Author Archive for DFK Gray Perry

2017 DFK International Statistics

DFK International requests statistics about each member firm that collectively is submitted to the IAB publication. We are pleased to announce that we have ranked 7th largest association worldwide!

At the recent EMEA Annual Conference in Dubai, the International Accounting Bulletin presented the results of the World Survey of global accounting networks and associations. We are delighted to report that the DFK association remains firmly in the top 10 global associations. This is thanks to both organic growth within our member firms and to DFK’s continuing expansion with high quality accounting and consulting firms worldwide.

2017 Christmas Greeting

Tax Time Free Live Webinar

DFK ANZ regularly hosts webinars looking at core business management and growth issues.

Join us for the June event, our Tax Planning Live Webinar, where Steve Haller and Gavin Johns will be sharing the essential steps to take before June 30 to take full advantage of the concessions available to you and your business.

You can register your seat for the June 8 Webinar here >> http://bit.ly/dfktaxtime

When you join us you’ll also be able to download our Tax Planning Preparation Checklist and Infographic.

Superannuation Contribution Changes

The Government is lowering both the non-concessional (after-tax) and concessional (pre-tax) contribution limits for SMSF’s from 1 July 2017. DFK Australia New Zealand have prepared “The 2 Minute Overview”

 

2017 Wavelength Results

2017 WAVELENGTH BUSINESS SURVEY

This year again, firms across Australia and New Zealand ran the DFKANZ Annual Business Survey, Wavelength, inviting DFK clients, contacts who own businesses, and strategic business partners to complete an opinion survey.

It covers new topics of cyber security, disruptors, as well as topics from previous ears showing trends in businesses for topics such as social media, business challenges, technology and IT..

For the DFKANZ analysis and commentary on the results please read DFK-Wavelength-2017-Final

Are you prepared for the Age Pension asset test changes?

A significant number of Australian retiree’s face losing their age pension from January 2017. The Federal government estimates there will be over 300,000 people affected by the changes that will result in them losing all or some of their Age Pension. The amount of Age Pension is affected by two tests, the asset test and the income test. It is the asset test that is being changed. The government apply the two tests and pay your Age Pension based on whichever of the tests results in you receiving the least Age Pension. If your Age Pension is impacted by the asset test or you don’t know which test is applicable to you, you should read on. The asset test threshold, for a couple who own their own home, is being reduced from $1,178,500 to $816,000. This will mean that for a couple with assets of more than $816,000 (excluding the family home) they will be impacted and see their Age Pension potentially disappear completely. For single home owners, the asset test threshold is being reduced from $793,750 to $542,500. Assets above this level will mean that they will be impacted and lose their Age Pension. The limits for couple non-home owners are changing from $1,330,000 to $1,016,000 and for single non-home owners from $945,250 to $742,500. Again, assets above these levels will result in a loss of Age Pension. The is also some good news. For couple home owners, the asset test cut off amount for full Age Pension is increasing from $296,500 to $375,000. As a result, more people will receive the full Age Pension. The limit for single home owners is rising from $209,000 to $250,000. For couple, non-home owners, the full Age Pension asset test lower limit, is increasing from $448,000 to $575,000 and for singles it is increasing from $360,500 to $450,000. However, once the full Age Pension threshold has been reached the pension will be reduced at a much faster rate than was previously the case. Before January 2017 the rate of reduction is $1.50 of Age Pension per fortnight for every $1,000 of assets above the relevant full Age Pension threshold relevant to you. From January, the reduction rate will increase to $3.00 of Age Pension per fortnight for every $1,000 of assets above the full Age Pension threshold. This will make the Age Pension tapper off much more quickly for those on part pensions with assets between $375,000 and $816,000. In light of these changes it is important to check your financial position and discuss the changes with a financial adviser. There may be strategies available to you to mitigate the impact of the changes if:

  • You are at the higher end of the relevant asset test scale with assets greater than the cut of limit for age pension.
  • You are in the middle of the relevant ranges and currently receive a part pension.
  • You will be affected by the increase in the full Age Pension cut off amount asset test threshold but still have slightly too much to qualify for the full Age Pension under the new relevant threshold.

How can we help? If you need assistance, please feel free to give us a call on 8212 2366 to arrange a time to meet so that we can discuss your particular requirements in more detail. The information contained in this note is general in nature and does not take into account your personal circumstances, objectives, needs or financial situation. Therefore, you should consider whether the information is appropriate before you act upon it. This general information note should not be relied upon in place of appropriate professional advice. You should obtain a Product Disclosure Statement relating to any financial product and consider the statement before making any decision about whether to acquire the product. Taxation, legal and other matters referred to in connection with financial products are of a general nature only and are based on our understanding and interpretation of laws at the time of publishing and should not be relied upon in place of appropriate professional advice.

