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What is a tax loss, and how can it be turned to good use?

Posted by Team AVS on 24 Aug, 2017  0 Comments

You generally make a tax loss when the total deductions that can be claimed for a financial year exceed the total of assessable and net exempt income for the year.

If you operate a business that makes a loss you can generally carry forward that loss and claim a deduction for it in a future year. If you’re a sole trader or in a partnership, you may be able to claim business losses by offsetting them against your other personal income (such as investment income) in the same income year.


SMSFs and the in-house asset rules

Posted by Team AVS on 16 Aug, 2017  0 Comments

A not-uncommon conundrum for many SMSF trustees is what to do when the fund is found to have breached the in-house asset rules. There are also some common misconceptions about these regulations that keep resurfacing.

What does the ATO say in relation to the in-house asset rules?

Recent ATO statistics on the SMSF sector show the proportion of reported breaches that relate to the in-house asset rules remains high. While it can be argued that the higher number is because the in-house asset provisions are by far the most complex and hard to understand SMSF investment rules, it is still critical for trustees to improve compliance to prevent the substantial penalties imposed for breaching these rules.


Deductions for finance of a rental property

Posted by Team AVS on 8 Aug, 2017  0 Comments

Interest can be claimed for the cost of funds borrowed to purchase a rental property and to meet maintenance costs or running expenses while the rental property is being let (or is available to be let) under a commercial arrangement to generate assessable income. In these circumstances the interest paid is deductible even if it exceeds the income generated.


Tax deductions specifically for SMSFs

Posted by Team AVS on 3 Aug, 2017  0 Comments

One overarching fundamental that SMSF trustees should ideally keep in mind is the sole purpose test — that is, every decision made and action taken is required to be seen as being undertaken for the sole purpose of providing retirement benefits for the fund’s members.

If an SMSF trustee incurs an expense in the usual operation of the fund, this will generally give rise to a deductible expense against assessable income.


Substantiation for mobile, home phone and internet costs

Posted by Team AVS on 28 Jul, 2017  0 Comments

The ATO has issued guidance on making claims for mobile phone use as well as home phone and internet expenses, and says that if you use any of these for work purposes you should be able to claim a deduction if there are records to support claims.

But the ATO points out that use for both work and private matters will require you to work out the percentage that “reasonably relates” to work use


A big tax refund isn’t always a great news for you

Posted by Team AVS on 19 Jul, 2017  0 Comments

A large tax refund may feel like free money, but it isn’t. During 2015-16, ATO has refunded close to $28b to individuals. Many tax refund recipients are putting that money to work. Some taxpayers getting a refund expect to save or invest the money, while others may use the money to pay down the debt.
Here’s the bad news: If the ATO sends you a huge check, it means you’ve likely overpaid on taxes throughout the year.


How does the Budget 2016 affect contributions to an SMSF – Guest Post by Liam Shorte

Posted by Team AVS on 27 Jun, 2016  0 Comments

I am breaking the Budget down into bite size chunks with strategies to consider going forward for SMSF Trustees. The first part which dealt with pension strategies is available here . This second part deals with changes to contribution options, methods and caps
The concessional contribution cap will be reduced from the current level of $30,000 to $25,000 from 1 July 2017, irrespective of the age of the individual. The higher cap of $35,000 that currently applies to individuals over age 50 will be abolished. The reduced cap will continue to be indexed in future years in line with wages growth.


5 Must-dos for Small Business Owners for EOFY – by Intuit Quickbooks

Posted by Team AVS on 23 Jun, 2016  0 Comments

If you work on your accounts regularly, this won’t be such a problem. But if you tend to push everything to one side, you may have a large backlog to catch up on. Moving from paper or Excel accounts to professional accounting software can help you here, as it will automate a lot of tasks such as bank transactions. Miscoding these is the top mistake made by small businesses, according to a survey of members of the Institute of Public Accountants (IPA).


Medical practitioners and tax deductions

Posted by Team AVS on 23 Jun, 2016  0 Comments

Going to basics, income tax is levied on the taxable income which is the resultant amount of assessable income minus allowable deductions. Assessable income is which we receive for services rendered and allowable deductions are expenses which are incurred for earning the assessable income. Balance amount which remains is taxable income on which tax rate is applied. So, in order to lower the tax liability one has to maximize the allowable tax deductions.


Year-end Tax Planning Strategies

Posted by Team AVS on 15 Jun, 2016  1 Comments

The financial year is going to end soon and as your accountant, it is our responsibility to help you arrange your financial affairs in a manner so as to minimize your tax liability within the framework of the Australian taxation system. Here, we have put together some strategies for year-end tax planning. You need to act fast, and should you want to discuss your circumstances and how you can take advantage of these strategies


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