We are glad to share our May edition of Monthly update. Below are ATO and other major updates up to April 2020.
Federal Child Care Relief Package
- The Prime Minister has announced $1.6 Billion of assistance to early leaning and childcare operators.
- Under the plan, the Government will pay 50% of the sector’s fee revenue up to the existing hourly rate cab.
- This will be paid only if the services remain open and do not charge the families for care.
- The funding will apply from 6th April 2020 based on the number of children who were in care during the fortnight leading inti 2nd March 2020.
Increased Medicare Levy Low Income Thresholds 2019-20
Below are the updated thresholds as part of the ‘Coronavirus Economic Response Package Omnibus Act 2020’.
|Category||Revised Limit||Previous Limit|
|Couples||$38,474 + $3,533 for each dependent child||$37,794 + $3,471 for each dependent child|
|Seniors and Pensioners (Single)||$36,056||$35,418|
|Seniors and Pensioners (Family)||$50,191 + $3,533 for each dependent child||$49,304 + $3,471 for each dependent child|
Deductions for Work from Home
- The ATO has announced a new shortcut method which will allow taxpayers to claim a rate of 80 cents/hour for all their running expenses
- This applied for the home office expenses incurred on or after 1st March 2020.
- The expenses prior to 1st March 2020 will be claimed using the pre-existing method.
Jobkeeper Payment and Superannuation
- Employers are required to make Superannuation Contributions for only the amount payable to the employee in respect of the actual employment.
- Extra payments made to the employee to satisfy the wages condition for Job keeper Payment can be disregarded for the purpose of Superannuation Contributions.
- For Example, if the actual entitlement to the employee is $1,000 but the employer paid $1,500 to satisfy the wage condition, the obligation for Superannuation Contribution is only on $1,000 and not on $1,500.
Exemption from STP reporting
- Entities not having ABN but having Withholding Payer Number (WPN) will be granted an exemption from Single Touch Payroll (STP) reporting for FY2020-21.
- However, such entities can still choose to report under STP, notwithstanding the proposed exemption.
SMSF Annual Return Concessions
- Trustees of SMSF who need more time to lodge their SMSF Annual Return can contact the ATO to request an extension.
- Tax Agents can apply for deferral for their SMSF clients until 30th June 2020.
Early access to Super
- Eligible individuals can access up to $10,000 (Tax Free) by making an application via myGov until 30th June 2020 under the Coronavirus condition in reg 6.19B of the SIS Regs.
- A 2nd application for another $10,000 can be made in FY2020-21 until 24th September 2020.
- Temporary Australian Residents can also apply for the early release of Super but not eligible for the 2nd payment of $10,000 in FY2020-21.
- The ATO will be solely responsible for assessing the applications for the early release by eligible individuals.
ASIC relief for financial advice during COVID-19
- ASIC has granted temporary relief to financial services providers to enable the provision of timely COVID-19 advice.
- Registered Tax Agents can give advice to existing clients about early access to super without holding an AFS license.
- Advisors holding AFS license not to issue Statement of Advice (SoA) to clients when providing on early access to super.
- This relief is temporary and subject to the below conditions.
1. The client must have approached the advice provider for the advice.
2.The advice provider must establish that the client is entitled to the early release of their super.
3. The advice fee is capped at $300, and
4. The clients must be provided with a Record of Advice (RoA).