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FAQs

Frequently Asked Questions

Our Frequently Asked Questions section provides you with answers to commonly asked questions.

The questions and answers are organised into key areas as follows:

FAQs for Individuals

FAQs for Business

FAQs for Companies

FAQs for SMSFs

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FAQs for Individuals

What are the current individual tax rates?

If you are a resident individual, the following income tax rates apply, effective 1 July 2017:

Taxable Income Tax on Column 1
0 – 18,200 Nil
18,201 – 37,000 19c on each dollar over 18,201
37,001 – 87,000 3,572 + 32.5c on each dollar over 37,000
87,001 – 180,000 19,822 + 37c on each dollar over 87,000
180,001 and over 54,232 + 45c for each dollar over 180,000
Medicare Levy and HECS/HELP tax rates are not included in the above

 

If you are a non-resident individual, the following income tax rates apply, effective 1 July 2017:

Taxable Income Tax on Column 1
0-87,000 32.5c on each dollar
87,001-180,000 28,275 + 37c on each dollar over 87,000
180,001 and over 62,685 + 45c on each dollar over 180,000
Foreign residents are not required to pay the Medicare levy

 

If you are a working holiday maker (Visa subclass 417 or 462), the following income tax rates apply, effective 1 July 2017:

Taxable income Tax on this income
0 – 37,000 15c on each dollar
37,001 – 87,000 5,550 + 32.5c for each dollar over 37,000
87,001 – 180,000 21,800 plus 37c for each dollar over 87,000
180,001 and over 56,210 plus 45c for each dollar over 180,000

 

 

When is my tax return due?

There are several possible dates depending on your circumstances and past lodgement history:

  • October 31 – for those lodging themselves, and for those who have previously lodged late or currently have lodgements outstanding
  • March 31 – for those whose latest return had a tax liability of at least $20,000
  • May – 15 – for everybody else (must lodge through a tax agent to ensure no penalties)

 

What do I need to complete my tax return?

In order to complete your tax return, at the very least you will need to know your total income for the year in each category such as employment income, government payments, interest, capital gains, trust distributions and foreign income. You will also need evidence of any deductions you want to claim. If you have private health insurance, you will also need the statement sent to you from your insurance provider.

 

Please contact us for more specific advice personalised to your circumstances.

 

 

What can I claim in my tax return?

In general, you can claim expenses you have paid personally that were incurred in the course of earning your income and that were not reimbursed by your employer or another entity. This MAY include laundry and clothing, stationery, motor vehicle usage, telephone and internet usage, and many other things.

 

Please contact us for more specific advice personalised to your circumstances.

 

 

What are PAYG Instalments?

PAYG Instalments are pre-payments of your income tax. The ATO is likely to put you on the instalment system if your most recent tax return resulted in a tax payable position. The instalment amounts are determined by the ATO, but you can request to have them varied. Please contact us for assistance in doing this.

 

How do I pay my tax that’s due?

After your tax return is lodged with the ATO, they will assess it and send a Notice of Assessment with your taxable position. If that taxable position is a payable, there will be a payment slip on the bottom of the Notice of Assessment that can either be used to pay the tax at the post office, or online using the BPay details. Sometimes the ATO will also send out a Statement of Account with your Notice of Assessment, and the payment slip will be on this instead.

FAQs for Business

What are TPARs?

TPAR is short for Taxable Payments Annual Report. It is a report that businesses in the building and construction industry need to complete and lodge with the ATO. The report contains information about the payments you made to contractors, and the GST on those payments (if the contractor is GST-registered). The ATO considers plumbers, electricians, painters and many other trades to be part of the building and construction industry. So while you may not be a ‘builder’, you may still have to report.

 

The TPAR report can be lodged either by paper, or electronically by creating the report in your accounting software and then uploading it to the ATO via the Business Portal. We can assist you with this report.

 

What is the difference between PAYG Withholding and PAYG Instalments?

PAYG Withholding is tax payments that employers withhold from their employee’s gross wages. These amounts are to be paid to the ATO and reported at W1 and W2 on the activity statement each month or quarter.

 

PAYG instalments are prepayments of your own tax. Because you run a business, and not employed by another person, your income tax is not withheld automatically. You need to do this yourself. The ATO may enter you onto the PAYG instalments system, or you can enter it yourself by contacting the ATO or by having us contact the ATO for you. You will need to estimate how much income you will earn for the year, from which we can estimate your taxable position. This amount will be split into quarterly instalments that you can pay online or at the post office.

 

Do I need to register for GST?

You will need to register for GST if your turnover for the year exceeds $75,000, or you expect it to exceed this amount. You will also need to register if you are receive income from a taxi or ride-sharing business, no matter how little you may earn.

 

If you register for GST, you will need to add GST to your tax invoices. You will also need to keep a record of how much GST you pay out via purchases. These amounts are reported on your BAS.

FAQs for Companies

What are the company tax rates?

Company tax is payable from the first dollar of profit made. The following rates apply for the 2017-18 tax year:

 

Income category Rate (%)
Company with turnover less than $25 million and are carrying on a business 27.5
All other companies 30

 

Please note that a bill was tabled in parliament in October 2017 that would change the “carrying on a business” test to an “80% passive income” test. This bill has not yet been passed. We will update this information if/when things change.

FAQs for SMSFs

What is the tax rates for superannuation funds for 2017-2018?

Complying Superannuation Funds
Employer Contributions 15%
Superannuation Fund Investment Income 15%
Concessional Contributions 15%
Non-concessional contributions 0%
Government co-contributions 0%
Consolidation or transfer of superannuation 0%
Non-complying Superannuation Funds
All assets and income 45%

 

 

How much can I contribute to my superannuation fund in the 2017-18 year?

You can contribute the following to your superannuation fund, in the 2017-18 year:
Concessional Contributions $25,000*
Non-concessional Contributions $100,000 (provided you have less than $1.6 million in your superannuation fund)*

 

*As superannuation is a very complicated area of taxation and law, it is always best to seek advice on such matters from trained and experienced professionals. The above information is for general reference only and does not constitute any consideration of yours or your superannuation fund’s individual position.

 

Why is it important that my SMSF is compliant?

It is most important that your superannuation fund is compliant and remains compliant with taxation and superannuation law. Income of a complying superannuation is taxed at a rate of 15%. However, a non-complying superannuation fund is taxed at a rate of 45% on their assets and income (47% during the budget repair levy years).

It is also important to ensure your superannuation fund is compliant, as non-compliance can result in anything from education directions, trustee disqualification, right up to civil and criminal penalties, including jail.