Saving for a first home is hard. From 1 July 2018, the first home savers scheme will enable first-home buyers to save for a deposit inside their superannuation account, attracting the tax incentives and some of the earnings benefits of superannuation. Home savers can make voluntary concessional contributions (for example by salary sacrificing) or non-concessional…
Super concessions for downsizers If you are over 65, have held your home for 10 years or more and are looking to sell, from 1 July 2018 you might be able to contribute some of the proceeds of the sale of your home to superannuation. The benefit of this measure is that you can contribute…
The need for greater formality and management structure Generational succession often requires a greater level of formality in the management and decision-making process. This formality should achieve a separation of function between: Management The Board of the company, and Shareholders Often in a small or medium business, roles can merge with no clear dividing lines…
Transition timeframes and expectations Generational succession is often a process rather than an event, achieved over an extended period of time. This is quite different to a sale of business where the owner’s active involvement in the business generally ceases shortly after sale. The extended timeframe for the transition requires active management to ensure that there are…
Succession income needs Ensuring remuneration is on commercial terms In many small and medium businesses, the owners arrange their remuneration from the business to meet their needs rather than being reasonable compensation for the roles undertaken. This can result in the business either paying too much or too little. Under a generational succession there should be an…
How much money needs to be taken out of the business during transition? What level of capital do the current business owners, generally the parents exiting the business, need to extract from business at the time of the transition? The higher the level of capital need the greater the pressure that will be placed on…
Capability and willingness of the next generation When it comes to business succession, there needs to be a realistic assessment of whether or not the business can continue successfully after the transition. In some cases, the exiting generation will pursue generational succession either as a means of keeping the business in the family, perpetuating their legacy, or…
New GST rules for goods under $1,000 Last month, Parliament passed legislation that will see GST applied to all consumer imports regardless of their value. Currently, imports below $1,000 are excluded from GST. The perceived preferential treatment of internet shopping has been a contentious issue for a while with the retail sector lobbying hard to…
1 July changes GST applies to digital products & services imported by consumers Small business $20k instant asset write-off extended until 30 June 2018 Company tax rate reduction to 27.5% for entities with an aggregated turnover of less than $25m (companies with a turnover of less than $10m have been subject to this tax rate…
200 Outlaw Motor Cycle Gang members served notices by ATO for failing to comply with tax obligations. We hope for the sake of theAustralian Taxation Office (ATO) staff the notices were delivered by mail! There are not a lot of details about exactly what type of income the ATO is targeting but tax law does…