November 2023 - Update

Author na1616mewedewd

Tax issues for businesses that have received a support payment

 
Taxpayers who have received a government support grant or payment recently to help their business recover from COVID-19 or a natural disaster should check if they need to include the payment in their assessable income.

Grants are generally treated as assessable income, and taxpayers may be able to claim deductions if they use these payments to:

  • purchase replacement trading stock or new assets;
  • repair their business premises and fit out; or
  • pay for other business expenses.

However, some grants are declared non-assessable, non-exempt ('NANE') income. This means taxpayers don't need to include them in their tax return if they meet certain eligibility requirements.

NANE grants include but are not limited to:

  • COVID-19 business support payments;
  • natural disaster grants; and
  • water infrastructure payments.

Taxpayers can only claim deductions for expenses associated with NANE grants if they relate directly to earning their assessable income, including wages, dividends, interest and rent. 
 

Paying super benefits

 
Generally, before SMSF trustees pay a member's super benefits, they need to ensure that:

  • the member has reached their preservation age;
  • the member has met one of the conditions of release; and
  • the governing rules of the fund (e.g., the trust deed) allow it. 

Benefit payments to members who have not met a condition of release are not treated as super benefits. Instead, they will be taxed as ordinary income at the member's marginal tax rate.

If a benefit is unlawfully released, the ATO may apply significant penalties to:

  • the SMSF trustee;
  • the SMSF; and
  • the recipient of the early release. 

The ATO may also disqualify the trustee(s) involved.

Investment restrictions and other rules that apply to SMSFs in the accumulation phase continue to apply when members begin receiving a pension from the SMSF.

Where a member has met a condition of release, the trustee can either pay the benefit as a lump sum or super income stream (i.e., a pension). If a member has died, the trustee will generally pay a death benefit to a dependant or other beneficiary of the deceased, subject to the applicable rules.
 

Notice of visa data-matching program

 
The ATO will acquire visa data from the Department of Home Affairs for the 2024 to 2026 income years, including the following:

  • address history and contact history for visa applicants, sponsors, and migration agents;
  • active visas meeting the relevant criteria, and all visa grants;
  • visa grant status by point in time;
  • migration agents who assisted the processing of the visa;
  • all international travel movements undertaken by visa holders; and
  • sponsor details, and visa subclass name.

The ATO estimates that records relating to approximately nine million individuals will be obtained each financial year.

The objectives of this program are to (among other things) help ensure that individuals and businesses are fulfilling their tax and super reporting obligations, and identify potentially new or emergent approaches to fraud and those entities controlling or exploiting the visa framework.
 

Be cyber wise, don't compromise

 
Throughout the 2022 income year, one cybercrime was reported every seven minutes. The ATO encourages taxpayers to implement the following four quick steps to protect themselves.

Step 1: Install updates for your devices and software
Regular updates ensure taxpayers have the latest security in place which can help prevent cyber criminals from hacking their devices. They should also make sure they are downloading authorised and legitimate programs.

Step 2: Implement multi-factor authentication
Multi-factor authentication ('MFA') is a security measure that requires at least two proofs of identity to grant access. Businesses as well as individuals should implement MFA wherever possible. MFA options can include a physical token, authenticator app, email or SMS.

Step 3: Regularly back up your files
Backing up copies of files to an external device or the 'cloud' means taxpayers can restore their files if something goes wrong.
It is a precautionary measure that can help avoid costly data recovery.

Step 4: Change your passwords to passphrases
By using passphrases, taxpayers can boost the security of their accounts and make it harder for cyber criminals to access their information. 

Passphrases use four or more random words and can include symbols, capitals and numbers. A password manager can help generate or store passphrases.
 

Losses in crypto investments for SMSFs


Over the last few income years, the ATO has seen some instances of SMSF trustees losing their crypto asset investments.
These losses have been caused by:

  • crypto scams, where trustees were conned into investing their superannuation benefits in a fake crypto exchange;
  • theft, where fraudsters would hack into trustees' crypto accounts and steal all their crypto;
  • collapsed crypto trading platforms, many of which were based overseas; and
  • lost passwords, resulting in trustees being locked out of their crypto account and being unable to access their crypto.

Trustees thinking of investing in crypto need to be aware of the ways that crypto can be lost, including through scams, and how these scams can be avoided.

Many crypto assets are not commonly considered to be financial products, which means the platform where crypto is bought and sold may not be regulated by ASIC. 

Therefore, trustees may not be protected if the platform fails or is hacked. When a crypto platform fails they will most likely lose all of their crypto.


Investing in crypto can be complex and risky, and so the ATO recommends that trustees seek financial advice before investing.
 
The information provided in this update is general in nature and if you have any queries of require further information or assistance with the above, please contact our office.


Crawford News

October 5, 2026
ATO focus on PAYG instalments variations The ATO is writing to taxpayers who have varied their PAYG instalments to nil over multiple years, reminding them that the general interest charge may apply where their instalments have been significantly understated. Where varied instalments are less than 85% of the total tax payable, the ATO may impose GIC on the difference and, depending on the circumstances, penalties may also be applied. Taxpayers are advised to maintain appropriate records to support their variation decisions, and review variations where circumstances change. FBT changes for salary sacrificed work-related benefits From 1 April 2027, employers will no longer be able to use the ‘otherwise deductible rule’ to reduce the taxable value of an expense payment fringe benefit provided to an employee where the expense is: work-related; covered by the new $1,000 standard deduction; and provided under a salary sacrifice arrangement. This includes where an employer pays for, or reimburses, work-related expenses, such as home office expenses, home phone or internet expenses, or self-education expenses. However, the otherwise deductible rule can continue to apply where the expense is: not covered by the standard deduction; or covered by the standard deduction but the benefit is not provided under a salary sacrifice arrangement. Further, from 1 April 2027, certain work-related items will no longer qualify for the FBT exemption where they are provided under a salary sacrifice arrangement. These include: portable electronic devices; computer software; protective clothing; and briefcases and tools of trade. Eligible work-related items may still qualify for the exemption where they are not provided under a salary sacrifice arrangement. Further, under the changes, employers may be able to provide an employee with more than one eligible work-related item in an FBT year, even where the items have the same or substantially identical function, and continue to receive the exemption where the items: are mainly used for work purposes; and are not provided under a salary sacrifice arrangement. This repeals the general 'one-item' restriction applying to this work-related item exemption from 1 April 2027. Cents per kilometre method Motor Vehicle claims There are several misconceptions that commonly lead to incorrect claims under the cents per kilometre method for claiming deductions for car expenses. Common errors include: Claiming travel between home and work, which is generally private and non-deductible; Automatically claiming 5,000 kilometres without the appropriate records (for example, being unable to show how the business kilometres were worked out); Claiming car expenses for a vehicle provided under a novated lease through a salary sacrifice arrangement; Separately claiming the decline in value of a car and other expenses when using the cents per kilometre method; and Using both the cents per kilometre and logbook methods for different periods during the same year. Loss carry back rules have returned The re-introduced loss carry back measure has also now become law, applying to income years starting on or after 1 July 2026. Where eligible, companies will broadly be able to carry back a tax loss (revenue in nature) and apply it against tax paid in either, or both, of the previous two income years, basically giving rise to a tax refund for the loss year. ATO extends data-matching programs The ATO is continuing its visa data-matching program, acquiring data from the Department of Home Affairs from the 2027 to the 2029 income years. Under this program, the data collected may include: address and contact history for visa applicants, sponsors and migration agents; histories of visas granted, including visa subclasses; an individual’s visa status at a point in time; details of migration agents, sponsors and education providers; and international travel movements undertaken by visa holders (arrivals and departures). The ATO is also continuing its passenger movements data-matching program for the same period. Under this program, the data collected by the ATO may include names, dates of birth, arrival and departure dates, passport information and status types (including visa status, residency and citizenship status). The information provided in this Newsletter is general in nature and if you have any queries or require further information or assistance with the above, please contact our office.
September 9, 2026
