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Newsletter July 2004

The final date for payment of 9% superannuation guarantee contributions for employees for the year ended 30 June 2004 is 28 July 2004.  If payment is not received before this date Superannuation Guarantee Levy will be payable.

A written report must also be provided to employees within 30 days of making the final contribution for the quarter and must detail:

• The amount of contributions made;
• The name of the superannuation provider; and
• The employee's membership or account number

From the 1 July 2004 the commissioner of tax has offered to small businesses a payment arrangement to clear up any outstanding debts that total less than $25,000.

The offer is:

• a six month payment plan with no further interest being charged for the period of the arrangement or;
• a 12 or 18 month payment plan with interest reduced from 12.51% to 6.28% for the period of the arrangement.

The arrangement will be conditional on:

• monthly payments being made by direct debit;
• lodgement obligations being brought up to date; and
• all future payments and lodgements being met as they fall due.

There is a 15% bonus for voluntary repayments of your HECS debt on or before the 31 December 2004.  After 31 December 2004 the bonus reduces to 10%.

The commissioner of tax has recently released a draft tax ruling which notes that the following expenditure on rental properties will not be regarded as repairs and maintenance or a depreciable asset.

• Kitchen cupboards
• Insulation batts
• Built-in wardrobes and
• In ducted (built in) vacuum system inlet pipes.

The above items may be deductible under division 43, being entitled to a 2.5% capital expenditure deduction.

After audit investigation the ATO has released a fact sheet on Rental Property Expenses to assist taxpayers.  The fact sheet, deals with a range of issues, including the types of rental expenses that can be claimed; renting out a property at non-commercial rates and the pre-payment of expenses.  Attached is the web-link.

http://www.ato.gov.au/individuals/content.asp?doc=/content/31258.htm

A maternity payment will replace existing maternity and baby bonuses from 1 July 2004.  The maternity payment will not be income tested.  The payment will be $3,000 per child from 1 July 2004, increasing to $4,000 on 1 July 2006.

From 1 July 2004, personal income tax has been reduced.  Employers will need to apply the new PAYG withholding rates to employee's salary and wages from 1 July 2004.  Copies of the tax tables are available from ATO website at www.ato.gov.au

The PAYG Annual Payment Summary Statement and the Employees Payment Summaries are due for lodgement with the ATO by 14 August 2004 to avoid late lodgement penalties.

"Taxes on Wealth are Capital Punishment."