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OUR SERVICES

Accounting & tax compliance

Is accounting and compliance taking you away from your focus?

Business tax consulting service

Are you sure your business structure is correct? Don't risk it!

Business benchmarking

How do you measure up against other businesses?

Business exit planning

Do you know when you will be exiting your business?

Business acquisitions and sales

Are you acquiring or selling your business?

Business growth consulting services

We can help you grow your business like many others to achieve your goals.

Financial management and external CFO Services

We are an extension of your business for advice.

Self Managed Superannuation Fund Compliance

Are you staying compliant with all the SMSF laws?

CHECKLISTS

Download our handy checklists using the buttons below

Business

Our checklist ensures you have everything you need to prepare your business tax return.

Home Office

If your perform some of your work from your home office, you may be able to claim a deduction for the cost you incur in running your home office, even if the room is not set aside solely for work-related purposes.

Individual Tax Return

To maximise your deductions and ensure that your tax return is complete, please review the following items and advise your Accountant if any apply to you.

Business information checklist
What home office expenses are allowed?
Is it tax deductible?
Income tax questionnaire
Items to consider

Business

Our checklist ensures you have everything you need to prepare your business tax return.

Business information checklist

Home Office

If your perform some of your work from your home office, you may be able to claim a deduction for the cost you incur in running your home office, even if the room is not set aside solely for work-related purposes.

What home office expenses are allowed?

Individual Tax Return

To maximise your deductions and ensure that your tax return is complete, please review the following items and advise your Accountant if any apply to you.

Income tax questionnaire
Is it tax deductible?
Items to consider

ABOUT US - THE TEAM

Company History

Zentveld & Lewis was originally founded in 1983 by Barry Lewis with a vision of providing better service through creating stronger relationships. The practice has achieved continual growth as we continue to develop and strengthen the businesses of our clients.

We provide specialist services to our broad client base. We draw upon our knowledge and experience to give you the best advice and service. At Zentveld & Lewis, it’s not just about providing an exceptional service, it’s about providing clients with information you require to make informed decisions about your business and financial affairs.

The business environment has changed. Technology is driving this rapid change….are you equipped? Don’t make the mistake of doing nothing. Talk to us, so you are not left behind in your industry. We want to see your business exceed, not just survive.

Our Mission & Values

Our mission is to build strong client relationships whereby we provide tailored services aimed at providing clients with the best opportunity to maximise their financial position and lifestyle balance. Our commitment to excellence is underpinned by the three core values.

Customer Service & Relationships

We take the time to listen to our clients to ensure we are focused on their needs. We are pro-active in maintaining our clients trust and work diligently to provide new ideas to meet their goals. We do all our accounting and taxation services in-house. Our accountants work in our office at Holland Park.

Quality Advice

We pride ourselves on maintaining a high standard of industry knowledge to ensure we maintain the highest professional standards and competence through effective training and feedback.

Our initial consultation is complimentary.

Exceeding Our Clients Expectations

Our satisfaction is from knowing we have performed exceptionally to help our clients reach their goals and lifestyle balance.

Peter Zentveld - Zentveld and Lewis

Peter Zentveld - Principal

Peter has worked in public practice since 1995 and is a qualified Chartered Accountant and Registered Tax Agent.

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Nicole Zentveld - Zentveld and Lewis

Nicole Zentveld - Senior Associate

Nicole has been in public practice since 1994 and is a qualified Chartered Accountant.

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Sisi_Wu_final

Sisi Wu - Senior Accountant

Sisi is focused on providing timely and detailed advice to small business owners concerning their taxation and SMSF compliance needs.

