Message from David Shaw CEO WSC GROUP EVENTS

I am excited to announce that we have a number of events planned for the upcoming months on special interest topics at the request of our clients.

In addition to our The 10 Years before Retirement seminar being held in Perth on 25 February, below are some details of the upcoming events scheduled.

2015 Property Investment Tax Webinar Series

This five (5) topic webinar series will focus on tax issues relevant to property investors, how to maximise the tax benefits from your property portfolio and keys to improving your cashflow.

We will be hosting two (2) sessions of one (1) topic each month. This will give you the flexibility to choose topics relevant to you at a time which suits you best.

Topic 1: Getting your loan structures right for you (February) Topic 2: How to get the most from Negative Gearing (March) Topic 3: Self-Managed Funds and Property (April) Topic 4: Improving your property cash flow (May) Topic 5: Tax Time Tips for Property Investors (June)

To register for these webinars, go to the Upcoming Events section of our website.

2015 Business Basics Work Shops

We will also be hosting Work Shops in our WSC Group offices during March on Business Basics.

Are you considering starting up your own business? Would you like to know what is involved and what you should know about starting a business? Are you new to business and want to know more? Find out how the tax system works for all business types. Find out what is the best structure for you to run your business through More and more people are choosing to run their own business. Some simply want to be the masters of their own destiny and be their own “boss”, while others see specific opportunities in the market place.

In today’s business environment, we have also seen an increasing number of trades-people offered contract work instead of employment, a trend which is likely to grow.

If going into business is an option for you now or in the future, do not miss this special seminar on the steps and options you have in self-employment and running a small business.   The Work Shops will be held in our WSC Group offices:

MENAI – Tuesday, 3rd March 2015, commencing at 6:30pm

CANNON HILL – Wednesday, 11th March 2015, commencing at 6:30pm

PORT MELBOURNE – Tuesday, 17th March 2015, commencing at 6:30pm

KOTARA – Wednesday, 25th March 2015, commencing at 6:30pm

ST LEONARDS – Wednesday, 1st April 2015, commencing at 6:30pm

Seats to these Work Shops are strictly limited. Register now to secure your seat. Ph: 1300 365 125 or email: [email protected]

We will release more details of upcoming events shortly.

To stay up to date with the latest event details visit the Upcoming Events page of our website or like WSC Group on Facebook, LinkedIn or Google+.

REVIEW YOUR 2014/15 PAYG WITHHOLDING TAX VARIATION

As we are now seven months into the 2015 financial year, it is now a good time to conduct a quick review of your 2015 PAYG withholding tax variation to ensure that your income and deductions are on track with the earlier estimates submitted in your tax variation.

Reviewing the tax variation now allows for any discrepancies to be identified and, if need be, we can amend your tax variation to further adjust your tax rate to avoid any possible discrepancies or tax payable upon lodgement of your 2015 tax return if your income has significantly changed during the year.

It is particularly important to review your tax variation if your circumstances have changed during the year including increases in your wage/salary, any bonus or overtime increases, significant change in interest rates or rental increases.

If you would like us to review your tax variation, please send us the following information:

Copy of your most recent payslip showing year-to-date gross income and year-to-date tax paid, including any overtime earnings and allowances Details of interest paid on all property loans paid from 1 July 2014 to most recent available Should we feel that it would be beneficial for you to lodge an amended tax variation, we will advise accordingly together with our estimate of costs to process the amendment before proceeding further.

Please contact our office to speak with your Client Manager should you have any queries.

Paper activity statements to stop for electronic lodgers

From 1 July 2014, if you or WSC Group lodges your activity statement via an electronic channel the Tax Office will stop sending paper activity statements. Instead, your next activity statements will become available in an electronic channel.

If you lodge your own activity statements

This change is in line with what already occurs if an activity statement is lodged via the Business Portal, Standard Business Reporting (SBR) and electronic commerce interface (ECI) with one key difference – currently if the Tax Office does not have your email address, they do not stop the paper activity statement issuing.

From 1 July 2014, the Tax Office has stopped sending the paper to all electronic lodgers regardless of whether they have an email address.

Activity statement notification – portal, SBR or ECI

Where you lodge via the Business Portal, SBR or ECI and the Tax Office have a valid email address recorded against your activity statement role, they will send an email to the nominated address advising that the next activity statement is available online.

Where the email address is not recorded or is incorrect, they will not send an email notification.

If you lodge via WSC Group

If you use WSC Group to prepare and/or lodge your activity statements, please note that we lodge through an electronic channel. We welcome the opportunity to discuss this with you for your next activity statement to determine how to manage your activity statement obligations in the future.

Access your activity statement

If WSC Group manages the lodgment of your activity statement, you may still want to access your activity statement. You can do this by getting access to the Business Portal. The Business Portal allows you to:

View activity statements View business tax account details Access online tools and calculators View payment options Obtain an electronic funds transfer (EFT) code Obtain a payment slip Exclusions

The Tax Office will continue to send paper activity statements for the following form types because they cannot currently despatch them electronically.