Gray Perry Wealth Advisers Pty Ltd and Allan Taylor are Authorised Representatives of Lionsgate Financial Group Pty Ltd ABN 92 140 591 484 AFS License 342766

Maximise your Profitablity Webinar

Maximise your profitability in 60 minutes

Don’t miss this Webinar from DFK ANZ
Wednesday 2 November 12.30 AEDT
http://bit.ly/scprofitability

DFK Accountants and Business Advisors Melissa Healy and Brett Beaver present 6 key strategies you can action immediately in your business to maximise your profitability.

You’ll leave with new clarity, immediately actionable insights and 3 resources – – a step-by-step profitability infographic, a financial spotlight super worksheet, our “Free your working capital” checklist and the opportunity to reserve a Profit Improvement Evaluation Session with a DFK Advisor in the firm closest to you in Australia and New Zealand.

Register today > http://bit.ly/scprofitability

Do you know how to spot a scam?

 

Motor Vehicles & FBT: What Options are Available and What Information You Need to Keep

Motor vehicles can be a common benefit provided to an employee, however, doing this may attract an FBT liability for the employer. There are two methods available when determining the taxable value of the benefit provided: the statutory method and the operating cost method.

Keep in mind that these rules apply to cars only. Motorcycles, vans and other motor vehicles that do not meet the FBT’s definition of a ‘car’ will fall under another category of FBT and will require different calculations to be made.

Record keeping requirements

The operating cost method requires more records to use, namely, keeping a 12 week logbook to establish the business use percentage and supporting documentation to justify the operating costs of the motor vehicle. Changing from the statutory formula method to the operating cost method only requires keeping the relevant documentation. No formal election is required.

Statutory Formula Method

The default method used to value motor vehicles for FBT is the statutory method. From a broad perspective, this method values the motor vehicle at 20% of its base value multiplied by the proportion of days the car is provided, less any payments made by the employee.

Operating Cost Method

This method considers the GST-inclusive operating costs and the percentage the motor vehicle is used for business purposes by the employee. This method values the motor vehicle by adding the operating costs, apportioning this by the employee’s business use then reducing the resulting figure by any payments made by the employee.

The above two methods are both acceptable ways to determine the taxable value of a motor vehicle. Keep in mind that the outcome from each formula will need to be grossed up then taxed by the FBT rate in order to find out the tax liability payable due to providing this fringe benefit.

FBT – Major Changes

MAJOR CHANGES TO 2016 and 2017 FBT Returns

1. Increase in FBT rate

The FBT rate for the 2016 year has increased from 47% to 49%.

Due to the increase in the 2016 FBT rate, the amount of FBT payable by the employer will also increase.

Most employers pass on the cost of the FBT to their employees through salary sacrificing arrangements. Therefore employers will need to re-calculate the salary sacrifice amounts and ensure that the employee’s remuneration is appropriately reduced to absorb the increase in the FBT payable, this effectively means less take home pay for those employees.

You should note that the FBT rate increase to 49% is only for the 2016 and 2017 years. The FBT rate will reduce back to the previous level of 47% for the years ending 31 March 2018.

This change in rates will once again require employers to make adjustments to employees’ salary sacrifice arrangements due to the reduction in the FBT payable for 2018 FBT years onwards

2. Small business FBT exemption for portable electronic devices

Currently, there is an FBT exemption where a portable electronic device is provided to an employee primarily for work use. However, if two devices have similar functions (for example a laptop and a tablet); only the first is exempt from FBT unless the devices perform substantially different functions.

From the 1st April 2016, a small business entity, i.e. a business with an aggregated annual turnover of less than $2m, is able to provide more than one portable electronic device to be used primarily for work without incurring a fringe benefits tax liability, even where the items have substantially similar functions.

3. Meal & entertainment concessions for not for profit employees to be capped at $5,000

Currently, employees of Not for Profit Entities, public benevolent institutions and Charities have either a $17,667 or a $31,177 FBT exempt benefits cap. A summary of these caps is included in the table below. In addition to these exempt benefit caps, these employers are able to provide meal entertainment benefits to employees with no FBT payable and these benefits are not included as reportable benefits on the employee’s PAYG Payment Summary.

From the 1st April 2016, a $5,000 cap on the amount of meal entertainment benefits that can be salary sacrificed by employees of not for profits will apply. Any benefits in excess of this cap will count towards the employee’s ordinary exempt benefit cap and any excess over this cap is subject to normal FBT treatment and will be taxable.

Concessional FBT treatment for certain employers – Capped


*
Entity
*
Gross amount
($)
Maximum amount
(No GST credits)
($)
Maximum amount
(GST credits)
($)
Public benevolent institutions (PBIs) – not including hospitals, health promotion charities and rebatable employers 31,177 15,900.14 14,525.93
Public and non-profit hospitals 17,667 9,010.09 8,231.37