2016 tax time will be here in two months, there will be changes for income tax returns, and there will be some points that we need to pay attention to.
The ATO will both change and introduce several rules this year:
- Car expenses – tax deduction rules
- From 1 July 2015, the Australian Taxation Office will remove two of the calculation methods for work-related deductions for car expenses – ‘12% of original value method’ and ‘one-third of actual expenses method’.
- The introduction of a flat rate when applying the cent per kilometre method – 66% for all cars, regardless of the engine size.
- HECS-HELP repayment for overseas working/ living Australians
- People who have a HELP debt who leave Australia and intend to live or work overseas less than 6 months in a 12 month period will need to repay the debt if the taxable income is over the threshold, which is over $54,126 for 2015/16 year.
- People who have a HELP debt leave Australia and intend to live or work overseas more than 6 months in a 12 month period will need to repay the debt if the world- wide taxable income is over $54,126.
- The voluntary repayment discount for HELP debt will be removed from 1 Jan 2017.
- Capital Gains Tax (CGT) – Exemptions from CGT
- A car, motorcycle or similar vehicle that is designed to carry less than one tonne or fewer than nine passengers.
- A decoration that is awarded for valour or brave conduct, unless purchased by the taxpayer.
- A collectable item acquired for less than $500
- A personal use item acquired for less than $10,000
- A CGT asset used solely to produce exempt income not subject to withholding tax
- Gambling winnings or prizes
- An individual’s main residence
- Compensation for personal injuries or libel, slander and defamation, insurance proceeds for personal accident claims are also exempt.
- Small business depreciation
- The 2015 Federal Budget announced an immediate write-off up to $20,000 for assets acquired after 7:30pm 12 May 2015 to 30 June 2017
- Most other depreciating assets are pooled in the general small business pool. Newly acquired assets are depreciated at 15% in the first year, regardless of the date on which they were acquired. In the next year, the assets are depreciated at 30% on the diminishing value basis
There will be more changes and new rules coming up around July 2016 tax time, if you would like know more about these, and get ready for your tax returns, you are welcome to contact us for more information on 07 5444 1022, or email us at firstname.lastname@example.org.