It’s time to catch up on the latest accounting and tax news in February! Let’s find out what the ATO (Australian Taxation Office) has been up to last month…
Protect yourself from illegal phoenix activity
Do you know what an illegal phoenix activity is?
When someone creates a new company to continue the business of an existing company that has been deliberately liquidated. Most of the time, the reason is to avoid paying all sort of debts on the liquidating company, including taxes, creditors and employee entitlements.
How can avoid you, as a business owner, avoid phoenix companies? The first step is making sure you know exactly who you’re dealing with.
Here are a few tips that can help you protect your business:
- confirm the business is registered and its ABN is valid
- obtain a credit check
- ask for references
- get a company report from ASIC
- search the company and its directors online for any adverse media reports
- ask for payment up front or in instalments
- include a clause in your contract requiring the business to have all their taxes paid up-to-date. This creates a contractual right that you can enforce in the event of illegal phoenix activity
Tip: The Phoenix Taskforce provides a complete approach to support businesses who want to do the right thing and deal firmly with those who engage in illegal phoenix activities.
Get your business’ licenses and permits in one simple search
Starting your own business has never been easier!
The ATO has simplified the process of getting all your business permits and licenses. Now, you can find all your local council, state and federal government licences and permits to run your business in one place.
Australian Business Licence and Information Service (ABLIS)
ABLIS is the government’s online search tool that can tell you all the necessary licenses, registrations and permits you need to run your business.
What happens when you search ABLIS?
ABLIS uses a short survey about your business type, industry and location.
You receive personalised results with licence and permit requirements relevant to your business from all levels of government, including links to the applications and contact details. You’ll also receive information on licence fees, how to apply, periods of cover and renewals.
Give ABLIS a try here.
Increased fuel tax credit rates!
Fuel tax credit rates increased on 5 February 2018 (not 1 February as in previous years), in line with fuel excise indexation.
Don’t worry, fuel tax credit rates change regularly. Just make sure you use the correct rates each time you lodge your business activity statement (BAS).
Get up to date with the latest fuel tax credit increase here.
Is your “business” a hobby?
How can you tell?
A good rule of thumb is this: if you sell products or services without the intend to make a profit, your activity may be a hobby rather than a business.
You’re likely not in business if your activities are:
- not aimed at making a profit
- small in size and scale
- not carried out in an organised manner
- conducted in your spare time
- mostly for your own satisfaction
Why does it matter?
You can’t claim GST credits on your purchases if your activities are a hobby. You can only claim GST credits for items you purchase that help you conduct a business.
Get in touch with a tax specialist and find out what can you do about your GST credits.
Every new business needs support. Find yours here…
The ATO understands tax and super can be tricky and not everyone gets it right the first time. That’s why they created the business assistance program, to help you get moving in the right direction.
This business support program is specially tailored to help with the uncertainty of tax and super.
Feel free to register if you have:
- recently registered for an ABN
- a turnover of less than $2 million
- registered or intend to register for GST.
Here are a few topics they will be offering assistance with:
- GST reporting requirements
- tax requirements based on your business structure
- employer and superannuation requirements
- activity statement and record keeping requirements
- digital services and electronic lodgment
You might also be interested in: November 2017 Tax And Accounting News: All You Need To Know
Want to find out more about how these updates affect you?
One of our specialists here at Shuriken Consulting is ready to assist you with any questions you might have about the latest tax and accounting updates. Get in touch with us today: