Robert Goodman Accountants Blog

Stay alert to Phishing Scams

Beware of emails claiming to be from organisations you deal with alerting you to unexpected changes on your ATO accounts.

To help protect your practice in these instances, we recommend you:

  • do not click on hyperlinks, open attachments or log on to the organisation's website
  • immediately check those accounts and contact the organisation by phone.

Report a breach

If you are aware of a data breach, you can report it to the ATO by phoning 1800 467 033 between 8.00am and 6.00pm Monday to Friday.

You can also report suspicious emails claiming to be from the ATO by forwarding the entire email to ReportEmailFraud@ato.gov.au.

Read more about the protective measures following a data breach the ATO will take to help you.

See also:

Reference: ATO 4 September 2017 

If you have any questions about a potential Phishing Scam, please don't hesitate to contact Robert Goodman Accountants on 07 3289 1700.

Don't be the next Scam Victim

The Australian Taxation Office (ATO) is urging all Australians to keep their personal information secure and to report any suspicious activity immediately. 

Assistant Commissioner Kath Anderson warns that identifying information like tax file numbers, bank account numbers or your date of birth are the keys to your identity, and can be used by scammers to break into your life if they are compromised.

"We cannot stress this enough – your personal information must be treated like your bank PIN. If someone knew your PIN, they would have access to your hard-earned income, and it's the same with your personal information and tax return," Ms Anderson said.

"The ATO works really hard to maintain the highest levels of security, but if someone gets your personal information, they can use it to impersonate you and engage in fraudulent activity."

"More than one thousand taxpayers reported their personal information had been compromised in June, up by 26 per cent from May, so we know it is a real problem at this time of year."

Ms Anderson said all reports of identity theft are taken seriously, with the ATO working directly with taxpayers when they suspect their identities have been stolen, misused or compromised.

"We are committed to supporting victims of tax scams and tax crimes. If you think your tax file number has been stolen or compromised, you should contact our Client Identity Support Centre on 1800 467 033 right away," Ms Anderson said.

"By alerting us we can immediately take steps to secure your identity and limit the damage done by scammers. Your information also helps us understand the constantly evolving scams and therefore better protect the community from falling victim to them.

Ms Anderson said the best defence against scammers was keeping your information safe and knowing what to do if you are targeted.

"You can't be too careful when it comes to your personal details. If you are contacted by anyone purporting to be from the ATO and you have any doubts about whether it is legitimate, immediately hang up and get in touch with the ATO to verify the call."

Ms Anderson said the ATO makes thousands of outbound calls to taxpayers each week, but there are key differences between a call from a scammer and a legitimate call from the ATO.

"Tell-tale signs include a caller threatening you with arrest or jail, aggressive or rude behaviour, or asking you to pay money into strange bank accounts or settle tax debts with things like gift cards or iTunes cards. We would never do this," Ms Anderson said.

"If something doesn't sound right, you can always check your myGov account, ask your tax agent, or call us directly on 1800 008 540 to see if the contact is legitimate. Be especially wary if you're asked to make a payment, make sure you only use one of the methods listed on our website."

For more information on scams, visit ato.gov.au/scams

For more information identity theft visit ato.gov.au/identitytheft

To see a list of things the ATO may contact you about, visit ato.gov.au and search for 'Current ATO SMS and email activities'.

How to spot a scammer

The ATO will not:

  • be abusive or offensive to you
  • threaten you with immediate arrest
  • ask you to transfer money into an account with a BSB that is not 092009 or 093003
  • request payment via unusual methods such as iTunes gift cards or other prepaid cards
  • request personal security information such as your TFN or your bank details via email or SMS or social media sites
  • ask you for money up front in order to receive a refund or other payment
  • direct you to download files from the internet.

The ATO will:

  • provide you with a range of options for paying debts, which are all set out on our website at ato.gov.au/howtopay
  • contact you by phone
    • if you are in doubt about the authenticity of a call claiming to be from the ATO, you can call us on 1800 008 540 to verify
    • you will generally be aware of any debt before it is due for payment, but you can check through your myGov account, your tax agent or by calling the ATO
  • send emails and SMS asking to you to take specific action such as:
    • provide additional information required to process a BAS or tax return lodged
    • provide additional information required regarding an application that's been made
    • verify changes to an account
  • send general notifications and reminders via SMS or email
  • send promotional and informational SMS and emails.

Reference: ATO 26 July 2017

If you have any questions about a potential Tax Scam, please don't hesitate to contact Robert Goodman Accountants on 07 3289 1700.

The Tax Office has updated its website for the sharing economy:

  • Deductions you can claim - Taxpayers may be able to claim deductions for expenses incurred in participating in the sharing economy. Deductions may need to be apportioned if they are for both personal and work purposes.
  • How GST applies to residential rent - GST obligations when renting out a property. GST does not apply to residential rent, but the ATO says taxpayers have to pay GST if they provide accommodation such as a hotel room or serviced apartment, a bed and breakfast, or if they rent out commercial spaces like a function room or office space.
  • Renting out a room :
    • Income tax requirements – What taxpayers need to know for income tax purposes when renting out a room or their home through the sharing economy.
    • How CGT applies - When renting out a room or a home through the sharing economy, taxpayers may have to pay CGT when they sell.
  • How to avoid a tax debt - If taxpayers are concerned they might get a tax bill from participating in the sharing economy, the ATO provides tips on how they can get on top of it before they need to lodge their tax.
  • Income tax and GST in the sharing economy - If taxpayers are getting an income from participating in the sharing economy, they need to know what to do for income tax purposes and if they need to get an ABN and register for GST.
  • Record keeping - Taxpayers need to keep good records when they earn income through the sharing economy.
  • Renting out a car parking space - Tax obligations if a taxpayer rents out a car parking space.
  • Renting out all or part of a home - When renting out some or all of a home through the sharing economy (eg Airbnb, Stayz or similar), the ATO says there are a number of things taxpayers need to know for tax purposes.
  • Ride-sourcing   - Ride-sourcing may also be referred to as ride-sharing, ride-hailing and by certain company names. The ATO says that being a ride-sourcing driver means taxpayers have tax obligations including having an ABN, registering for and paying GST if they have an enterprise, and declaring fares and claiming deductions for income tax.
  • Understanding the sharing economy and tax – The ATO has updated information for clients of tax practitioners who are earning income through the sharing economy.
  • Working in the sharing economy - What taxpayers need to know about working in the sharing economy for tax purposes.

If you have any questions about how Tax and the Sharing Economy applies to you, please don't hesitate to contact Robert Goodman Accountants on 07 3289 1700.

 

 

The Government introduced Treasury Laws Amendment (Reducing Pressure on Housing Affordability Measures No 1) Bill 2017 in the House of Reps Thur 7.9.2017. The Bill proposes to allow people aged 65 or over to make additional non-concessional contributions up to $300,000 from the proceeds of selling their home from 1 July 2018.

The measure will apply to sales of a principal residence (excluding a caravan, houseboat or mobile home) that would qualify for a partial or full CGT concession. Either the individual or their spouse must have owned the home for a minimum of 10 years up to the point of sale. If the person's spouse is not on the title with them, both can still make a downsizer contribution. Note that a person is not required to make any subsequent purchase of another dwelling after selling their home and making a downsizer contribution. The measure seeks to reduce a barrier to downsizing for older people to enable more effective use of the housing stock by freeing up larger homes. 

This downsizer contributions cap of $300,000 will be excluded from the non-concessional contributions cap. It will also be exempt from the contribution rules for people aged 65 and older, and the restrictions on non-concessional contributions for people with total superannuation balances above $1.6 million. The contribution (non-deductible) must be made within 90 days after the home changes ownership (generally the date of settlement). While the family home is totally exempt from the Age Pension assets test, any sale proceeds from downsizing that are contributed to superannuation will count toward the assets test.

DATE OF EFFECT: Only applies to home sales where the contract of sale is entered into (exchanged) on or after 1 July 2018.

If you have any questions about how the proposed Downsizing measures applies to you, please don't hesitate to contact Robert Goodman Accountants on 07 3289 1700.

Don't take your tax return for a ride

The Australian Taxation Office (ATO) wants people involved in ride-sourcing to make sure they understand their tax obligations.

Assistant Commissioner Tom Wheeler said that drivers in the sharing economy should be aware that anything they earn is assessable income that needs to be included in their tax return.

"It pays to know what your tax obligations are as a driver so you can report and fulfil them correctly from the start," he said.

"The ATO collects more than 650 million pieces of data each year and has recently started receiving information directly from ride-sourcing facilitators to better support drivers to report their tax obligations correctly. This also means that if you misreport your income, red flags will be raised in our systems and we'll start asking questions."

Mr Wheeler said the ATO is reminding taxpayers that have a ride-sourcing enterprise, that they must be registered for GST regardless of their turnover, and pay GST on the full fare.

"If you're providing ride-sourcing services and do not have an Australian business number and GST registration, you should make this your first priority," he said.

"By reporting your ride-sourcing income and GST you can also claim tax deductions and GST credits in respect of your business expenses, such as your car, fuel, servicing and your smartphone and data usage."

"Remember, if you purchase something that's used for both business and private use. You can only claim the part that relates to your business use."

Mr Wheeler said taxpayers that provide ride-sourcing services are generally considered to be sole traders, unless they have made other formal arrangements for their business structure.

"The good news is that the myDeductions tool in the ATO app is now available for use by sole traders, and will let you store your business income and expenses in the app and upload them to your tax return or registered tax agent later. You can also use the tool to say what portion of the deduction is for business purposes as well as an easy way to track your trips."

For more information on ride-sourcing and your GST obligations, visit ato.gov.au/ridesourcing

For more information on the sharing economy and tax obligations, visit ato.gov.au/sharingeconomy

Ref: ATO media release ('Don't take your tax return for a ride'), 30 June 2017. 

The Australian Taxation Office (ATO) is warning taxpayers that they are paying close attention to claims for work-related car expenses this tax time.

Assistant Commissioner Kath Anderson wants taxpayers to avoid getting tripped up by making claims that they can't justify, citing 'standard' claims as a common error.

"Some people think they are entitled to a 'standard deduction' for car expenses, using the cents per kilometre method, but this is not the case.

"While it's true that you don't need written evidence for claims of up to 5,000 kilometres per year, you do need to be able to show that you were required to use your car for work, and how you calculated your claim.

"Over 3 million people made a work-related car expense claim in 2015–16, totalling around $8.5 billion. A significant proportion of these claims were right at the limit that does not require detailed records," she said.

"While we have no issue with people using the cents per kilometre method and we expect that most claims at this threshold may be legitimate, but we are reminding people that there's no such thing as a 'free pass' when it comes to deductions.

Ms Anderson said the ATO wants people to claim what they're entitled to, no more and no less.

Car expenses incurred in performing your duties as an employee are generally deductible, but taxpayers usually can't claim trips between home and work unless they've got a good reason, such as carrying bulky tools or equipment to work.

"If you make a claim for transporting bulky tools, you need to be able to prove you were required by your employer to take these items to work, and that there was no safe place to store them."

"It is also important to make sure you don't double-dip. In other words, you cannot claim expenses that have already been paid by your employer, including salary sacrificing arrangements," she said.

Ms Anderson said there are three golden rules for taxpayers to remember to get it right.

"One – you have to have spent the money yourself and can't have been reimbursed, two – the claim must be directly related to earning your income, and three – you need a record to prove it."

The myDeductions tool in the ATO app can help make keeping records easier, and at tax time you can send your deductions to your tax agent or upload them directly to myTax. The app is particularly useful for people who use their car for work, as it helps them track trips using GPS, point-to-point or the odometer method. This year myDeductions is available to sole traders as well as individuals.

Ms Anderson said taxpayers who are confused about what they can claim a deduction for should talk to their tax agent or visit the ATO website.

For more information about work-related car expenses, visit ato.gov.au/carexpenses and to find out about myDeductions, visit ato.gov.au/mydeductions

Caught up car claims

Off the rails

A railway guard claimed deductions for car expenses in travelling to and from work, basing his claim on the fact that he carried bulky tools (including his flag, safety vest, handheld radio, torch, instructions and timetables) in his car.

He attracted an audit because his deductions were much higher than those of other people in the same occupation. His employer advised us that secure facilities for equipment were available on the business premises, so the transportation of equipment was the employee's choice. For this reason, expenses relating to travelling to and from work are not an allowable deduction in this situation, and the taxpayer had to pay $2,000 for tax owed plus interest.

Double dipping deductions

An employee manager claimed $3,800 in work-related car expenses. When we asked the taxpayer to verify that they owned the car and it was registered in their name, we discovered the car was under a novated lease arrangement. Employees who have a novated lease arrangement are not considered to have expenses in relation to the car, as their employer leases the car on their behalf. Claiming a deduction for these expenses is considered double-dipping.

All deductions were disallowed and we applied a penalty.

Crossing the line

A school crossing safety officer claimed work-related car expense for travel between his home and workplace. He indicated that this expense related to the carriage of bulky tools – a safety sign for the school crossing. However the school told us that the sign was securely stored on school property each day. The taxpayer's car expense claims were disallowed because the trip from home to work was private in nature and did not involve the transportation of the sign.