Q (Annual GST report) R (Quarterly PAGY instalment notice) S (Quarterly GST instalment notice) T (Quarterly GST and PAYG instalment notice)

They will also continue to send paper activity statement for other form types if you do not have an active ABN.

Making payments

WSC Group can provide you with your payment details. Alternatively, these can be obtained from the Business Portal.

If you would like more information on this change, please contact your Client Manager.

ATO data matching programs

Editor: The ATO is carrying out two new data matching programs to identify non-compliance with registration, lodgment, reporting and payment obligations, i.e., looking for tax avoiders.

Motor vehicles

The ATO has announced a new "Motor vehicle data matching program" to collect details of individuals or businesses that have purchased or acquired a vehicle costing $10,000 or more in the 2011/12 and the 2012/13 financial years.

It will acquire information from every State and Territory vehicle registration authority.

It is expected that records relating to approximately 2.8 million individuals will be matched.

Share transactions

The ATO has also announced a new "Share transactions data matching program" that will acquire details of share acquisitions and sales from 20 September 1985 to 30 June 2016 from:

Link Market Services Limited; Computershare Limited; Australian Securities Exchange Limited; Boardroom Pty Ltd; Advanced Share Registry Services Pty Ltd; and Security Transfer Registrars Pty Ltd. The type of data that the ATO will collect includes the name and address of the taxpayer, and the date, price and number of shares acquired or sold.

It estimates that more than 95 million records will be obtained, including the records for approximately 1.2 million individuals.

Editor: The fact that this program collects information back to 20 September 1985 raised concerns the ATO might amend assessments up to 30 years old!

However, the ATO has come out and said that it is only going back to when CGT was first introduced so that it can identify 'post-CGT shares' and calculate the cost base where shares have recently been sold (for example, if they were bought in 1986 and sold in 2014).

ATO focus on super obligations – child care, pubs and cleaning

Each year, the ATO identifies industries where employers are at a greater risk of not making super contributions for their eligible employees.

This year its focus is on:

child care services; pubs, bars and taverns; and industrial cleaning industries. Furthermore, the ATO stated that, in early 2015, it will write directly to employers in these industries to remind them of their super obligations.

It has also advised that it will be undertaking super obligation audits of these industries from July 2015.

The ATO reminds all taxpayers that they must:

contribute at a rate of 9.5%; make contributions by the quarterly cut-off dates (i.e., 28 October, 28 January, 28 April, 28 July); pay super for eligible contractors, even if the contractor quotes an Australian Business Number (ABN); and give an employee's tax file number (TFN) to their super fund within 14 days of receiving it. Editor: We’ve heard on the grapevine that the ATO may also be directly contacting the trustees of SMSFs (or directors of the corporate trustee).

If you receive a call from the ATO and you’re at all uncomfortable answering their questions over the phone, feel free to tell them to call us instead, or (if they still insist on speaking to you) that you would like to speak them later (after speaking to us).

Travel allowance – deductions are not a foregone conclusion

Editor: A recent case, and the ATO's stance in relation to it, indicates that it is prepared to take a hard line on travel expense claims in relation to travel allowances paid to employee truck drivers.

Even though there is an exception to the substantiation rules for these sorts of expenses, (i.e., in terms of keeping receipts, etc.), the ATO looks like it may still expect truck drivers to be able to back up how many nights they were away, what they ate and where, and how they calculated the amount claimed. These sorts of claims are often quite large and have become a target for the ATO.

ATO recovers super from phoenix operators

The ATO says that it has used new powers known as Superannuation Guarantee Estimates (SGE) to recover $8 million in worker’s superannuation from the operators of labour-hire companies which have engaged in 'phoenix behaviour'.

Editor: Phoenix behaviour involves the deliberate liquidation of companies to avoid paying superannuation obligations, as well as to avoid other tax liabilities, and to avoid paying creditors and suppliers.

In this case, the network of companies provided labour-hire services such as seasonal fruit picking and meat packing, and had been failing to pay workers their superannuation entitlements.

Single Touch Payroll

The Government has announced that it will simplify tax and superannuation reporting obligations through 'Single Touch Payroll'. Under Single Touch Payroll, employers’ accounting software will automatically report payroll information to the ATO when employees are paid.

This will eliminate the need for employers to report employee-related Pay As You Go Withholding (PAYGW) in their activity statements throughout the year, and employee payment summaries at the end of the year.

The Government stated that Single Touch Payroll will be available from July 2016, and transition arrangements will be the subject of consultation with the business community early in 2015.

Construction industry annual payments report

The ATO is writing to businesses in the building and construction industry that have not lodged their 'Taxable Payments Annual Report', which was due to be lodged by 21 July 2014.

What are 'building and construction services'?

Editor: It is important to note that the definition of building and construction services is broad and covers a wide range of occupations and activities.

It includes services such as bricklaying, plumbing, etc. However, it also includes some activities that businesses may not be aware of, such as:

architectural work (including drafting and design); cable laying; communications construction; decorating (including painting); engineering; installation of hard wired alarm systems; installation of solar devices; landscaping; and project management. Editor: Clients with any concerns should contact us.

Please Note: Many of the comments in this publication are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances.