No GST on imported services for Australian businesses
From 1 October 2016, Australian businesses importing intangible goods (e.g. professional services or digital products such as downloaded movies, music, apps, games or e-books) from overseas businesses will no longer have to pay GST on such imports – and thereby effectively pay 10% less on such imports (compared to such imports prior to 1 October 2016).
To ensure such Australian businesses are not charged GST, those businesses will need to supply their ABN and a statement that they are registered for GST to the overseas supplier at the time of purchase.
Please come and talk to us if you are an Australian GST registered business that has mistakenly been charged GST on such a transaction. We can assist you to claim a refund of the GST charged.
Note: From 1 July 2017, Australian consumers importing such intangible goods from foreign businesses will have to pay GST on such imports – thereby effectively paying 10% more on such imports.
Take care when setting up a reserve in your SMSF
From 1 July 2017, the main limits and restrictions on the amount an individual can have in superannuation are:
- the $1.6 million transfer balance cap whereby the balance of a taxpayer’s benefit transferred to the tax free pension account must be limited to $1.6 million; and
- the $1.6 million total superannuation balance cap whereby non-concessional contributions will no longer be possible where the total superannuation balance is $1.6 million.
Some are contending that these limits can be circumvented with the use of reserves.
However, please note that establishing and maintaining such reserves may not be appropriate. The ATO has announced that they will be closely monitoring SMSFs that establish reserves following the introduction of the new limits.
Please contact us so that we can assist you in implementing a superannuation strategy that does not breach the rules.
Beneficiaries must quote their tax file number (TFN) to trustees
Beneficiaries of closely held trusts (e.g. a resident family trust or a trust that has up to 20 individual beneficiaries who between them have fixed entitlements to at least 75% of the capital or income of the trust) must quote their tax file number (TFN) to the trustee of the trust. Further, the trustee must lodge a TFN report with the ATO by the last day of the month following the end of the quarter in which the TFN was quoted to the trustee.
If a beneficiary does not provide their TFN, the trustee must withhold an amount (at the top tax rate of 47%) from any distributions made to the beneficiary, pay the withheld amount to the ATO and lodge an annual report with details of all withheld amounts.
Please contact your Nexia adviser if you are a beneficiary of a family trust so that we can ensure that you do not fall foul of these reporting rules.