November 2022 Newsletter
Have you applied for your director identification number?
Time is running out to meet the 30 November 2022 deadline which applies to most directors. All existing directors of a company, registered Australian body, registered foreign company, or a director of corporate trustees of an SMSF are required to apply for a director ID. A director ID is a unique 15-digit identifier that all directors or people intending to become directors must apply for. It’s free to apply and you only need to apply once. A director must apply for their own director ID personally.
With the economy emerging from its COVID-related downturn, individuals may have made business losses that may be able to be offset against other income such as salary and wages. There are however a number of hurdles to clear. These include the non-commercial loss rules which determine whether the loss, or your share of the loss, is deductible in the current year.
Meanwhile, the latest ATO super statistics confirm that there is a significant superannuation gender gap – with women generally having far less super savings than men. There are a number of strategies that can be employed to close this gap including catch-up contributions, superannuation splitting, and spouse contributions.
This edition features pieces on:
Federal budget – business and individual taxation: It was a somewhat quiet budget on the business front, with it being notable for the burning issues that it did not address such as Division 7A reform, the taxation of trusts, the future of the loss carry back rules and current depreciation rules for business (both expiring in 2023). On the individual level though, lucrative future year tax cuts were confirmed.
Federal budget - superannuation: The retention of the existing contribution caps, leaving indexation undisturbed, reducing the downsizer contribution age to 55 (down from 60), and the delay in the SMSF residency rule changes were just some of the announcements on the super front.
Rental deductions curbed: Where you let out your home to family or friends or otherwise on a non-commercial basis, a recent AAT decision reminds us that, in doing so, this may limit your deduction claim to the amount of rent charged.
Director ID’s – new campaign launched: The federal government has launched a last-ditch awareness campaign reminding those who are directors to obtain their ID by the 30 November deadline. How? Who? Why? We answer these questions.
Do I have to pay myself super as a business owner?: The answer depends on a range of factors, principally your trading structure. Different rules apply for sole traders, companies, partnerships and businesses operated through a trust structure.
Business versus hobby: When do otherwise private activities cross over from a hobby to a business? This matters from a tax perspective particularly around the declaring of payments received, claiming deductions, record-keeping…and more!