/06/2017 - 22:23
    
    -4
    
    If you land on super tax and don't want to pay do the police give you a speeding ticket.
navegante88 on 19/06/2017 - 22:05

Hello,
I run a photo booth business, is there any way I can claim fuel as an expense when travelling to events while also claiming for car related expense (car servicing etc)

Also, if business does get busier in the future, is it possible to buy a vehicle to help lessen the tax bill?

Thank you in advance
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 19/06/2017 - 22:30
  
  Are you carrying all the booth and stuff with you. If so then you can claim using cents per km method or log book.method.
  
  Yes buying a car might lessen your tax bill. Speak with your accountant before buying though. That's very important.
  - navegante88 on 19/06/2017 - 22:32
    
    Yes, I carry everything with me.
    
    Thank you for your response :)
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 08:08
      
      No problem :)
    - Fluffmeister on 27/06/2017 - 22:06
      
      @nicolemcmilllon:
      
      Similar situation however I'm a photographer so its not as bulky, generally though its more than I could care say on public transport (lights and tripods) so I have no alternative but to drive.
      
      Does this still qualify for a deduction on kms?
Angelajojo on 19/06/2017 - 22:10

Hi,
If my work pays for mileage, but on my pay summary it's not included as an allowance, should I be claiming the same km to offset tax.
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 19/06/2017 - 22:19
  
  +2
  
  No. If it's not included it means they are reimbursing you. Therefore don't claim the deductions as you're not incurring any expenses.
  - Angelajojo on 24/06/2017 - 22:10
    
    Hi Nicole,
    Sorry I wasn't clear. What if they include the cost into the taxable income. My payslips say xxxkm $$$ paid. But the summary at the end of fy has income and travel added altogether.
    
    Also as per your comment, if they do include it as an allowance. Does that mean I should claim through to offset?
    
    Thank you in advance. what your doing is amazing.
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 24/06/2017 - 22:27
      
      IF they include the what they pay you for travel in your income then you can claim the expense provided you incur the cost.
      
      You can only claim what is deductible under the tax law. For example travel to and from home isn't deductible. So although hypothetically an employer may give you an allowance for that travel, you wouldn't be able to deduct those kms.
Slayerking on 19/06/2017 - 22:46

Hello, thank you for providing this opportunity to ask questions.

I have set up a PTY LTD company for myself at the start of the financial year (i am the single employee) and have been sending the ATO 3 monthly BAS statements. I recently received a payG payment summary for my company. I am wondering what amount of money I should pay myself as an employee and how much to leave for the companies profit. As an estimate I made aproximately $150,000 this financial year.

Is it just a matter of paying myself anything that gets less than 28.5% taxed, and thereafter leaving the extra money in my company where it won’t be charged a higher tax fee?

Thank you
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 03:42
  
  If you pay yourself wages you will also have to pay super and include it in a orders comp.etc.
  
  You can also consider paying the entire tax on 150 in the company and declare a dividend.
  
  Do you have an accountant. These are the types of things your accountant should be doing as year end planning this time of year.
Spending2Much on 20/06/2017 - 00:33

Is the excess on an insurance claim for a rental property tax deductible?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 03:47
  
  +1
  
  It depends on what the insurance pay out was related to. Would need more details
  - Spending2Much on 20/06/2017 - 04:25
    
    Break enter and steal. Smashed windows and damaged door forcing inside.
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 08:05
      
      Just to understand what you're circumstances are like.
      
      You're going to pay $X amount in excess and in return they're going to fix the door and window etc.
      
      That would be deductible as the cost of you repairing the doors yourself would have been deductible :)
    - Spending2Much on 20/06/2017 - 08:57
      
      @nicolemcmilllon:
      Thankyou.
      Appreciate your reply.
      