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Read Sisi's bio

Blog News

Download Recent Newsletters

Fending off GST audits
Accommodation Sharing and Tax
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ATO finalises Section 100A guidance for Family Trusts

Top cyber security tips for business

FBT exemption for electric vehicle

Proposed tax on $3m super balances

| Contact

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Zentveld & Lewis
Chartered Accountants

23 Smith Street
Holland Park, QLD 4121

07 3394 4992

07 3394 4993

Zentveld Lewis Chartered Accountants
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Zentveld & Lewis © All rights Reserved
Liability limited by a scheme approved under Professional Standards Legislation

Accounting and tax compliance

Our Services

  • Tax compliance including FBT, GST, CGT & income tax
  • Income tax strategies and tax returns
  • SMSF administration and compliance
  • Preparation of year end financial statements and periodic management accounts
  • Cash flow monitoring and management
  • Structure review and establishment

Accounting and tax compliance

Do you feel you are spending too much time on accounting compliance instead of growing your business?

We specialise in knowing exactly what needs to be done to meet your regulatory and statutory needs. Let us fix this so you can work on your business growth. 

Understanding your business and how it is trending with other industry benchmarks is key. Are you expanding too quickly without sufficient working capital. 

Avoid penalties. The tax and accounting laws are very complex and rapidly changing. We have the expertise to handle these situations and keep your business safe.

Our initial consultation is complimentary.

Business tax consulting service

Our Services

  • Tax planning and structuring strategies
  • Asset protection
  • Retirement & estate planning
  • Managing capital gains tax
  • GST advice

Business tax consulting service

Being in the wrong tax structure can cost you money and assets. As a business owner, growing the business has been your priority. However, some important decisions do not get made that could impact on your wealth. 

Come and talk to us about asset protection and minimising your risk and exposure.

Business benchmarking

Our Services

  • Industry benchmarking
  • Financial strategies to drive performance
  • Financial business assessments

Business benchmarking

We can help you understand how your business is performing compared with other businesses in your industry. 

There are many financial drivers at play. We can help address key areas of concern and identify the best strategies to increase profitability.

Business exit planning

Our Services

  • Business exit planning
  • Preparing a business for sale
  • Tax advice
  • Structuring a sale
  • Succession planning

Business exit planning

Do you know what your exit plan is? Will the next generation continue with this legacy? 

Whether this exit is soon or many years from now, planning is necessary to achieving the best outcome for all. It will minimise stress and keep you focused on the end goal in achieving financial success and lifestyle balance. 

Business acquisitions and sales

Our Services

  • Due diligen
  • Benchmarking against best practice
  • Structuring advice
  • Exploring purchasing options
  •  

Business acquisitions and sales

It is important to understand the process involved to acquire or sell your business and what you can do to increase the value and opportunities of success.

We will give you a clear perspective on areas of concern, as well as strategies to address these areas.

Business growth consulting service

Our Services

  • Cash flow analysis
  • Strategic planning and support in funding growth
  • Business assessment and key financial indicators
  • Growth through acquisition
  • Avoid growing too quickly
  •  

Business growth consulting service

Knowing when to build your business is critically important depending on where it is in the business lifecycle. Avoiding the pitfalls and capitalising of emerging markets is key to building sustainable businesses.

Many businesses will need external funding at some point to grow. We can help you determine your current capital needs, future needs and what the most appropriate way is to source it?

Financial management & external CFO services

Our Services

  • Cash flow management
  • Management accounting
  • Budgeting, forecasting and reporting
  • Improving business processes and internal controls
  •  

Financial management & external CFO services

We can strengthen your business and financial leadership with setting effective business strategies. We are here to guide you through complex decisions as they develop.

We can help your business on complex matters as and when they arrive. Many businesses enjoy this service as a cost effective alternative to hiring a full-time General Manager.

Self Managed Superannuation Fund compliance

Our Services

  • Technical advice on superannuation matters
  • Preparation of annual financial statements
  • Completion and lodgement of annual tax return
  • Audit arrangement of your SMSF
  • Management of compliance obligations

Self Managed Superannuation Fund compliance

Having a SMSF can have its challenges. We are here to step you through the process to ensure the trustees of the fund understand their obligations and all the requirements and legislation are complied with.

You can be confident that we are here to listen and help you as we appreciate SMSF is a daunting subject for many and we know how vital it is that you have a point of contact to assist you and answer your queries.

