Frequently Asked Questions

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What the benefit of having a tax agent to prepare your tax return?

Tax law is constantly changing, so if you are not completely up to date then you could end up losing more money that you’d save by doing it yourself. We have also seen some big mistakes from people who tried to fumble their way through a tax return. For the mistakes we detected early enough, we have been able to save our clients thousands of dollars. Having a professional tax agent like One Minute Tax to help you to prepare and lodge your tax return if the way to go for saving on tax. Contact us today to get your tax matters sorted.

Which accounting package is the best for me?

This depends on several factors:

  • The size and structure of your business
  • Whether you are a service or trading business
  • What you want to do with the software, e.g. Do you want to use it to create invoices, do you have payroll needs?
  • Your access to information technology and your skill level using information technology
  • Your budget

One Minute Tax is a professional partner with Xero , MYOB, and Quickbooks.
Generally we can work with any accounting package providing that we can access your Trial Balance, Balance Sheet, GST Ledgers, General Ledger and Profit and Loss Statements.
We have found that Xero is ideal for most businesses as it works well for clients who wish to do their own data entry but require our help to ensure the accounts are in order.
We prefer Xero and we are able to provide support for the program and the feedback we get from our clients has been excellent, however having said that, we’re also happy to work with MYOB and Quicken, if that is the software you are currently using.
It is advisable to discuss your Accounting Software requirements with your accountant, or organise a consultation with One Minute Tax to find the perfect fit for your business.

I want to start my own business, what’s the best business structure for me?

This question is more complicated than many people think.
Here are some important factors to consider:

  • Your risk management strategy, including your exposure to litigation risks and the need for asset protection
  • The expected size, growth and income of your business
  • Whether or not you have a need for a nationally registered business name, e.g. If you want to operate under one name in more than one state
  • Who will be involved in owning the business and whether or not you plan to introduce equity partners or shareholders in future
  • Your career and work plans for the future, e.g. When you plan to retire, how long you plan to work for and if you are expecting to have time off
  • The structure of your family and whether you have beneficiaries to whom you wish to distribute income
  • The availability of reduced tax rates and other tax concessions (e.g. Capital Gains Tax concessions for Individuals) and how you plan to spend the money you earn.

Can I claim the tools and equipment expenses that I paid for my job?

You are able to claim expenditure incurred in replacing, insuring and repairing tools of trade that you use for earning your income. If the cost of any item is more than $300 then it will have to be depreciated (i.e. claimed over its effective life). The amount you can claim will depend on what records you have kept and to what extent you use it for income producing purposes.

What self-education expenses can I claim?

You may be able to claim a deduction for self-education expenses if your study is work-related or if you receive a taxable bonded scholarship. In some circumstances you have to reduce the amount of your claim by $250. However, you can’t claim the repayments of Higher Education Loan Program (HELP) loans (although the fees paid by some HELP loans are).

I was unemployed during the year. Can I claim money I spent looking for a job as a tax deduction?

The tax office ruled that deductions for expenses incurred job seeking are not deductible as there is no income to offset them against.

I donate $1,000 when I attend fundraising dinners, can I claim deduction on my tax return?

You can only claim a tax deduction for gifts or donations to organisations that have the status of deductible gift recipients (DGRs). The amount you can claim depends on the type of gift. For gifts of money, it is the amount of the gift but it must be $2 or more. A tax deduction for most gifts is claimed in the tax return for the income year in which the gift is made. However, you can elect to spread the tax deduction over five income years in certain circumstances.

I received an travel allowance from my group certificate, Can I claim a deduction for that on my tax return?

A deduction will only be allowed if you have actually incurred a work related expense and have the necessary documentation. Some awards allow for a payment of an allowance even though an expense is not necessarily incurred by the employee. If a deduction can be claimed it cannot be for more than the expense that you incurred even if the allowance that you have received was higher.

Each day from home to work, I travel 150km return, can I claim any travel expenses on my tax return?

Trips between home and work are generally considered private travel, which means it is not deductible. However, you can claim deductions in some circumstances, such as the cost of travelling between two separate workplaces, or from your normal workplace to an alternative workplace, or if you need to carry bulky tools or equipment that you need for work and couldn’t leave at your workplace.
At One Minute Tax, we will claim every possible deduction to minimize your tax bill.

I need to wear specific clothing for work, what can I claim on my tax return?

You can claim for clothing that is specific to your occupation, is not everyday in nature and allows the public to easily recognise your occupation – such as the checked pants a chef wears.
You can’t claim the tax returns on the cost of purchasing or cleaning clothes you bought to wear for work that are not specific to your occupation, such as a bartender’s black trousers and white shirt, or a suit.

Am I entitled to claim $300 for work related expenses as this does not have to be substantiated?

You cannot just claim $300. You must actually incur any expense before it is claimable. Whilst you may not need receipts for expenditure up to $300 you must have spent the money and it must be relevant to your employment.

How long do I have to keep my tax documents for?

You must keep all the records, receipts and other documentation you have used to prepare your tax return. If you are claiming deductions, you must keep written evidence to verify your claims for those deductions.

If you are an individual, you must keep proper records relating to your tax affairs for at least five years from the date you lodged your tax return.

If you are a small business, you must keep proper records relating to your tax affairs for at least five years from when the business record is prepared or the transaction is completed, whichever occurs later.