      (Previously when the fence blew over, the insurance took the excess from the amount they paid me to find my own contractor to fix the fence, therefore I didn't pay out for the excess that time, but the amount I paid the fence repair was more than the insurance payout)
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 09:00
      
      @albanyson:
      
      You can claim the amount the insurance paid you out (the net amount after excess) and include that as income.
      
      Then the fence repair costs could be deducted depending on if they were repairing part of the fence or the entire fence. If it is the entire fence then you can depreciate them over the fences effective life, say 10 years
djmm on 20/06/2017 - 00:37

I use personal car to travel meeting clients at work. I claim the kilometers via work as well and they pay me x amount of cents per km.

My question is, if I claim through worl, come tax time can I still claim the travel through my individual tax return? Thanks
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 03:48
  
  Depends if it is in your payment summary. If it is. Then you claim the income and the deduction.
  
  If it is not in your payment summary. And I assume it would not be. Then it is a reimbursement and you don't claim income or deduction in your return.
  - djmm on 20/06/2017 - 08:39
    
    Cool thanks
dd101 on 20/06/2017 - 01:00

Hey,

Two questions I have been wondering about for a while:

If I am a part time student, part time worker and meet the tax threshold, are the uni fees tax deductible under educational expense?

Do purchases online (like from Amazon) qualify towards work-related deductions? (There's nothing on the ATO site that says it needs to have GST or purchased in Australia).

Thanks once again for doing this :)
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 03:50
  
  Are your uni fees paid upfront or using help repayment. If paid upfront they may be deductible.
  
  All purchases qualify for work related deductions. Regardless of how or where they are purchased from. As long as you have an invoice and you paid for it. So Amazon purchases are fine.
  - techboy on 20/06/2017 - 09:55
    
    Assuming that there is a nexus between work and study of course..
[Deactivated] on 20/06/2017 - 01:01

oh very cool ! many thanks mate :

Here's my question:

We (Me & my other half) bought one house (rented out at the moment with both share at 50/50) - we never moved in. Recently I paid a company to get a depreciation schedule which they have created two separate schedule documents against each owner being 50% each. Now she's not working at the moment and the tax return is mostly 0 and I do the rest. When claiming tax break - can I claim both her+mine depreciation or just mine ? We do pay from mortgage from shared account and even my salary comes in a shared account as well.
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 03:51
  
  You should both include income and expenses from your rental property 50 50 regardless of who pays for it. It is all got to do with ownership of the property. Your partner will need to include their 50 percent share of income and expenses and therefore depreciation.
  - [Deactivated] on 20/06/2017 - 09:34
    
    Does that mean - we only would get 50% tax return as her salary is 0 so she can't claim that tax return anyway ?
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 09:36
      
      That is correct. If the property is negatively geared and she has tax losses. They can be carried forward to future years when she has income.
SaberX on 20/06/2017 - 02:10

What are your thoughts on owning your own place of residence (constructed). Given you still have surplus funds to draw down on your max loan, would drawing these down to pay annual costs such as council rates, reinspections for termite warranties each year etc. cause issues in the future if one was to rent out their house and claim 100% of the loan interest as deductible?

Typically it is private obviously while living in it now, but similar to paying your own DIY painting or other costs e.g. window treatment etc through your loan, when rented out assumedly all these costs making up the loan balance are akint o buying a complete established house with all this work done? And therefore all deductible as the cost of the 'whole property'.

Just curious therefore if these annual costs, maintenance costs and other costs such as the example termite and pest warranty reinspections and treatments would therefore be looked at as part of the cost of acquiring the property initially for private use, and as now rented - fully 100% deductible interest?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 03:54
  
  From my experience if it is your own place and all the money redrawn is being directly used for the property and there are no private expenses theb there should be no problem claiming the interest in the future.
  
  Just make sure you document all redraw funds and what they were used for.
Ravensbane on 20/06/2017 - 06:34

If you are employed by someone remotely and do all your work from home and are required to use a personal computer to do your work can you claim the cost of the computer and internet back on tax?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 08:08
  
  +1
  
  You can claim a depreciation deduction on the cost of the computer if you purchased the computer yourself. You will have to apportion the cost based on the days in the financial year you bought it and claim the rest in the next year.
  
