Monthly Update – June 2020

This month we bring to you news on time discretion for ABN registration, announcements from South Australian Government on land tax. We also look deeper on New Private Health Insurance Rebate and Foreign Employment Income and S23AG Exemption. Finally, we look at SMSF Independent Auditor’s Report (IAR).

Further time discretion for ABN registration
The ATO has released Practice Statement Law Administration (PS LA 2020/1), which provides guidance on the relevant circumstances that should be considered when the Commissioner is considering whether to grant further time for an entity:

• To register for an ABN
• To provide notice of income or taxable supplies during the relevant period to the Commissioner

For an entity to be eligible for the Cash Flow Boost or to receive the Job Keeper payment, the entity must have had an ABN on 12^th March 2020. The PS LA states that the further time will only be allowed in ‘limited circumstances where to do so would be consistent with the policy intent’.

South Australia Government announces 25% reduction on Land Tax
The SA government has announced a 25% reduction in the Land Tax liability for FY2019-20 subject to the below conditions:

• The land is used for residential or commercial purpose.
• The land is leased to either a residential tenant or non – residential tenant with annual turnover of up to $50M, who has been financially impacted because of COVID-19.
• The landlord reduces the rent of the affected tenant by at least to the extent of the land tax reduction received.
• The land tax is directly related to the land for which the rent has been reduced.

Tasmania Government announces relief
The Tasmania government has announced a waiver of Payroll Tax on Job Keeper payments.

New Private Health Insurance Rebates from 1^st April 2020 to 31^st March 2021

ASIC reporting and lodgment extension
Additional one-month extension granted to unlisted public companies, proprietary companies, registered schemes, disclosing entities and AFS licensees to report to members and lodge reports with ASIC.

Foreign Employment Income and S23AG Exemption

• S23AG provides tax exemption for foreign income earned by taxpayers who have returned to Australia because of COVID-19.
• Foreign Earnings include salary, wages, commission, bonus, and allowances earned from engagement in foreign service.
• The exemption is available when the taxpayer had already completed 91 days of continuous foreign service.

Increased Car Cost limit for depreciation
The ATO has updated the Car Cost limit for depreciation for FY2020-21 to $59,136 (previously $57,581 since FY2016-17).

Work Test changes from 1^st July 2020

• The age limit for voluntary concessional and non – concessional contributions pushed out to 67.
• The age limit for spouse contributions lifted to 74 from 69.

SMSF Independent Auditor’s Report (IAR)
Changes have been made to the SMSF Independent Auditor’s Report effective for the reporting periods starting on or after 1^st July 2019. This form replaces the previous IAR that was effective for the reporting periods on or after 1^st July 2016.
However, the Audit Reports for the funds wound up during FY2019-20 and lodged with previous version of form would be accepted.