Personal Finance

While the Federal Government's 2010 Budget proposal for a 50% tax savings discount and a standard $500 deduction for work-related expenses grabbed most of the headlines, a key issue for businesses was the proposal on the CGT treatment of "earnout arrangements".

To assist self managed superannuation fund (SMSF) trustees better understand the complexity of their role, CPA Australia, the Institute of Chartered Accountants in Australia and the National Institute of Accountants — under the auspices of the Joint Accounting Bodies (JAB) — have developed a free online training tool.

The way you search the lost members register (LMR) using the ATO’s electronic commerce interface (ECI) has been updated. For more information and to register, see SuperMatch.

You must use ordinary time earnings (OTE) to calculate the minimum super guarantee (SG) contributions required for your eligible employees. This ensures all eligible employees are treated the same for SG purposes.

In order to claim a tax deduction for personal superannuation contributions, you need to get most of your income from sources other than employment. 

Over the last few months, there has been a lot of media attention on the ATO’s crackdown on tax planning using trusts.

The latest target has been discretionary trusts with corporate beneficiaries.  Specifically, the ATO has had concerns regarding trusts declaring distributions to corporate beneficiaries (ie companies) and leaving the amount unpaid (ie unpaid present entitlements). 

What is the Medicare levy surcharge (MLS)?

Individuals and families on incomes above the MLS thresholds, who do not have private patient hospital cover pay MLS for any period during 2008-09 that they did not have this cover.

MLS is calculated at the rate of 1% of your taxable income. The MLS is in addition to the 1.5% Medicare levy.

Number-crunching data recently released from the ATO and APRA give a mixed impression of how self-managed super funds have coped with the global financial crisis and of their ability to take advantage of the rebound in share prices.
In short, DIY funds on average are extremely cashed-up - which would have cushioned them from the worst of the GFC - but now face the challenge of astutely boosting their equity exposure, if appropriate for their members' circumstances, before missing out on much of the rebound.

The number of self-managed super funds (SMSFs or more commonly known as DIY funds) continues to grow. As at June 30 this year, there were over 410,000 of them holding over $300 billion in assets. The global financial crisis and the losses it generated for super fund investments has possibly caused many to look into and indeed, start up, a self-managed super fund. Being in control of your own financial destiny sounds good. Just don't forget there are laws to comply with.

And who oversees compliance with those laws - the ATO.