  For example, if you purchase it today for $1,000 you can only claim 10/365 days =$27 in this years return. You would claim the remainder in next years return.
  
  Regarding your internet, you can claim a portion of it that is related to work use. Same with electricity and your mobile phone.
  - Ravensbane on 20/06/2017 - 09:52
    
    Great, thanks for the reply!
  - banzini on 20/06/2017 - 10:26
    
    "you can claim a portion of it that is related to work use"
    
    so, you are ok roughly estimate how much of it is used for work? What if you have a $35 mobile stick when on road, only use it once a month (*this is me/on road emergencies), I can claim 100% of cost even though I use it maybe once a month with no personal use?
    
    Thanks
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 10:28
      
      That is correct. It is not about how frequently you use it, it is the percentage of use that is work related to total usage.
  - techboy on 20/06/2017 - 10:36
    
    oops wrong response.
  - techboy on 20/06/2017 - 10:38
    
    Regarding Telephone usage if it is Incidental use and you are not claiming a deduction of more than $50 in total, you may make a claim based on the following, without having to analyse your bills:
    
    $0.25 for work calls made from your landline,
    $0.75 for work calls made from your mobile, and
    $0.10 for text messages sent from your mobile.
    
    https://www.ato.gov.au/Individuals/Income-and-deductions/Ded…
wyndham29 on 20/06/2017 - 08:48

If a backpacker is here on a working holiday visa for 1 year (417 or 462 visa), working in 3 or 4 locations, should they put that they are a resident for tax purposes? I believe the rules changed in January so there's a bit of confusion.
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 09:02
  
  Most people who come to Australia for a working holiday or visit are not Australian residents. This includes people on 417 or 462 visas (backpackers).
  
  This is because most backpackers, consistent with their visa requirements, do not intend to stay in Australia, but only intend to have a holiday while working some of the time.
  
  From 1 January 2017, the first dollar of income earned by backpackers in Australia is taxed at the working holiday maker tax rate of 15% up to $37,000 in an income year. This is regardless of residency status.
  - wyndham29 on 20/06/2017 - 12:02
    
    Thanks!
banzini on 20/06/2017 - 10:22

Hi thanks for this AMA.
If I stay in a hotel interstate, and visit workplaces and sites related to my field of work (not directed by my employer, more so for knowledge and experience), am I able to claim that night at the hotel and other expenses like uber? I would be visiting places to gain a greater understanding of my field of work to assist me.
Regards
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 10:30
  
  This would most likely be denied at it isn't a formal course and it is not directly work related. Personally I would not claim the hotel or travel costs but might claim things like any books you purchased, or for example admission fees to a museum etc.
  - banzini on 20/06/2017 - 10:31
    
    Thank you
wannagrababargain on 20/06/2017 - 10:32

This is a question about foreign tax on dividends from UK shares. Pre-2016 the UK had a 10% "notional" tax on all dividends which appeared on the dividend statement.
That is a net dividend of 900GBP would actually be a gross of 1000GBP with 100GBP being 'deemed' to have been taxed. Even though this was a 'notional' amount it could be treated like a real tax credit for local and foreigners. This was easy to do because the amount was shown on dividend statements. Post 2016 there is no longer this notional 10% tax amount stated, instead UK locals have a 5000GBP dividend allowance on their individual tax return. My question is, where does this leave us (non UK resident) foreigners? Is there any 'foreign tax' paid offset that Australians can claim from proceeds of UK dividends?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 10:50
  
  If they are not withholding tax from you, then you obviously won't get a credit as there is no foreign tax paid.
  
  You should check if they are withholding anything from your dividend or whether or not they are treating you as part of the 5000BP allowance group and therefore not taxing you.
  
