The ATO start full processing 2018-19 tax returns on 5 July 2019 and are expected to start paying refunds from 16 July 2019, with the majority of electronically-lodged current year tax returns completed within 12 business days of receipt. There a few changes to tax returns individuals should take note of going into this end of financial year.
Private health insurance statements:
From 1 July 2019, health insurers are no longer required to send private health insurance statements, it is now optional to send this information. Private health insurance information will be available in the pre-fill report, expected by mid-August. If it is not populated by then, taxpayers may need to request a statement from their health insurer.
Low and middle-income tax offset:
Taxpayers may be eligible for an income tax offset if they are an Australian resident for income tax purposes or their taxable income is in the appropriate income range. It is not compulsory to claim this offset, the ATO will work it out when their tax return is lodged.
In the event the changes proposed in the 2019-20 Budget become law after 1 July 2019, the ATO will automatically amend assessments. The offset can only reduce the amount of tax paid to zero and it does not reduce Medicare levy.
Employers reporting through Single Touch Payroll are not required to provide a payment summary to their employees as income statements will replace them. Employees can access their income statements through ATO online services at any time. Employees will receive a notification through myGov when their income statement is ‘Tax ready’, so they can complete their tax return. Employees will be able to contact the ATO for a copy of their income statement if they do not have access to myGov.
The event-based reporting (EBR) framework for self-managed super funds (SMSFs) commenced on 1 July 2018. This system allows the ATO to administer the transfer balance cap. Reporting under the EBR framework commences when your first member begins a retirement phase income stream. The transfer balance account report (TBAR) is then used to report certain events and is separate from the SMSF annual return.
An SMSF must report events that affect a member’s transfer balance, these should include details of:
- Pre-existing income streams being received on 30 June 2017 that;
– continued to be paid to them on or after 1 July 2017.
– were in retirement phase on or after 1 July 2017.
- New retirement phase and death benefit income streams including value and type.
- Limited recourse borrowing arrangement (LRBA) payments, including the value and date of each relevant payment, if entered into on or after 1 July 2017.
- Compliance with a commutation authority issued by the ATO.
- Personal injury contributions.
- Commutations of retirement phase income streams that occur on or after 1 July 2017.
Events that an SMSF do not need to report include:
- Pension payments made on or after 1 July 2017.
- Investment earnings and losses that occurred on or after 1 July 2017.
- When an income stream ceases because the interest has been exhausted.
- The death of a member.
All SMSFs must report events that affect their members’ transfer balances. If no event occurs, there is nothing to report.
Timeframes for reporting are determined by the total superannuation balances of an SMSF’s members. In the events affecting members’ transfer balances, reports must be made within 28 days after the end of the quarter in which the event occurs. Unless a member has exceeded their cap and the fund needs to report an event sooner, the first due date for the lodgment of TBARs is 28 October.
Under Australian Consumer Law, there are a number of sales practices that are illegal for businesses to engage in when dealing with their customers. Unfair business practices encompass a wide range of activities, such as misleading or false statements and deceptive conduct.
Here are some examples of illegal activities that you should be aware of as a business owner in order to avoid harsh penalties.
False or misleading statements:
It is unlawful for a business to make false or misleading representations about their goods or services that they are supplying, offering to supply, or promoting. For example, businesses may not make false or misleading statements about the standard or quality of goods or services, testimonials from other customers about the goods or services, or their price. While it will depend on the circumstances of each particular case, the maximum fine for this offence is $220,000 for individuals and $1.1 million for a body corporate.
Accepting payment without intending to supply:
Payment cannot be accepted for goods and services if businesses do not intend to supply, they intend to supply materially different goods or services, or if they are aware that they will not be able to supply the goods or services in a timely manner. However, this is not intended to affect businesses who demonstrate a genuine attempt to meet supply agreements. For example, a business may avoid prosecution if the failure to supply was due to something beyond its control.
Businesses are prohibited from acting in a manner that is against good conscience. For conduct to be classified as unconscionable, it is extremely harsh or aggressive where one party exploits another and must be more than just unfair or unreasonable. Examples of this conduct include coercing a person to sign a blank or one-sided contract, failing to disclose contractual terms, or taking advantage of low-income consumers by misleading them about prices. Whether certain conduct is deemed to be unconscionable will depend on the particular circumstances involved and may require legal action. There is a list of factors that courts may consider, including the relative bargaining strength of the parties, and the extent to which the parties acted in good faith.