logo
spacer
spacer

 eWombat Search 
>
spacer spacer spacer
Latest Accounting News
Hot Issues
Business confidence hits 5-month high: NAB
Caution advised on best interests duty with cryptocurrencies
$20,000 asset write-off renewed for another financial year.
SMSF compliance traps with bitcoin
Where Australia is at. Our leading indicators.
Foreign resident CGT withholding: early recognition of tax credit
ATO set to doorknock as 60% of cash-heavy businesses caught
New downsizing cap available
Capital Gains and Renounceable Rights
Treasury finds Australia 'increasingly uncompetitive' as US moves on tax plans
Australia's vital statistics
Our Advent calendar for 2017
SMSFs warned on ‘ticking time bomb’ with outdated deeds
Taxation ruling on commercial website deductibility
68% of SMEs ‘significantly stressed,’ 85% rely on accountants
Statutory wills are underutilised in estate planning
Small business slips on lodgement deadlines
Articles archive
Quarter 4 October - December 2017
Quarter 3 July - September 2017
Quarter 2 April - June 2017
Quarter 1 January - March 2017
Quarter 4 October - December 2016
Quarter 3 July - September 2016
Quarter 2 April - June 2016
Quarter 1 January - March 2016
Quarter 4 October - December 2015
Quarter 3 July - September 2015
Quarter 2 April - June 2015
Quarter 1 January - March 2015
Quarter 4 October - December 2014
Quarter 3 of 2017
Articles
Australia's leading causes of death - ABS
How is your super going, ready for retirement?
ATO increasing data exchange with international regulators
Illegal SMSF early access scheme leads to $6,000 fine
Our 'hardest' SMSF tasks
Uber drivers hit for 10% tax
Lack of literacy promotes unrealistic goals
Taxpayer failed to prove that payments were “loans”
New STP dates confirmed as ATO goes on compliance blitz
ATO flags compliance project for FY17/18
Items that heat up your depreciation deductions
Doing a budget is a good idea but ....
Government ‘undermines’ tax system in new moves on property expenses
Taxpayer denied deduction for work expenses of $60,000
Overtime meal expenses disallowed because no allowance received
Key Economic Indicators, 2017
Government to shut down salary sacrifice loophole
Crowdfunding legislation gets greenlight
ATO heavyweight responds to hacking fears
Checklist - Individuals Tax Returns - 2017
Checklist - Tax time 2017 - Company, Trust & Partnership
Checklist - Superannuation Funds - 2017
ATO to ramp up scrutiny of $20K tax break use
ATO to ramp up scrutiny of $20K tax break use

THINK ABOUT IT - Accountants and SMEs should be wary of entering “dodgy” end-of-year deals simply to utilise the $20,000 instant asset write-off according to one accounting body, with the ATO poised to up its monitoring of the tax concession. 



       


 


Last week, the government announced that legislation to extend the $20,000 instant asset write-off for small businesses for another year was passed by the senate with no amendments.


Whilst supporting the extension of the tax break, Chartered Accountants Australia and New Zealand (CA ANZ) head of tax Michael Croker has warned SME owners that the ATO will be carefully monitoring how taxpayers respond to this tax concession.


“The ATO monitors business spending and any ‘high risk’ behaviours can result in follow-up contact,” Mr Croker said.


“Spending leaves a data trail, and the ATO expects that trail to lead to bona fide business activity. Few appreciate the huge amount of data the ATO collects to monitor business spending patterns.”


CA ANZ warned that the ATO will be on the lookout for businesses falsely representing their annual turnover to be under $10 million, as well as breaking down one large purchase into lots of less than $20,000 purchases.


Also on their radar will be false invoicing, collecting discarded cash receipts to make false claims, pretending something is worth nearly $20,000 when it isn’t, and buying equipment for personal or home use rather than business use.


Finally, they will monitor private buyers giving funds to small business operators and asking them to buy equipment on their behalf, quoting a false Australian Business Number, and non-business taxpayers misrepresenting their eligibility for an Australian Business Number.


Mr Croker also issued a warning to small businesses owners not to fall for end of financial year “dodgy deals” in order to get the $20,000 tax deduction.


“Chartered Accountants know from experience that clients get the best outcomes when they take time out to think about what new equipment will boost productivity and the cash flow impacts,” Mr Croker said.


Mr Croker said that SME owners should consider what new equipment their business really needs, if they have budgeted for this spending, and how they would finance the purchases.


Now that the legislation has been extended till 30 June 2018, Mr Croker said they should think about spreading the expenditure over two financial years. He also reminded that the equipment must be installed and ready for use by 30 June 2017 to get the deduction this financial year.


 


LARA BULLOCK
Monday, 19 Jun 2017
accountantsdaily.com.au




2nd-July-2017