Peter Zentveld

Peter Zentveld - Zentveld and Lewis
Peter
Zentveld

Principal
P: (07) 3394 4992

Peter works with a diverse range of clients including small and medium business operators. 

Peter has considerable experience in all aspects of taxation, business management, structuring and succession planning. He works closely with clients to create strategic plans aimed at improving the financial health of their businesses. 

Peter has a special interest in property developments and construction. He understands the taxation implications from working on commercial and residential projects and offers sound commercial and practical solutions. 

Areas of expertise

  • Business & Personal Taxation
  • Business Taxation – Small and Medium Business
  • Business Consulting Service
  • Management Accounting
  • Tax Planning and Structure Advice
  • Business Acquisitions & Sales
  • Outsourced Financial Controller (FC)
  • Property Development & Construction
  • SMSF compliance

Qualifications & Memberships

  • Bachelor of Commerce
  • Member of Chartered Accountants Australia and New Zealand
  • Tax Agents Licence
  • Practice Certificate

Nicole Zentveld

Nicole Zentveld - Zentveld and Lewis
Nicole Zentveld

Senior Associate
P: (07) 3394 4992

Nicole manages the taxation and compliance needs of all our SMSF clients and personally manages some of our Small Medium Enterprise clients. 

She brings a wealth of knowledge and practical experience gained from previously working as an Insolvency specialist. Nicole understands where businesses collapse and can assist in turning those cash strapped enterprises into profitable businesses. Nicole’s knowledge and expertise of compliance needs combined with her outstanding interpersonal and communication skills allows her to provide expert advice while also identifying potential areas of additional need for clients. 

Nicole also spends a considerable amount of time in managing the strategic direction of the firm. Nicole is a keen advocate for new technologies and Artificial Intelligence that is driving change in many industries. She is passionate about ‘Embracing Effective Change’ otherwise ‘Risk Being Forgotten’. 

Areas of expertise

  • SMSF compliance
  • Business & Personal Taxation
  • Business Consulting Service
  • Tax & Succession Planning
  • Management Accounting
  • Outsourced Financial Controller

Qualifications & Memberships

  • Bachelor of Commerce
  • Member of Chartered Accountants Australia and New Zealand

Sisi Wu

Sisi
Wu

Senior Accountant
P: (07) 3394 4992

Sisi is focused on providing timely and detailed advice to small business owners concerning their taxation and SMSF compliance needs. She is able to provide value adding advice and one on one assistance to clients regarding cloud and computerised accounting, proving to be a real time saver for business owners. 

Areas of expertise

  • Business & Personal Taxation
  • SMSF compliance
  • Computerised Accounting & Training
  • Management Accounting

Qualifications & Memberships

  • Bachelor of Commerce
  • Member of Chartered Accountants Australia and New Zealand
  • Xero Advisor

ATO finalises Section 100A guidance for Family Trusts

Do you operate your business via a family trust?

The ATO released its final guidance material on the application of section 100A on 8 December 2022 – TR 2022/4 and PCG 2022/2. In doing so, it has clarified a number of issues which is welcome.

To recap, the ATO in February 2022 updated its guidance around trust distributions made to adult children, corporate beneficiaries and entities that are carrying losses. Depending on the structure of these arrangements, potentially the ATO may take an unfavourable view on what were previously understood to be legitimate distribution arrangements. The ATO is chiefly targeting arrangements under section 100A of the Tax Act, specifically where trust distributions are made to a low-rate tax beneficiary but the real benefit of the distribution is transferred or paid to another beneficiary usually with a higher tax rate. In this regard, the ATO’s Taxpayer Alert (TA 2022/1) illustrates how section 100A can apply to the quite common scenario where a parent benefits from a trust distribution to their adult children.

The final guidance is not the law and represents no more than the ATO’s view about how the law applies. It carries no legal authority, and clients in consultation with us as your advisor may consider venturing out into deeper and rougher waters, depending on your circumstances.