Payday Super and contractors Businesses generally need to pay super where they engage an independent contractor mainly for their labour, personal effort, skills or time. This can apply even if the contractor: has an ABN; invoices the business for their work; or is described as a contractor in a written agreement. It is not mandatory to report payments made to independent contractors through Single Touch Payroll. However, if a business reports them voluntarily, it must meet the STP reporting requirements, including reporting qualifying earnings and super liability information. Where an independent contractor is entitled to super, the contribution must be paid for each payday and reach their super fund within seven business days after payday. Payday Super timeframe Under Payday Super, contributions must be received by an employee’s super fund within seven business days after payday. To keep on track, the ATO recommends that employers: use the new member verification request to verify that an employee’s super fund details are valid and that the fund can accept a contribution before it is made; check with the relevant payroll provider or clearing house that the fund is responding to MVRs; monitor payments, as funds have three business days to allocate or reject a payment; and if a payment is rejected or returned, act quickly to correct any errors and resubmit to the correct fund. For new employees, or where an employee changes their fund, employers generally have 20 business days to make the initial contribution. $21 billion in lost super The ATO is urging individuals to check whether they have lost or unclaimed super, with more than $21 billion waiting to be reunited with its owners. Super can become lost when an account is inactive and the fund cannot contact the member, often following a change of job, address or phone number. In some cases, the balance may be transferred to the ATO to hold until it can be reunited with the individual. The ATO reports that last year, more than $1.1 billion was returned through consolidations and direct payments to eligible individuals. ATO motor vehicle registries data-matching program The ATO acquires motor vehicle registries data from state and territory authorities from the 2026 to the 2030 income years. The information will be matched against ATO records to identify taxpayers who are not meeting their registration, lodgment, reporting, or payment obligations. The data will also be used to support ATO compliance activities through modelling, risk profiling and case selection. The data collected may include identification details for purchasers, sellers and other relevant parties, together with transaction dates and types, sale prices, market values, vehicle garage addresses, intended use, vehicle specifications and registration details. $1,000 deduction for work expenses From 1 July 2026, employees may choose either the standard deduction for work-related expenses of up to $1,000, or a deduction for the actual work-related expenses they incur. You should continue keeping records for deductible work expenses incurred from 1 July 2026. If, at the end of the 2027 income year, you choose to claim actual expenses, you must have the required written evidence for those expenses. The information provided in this Newsletter is general in nature and if you have any queries or require further information or assistance with the above, please contact our office.
August 4, 2026
Government extends the $20,000 instant asset write-off The Government has recently introduced legislation to extend the $20,000 instant asset write-off for small businesses. If enacted, the changes would set the instant asset write-off threshold at $20,000 for eligible depreciating assets first used, or installed ready for use, for a taxable purposes from 1 July 2026. The changes would also further suspend the 'lock-out rule' until 30 June 2027. Loss carry back rules to be reintroduced The Government has introduced legislation to re-introduce the loss carry back measure for companies from 1 July 2026. If enacted, this will allow most companies to carry back a tax loss and apply it against tax paid in either, or both, of the previous two income years, basically giving rise to a tax refund for the loss year. New restrictions on LRBAs New legislation imposes restrictions on the use of limited recourse borrowing arrangements by SMSFs. LRBAs entered into on or after 10 August 2026 to purchase real property can now only be used to acquire business real property. These changes do not apply if an SMSF: has already entered into an LRBA to finance a real property acquisition before 10 August 2026; or maintains or refinances that LRBA on or after 10 August 2026. 'Business real property' generally means land and buildings used wholly and exclusively in one or more businesses. Division 7A benchmark interest rate The ATO has published a Division 7A benchmark interest rate of 8.77% for the income year ending 30 June 2027, up from 8.37% for the previous income year. The benchmark interest rate is applied when calculating minimum yearly repayments for complying Division 7A loans. ATO scam warning The ATO has received reports of a new email impersonation scam claiming to be from the ATO. The email states that a phone appointment with the ATO has been scheduled and includes appointment details such as the date and time. The email claims that recipients must open an attachment included in the email to securely access relevant services or reschedule the appointment. The attachment contains a link to a legitimate looking myGov sign-in page designed to steal usernames, passwords and other personal information. The ATO has advised recipients not to respond to the email or interact with it in any way. The information provided in this Newsletter is general in nature and if you have any queries or require further information or assistance with the above, please contact our office.
