The tax office now have the best computer system that they’ve ever had, and they’re putting it to use on the Australian public.
There are four things that the ATO won’t let slide in 2019.
They want the cash economy to be declaring all of their income. No excuses. They’re starting to look at money going in and out of bank accounts, above about $5,000 to $10,000. The tax office are also hammering GST in this area, using statistics and tax averages from specific industries to see if people are reducing their tax via the cash economy.
People of high wealth are often in extremely complicated tax situations to save themselves a lot of tax. However, the ATO knows that many smaller tax agents cannot cope with the complexity of the law. Hence, small tax agents working with high wealth individuals can expect an audit.
Finally, the Australian government are tackling the profit shifting of big multi-nationals. They are putting a target on tax dodging and kicking the money back to the Australian people.
If you’re claiming more than $2,000 to $5000 in a particular deduction area on your individual tax return, it’s likely you’ll get caught. Make sure you have your receipts, make sure you’re claiming things according to tax law. This is the second year that the tax office have targeted this area, and last year they discovered thousands of incorrect claims.
Your own funeral can be hard to think about, but after a lifetime of working hard for your money and having it work hard for you, now is not the time to drop the ball when some intelligent research and thoughtful planning could ensure value for money with that final big spend.
The expenses considered deductible by super funds are similar to that of individuals.
We encourage many of our growing small businesses to set up family discretionary trusts. ?
These trusts are great for one family and have a number of people involved in them.
✅ Firstly, the person who starts a family trust is the settlor.
The settlor sets up the trust by contributing about $10 or $20, merely to kick it off.
And then… the settlor sails off into the sunset never to be known of again. ?
That settlor can’t be a family member. We don’t really want it to be the accountant or the lawyer either. It should be a next-door neighbour or someone known to the family.
All they do is start the trust. That’s it.
✅ Next is the trustee. This is the person who directs the trust and makes all the day-to-day decisions.
They have power to run that trust. The trustee can be an individual, or they can be the director of a trustee company.
✅ Then you have the all-powerful appointor.
The appointor is super important in a trust because they can sack the trustee and put another trustee in place, if ever needed.
✅ Finally, you have the beneficiaries of that family trust.
In Australia, beneficiaries under 18 can earn about $416 tax-free.
Beneficiaries over 18 pay individual tax rates.
Companies pay company rates.