 Following the release of the ATO material, there are a number of risk management options going forward:

  • Only distribute to Mum and Dad

This would be quite safe from section 100A scrutiny. No person pays less tax as a result of any agreement, and this is unlikely to be seen as high-risk by the ATO.

  • Continue to distribute to young adult beneficiaries, but hand over the money

If you are happy to give money to your children, this can be achieved while at the same time optimizing tax.

  • Charge board and current university fees

If adult beneficiaries are living at home, they should pay board (just as if they had a job). This will not add up to large sums, but arm’s-length board for a full year could come to about $18,000. This allows for some tax arbitrage without handing the kids any money.

  • Use of bucket company

Having a private corporate beneficiary caps the tax rate imposed on trust income. Franked dividends can subsequently be flexibly allocated through having a trust structure interposed between the bucket company and the beneficiaries. The present entitlement can be lent back to the trustee for use in the business of the trust, although there are minimum repayment conditions. Avoid having the main trust as a shareholder in the bucket company. The ATO considers circular income flows to be high-risk.

  • Be alert for the “no reimbursement agreement” argument

If you are contemplating making a gift or an interest-free loan to another person, ask questions about the circumstances behind this plan. If it was not in contemplation at the time of the relevant appointment of trust income (up to two years ago), but has arisen because family circumstances have changed recently, there may not be a reimbursement agreement.

  • If making gifts, go once and go big

You are unlikely to escape ATO attention if you have beneficiaries making gifts or loans year-after-year. So, where there is a strong argument to support the ordinary dealing exception, try to make it once-off, and for a significant amount if possible.

If you are impacted, reach out to us determine which option is best for you and your business.

**This advice constitutes general advice only**

Last Updated 29/3/2023

Top cyber security tips for business

It is important you keep all your business, staff and client information secure. If your data is lost or compromised, it can be very difficult, time consuming, and costly to recover.

The federal government have created a list of top security tips to help keep your and your clients’ information safe.

Use strong and secure passwords

Regularly change passwords and do not share them.

Use multi-factor authentication where possible. This requires users to provide multiple pieces of information to authenticate themselves – for example, a text message to your phone when logging in to a website.

As a business owner, remember:

  • multi-factor authentication puts an additional layer of security on your accounts, making it harder for others to access your account
  • consider using a password that includes numbers and symbols which is easy for you to remember but difficult for someone to guess (for example, P!ne@pp1eP!zz@).

Remove system access from people who no longer need it

Immediately remove access for people who:

  • no longer work for your business
  • have changed positions and no longer require access.

Unauthorised access to systems by past employees is a common cause of identity security or fraud issues for businesses.

Make sure all devices have the latest available security updates

Run weekly anti-virus and malware scans and have up-to-date security software.

Instances of malicious software (malware) are increasing. It can be easy to accidentally click on an email or website link which can infect your device.

In some instances, your device may be impacted by ransomware which can:

  • lock your computer until you pay a fee to the hacker
  • install software which provides access to your bank accounts, allowing criminals to steal your business’s money.

Do not use USBs or external hard drives from an unfamiliar source

USBs and external hard drives may contain malware, which can infect your business computers without you noticing.

It can cost your business a lot of money to repair the damage.

Stolen information could be used to commit crimes, often in your business’s name.

Be vigilant about what you share on social media

Keep your personal information private and be aware of who you are interacting with.

Before sharing, ask yourself if it is information you want strangers to have access to.

Scammers can take information you publicly display and impersonate you or your business. Impersonators may send emails to trick your staff into providing valuable information or releasing funds.

Monitor your accounts for unusual activity or transactions

Check your accounts (including bank accounts and digital portals) for transactions or interactions you did not make, or content you did not post.

If an organisation you deal with sends you an email alerting you to unexpected changes on your account:

  • don’t click on included hyperlinks
  • don’t log on to the organisation’s website by using links or attachments included in the email.

You should immediately:

  • check those accounts
  • contact the organisation by phone.

Ensure your mail is secure

Consider using a secure PO Box.

