March 2017

Are you?
– A member of a private health insurance fund?

At a glance:
– Taxpayers may be eligible for the private health insurance (PHI) rebate if certain conditions are met.

You should:
– Consider how the Private Health Insurance rebate will affect the cost of your insurance premiums and your tax liabilities.
– Contact us if you require any clarification or advice.

The PHI rebate is an amount the Government contributes towards the cost of private health insurance premiums.

The PHI rebate can be received through:

• A reduction in the cost of PHI premiums; or
• A refundable tax offset when an individual’s tax return is lodged.

To be eligible for the PHI rebate, an individual must:

• Have a complying PHI policy with an Australian registered health insurer;
• Be eligible for Medicare;
• Be a PHI incentive beneficiary; and
• Have an income less than the Tier 3 threshold.

Taxpayers health insurance policy is complying if it:

• Is provided by a registered health insurer;
• Provides hospital cover or combined hospital and general cover; and
• Meets other complying private health insurance policy requirements.

All private health insurance rebate percentages are adjusted each year on April 1 by a ‘rebate adjustment factor’.

For more information, click here.

Remember:
– The maximum rebate may be claimed automatically by an individual’s PHI but will be adjusted according to personal circumstances and income in an individual’s tax return.

This article was published on 28/02/2017 and is current as at that date

Are you?
– A primary producer or landholder?

At a glance:
– The Tax Office has outlined some deductions that primary producers and other landholders can claim for capital expenditure.

You should:
– Be aware of capital expenditure that can be claimed as tax deductions.
– Contact us if you require any clarification or advice.

Taxpayers may be entitled to claim a deduction for capital expenditure incurred on electricity and telephone connections, landcare and shelterbelts.

For electricity and phone connections, a deduction in equal instalments over 10 years may be claimed on capital expenditure incurred:

• Connecting mains electricity or upgrading an existing connection to land on which you conduct a business; or
• On a telephone line on, or extending to, land on which you conduct a primary production business.

To claim a deduction for landcare operation in Australia, the taxpayers need to be:

• A primary producer;
• Business using rural land, except for mining or quarrying; or
• Rural land irrigation water provider.

If a shelterbelt is established on the land where the primary production business is conducted, the following may be claimed:

• An immediate deduction for any costs for new fencing and reticulation; and
• A deduction for the cost of site preparation, chemicals and trees.

For more information, click here.

Remember:
– Expenditure must have been incurred primarily and principally for use in a primary production business conducted on land in Australia.

This article was published on 28/02/2017 and is current as at that date

Are you?
– An employer paying contributions under the Superannuation Guarantee Rules?

At a glance:
– To assist employers with calculating employees’ Superannuation Guarantee (SG), the Tax Office has published a checklist that outlines which payments constitute ordinary time earnings (OTE).

You should:
– Be aware of what payments will constitute ordinary time earnings.
– Contact us if you require any clarification or advice.

The superannuation guarantee is the minimum level of superannuation support that employers must provide to their eligible employees’ superannuation funds. Currently, employers need to pay 9.5% of an employee’s ordinary time earnings (OTE) to the employees’ superannuation accounts.

Eligible employees are defined as employees who earn a minimum of $450 (before tax) in any given calendar month.

The Tax Office website contains a checklist explaining the types of payments that constitute OTE and the types of payments that do not.

According to the checklist, a number of payments are considered OTE and must be included in working out the 9.5% SG, including:

• Awards and agreements, such as shift-loadings and piece-rates;
• Allowances, including danger and retention allowances;
• Annual leave payments; and
• Bonuses, such as performance, Christmas and certain ex-gratia bonuses.

Generally, any hours worked in excess of an employees’ ordinary working hours or standard hours prescribed in an award, industrial or workplace agreement do not form part of the definition of OTE.

For more information about SG, click here.

For more information about salary or wages and OTE, click here.

Remember:
– Employers who fail to meet the minimum superannuation guarantee obligations will be liable to pay the penalties and fines.

This article was published on 28/02/2017 and is current as at that date

This article was published on 28/02/2017 and is current as at that date