  If they don't tax you that's good news it means you are receiving more in your hand upfront :)
silvion on 20/06/2017 - 10:34

+1

Hi Nicole!

I've been reading through a lot of comments etc and thanks on everyones behalf. Great information in these forums.

If someone was coming to you for a tax return that had investment properties, do you have preferred way to get these details?
I've been trying to prepare for mine, so i created a excel sheet with item, description, cost, claim percentage. But as this is my first year for tax with an investment property (actually two), just wanting to learn what to claim and how best to track it while getting the list ready for an accountant.

Also trying to get a generic list together of things that i can claim like travelling interstate, car hire etc for them. Unsure about things like insurance, water supplies and general expenses with a property. Do you happen to have a suggestions list for your clients like that?

Thanks In Advance
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 10:48
  
  +2
  
  For their first return with us we generally ask our client to provide all expenses incurred in relation to the investment properties.
  
  One we receive everything from them we can advise on whether or not they missed anything such as depreciation reports (if your property was built less than 10 years ago, and you purchased it before May 2017, get one!)
  
  Once you go through one year of providing your tax agent with the information and the back and forth correspondence, you will be a pro by the time it comes to the second year.
  
  Putting everything down on a spreadsheet rather than sending your accountant 50 invoices ensures that they don't miss anything.
  
  If you are looking for someone to prepare and lodge your returns, please do not hesitate to PM me and I can provide you with our details :)
banzini on 20/06/2017 - 10:36

If I use my own car to visit sites related to my field (yes, there is a car available at my workplace to use but often using my own car to visit sites closer to my place of residence is more convenient time wise).
Am I able to claim the km’s from my own personal car use to visit these work sites?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 10:45
  
  What kind of sites are these? Construction? If you are carrying heavy things to the sites for work yes.
  
  Otherwise most likely you can't claim those km.
investwell8 on 20/06/2017 - 11:05

Hi Nicole,
It's very kind of you to offer this advice. It is very much appreciated.
My question is regarding CGT on investment property.

Property 1
Jul 2011 - I've purchased a 2 bedrooms unit, moved in to one room and rent out the other room. All utilities bills are in my name.
June 2015 to current - Rent out the whole unit through property manager.
I do include the rental income and claim deductions for this property.

Property 2
I have another property under me and my husband's name which we purchased as block of land in Jul 14 and moved in after construction is completed in Oct 15. This is my principal place of resident.

I would like to understand if I will get full CGT exemption with the 6 years rule for my property 1 as long as I sell it prior June 2021?

Thanks in advance.
T
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 11:12
  
  No you will not. You can only have one place of residence at a time. Even then, as you rented part of the property initially, you will not get the full exemption.
  
  If you decide that Property 2 is your PPOR then it will be from the date you moved in (Oct 15).
  
  Therefore property 1 was your main residence from Jul 11 (date of purchase) until Oct 15 (date you had a diff PPOR).
  
  When it comes to sell it there will be a calculation to claim a partial exemption for the time that you lived in it and rented it too.
  
  I hope I am not confusing you. You should speak with your accountant when it comes time to sell either property and they can figure out the scenario which provides the lowest tax paid.
  - investwell8 on 20/06/2017 - 12:44
    
    Thanks for your quick reply Nicole.
    Could you please provide guidance on CGT payable if I was to sell the property 1 in July 2017?
    Assuming 50% of unit is rented from Jul11-June15. profit is $200k, Marginal tax rate of 39%
    
    Kind regards,
    T
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 12:48
      
      +1
      
      It will take too long for me to sit and work it out. Probably best if you sit with your accountant and talk to them. The tax wouldn't be that much off the top of my head it would be less than $15k.
    - investwell8 on 20/06/2017 - 13:29
      
      @nicolemcmilllon:
      Hi Nicole,
      Sorry to bother you again.
      My calculation will be as below
      total years Jul11-Jul17 = 6 yrs
      years with another PPOR (Oct15-Jul17) = 1.75 yrs
      
      Taxable CGT amount = 1.75/650%(CGT disc)$200k = $29,199
      CGT liabality at 39% = $11,375
      
      Could you please let me know if my logic is correct or if I have missed anything?
      
      Thanks so much
      T
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 13:37
      
      @investwell8:
      
      You have missed the first 4 years where the property was half rented. You won't get the full exemption for those years.
      
      Effectively you will get half the exemption for those years.
      
      When it comes time to sell the property, sit with your accountant and they will figure it out. Don't make a decision about selling or not selling in relation to tax payable. Thats the best advice I can give you.
    - investwell8 on 20/06/2017 - 13:42
      
      @nicolemcmilllon:
      Thanks Nicole.
      very much appreciated.
[Deactivated] on 20/06/2017 - 11:12

Hi,

I apparently have overdue tax returns from the 2011-2012 and 2012-2013 period.

I don't have access to my PAYG summaries from these periods, but I do know that I was under the tax threshold - this is from estimating my income for those financial years using bank statements - (2011 - 2012 I worked at a bar for a month before starting uni, and 2013-2014 I would have done something similar during university breaks). Apart from this I would have earned interest on my term deposit (<$1k interest total).

What would be the best way to go about lodging these?

Would it be as simple as calling up and asking the ATO? Or would I have to go back to my employers and ask them for summaries from that period?

Thanks.
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 11:17
  
  I would assume that your employers withheld some tax from you during those years.
  
  Your best option would be to speak to a tax agent and they can add you into their system. That way they can view your records and see if there is any information on there about your payg payment summaries.
  
  If we find that there is no tax withheld on your payments, then we can lodge what is called a non necessary return rather than having to lodge actual tax returns. If there is tax withheld and you are under the threshold its best to lodge actual returns so you can get that tax back.
  
  Have you received any fines/penalties for not lodging a return in those years?
  
  If you would like us to go through this with you by adding you onto our system and preparing your returns if necessary, ~~you can email us directly at xxx@xxx~~ send me a PM.
  - [Deactivated] on 20/06/2017 - 11:33
    
    I would presume too.
    
    Depends what you guys charge, for a late return - I have not received any correspondence from the ATO at all.
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 11:40
      
      Can you PM me to discuss further.
bobbinbrisco on 20/06/2017 - 11:59

Hi thanks for this.

Question is about the medicare levy surcharge. If my spouse and I are going to be in Tier 1 under the family threshold but only I have health insurance, would my spouse need to pay anything (say if we both have taxable incomes of $100k)?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 12:15
  
  The calculation is based on your combined adjusted taxable incomes. As your spouse does not have adequate private health you will both pay the medicare levy and the medicare levy surcharge depending on your combined family adjusted taxable income. For example if your combined income is greater than 180,000 you will both pay 2% medicare levy and both pay 1% surcharge.
Jabberwocky on 20/06/2017 - 12:08
Hi Nicole

I am into a Software Sales job with a US MNC. My company pays me $17,000 yearly as 'Car Bonus'.
Can i claim all $17,000 in tax given my company declares it on the payslip or do i still need to show my kms usage ?

I just bought a new house (first purchase)to live-in, not investment. What all things can I claim as tax, if any

Thanks
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 12:16
  
  If you use cents per km method, you can only claim 5,000km. The better method for you might be the log book method, in which its best to sit with your accountant to discuss in detail.
  
  As it is not an investment you can't claim anything. However keep records of the purchase costs in case it one day becomes an investment property.
  - Jabberwocky on 20/06/2017 - 14:10
    
    Thanks much for your response.
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 14:13
      
      You're welcome :)
Carmen Sandiego on 20/06/2017 - 12:20

Hi Nicole, thank you so much for doing this and providing me with answers to future questions :)

This year, I earned less than the tax threshold that my employer put me into and I know I can get a return.