Mail theft is a leading cause of information security breaches.

Zentveld & Lewis Chartered Accountants

a 23 Smith Street, Holland Park Qld 4121
p 07 3394 – 4992 e admin@zentveldlewis.com.au

This article is provided as general information only and does not consider your specific situation, objectives or needs. It does not represent accounting advice upon which any person may act. Implementation and suitability requires a detailed analysis of your specific circumstances. © 2023 Zentveld & Lewis | Last Updated 17 August 2023

FBT exemption for electric vehicle

FBT exemption for electric vehicle

The new law introduces an electric car discount in the form of an FBT exemption. This allows for car fringe benefits comprising the use or availability for use of an eligible car that is a zero or low emissions vehicle to be exempt from FBT. Specifically, a car benefit will be an exempt benefit for a year of tax if:

  • the car is a zero or low emissions vehicle (note the scheme has been extended to include plug-in electric and internal combustion hybrids until 1 April 2025)
  • the value of the car at the first retail sale was below the luxury car tax threshold for fuel efficient vehicles (currently $84,916), and
  • the car is first held and used on or after 1 July 2022

The FBT exemption would mean a customer with a gross income of $95,000 using a 36-month novated lease through their employer to purchase a 2022 Tesla model Y would see their take-home pay reduced by $1,364 a month, compared to $1,863 under the current rules, according to Inside Edge. Over the course of the lease, the total saving to the buyer would be $29,451 compared to a standard car loan.

Employers are the other big winners from the changes, which will remove the FBT liability on company-owned electric vehicles provided as part of a salary package for personal use by employees.

Under the earlier example, a Tesla valued at $64,000 currently results in a company FBT charge of around $12,500, according to Treasury calculations. This would be reduced to nil where the conditions above are met.

Car fringe benefits that are exempt from FBT will continue to be included in the employee’s individual fringe benefits amount for the purposes of determining the employee’s reportable fringe benefits amount for each FBT year in which the exempt benefit is provided.

Your reportable fringe benefits amount is used for:

  • calculating your liability for the Medicare levy surcharge
  • calculating your adjusted taxable income in determining whether a child is a dependant for Medicare levy purpose
  • calculating your adjusted taxable income in determining whether a child is a dependant for Medicare levy purpose
  • determining whether you are liable forDivision 293 tax for superannuation contribution
  • determining your eligibility for the government co-contribution for personal superannuation co-contributions you mad
  • determining your eligibility for the low-income super tax offset forconcessional (before tax) super contributions you or your employer pays into your super fun
  • determining whether you can offset your business loss against other income (non-commercial losses
  • working out if you are entitled to reduce your employee share scheme discount
  • working out the amount you must repay against your
  • Higher Education Loan Program (HELP)
  • Vocational Education and Training Student Loan (VETSL)
  • Student Financial Supplement Scheme (SFSS)
  • Student Start-up Loan (SSL)
  • ABSTUDY Student Start-up Loan (ABSTUDY SSL)
  • Trade Support Loan (TSL) debt
  • Trade Support Loan (TSL) deb
  • determining your entitlement to a tax offset for
  • contributions you made to your spouse’s superannuation
  • invalid and invalid carer
  • zone or overseas forces
  • Medicare levy surcharge (lump sum payment in arrears)
  • seniors and pensioner
  • determining your eligibility for family assistance payments, including
  • Family Tax Benefit Part A and Part B
  • Child Care Subsidy
  • Parental Leave Pay
  • Dad and Partner Pay
  • working out your child support obligations.

**This advice constitutes general advice only**

Proposed tax on $3m super balances

Individuals with large superannuation balances may soon be subject to an extra 15% tax on earnings if their balance exceeds $3m at the end of a financial year.

What has been proposed?

Recently, the government announced it will introduce an additional tax of 15% on earnings for individuals whose total superannuation balance (TSB) exceeds $3m at the end of a financial year.

Those affected would continue to pay 15% tax on any earnings below the $3m threshold but will also pay an extra 15% on earnings for balances over $3m.

