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Newsletter July 2009

The following rates for 2009/2010 apply from 1 July 2009;

Residents

Taxable Income	Tax on this income
$1 - $6,000	Nil
$6,001 - $35,000	15c for each $1 over $6,000
$35,001 - $80,000	$4,350 plus 30c for every $1 over $35,000
$80,001 - $180,000	$17,850 plus 38c for every $1 over $80,000
$180,001 and over	$55,850 plus 45c for every $1 over $180,000

 Non-Residents

Taxable Income	Tax on this income
$0 - $35,000	29c for every $1
$35,001 - $80,000	$10,150 plus 30c for every $1 over $35,000
$80,001 - $180,000	$23,650 plus 38c for every $1 over $80,000
$180,001 and over	$61,650 plus 45c for every $1 over $180,000

 

Most Australians are liable to pay the Medicare levy. The standard Medicare levy is 1.5% of your taxable income. However, the Medicare levy low-income threshold has increased to $17,794 for the 2009/2010 year (up from $17,309 for 2008/2009). 

You do not have to pay the Medicare levy if you taxable income is equal to or below the threshold.

 

The Australian Taxation Office has determined that the CGT improvement threshold for the 2009/2010 year is $124,258 (up from $119,594 for 2008/2009). 

The improvement threshold is used when capital improvements are made to a pre-CGT asset, if the improvements are less than the threshold, then the ‘exempt from CGT’ status of the asset remains unchanged.

 

The Tax Office has confirmed that, for the year of income beginning 1 July 2009, the benchmark interest rate is 5.75% (down from 9.45% for the previous year).

The benchmark interest rate is relevant to private company loans made or deemed to have been made after 3 December 1997 and before 1 July 2009; and to trustee loans made after 11 December 2002 and before 1 July 2009. It is used to;

• determine if a loan made in the 2008/2009 income year is taken to be a dividend, and
• calculate the amount of the minimum yearly repayment for the 2009/2010 income year on an amalgamated loan taken to have been made prior to 1 July 2009. 

Under the rules governing distributions from private companies contained in Div 7A, a loan will be treated as a deemed dividend unless it is made under a written agreement, the interest rate equals or exceeds the benchmark rate, and the term does not exceed the maximum term allowed for the loan.

 

The Tax Office has issued warnings about email scams that fraudulently claim to offer tax payers a 30% discount on their taxes and requests them to provide their tax file numbers and other personal information.

Other email scams include the online access to tax office refunds, which simply require you to complete a form with your tax file number and bank account details.

The Tax Office warns that it never sends emails asking people to provide personal information including tax file numbers. Any one who has entered their tax file number or personal information on the website should contact the Tax Office immediately.

 

The car cost limit for capital allowance purposes for 2009/2010 is $57,180 (which is the same as 2008/2009). So, for cars first held in the 2009/2010 year, the deduction for the decline in value of the car is calculated as if the cost were only $57,180. The claiming of GST input tax credits is also limited to $5,718 (10% of the car limit). The luxury car tax threshold for 2009/2010 is also $57,180.

The fuel efficient car limit for the 2009/2010 financial year is $75,000.

 

The Commissioner has set out the amounts he considers to be reasonable for the 2009/2010 year in relation to claims for;

• Overtime Meals – Overtime meal allowance claims up to an amount of $24.95 per meal are considered reasonable for the 2009/2010 income year where the meal allowance is paid under an industrial instrument.
• Domestic and Overseas Travel – A domestic or overseas travel allowance expense claim is considered to be reasonable if the amount of the claim covered be the allowance received by an employee does not exceed the relevant reasonable amount shown in the table of the new determination Reasonable Allowances 2009/2010 TD 2009/15. Different allowance amounts apply to employees at three separate salary levels.