However, in the effort of trying to get my annual leave paid out, I was taxed at 33% on the income of around $450 instead of the normal 14%…

Would I have to talk to an accountant about that single payment or do I just lodge my tax as normal? I know I should talk to someone at work about this but, they dragged this issue on for almost a month :/
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 12:22
  
  I am confused by what you mean. What your employer withholds from you doesn't really matter. It is just a prepayment for tax that is essentially payable when you lodge your tax return.
  
  If they have withheld too much based on your taxable income at the end of the year you will get the difference back.
  
  Are you going to earn less than $18,200 for this financial year? If so, you should get all the tax withheld back.
  - Carmen Sandiego on 20/06/2017 - 12:30
    
    So, they have taken tax this financial year assuming I would earn $43,000 but, as of this week, I have only earned ~$37,000.
    
    I was just confused as to why they would tax me a percentage that I am clearly not earning according to the ATO income tax brackets.
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 12:33
      
      +1
      
      That is not how it works. On each pay cycle, the payroll system calculates how much to withhold. It has nothing to do with your annual salary.
      
      For example, if you earn $100,000 in one week, the payroll system assumes you earn that every week and will withhold accordingly. In the next week if you only earn $100 the system doesn't take into account what you earned last week.
      
      The withholdings also aren't exactly related to the tax brackets. That is your tax at the end of the year.
      
      I hope that makes sense.
    - Carmen Sandiego on 20/06/2017 - 12:42
      
      @nicolemcmilllon: That does :) Thank you :)
Amaris on 20/06/2017 - 12:44

Hi Nicole. Thanks for taking the time.
We've got an investment property which is about 6 years old. We got a depreciation schedule done for tax purposes. Are there any implications of any capital gains tax if we use it to claim depreciation against our income? Would the effective capital gain increase when we sell it say in 5 years?

Thanks
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 12:46
  
  There are two types of depreciation. Division 43 is depreciation that won't get added back to the capital gains when you sell it.
  
  Division 40 is the 2.5% write off each year, that deduction is added back when it comes time to sell the property.
  
  However, generally, if you need the deduction, its best to claim them both and worry about the capital gains in the future.
  - Amaris on 20/06/2017 - 15:07
    
    Thanks Nicole. The schedule I got done doesn't specify a division but I presume it is Division 43 as it has lots of different items rather than a flat 2.5%. Can you clarify I can claim both at the same time?
    
    Thanks
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 15:32
      
      Yes you can claim :)
ohsotight on 20/06/2017 - 13:12

Hi. If both husband and wife(no kids)are working by law do we need to disclose we are married or can you lodge tax returns as individuals?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 13:33
  
  In Australia you still lodge returns as individuals, there is no joint return like other countries. However by law, in your tax return, you make a declaration that you do/do not have a spouse.
  
  If you don't disclose your spouse details including income etc, then you are making a false declaration which is illegal :)
chengjianer on 20/06/2017 - 13:14

Just a few simple questions.

Do i have to do the tax return or lodge tax each year? Compulsory? Will i get a fine if i don't do it?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 13:30
  
  There is a variety of criteria which will let you know if you have to lodge a return.
  
  Did you work during the year? Did your employer withhold tax from you?
  
  Most people are required to lodge a return every year. There are fines of up to $990 per year for not lodging if I am not mistaken.
  
  If you would like to discuss us preparing your returns for you, please PM me.
  - chengjianer on 20/06/2017 - 14:09
    
    Did you work during the year? Did your employer withhold tax from you?
    
    Both yes.
    
    It just got me thinking that do i still need to lodge a tax each year? Because i am paying tax and the ATO should already know since my employer is withholding tax from my salary each fortnight, and i am guessing those money is sent to ATO.
    
    If you would like to discuss us preparing your returns for you, please PM me.
    
    I might do that if i do have to lodge the tax, which i think i haven't done that for the last 2 or 3 years.
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 14:12
      
      If you have employment and your employer withholds tax from you. You are required to lodge a return with the ATO.
      