The proposal will not impose a limit on superannuation account balances in the accumulation phase, rather it is about how generous the tax concessions are on higher balances.

The government has confirmed the changes will not be applied retrospectively and will apply to future earnings, coming into effect from 1 July 2025. This means your balance in superannuation at 30 June 2026 is what matters initially.

What counts towards the $3m threshold?

The $3m threshold is based on your total superannuation balance (TSB) and includes all of your superannuation accounts. This includes your accumulation and pension accounts and all superannuation funds you may have (such as your SMSF and any APRA-regulated superannuation funds you have). 

Further, the $3m threshold is per member, not per superannuation fund. This means a couple could have just under $6m in superannuation/pension phase before being impacted by the proposals.

How will earnings be calculated?

Put simply, the extra 15% tax is unrelated to the actual taxable income generated by your superannuation fund. Rather, it is a tax on earnings or increases in account balances over $3m (including unrealised gains and losses).

This means any growth in balances will include anything that causes your account balance to go up – such as interest, dividends, rent, and capital gains on assets that have been sold, including any notional or unrealised gains on assets that increase in value, even if your fund hasn’t sold them.

Apart from the extra 15% tax, the taxation of unrealised gains is what has caused a stir as currently, individuals do not pay tax on income or capital gains on assets that have not been sold..

When looking at how to capture growth in a person’s TSB over a financial year, earnings will be calculated based on the difference in TSB at the start and end of the financial year, and will be adjusted for withdrawals and contributions.

It is also worth noting that negative earnings can be carried forward and offset against this tax in future years’ tax liabilities.

How is the extra 15% tax calculated?

Superannuation funds, including SMSFs, will not be required to calculate the earnings attributable to a member’s balance above $3m.

Rather the ATO will use a  three-step formula to calculate the proportion of total earnings which will be subject to the additional 15% tax.

How will the extra tax be paid?

Individuals will be notified of their liability to pay the extra tax by the ATO. This means the ATO, not their superannuation fund, will issue members with a tax assessment.

Individuals will have the choice of either paying the tax themselves or from their superannuation fund(s) (if they have multiple funds).

The tax will be separate to the individual’s personal income tax liabilities.

Don’t fret just yet

The measure is due to start from 1 July 2025, so superannuation funds and members still have time to consider their options.

Remember, this measure is still a proposal and must be passed into legislation by Parliament to become law. So don’t rush to remove benefits below the $3m limit just yet as once amounts have been withdrawn from superannuation, it’s hard to get them back in.

If you have any questions or would like to discuss this proposal in further detail, please contact us for a chat.

**This flyer constitutes general advice only**
 
Last updated 30 June 2023

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Accommodation Sharing and Tax

Accommodation Sharing and Tax

The ATO has reminded taxpayers around their sharing economy tax obligations when providing accommodation.

The sharing economy provides a great opportunity for individuals with spare rooms or spare entire properties to rent out space and earn rental income using facilitators such as Airbnb. Indeed, approximately 2.1 million individuals reported rental income of $42 billion in the past financial year. This comes as the ATO announces a new data-matching program specifically targeting around 190,000 taxpayers receiving income from short-term rentals. The ATO said it would examine the information provided by online platforms like Airbnb to identify taxpayers who had left out rental income and over-claimed deductions.

If you are renting out rooms of your home, or indeed entire properties – whether via Airbnb or another facilitator, or indeed just privately – there are many tax issues to be aware of:

Rental Income

This will need to be declared in your tax return, irrespective of whether you rent out a room or an entire property, and irrespective of whether this is your main source of income.

Rental Expenses

Expenses associated with renting out your property can be claimed as a tax deduction. However, there can be a number of complexities. Expenses directly associated with the rented area are deductible in full, while expenses that relate to shared areas (i.e. areas that you as the host may share with renters), must be apportioned. Expenses that relate to the host’s private area only are not deductible.

Expenses include claims for depreciation and also capital works deductions (i.e. depreciation on the building structure). Expert advice should be sought as this is a complex area, with significant deductions potentially in play.

