Get ready for the 31 March 2018 FBT year-end
Recently, we published our FBT Year End Planner detailing some timely FBT year-end reminders and strategies. Read this planner to gain some practical insight on:
- the latest developments in the FBT landscape (e.g. new simplified record keeping for fleet cars and certain utes);
- what documents to keep to satisfy FBT record-keeping obligations; and
- what strategies to consider to reduce an employer’s FBT liability.
Some tricks and traps when applying for clearance certificates
As mentioned in a previous Top Tax Tips, we can help tax resident vendors to obtain ATO clearance certificates to avoid application of the 12.5% withholding rule when they sell their property for $750,000 or more. A clearance certificate – basically an ATO certificate confirming that the vendor is an Australian tax resident - provided to the purchaser before settlement date would enable such a vendor to receive 100% of the purchase price from the purchaser instead of only 87.5% of the purchase price at settlement.
Generally, tax resident entities owning properties directly (e.g. individuals or companies) have to apply for the clearance certificate themselves. However, for properties owned by a trust or superannuation fund, the trustee who has the legal title to the property, should apply for the clearance certificate using their own tax file number (if the trustee is an individual) or their own Australian Business Number (if the trustee is a company). If the corporate trustee does not have a TFN (or ABN), an attachment providing details of the relevant trust should be included in the application.
If more than one vendor is involved, each vendor must apply separately for a clearance certificate and if any of the vendors fails to provide such a clearance certificate to the purchaser, the purchaser may have to withhold 12.5% of the purchase price (in proportion to each vendor’s interest in the property).
Small business benchmarks to help improve your business
In today’s competitive world, all businesses need to know how they are faring against their competitors.
One of the ways Nexia can provide answers to this question is by analysing certain data from your business to information in the ATO small business benchmark database to work out how your business (with turnover up to $15 million) is tracking in a specific industry.
If the result from this calculation falls outside the benchmark range for your industry (for example because your business has only started or is in the process of being wound up, the purchase price of products is higher, yet the sale price of your products is lower than your competitors, or there are mistakes on your tax returns), we can discuss potential strategies to help improve your record keeping and business operations to increase your profitability and performance (e.g. help implement best practice industry strategies that is relevant for your business).
Contact us today for more information on how we can assist your business grow.