No images? Click here 21 July 2020 Synstrat Update - July 2020July 2020 The last month has seemed a little more settled; perhaps we’re getting used to constant change. For us here in Melbourne, we’re seeing an increase in social restrictions however most of us now have a plan on how to keep our businesses operational. Hunkering inside when it’s cold isn’t too difficult. Wearing masks won’t be any fun in the summer heat but we’ll do what we have to until we’re all safe and well. In the meantime, we’ll glance at the case numbers enough to be aware but not overwhelmed, we’ll hope for a vaccine, we’ll watch the stock market rise and fall, and we’ll keep our eye on more opportunities that arise to help our businesses and families prosper in 2021. JobKeeper 2.0 Hot off the press, the JobKeeper system has been given an extension to March 2021 for those businesses which continue to show a decline in turnover of 30% or more after September 2020. The decline in turnover will need to be demonstrated for the June and September quarter in order to be eligible for the December quarter. Also, the $1,500 per fortnight payment is set to be reduced to $1,200, and $750 for employees working less than 20 hours per week from 28th September. From 4 January, the rate will again fall to $1,000 per fortnight, and $650 for people working less than 20 hours a week. This change is intended to encourage employees to extend their hours where possible and to return their wages to something more sustainable for the business. No doubt there will be more detail on both the eligibility and payment criteria in the coming months and we will send updates as they come. For the current JobKeeper system, remember to keep recording final/ end dates for staff that have left or have been let go/ made redundant. The ATO rely on your Single Touch Payroll reporting to count your staff numbers when you lodge your monthly report so make sure it’s kept up to date. You are able to use the JobKeeper Directions outlined by FairWork to reposition staff for as long as you’re eligible; up to 28th March 2021. June 2020 BAS and the Cash Flow Boost 2 credit For those who lodge their Business Activity Statements (BAS) online with the ATO, you will see a second credit arise labelled Cash Flow Boost 2 on your next lodgement. This second credit was announced by the federal government at the same time as the first Cash Flow Boost and the JobKeeper regulations, as mentioned in our March 2020 newsletter. The Cash Flow Boost 2 credits will equal the Cash Flow Boost 1 credits you received between March, April, May and June. For those reporting monthly, you will receive ¼ of the total over the June, July, August and September months. For quarterly lodgers, you will receive ½ on the June BAS and ½ on the September BAS. Any credit that is in excess of your total BAS liability will be refunded into your nominated account. Alternatively, you will simply short-pay each BAS. You may need to contact us to confirm the amount you need to pay after the June BAS is lodged. Victorian Business Support Fund #2 Another stimulus measure enjoying a second wave is the Victorian Business Support Fund. This grant is a further $5,000 payment to eligible employers in Metro Melbourne and the Mitchell Shire to cover the six-week lockdown. The grant has no connection to the first payment and eligibility criteria is heavily dependent on being an employer. Applications are open until 19th August 2020. Any payments received under this measure will be taxable, as was the earlier $10,000 grant. Personal Superannuation Contributions Some people will have made contributions to their super funds up to late June 2020 with the intention to claim a tax deduction. Personal contributions are recorded by all superfunds as non-concessional by default, meaning that you haven’t claimed a tax deduction and that the Fund won’t pay tax on the contribution. To claim a tax deduction, you need to notify your fund using a prescribed form. The ATO has a standard form that you can complete and send to your Fund which can be accessed here. Industry and Retail Funds may send you a notice to make this nomination or require a special form. Once the form is processed by your fund, you can include the amount in your tax return – not before. It is best to get the form prepared and processed early in the new year so that it does not hold up the lodgement of your 2020 tax return. For clients who have Self-Managed Super Funds that we provide compliance or administration services to, the necessary form will be prepared by us and issued with your 2020 tax returns. Home office deductions More clarity has been given in relation to claiming the simplified home office deduction of 80c per hour from 1 March 2020. The simplified rate is intended to catch all of your expenses during the last four months of the financial year including depreciation, telephone, internet, electricity and the like. For those with large depreciation claims, you may be better off using the original rates or percentage use methods. It is expected that the simplified rate will continue for the first few months of 2021. After this time any written down value of depreciable home office items could be reinstated. Time will tell if this is permitted. Should you have any questions regarding any of the above issues, please contact your Synstrat Adviser on 03 9843 7777. The Synstrat Team The Synstrat Group provides Business Advice, Accounting and Financial Services. Prepared by Synstrat Accounting Pty Ltd for clients of Synstrat Group. 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