By Inzi Pethiyagoda • July 5, 2026
Welcome to the start of the new financial year, we sincerely thank you for your support and for partnering with us over the past 12 months. Our team is up to date with the changes to tax rules this year, so it’s time to start thinking about completing your 2026 tax returns. If you have not yet organised your tax appointment, please book an appointment using the link below or get in touch with us asap. https://www.crawfordaccountants.com.au/schedule-an-appointment We conduct appointments at the office, via Zoom or Phone. 03 9853 1000 admin@crawfordaccountants.com.au www.crawfordaccountants.com.au Book Now Are you Audit Safe? The possibility of being selected for an audit or investigation is increasing each year as the Australian Taxation Office (ATO) and other government agencies widen the scope of their investigation activities utilising data collection/detection capacity, data matching and benchmarking/risk profiling. Even if you can substantiate your claim for an allowable deduction, if queried you must still go through the audit process. To alleviate the cost and stress, we have offered you to take out our audit protection and you should have received an offer letter from us few weeks ago. It is a cheap and efficient way of dealing with an ATO audit. For more information, please contact our office. Tax Deductions Tax deductions will help you minimise your tax, but there are three golden rules for tax deductions: Expenses must be related to business/ work and not private. If a portion of the expense if private, the deduction must be apportioned. You must have records to prove the deduction such as receipts The expense must not be reimbursed Pay day super is now active From 1 July 2026, Payday super applies. Employers will need to pay super to an employee’s nominated super fund each payday, and it must reach the fund within 7 business days after the payday. The STP lodgement obligations remain. If you require assistance with the process, please contact our office. Changes to car thresholds from 1 July The car limit for the 2027 income year is $69,883. This is the highest value that a taxpayer can use to calculate depreciation on a car where they use the car for work or business purposes and they first use or lease the car in the 2027 income year. If a taxpayer is buying a car and the price is more than the car limit, the highest input tax (GST) credit they can claim except in certain circumstances is one-eleventh of the car limit. For the 2027 income year, the highest input tax credit they can claim is $6,353. The luxury car tax threshold for the 2027 income year is $91,661 for fuel-efficient vehicles, and $80,809 for all other luxury vehicles. Input tax credits need to be claimed within the four year time limit. A taxpayer cannot claim an input tax credit for luxury car tax when they buy a luxury car, even if they use it for business purposes. Recap – Tax Reforms The Government has recently legislated several of the tax reform measures announced in the 2026 Federal Budget. Replacing the CGT discount with cost base indexation and a 30% minimum tax on gains accruing from 1 July 2027. This applies to pre-CGT assets as well. Increasing the small business turnover threshold for the 50% active asset reduction from $2 million to $10 million. Limiting negative gearing for residential property to new residential dwellings from 1 July 2027. Existing properties are grandfathered. Introducing the Working Australians Tax Offset from 1 July 2027, and the $1,000 instant tax deduction for work-related expenses from 1 July 2026. The Government has also announced further proposed measures, including: A new targeted CGT discount for investors in innovative start-ups. Barring SMSFs from utilising future limited recourse borrowing arrangements to acquire residential property. Exempting income of discretionary testamentary trusts from the minimum tax proposed for trusts. Fuel excise relief extended for July The Government has announced a further temporary extension of fuel excise relief for July, together with a reduction in the Heavy Vehicle Road User Charge and based on the government announcements, these measures will make petrol and diesel 16 cents per litre cheaper than they otherwise would have been during July. Dental clinic liable for super guarantee charge The Administrative Review Tribunal recently considered whether an oral health therapist engaged by a dental clinic was an employee for super guarantee purposes. The clinic argued that the therapist was not an employee but was instead an independent contractor and, as such, the clinic was not liable for the super guarantee charge. The ART held that the therapist was an employee under the extended definition. In particular, the ART found that: the contract contained features consistent with an 'employment' arrangement; the therapist was part of a regulated profession and could not practise independently; the purpose of the contract was to engage the therapist personally to work as a member of an integrated team. the clinic did not establish that she had a genuine right to delegate/subcontract her work. the therapist was not directly rewarded for her services, as her remuneration was subject to adjustments applied by the clinic on patient invoices. The information provided in this Newsletter is general in nature and if you have any queries or require further information or assistance with the above, please contact our office.

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