      The reason is because what your employer withholds is only an estimate of your tax on your estimated income. It is effectively only a prepayment of estimated tax.
      
      The actual tax is calculated per your tax return at the end of the year.
      
      I would definitely recommend catching up on late returns as the ATO can issue fines and penalties of over $900 per year for unlodged returns.
      
      PM me if you would like to discuss further :)
    - chengjianer on 20/06/2017 - 14:32
      
      @nicolemcmilllon:
      
      Ok, thank you!!
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 14:33
      
      @chengjianer:
      
      You're most welcome. We have found a few people on here today that require a few years returns lodged.
      
      Happy to help. PM me :)
PropertyPig on 20/06/2017 - 13:21

Hello,

Thanks for doing this AMA. I haven't done my taxes in a while (3 years I think) due to just always putting it off. As far as I know, I don't owe anything. Do I have to go an see an accountant or can I still do them online myself?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 13:29
  
  I am not sure if you can still lodge online it might be too late. Not sure about that as obviously we don't use the same online system that individuals use.
  
  I would call the ATO and find out however this might flag that you are late and they may impose late fees/penalties etc.
  
  If you would like us to prepare the returns for you, please PM me and we can discuss further.
zakit on 20/06/2017 - 13:29

I already have a full time job but I want to become a stock trader part time, would it be better to trade on my personal account or setup a business for trading?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 13:31
  
  +1
  
  Too many things to go through to consider which business structure is best for you. Have a think about trading through a trust. Trading in your personal account is still a business if you are doing it regularly and not for long term investment.
  
  Probably best to discuss in detail with your accountant.
  - zakit on 20/06/2017 - 14:07
    
    Thanks for the reply!
skwil8 on 20/06/2017 - 14:20

Hi Nicole,
I earn $110k ex. super per annum - do I need to get health insurance to avoid penalties at tax time?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 14:28
  
  +1
  
  Yes, and it is already too late for 2017 financial year as it is done on a proportion basis.
  
  If you would like to avoid the surcharge for the future, I would recommend getting adequate private health insurance as soon as possible. Remember to ensure it meets the adequate level for medicare levy surcharge purposes :)
Randxyz123 on 20/06/2017 - 14:23

I'm in my early 20s I haven't had a job till now and was just made aware of claiming back franking credits from the small amount of shares (bought in my name by my parents). I've done it online for the last financial year. Question I have is can I still claim back the last 15 or so years of franking credits easily ? The ATO website kinda suggests I can but I need to ring up to get the correct forms.

I guess the other question I have is will this be a pointless exercise if I am in a full time job now earning enough to pay tax on ?
- Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 14:30
  
  How much were your franking credits for each of the last 15 years. If it is a significant amount, then you can consider calling the ATO and getting it all done.
  
  Remember to have all documentation to claim the franking credits, such as dividend statements which arent difficult to obtain online.
  
  It all depends on the amount of franking credits.
  
  Now that you have a full time job your employer is withholding tax from you and you will need to lodge a tax return each year :)
  - Randxyz123 on 20/06/2017 - 14:40
    
    Well the refund I just got was $130 so I wouldn't mind the other 15 years back.
    
    Yeah I know… I need to get on that. And I have 0 clue how haha.
    
    I want my refund…
    
    Thanks for your help.
    - Associatednicolemcmilllon @ Titanium Accountants & Advisors on 20/06/2017 - 14:46
      
      Are you a resident for tax purposes? Your location says Cincinnati?
      
      For the years you were a non resident for tax purposes you would not be entitled to a refund of your franking credits.
      
      PM me if you would like assistance with claiming back the franking credits :)
    - Randxyz123 on 20/06/2017 - 14:48
      
      @nicolemcmilllon: yeah I live in Melbourne now. Always been an Australian citizen. I lived there for 4 months last year.

Last AMA of The Financial Year - Tax and Tax Return Questions - Ask Away!

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