Ref: ATO media release, 25 August 2017

Tax Debt Payment Plans

Taxpayers with a debt of $100,000 or less can take advantage of the ATO's self-help service to set up a payment plan in two easy steps.
  1. Use the payment plan estimator to work out their options.
  2. With their TFN or ABN on hand, set up a payment plan by either: 
  • phoning the ATO's automated service on 13 72 26; or 
  • using the online services for sole traders or individuals on their myGov account

If they pay late or by instalments, interest accrues on the unpaid debt. 

In some circumstances, taxpayers may be eligible for interest-free payment plans for activity statement debts (interested taxpayers should phone 13 11 42 to find out if they are eligible).
If they pay late or by instalments, interest accrues on the unpaid debt. In some circumstances, taxpayers may be eligible for interest-free payment plans for activity statement debts (interested taxpayers should phone 13 11 42 to find out if they are eligible).

If the tax debt is more than $100,000, the taxpayer can also phone the ATO on 13 11 42. 

Note that taxpayers with a payment plan still need to lodge all of their ongoing activity statements and tax returns on time. 

Ref: ATO's Small business newsroom " Have a tax debt $100K or less?", 19 June 2017

The ATO is increasing attention, scrutiny and education on work- related expenses (WREs) this tax time. 

Assistant Commissioner Kath Anderson said: "We have seen claims for clothing and laundry expenses increase around 20 per cent over the last five years. While this increase isn't a sign that all of these taxpayers are doing the wrong thing, it is giving us a reason to pay extra attention," she said. 

Ms Anderson said common mistakes the ATO has seen include people claiming ineligible clothing, claiming for something without having spent the money, and not being able to explain the basis for how the claim was calculated. 

"I heard a story recently about a taxpayer purchasing everyday clothes who was told by the sales assistant that they could claim a deduction for the clothing if they also wore them to work," Ms Anderson said.

"This is not the case. You can't claim a deduction for everyday clothing you bought to wear to work, even if your employer tells you to wear a certain colour or you have a dress code." 

Ms Anderson said it is a myth that taxpayers can claim a standard deduction of $150 without spending money on appropriate clothing or laundry. While record keeping requirements for laundry expenses are "relaxed" for claims up to this threshold, taxpayers do need to be able to show how they calculated their deduction. 

"Over 1.6 million taxpayers claim a deduction of exactly $150. We expect many of these claims to be legitimate but the results of our random audits show that people are making mistakes."

Ms Anderson said there are three golden rules to follow which will help taxpayers to get their deductions right.

"One – you have to have spent the money yourself and can't have been reimbursed, two – the claim must be directly related to earning your income, and three – you need a record to prove it," she said.

"The myDeductions tool in the ATO app is also a great way to make keeping records for your deductions easier. If you start using it now, next tax time will be a breeze because you can send your deductions to your tax agent or upload them directly to myTax. For more information about work-related expenses, visit http://ato.gov.au/deductions.

The following are Case Studies of actual taxpayers being 'caught out' by the ATO.

Case Study 1: Not up to standards 

A public servant made a number of claims including $150 for work-related clothing, laundry and dry-cleaning. When reviewing her claim, the ATO asked for details of the expenses, including a letter from her employer confirming she needed to wear occupation- specific clothing or a uniform, details of how the laundry cost was calculated, and records to support her other expenses.

The public servant's tax agent advised that the claim was a 'standard claim of $150' and could not provide any supporting evidence. The claim was disallowed in full because there was no indication the public servant was required to wear a uniform or had spent the money she was claiming as a deduction.

Case Study 2: Taxpayer can't sell her claims

A sales consultant made claims for workrelated car, clothing and other expenses. She claimed more than $3,000 for work-related clothing, but said she realised her suits did not have a logo after the ATO contacted her. The claim was disallowed because her clothing was not a distinctive uniform or specific to her occupation.

She was also unable to confirm she was required to use her car for work and requested that the ATO not contact her employer, and couldn't provide evidence for her claim, so the ATO disallowed over $6,000 in work-related car expenses.

The consultant also claimed 'other work related expenses' related to food consumed in the workplace by customers and colleagues, and gifts given to customers and colleagues, including underwear, toiletries and a shoe rack.

The ATO disallowed these claims as well, because she could not prove she needed to incur these expenses to earn her income.

In the end, the consultant had to pay back over $8,000 in tax and received a penalty for being reckless in preparing her return.

Ref: ATO media release ('Pull up your socks, but don't claim them'), 19 July 2017.

Welcome to our new website!

We have just launched out new website. Please feel free to take a look around and let us know what you think.