2020 Tax Time with the COVID19 impact 15 Jun 2020

There is still enough time to take appropriate action to increase your tax savings!

HOME OFFICE
Working from home is probably the biggest change this year and the tax office has made adjustments to deductions related to Home Office.
 
The ATO has introduced a Temporary Shortcut Method that can be applied to home costs from 1 March to 30 June 2020 where minimum record keeping is required. This method is quite simple you can claim a deduction of 80 cents for each hour you work from home. Keep in mind though that the shortcut method includes all your costs and there are no additional expenses you can add.
 
If you have set up a dedicated work area we can look into an alternative test and maximise your tax refunds. For the Actual Cost Method will give you a bigger deduction as you can claim a percentage of running costs along with newly purchase furniture and equipment in order to work from home. These will include:

-electricity and gas for cooling, heating and lighting
-the decline in value of home office furniture (desk, chair) and furnishings,
-the decline in value of phones, computers, laptops or similar devices
-phone expenses
-internet expenses
-cleaning
-computer consumables and stationery  

Please note that items provided by your employer, or if you have been reimbursed for the expense are not claimable.  

SUPERANNUATION
If you are thinking of extra super contributions that can be claimed as a deduction here is what you need to know:
 
Generally, making extra concessional contributions is tax effective if you earn more than $37,000 per year. The combined total of your employer and salary sacrificed contributions must not be more than $25,000 per financial year.
 
If you cannot contribute more to your own super you may want to consider paying extra for your spouse. Under the current 2019/2020 tax rules, you may be able to claim an 18% tax offset on super contributions up to $3,000 that you make on behalf of your non-working or low-income-earning partner. Your partner must earn less then $40,000 per annum to be eligible.
 
Another good thing that comes from contributing personal (after tax) super is that if you are a low or middle-income earner, the government also makes a co-contribution up to a maximum amount of $500.
 
If you do decide to contribute to your superannuation funds you must pay by 23/06/2020 and compete Notice of intent to claim or vary a deduction for personal super contributions for submission to your super fund prior to lodging your return. We have included the form for your convenience below.
 
We have an in house financial adviser, David Roberts who hold a diploma of Financial Planning and can assist you with all your superannuation needs.

Notice of intent to claim for personal super contributions

CAPITAL GAIN
This year people were focused on what to do with their investments to help them during the pandemic. If you have made a decision to sell your assets you may be liable for Capital Gain's tax.  In this instance you will need to provide the original cost and the sale of investments documents.
 
PREPAYING INTEREST
The government made an announcement that they will back the new loans by guaranteeing 50% to help businesses with current situation. If you have taken out a loan keep in mind that you can prepay the interest if you can afford it and claim it as deduction this tax time.
 
The deduction for interest and fess paid in advance applies to all business loans.

JOBKEEPER AND JOBSEEKER
There are huge numbers of people that will be affected by these payments this financial year. Most of us do not have to worry about keeping records and calculating the payments as your employers and Centerlink will be lodging the annual statements to ATO on your behalf .
 
For those that have been claiming the jobkeeper payments yourself through their business we will require your lodgment forms and calculations for eligibility in order to complete your returns. However if the lodgements are done by us you do not need to worry about a thing!
 
We just wanted to touch base on this and remind you that these payments are taxable and any costs associated with the claims are tax deductible.
 
Business Owners
We also remind you that there is still time to take advantage of Instant asset write-off keeping in mind that a car is subject to a limit of $57,581.00
 
For those that pay payroll tax don't forget that there is a 25% discount that will be applied to the annual reconciliation.
 
And on a short note other COVID-19 supplements are not taxable. They include:
-Early Super Release
-Cashflow boosts
-Small Business Grant through Service NSW
-Small Business Grant through council
-HomeBuilder Grant
 
We remind you that after 30 years at Bondi Junction we have re-located to Westfield Eastgardens and if you wish to contact us to make an appointment please note that we have a temporary telephone line 02 8011 1086 . Our apologies for the inconvenience caused but our connections are beyond our control due to COVID-19.