I am writing this to give you some information to think about while you are trying to lose those extra calories you consumed using Christmas as an excuse to indulge in your passion for food and drink.
1. For those of you who need to pay PAYG withholding tax for the last quarter. Rather than accepting the standard quarterly amount that is printed on your return, it may be in your best interest to take the time and project what you believe your net assessable income will be for the financial year ended 30th June 2009 taking into consideration the changed economic conditions we are experiencing and apply for a variation to reduce the quarter’s payment.
In relation to the above the Government has announced that it will be giving a 20% reduction to people who are running businesses with an annual turnover of less than $ 2 million. At the time of writing we have not received details as to how this system will work. But it could be for those who fit the criteria for this relief, you may apply for variation of your PAYG withholding based on your income projection of just apply the 20% payment reduction. Call this office should you need further information.
2. For those of who are involved in private companies it may be an opportunity to revisit your responsibilities in relation to the company in these uncertain economic conditions.
If it could be proved that the company was trading whilst insolvent what is your exposure? As you probably know, directors who operate a company when it becomes insolvent can be held personally liable for the company’s debts. What you may not appreciate is the people who are not directors can also be deemed to be directors if:-
That person makes decisions on behalf of the company in a manner similar to those expected of a director or the company acts on those instructions as it would have had the person been a director.
Things to look for in regard to company being insolvent could be: -
- A company being put on a COD basis
- Continuing losses
- Dishonoured cheques
- Payment to creditors exceeding normal terms or being paid in rounded amounts not the invoiced amount
- Outstanding taxes
- Unpaid employee superannuation
Proving a company was trading whilst insolvent can be very difficult depending on the circumstances. However, if you are a director of a company or could be deemed to be a director of a company it may be in your best interests to keep reviewing the above information over the next 12 months.
3. Three questions we are often asked are:-
- “What deduction can I claim on my rental Property?”
- “Can I be deemed to be a Share Trader?”
- “How does Capital Gains Tax work?”
These questions can be readily answered by accessing the ATO website. The ATO has produced very comprehensive booklets covering these many other subjects. The booklets can be downloaded direct from the web site or they can be ordered by telephoning the ATO or visiting an ATO office and picking the booklets up. If you wish to pick up the booklets direct from the ATO, it may be wise to first telephone the office or check that they have them in stock at that branch.
The booklets are easy to read and carry examples to explain various situations.
4. For those of you who are business owners or have investments. Now may be an opportune time to re-examine if those assets are held in the right structure. With the collapse of the share market and the downturn in the property market. The consequences regarding CGT if moving these assets into a more tax effective structure or a more effective structure for estate protection purposes could be minimal. The same could apply for the goodwill of your business if you were considering of moving into a different operating entity. Give our office a call.
Should you have any queries regarding any of the above, we are only too happy to discuss the matter with you.
WISHING YOU ALL A PROSPEROUS 2009.
davenports FINANCIAL SOLUTIONS
Phone:: (03) 9510 7600
Disclaimer: This post is just the view of the blogger only. It should not be relied upon as susbtitute for professional advice regading actual facts or circumstances. The blogger do not accept any liablity for any injury, loss or damage resulting from any person acting, or referring to act, in reliance on all or part of these materials.