If at the end of the five year period, you are involved in a dispute with the Commissioner (an audit, for example), the five year period is extended.

If you use information from your records in a later tax return, you may have to keep records for longer. So, if you carry forward a tax loss, you must keep the records until the end of any period of review for the income tax return in which the loss is fully deducted.

If you own an asset which will be subject to capital gains tax on disposal, you will need to keep records covering the entire period of ownership until 5 years after lodgment of the tax return recording the disposal of the asset.

When can I receive the PAYG payment summaries from my employers?

Generally, payers are required to supply a payment summary within 14 days of the end of the financial year – i.e. 14 July. If an employee ceases employment part-way through the year, one must be supplied within 14 days of receiving a written request from the former employee and the request must not be made any later than 21 days before the end of the financial year. If a former employee has been receiving reportable fringe benefits (RFB) and leaves before the end of March then the 14 day limit may need to be extended.

Do I have to declare the inherited money on my individual tax return?

The inheritance is not taxable unless you are advised by the executor that a part is taxable. However, if you invest the income from the estate then any earnings will be taxable.

I have started a second job. Is there anything that I need to do so that I don't end up with a tax bill at the end of the year?

You cannot claim the tax free threshold of $18,200 from more than one employer at a time. It is better to claim it from your main employer. You will pay a little higher rate of tax on the second job but this should ensure that you have paid enough tax on all of your wages for the year. And a good tax accountant can help you claim some of those tax withhold back. Please contact One Minute Tax to see if we can help you to claim any tax refunds.

My wife and I received interest income from our joint bank accounts, can she declare all interest in her tax return because her income is much lower than mine?

All income must be declared by each recipient on the same basis as the accounts are held. Interest from a joint account must be split 50/50. You cannot declare it all on your wife’s tax return and doing so could lead to an ATO audit.

My 15 year's old son has received $700 from a trust distribution, does he have to lodge a tax return?

From 1 July 2011 the Government removed the ability of minors to access the low income rebate for unearned income (such as interest, dividends, rent, royalties, trust distributions etc.). This means that a minor who earns over $416 in unearned income must lodge an income tax return.
Personal exertion income (such as salary & wages) will still have tax payable on it, but that tax payable can be reduced by the low income tax offset but all unearned income will not attract the low income rebate and be taxed at minors’ rates.

I am an Australian tax resident, do I need to declare my overseas pension?

In most cases overseas pensions are taxable and, as you are an Australian resident, you will need to include the amount in your tax return. However, there are a few exceptions to this rule, please contact One Minute Tax if you are not sure.

Do I have to declare on my tax return if I have received income from Centrelink ( Newstart, Austudy )?

All income must be declared. This is because the tax office needs to determine what tax rate applies to your other earnings for the year. You may be entitled to an offset to ensure that no tax is payable on your benefit.

You can access the information required from Centrelink online services. One Minute Tax can also look up the required information for you.

How much does it cost to register a company?

The total fee is $888 which includes all government fees, our service fee and GST. The ASIC registration fee is $463 and our service fee, inclusive of GST, is just $425.

For $425 you get the professional advice before, on and after your business registration, Free ABN and GST setup, and also having all your company documentation such as consents, share registry, opening minutes etc. prepared and email to you. For an optional $88 extra One Minute Tax will also print, bind and post your documentation. For optional $49 extra One Minute Tax will also provide a common seal for your company.

ASIC also charge an annual fee on the anniversary date of registration, ie if you registered a company today the annual fee would be payable in one years time. Annual fees vary depending on the type of company, they can be viewed on ASIC website.

Type of company or scheme Annual review fee
A proprietary company, except a special purpose company $246
A special purpose company $46

 

For setting up a Trust, and company as the trustee of the trust, our fee will be $1088 (GST Incl.). Also, you need to pay around $200 stamp duty fee to State Revenue Office.

What's My Income Tax Rates?

Income tax rates may change every year, and the following rates apply to individuals who are Australian residents for tax purposes. They do not include the Medicare Levy rate. Note that special tax rates apply to taxpayers under the age of 18 who receive unearned income ( for example investment income ).

2015/16 TAX RATES FOR RESIDENT INDIVIDUALS

Taxable Income Tax On This Income
 0 to $18,200  Nil
 $18,201 to $37,000  19c for each $1 over $18,200
 $37,001 to $80,000  $3,572 plus 32.5c for each $1 over $37,000
 $80,001 to $180,000  $17,547 plus 37c for each $1 over $80,000
 $180,001 and over  $54,547 plus 47c for each $1 over $180,000

What is SuperStream?

SuperStream is a standard for processing superannuation data and payments electronically. Under SuperStream, you need to pay super contributions for your employees electronically (EFT or BPAY) and send the associated data electronically. If you not sure how to meet the new SuperStream compliance, please read our blog here for more information regarding the SuperStream.

 

I have just received a letter from the tax office saying that I did not declare some interest from my bank account. What should I do?

If you believe this is incorrect you should contact your bank to verify the income details for your accounts. The bank should notify the ATO in writing if this information is not correct. You have 28 days to correct this information. However, if you have omitted the income, you will not need to contact the ATO. They will amend your return and send you a new assessment requesting payment of the additional tax, a general interest charge and, in some cases, penalties. If you require assistance with your communication with the ATO, One Minute Tax can help.

Resources

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