Salary sacrifice vs personal contributions to super

If you are an employee, there are two ways in which you can optimise the tax-effectiveness of your additional super contributions:

  • Opt for a salary sacrifice arrangement, whereby your employer makes additional superannuation contributions beyond the compulsory superannuation guarantee (SG) amount from your pre-tax earnings and reduces your salary accordingly; or
  • Make a personal contribution and claim a tax deduction when you submit your tax return.

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Is your company compliant Sciacca Accountants Stafford

Is your company compliant?

IS YOUR COMPANY COMPLIANT?

 

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What we don’t often do at the end of a calendar year is legal compliance housekeeping, but perhaps we should. Legislation and regulations change throughout the year and these have an impact on your business.  Perhaps your company took on more employees and has a higher turnover?  These are excellent indicators of growth and success but also have the potential to attract new legal obligations.

Here is a list of 5 commonly overlooked legal issues you should review to ensure that your company is compliant this year…

Know the rules !

REVIEWING SALARY PACKAGING ARRANGEMENTS

Reviewing Salary Packaging Arrangements

REVIEWING YOUR SALARY PACKAGING ARRANGEMENTS

REVIEWING YOUR SALARY PACKAGING ARRANGEMENTS

The new fringe benefits tax year starts on 1 April 2016. The following changes will take effect from this date.

Car expense fringe benefits

The rules for individuals claiming car expense deductions have changed.

As a result, if you reimburse expenses relating to an employee’s use of their own car, only two methods will be available to calculate the taxable value of this fringe benefit (when you apply the ‘otherwise deductible’ rule).

The two methods are:

  • The log book method
  • The cents per kilometre method (a single rate of 66 cents per kilometre now applies).

Meal entertainment benefits

All salary packaged meal entertainment benefits will be reportable. They will also be subject to a separate cap of $5,000. Benefits exceeding this cap will be counted towards an employee’s existing FBT exemption or rebate cap.

 

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Are you SuperStream ready

Are you SuperStream ready

Time is running out to get SuperStream ready

Are you SuperStream ready

With only two quarters left until SuperStream becomes mandatory, employers are being urged to cross SuperStream off their ‘to-do’ list ahead of the 30 June 2016 deadline.

It takes a little time to set up, but over a quarter of a million employers who have made the change are already enjoying (on average) a 70% reduction in the time they spend on super. That equates to approximately 1.5 hours each cycle! If you haven’t done so already your options to get ready include:

  • upgrading your current payroll software
  • using your super fund’s online system
  • using a messaging portal
  • using a clearing house (like the ATOs free Small business superannuation clearing house).

You can also ask your accountant or bookkeeper for help.

An important part of SuperStream preparation is collecting your employees’ TFNs and their funds’ unique super identifiers (USIs). You then enter it into your system ahead of the next quarterly due date on 28 January. This gives you time to check that things are running smoothly before the deadline.

Use our Employer checklist for a step-by-step guide on all you need to do.

 

Fuel tax credit rates change

Fuel tax credit rates change

February fuel tax credit rates change

 

 

February fuel tax credit rates change

Fuel tax credit rates change regularly. They also vary depending on when you acquire the fuel, what fuel you use and the activity you use it for.

Fuel tax credit rates are indexed twice a year, in February and August, in line with the consumer price index (CPI). The CPI is released towards the end of January and July, five days before the rates are changed. Fuel tax credit rates will be updated as soon as they become available.

Rates may also change for fuel used in a heavy vehicle for travelling on public roads. This is due to changes to the road user charge which is reviewed annually.

Recent changes

As of Monday 1 February 2016 fuel tax credit rates change due to indexation.

Fuel tax credit rates are indexed in August and February in line with the consumer price index.

You may need to use more than one rate in a BAS period.

Use the Fuel tax credit calculator to help you get your claim right.

For details of the fuel tax credit changes go to ato.gov.au/fueltaxcreditrates

Changes to car allowances

Changes to Car Allowances

 

CHANGES TO CAR ALLOWANCES

 

CHANGES TO CAR ALLOWANCES

 

Claiming work-related car expenses is a common tax-time claim for many taxpayers. In fact, almost 4 million taxpayers claim the deduction each year. There are of course certain rules that must be adhered to in claiming these expenses and these days, the Australian Tax Office takes a close interest in such claims given the cost to the revenue.

The Treasurer announced in the 2015-16 federal budget that the methods used for calculating work-related car expense deductions would be simplified and modernised – in other words, changed.

Currently, taxpayers have an option to use one of four methods to determine their work-related car expense deductions:

  • cents per kilometre
  • logbook method
  • the 12% of original value method, and
  • one-third of actual expenses incurred.

Changes to car allowances mean if you are paying your employees a car allowance in excess of 66c per kilometre, you need to withhold tax on the amount you pay over 66c.

If you haven’t been doing this since July 2015, you should begin to withhold tax on the amount you pay over 66c and advise your employees.

What if your employees think that not withholding until now might result in them getting a tax bill?

Depending on the amount you’ve paid them, this shouldn’t have a significant impact on their tax for the year. But you can agree to increase the amount you withhold for the remainder of the financial year to cover the shortfall.

Make it count - Sciacca's news

Sciacca’s News – February 2016

We’re now one month into the new year, how are things going so far? Have you got all your plans in place? If not, we can help with budgeting, cashflow forecasting and general advice to help you ensure you reach your goals this year. Come in and see us or we can come to you.

This month in Sciacca’s News we’re bringing you:

  • 5 things you need to do to ensure your business is compliant
  • Top Marketing Tips for 2016
  • Reviewing your salary packaging arrangements

If you have any queries at all, please get in touch.

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Sciacca Accountants, Stafford

Sciacca’s News – December 2015

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As we come to the end of 2015, the words that come to mind are “thank you.”  This has been an amazing year.

We thank you for your continued support and wish you and your loved ones a joyful and relaxing holiday season.

All the best in 2016 and beyond!

Best regards from the entire Sciacca Group team.