Capital Gains Tax

Broadly, the sale of your main residence is free from Capital Gains Tax (CGT) when you sell it, where it was the main residence for the entire time you owned it, and it was not used to produce income. However, if you are renting out a portion of your home, you will only be eligible for a partial main residence exemption. If you are renting out the entire home, then none of the property will enjoy the main residence exemption for that period. Exceptions however apply, including the ability to rent out your home for six-years, and yet still enjoy the full CGT main residence exemption. This exemption however is subject to a number of conditions, and advice should be sought on your specific circumstances.

It is important to note that properties purchased prior to 20 September 1985 are totally exempt from CGT, irrespective of whether they are rented out.

Goods and Services Tax

Income from renting out part or all of a residential property is typically “input-taxed”. This means that you should not charge GST on the rent that you earn from guests. Conversely, you cannot claim GST credits credits for any rental expenses that you incur, but you are entitled to claim the GST-inclusive amount of any rental expenses as a tax deduction. All told, there is no requirement to register for GST on account of your rental property alone.

Take-Home Message

The number of people renting out their house or part of their house has exploded in recent times, due in large part to facilitators such as Airbnb. While this is a great avenue for earning essentially passive income, there are a number of tax issues that landlords need to be across.

If you would like to discuss any aspect of tax around accommodation-sharing or rental properties more generally, contact us.

**This advice constitutes general advice only**

Last Updated 24/08/2023

Fending off GST audits

The Government has welcomed the actions of an ATO-led taskforce in relation to what is termed “the biggest GST fraud in Australia’s history”.

The ATO states that the fraud was first detected in early 2022 and involved offenders inventing fake businesses and ABN applications, then submitting fictitious Business Activity Statements in an attempt to gain a false GST refund. In response, the ATO’s Serious Financial Crimes Taskforce set up “Operation Protego” in partnership with the Australian Federal Police. Warrants were executed in three States against 10 individuals suspected of promoting the fraud (which included the use of social media).

Some of the numbers involved are simply staggering in terms of the perpetrators’ audacity:

  • The ATO has taken compliance action on more than 53,000 “clients”.
  • It has stopped approximately $2.5 billion in fraudulent GST refunds from being paid (as at 31 December 2022).
  • Two individuals have been sentenced to jail following their arrest in 2022.
  • There have been some 87 arrests across the country, “with many more to come”.
  • The ATO has commenced writing to more than 20,000 individuals involved in the fraud.

The purpose of our informing clients of this operation goes to GST audits conducted by the ATO and what they will be looking for should you or your business be selected. As a starting point, generally, the ATO will apply at least some level of scrutiny to Activity Statements where there is a refund of $5,000 or more or where the refund is uncharacteristically large for the taxpayer involved.

The key to staving off a GST audit is the obtaining and retaining of tax invoices. As your tax agent, there is no requirement for us to view each and every tax invoice you hold before we make a claim for GST credits on your behalf on your Activity Statement. However, no claim can be made without you being in possession of a tax invoice.

Tax invoices for purchases of less than $1,000 must include enough information to clearly determine the following seven details:

  1. document is intended to be a tax invoice
  2. seller’s identity
  3. seller’s Australian business number (ABN)
  4. date the invoice was issued
  5. brief description of the items sold, including the quantity (if applicable) and the price
  6. GST amount (if any) payable – this can be shown separately or, if the GST amount is exactly one-eleventh of the total price, as a statement which says ‘Total price includes GST’
  7. extent to which each sale on the invoice is a taxable sale.

Tax invoices for sales of $1,000 or more also need to show the buyer’s identity or ABN.

The following example shows:

  • GST included in each line item
  • the sale is clearly identified as being fully taxable by the words ‘Total price includes GST’
  • the buyer’s identity for sales of $1,000 or more.

If you have any questions around tax invoices, or if you are having problems obtaining them, reach out to us.

Disclaimer: The information contained in this article is general in nature and does not constitute advice.