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Tuesday 17 November 2015

Determining if a business is a small business entity

  1. An individual, partnership, company or trust is a small business if it:
      • Operates a business for all or part of the income year; and
      • Has less than $2 million aggregated turnover.
  2. The aggregated turnover includes the annual business turnover, excluding passive income, of:
      • The taxpayer;
      • The taxpayer’s connected entities; and
      • The taxpayer’s affiliates.
  3. An entity is connected with the taxpayer if either:
      • The taxpayer controls or is controlled by that entity; or
      • Both the taxpayer and that entity are controlled by the same third party.
  4. An affiliate is an entity who acts or could reasonably be expected to act in accordance with the taxpayer’s directions or in concert with the taxpayer in relation to their business affairs.
  5. The $2 million aggregated turnover test is met if:
      • The taxpayers's aggregated turnover was less than $2 million in the previous income year; or
      • The taxpayers's aggregated turnover in one of the two previous income years was less than $2 million, and their current year aggregated turnover is likely to be less than $2 million as reasonably estimated at the first day of the current income year; or
      • The taxpayers's actual aggregated turnover was less than $2 million as worked out at the end of the current income year.
  6. For more information, click here.

Friday 13 November 2015

Licence requirements for market stalls

  1. Whether a taxpayer sets up a market stall to sell their second-hand goods or cupcakes at the local farmer’s market or annual fair, certain types of registrations, licences, permits or insurance may be required.
  2. To assist taxpayers, the website has compiled information on common licences that market stall owners may need to apply for.
  3. Although the applications required may be overwhelming, they are important in helping to protect the taxpayer and their investments in their market stall business.
  4. Common applications and regulations taxpayers may need to consider include:
      • Footpath usage/obstruction permit from the local council;
      • Insurance for public and product liability;
      • Products meet the product safety and standards requirements and trade measurement laws; and
      • Temporary food licences.
  5. Regulation and license obligations vary in each state, territory and local council, so taxpayers need to check their obligations for each government level.
  6. For more information, click here.

Tuesday 10 November 2015

Contractors, independent contractors and subcontractors

As an employer, it is important to determine whether the worker you hired is considered an employee or contractor.

Employees and contractors have different entitlements with regards to receiving various paid leave and superannuation guarantee.

Contractors fall into 3 main categories with subtle differences.

A contractor describes a person, business or organisation that contracts with another entity for work at an agreed price.

Independent contractors run their own business and are hired to do tasks based on their contract. They generally use their own processes, tools and methods to complete tasks.

A subcontractor is an independent contractor that has been hired by another independent contractor to help complete their contracted work.

A worker may be a contractor, however in certain circumstances, Government agencies such as the Fair Work Ombudsman and the Tax Office may classify them as an employee.

For more information, click here.

Friday 6 November 2015

ASIC - renew or lose business name

ASIC has cancelled more than 95,000 business names in the first half of 2015 after business name holders failed to pay their renewal notice.

ASIC urges business owners to maintain business name records and ensure renewal fees are paid when due to avoid the business name being cancelled.
Business names can be renewed with ASIC online for either a period of 1 or 3 years.

If business owners are unsure of their renewal date, they can search for their business name on ASIC Connect Search or log into their ASIC Connect account.

Business name guidance is available on topics such as renewal fees, renewal period options, how business name holders will be notified about their next renewal and outlines what happens after the renewal process has been completed.

For more information, click here.

Tuesday 3 November 2015

Are the costs of travelling between work and home tax deductible?

  1. The cost of travelling between work and home is usually private in nature and not deductible even if:
      • Minor work-related tasks are done on the way to work;
      • Travelling between work and home is required more than once a day;
      • The taxpayer is on call;
      • Access to public transport is limited;
      • The taxpayer works outside normal business hours; or
      • The taxpayer does some work at home.
  2. However, deductions may be available for the travelling costs in some situations such as:
      • Between two separate workplaces;
      • From the taxpayer’s normal workplace to an alternative workplace, such as a client’s premises, and back to their normal workplace or directly home;
      • From the taxpayer’s home to an alternative workplace for work purposes, then to their normal workplace or directly home; and
      • From home to work if the taxpayer needs to carry bulky tools and equipment used for work and cannot leave them at their workplace.
  3. Travelling between work and home may be deductible if the taxpayer carries out itinerant work. The following factors may indicate that the taxpayer does itinerant work:
      • Travel is a fundamental part of work, not just because it is convenient to the taxpayer or their employer;
      • The taxpayer travels to a 'web' of workplaces throughout the day;
      • The taxpayer’s home is a base of operations; and
      • The work site location is often uncertain;
  4. For more information, click here.