In The Loop with PrimeAdvisory [September]
Is it time for a family trust review? And do you know why your tax return might be smaller this year?
New rules and regulations mean it’s vital to stay up to date with all the ATO’s latest moves, while a study has found failed business owners are three times more likely to have bad personal credit scores of their own.
Why Credit History Counts When It Comes To Company Directors
Plenty of accounting firms help individuals improve their credit scores every day.
But what happens when a business is helmed by a director with dodgy credit history?
Market research by credit bureau Illion has found that directors with a dubious credit history are three times more likely to be involved in multiple business failures than directors with clean credit scores.
There’s an obvious link between the personal credit behaviour of a company director and the chances of a business failing—at least according to the research.
Learn more about why Illion says it pays to consider the relationship between company directors and credit history.
Expecting A Tax Return? Here’s Why You May Need To Think Again
Whisper it quietly, but chances are you’ll be receiving a much smaller tax return than usual this year.
That’s because the federal government has ended the low and middle-income offset introduced for the 2018-19 financial year—and extended twice throughout the COVID-19 pandemic.
It’s a sizeable change, with individuals earning up to $126,000 p/a set to have around $1500 slashed from their latest tax return.
Economists suggest that while the move will undoubtedly place even more pressure on already stretched households struggling to deal with the rising cost of living, it should also mean the end to a steady stream of interest rate rises.
Learn more about low and middle-income tax offsets.
Small Business Growth Holds Steady Despite Rising Costs
The latest report by the Council of Small Business Organisations Australia and payment platform Square has found growth rates for small businesses are holding steady despite a range of rising costs.
The report found that ‘micro businesses’ enjoyed a 6.02% increase in sales volume since the last quarterly report, however small and medium sales had contracted slightly to 2.29% since last reported.
That’s mainly because most small businesses faced a “storm” of rising costs that are increasingly cutting into their bottom lines.
“Australian small businesses are facing a storm of rising costs—energy, rent, and insurance premiums,” explained COSBOA chief executive, Luke Achterstraat.
“As we battle inflation, it’s crucial to keep the needs of small businesses at the forefront.”
While many small businesses are returning to pre-pandemic levels of growth, the report urges the federal government to continue supporting the industry—with many small to medium business owners forced to do more with less and continually look for efficiencies.
Read more in the latest COSBOA and Square report.
The Pros And Cons Of ‘Death Bed Benefits’ And Early Super Payouts
Are you aged 65 or over and worried about the tax implications of your superannuation benefits? You’re not alone.
While taxes are generally the last thing you want to think about during your retirement years, many older Australians are forced to mull over a range of super-related tax obligations every day.
One of the more pressing concerns relates to so-called Death Bed Benefits. It may sound like an unfortunate name, but it’s a topic worth discussing with your loved ones while you can.
That’s because there are a diverse range of complex tax implications around Death Bed Benefits—which occur when a member of a super fund makes a request to withdraw their superannuation as a lump sum before their death.
They generally do so because they have no dependents who could receive the benefit tax-free—with a tax rate of 17% applicable if the superannuation death benefit is ultimately paid to independent adult children of the member.
Such payouts are treated differently depending on whether they’re made as a lump sum payment directly to the member—thereby amounting to a ‘death bed benefit’—or are otherwise paid to the member’s children or estate.
This is a complicated tax area with many pros and cons to consider, and as with any element involving super, is not a decision that should be made lightly.