FREQUENTLY ASKED QUESTIONS
Be In The Know
WHAT ARE YOUR SERVICE FEES?
For a business you'll need to contact us to discuss your needs but for an individual I can let you know that a simple tax return can be done for $198 (including GST). Additional fees apply for investment properties, share portfolios and any bookkeeping required to organise your records.
WILL I GET A TAX REFUND?
That all depends on whether you've paid too much tax or not.
Unfortunately the Low and Middle Income Tax Offset (worth up to $1,080 by itself) no longer exists, so many tax payers will be getting refunds of over $1,000 less than they've been used to. However, there are still other tax deductions you can claim if there are work related expense that you have incurred or eligible donations that you have made. Furthermore the tax system is still over withholding on anyone whose income varied from month to month.
If you don't lodge a tax return you won't get the refund.
Unfortunately if you have some income that wasn't taxed or wasn't taxed correctly you could still end up with a tax bill.
ANY TAX SAVING TIPS?
Please take a look at my blogs.
The most important advice is to keep records of any work or income related expenses, and if you are using your car for business keep a log book. If you have a rental property and don't already have a depreciation report consider having one done.
WHAT DO YOU NEED TO COMPLETE MY TAX RETURN?
For and individual, as a minimum we will need your TFN, your bank details (for receipt of your refund) and proof of your identity. (Please never email all of those together to anyone - we recommend sending the TFN via a separate SMS).
We will however need to discuss with you if there is any income not shown on your ATO prefill (note that your employment income, interest and dividends should all be there by mid-July) and if there are any work expenses you have incurred.
DO I HAVE TO PAY TAX ON MY UK RENTAL PROPERTY IN AUSTRALIA?
That depends on whether you are a temporary resident or a permanent resident (or citizen).
Temporary residents are not required to pay tax on most types of foreign income and foreign capital gains.
If you are a permanent resident then you will have to pay tax. Note that the UK will tax you first under the terms of the double taxation agreement and Australia second meaning any tax you pay in the UK is a tax offset on your Australian tax return. Most UK citizens in this situation escape paying any tax in the UK because their net rental income is less than their annual allowance, so they simply pay the full amount of tax in Australia.
WHEN IS A CONTRACTOR NOT A CONTRACTOR?
While the differences in your obligations to contractors vs employees aren't that complicated, identifying whether or not someone is a contractor or an employee is very complicated.
In Australia, just because an individual working for you has an ABN or only comes in occasionally as a specialist doesn't necessarily make them a contractor.
Instead, it's important to consider 6 key factors. These are:
Whether they can subcontract/delegate work (contractors typically can, employees cannot)
Whether they're paid a set amount per period or per item/activity (employees), or paid a quoted price for an agreed result (contractors)
Whether the provision of equipment, tools, and other assets is up to you or them (you provide for employees, contractors provide for themselves)
Whether they take commercial risks (employees do not, contractors do)
Whether they control the way work is done (contractors can, employees cannot)
Whether the operate independently from your business (employees do not, contractors do)
If they are trading as a company you can almost always rely on that they are an employee of that company and not your employee.​
WHAT IS A BUDGET?
A budget is an estimate or prediction of your business’s income for a set period of time (week, month, quarter, etc.), and an estimate of your business’s expenses for that same period of time. In other words, it’s a record of what you expect your business to earn, and a plan for how you will spend your business’s money.
WHAT IS A BUDGET VARIANCE?
A budget variance is the difference between your business’s forecast expenses or income, and the actual amount you ultimately spend or earn.
For example: when creating a budget, you may record that you expect to spend $1,000 on your business’s monthly Google AdWords campaign. If you spend $900 instead, this is a variance. Similarly, spending $1,500 on AdWords would also represent a budget variance, as neither figure matches the one you predicted.
WHAT IS VAIRANCE ANALYSIS?
Being aware of your variances is certainly useful, but the real value lies in analysing them.
A variance analysis looks at the variances between your projected and actual spending, and analyses potential explanations for how and why these variances occurred. You can conduct a variance analysis yourself, but if you run a bigger business, it’s a good idea to get a properly trained and qualified professional to do it for you. As experts in their field, they will be able to identify solutions and explanations that you wouldn’t be able to come up with yourself.
WHY DO I NEED A VARIANCE ANALYSIS?
A professional variance analysis puts the power to grow your business firmly in your hands, as it can help you identify problems that require your attention. By addressing these problems, you can then increase your business’s profitability in a wide variety of ways, including cutting costs or even spending money on newly-identified opportunities.
For example: some businesses notice a variance between projected and actual spending on fuel costs for their business fleet. In analysing this, a range of explanations can be identified. These may be simple and point to an unavoidable factor (e.g. employees had to travel more regularly than normal that month), or they could draw attention to processes that require refining and standards that need enforcing (e.g. staff using vehicles for personal transportation). Either way, your variance analysis will help you to implement positive changes that increase your business’s profitability.