New guidelines for professional services firms - lawyers, architects, medical practitioners etc., came into effect on 1 July 2022.
The
guidance takes a strong stance on structures designed to divert income in a way that results in principal practitioners receiving relatively
small amounts of income personally for their work and reducing their taxable income.
The ATO is now contacting professionals who they believe might be at risk. Any structural changes that need to be made to reduce risk, should be completed by the end of the 2022-23 financial year.
Where the ATO deems that income has been diverted inappropriately to create a tax benefit, they will remove that benefit and significant
penalties may apply.
Falling behind on your BAS lodgements looks like an administrative problem. Left long enough, it becomes an expensive one, because the GST you collected stays payable indefinitely while the GST credits you are owed disappear after four years. Here is what that looks like in dollars.
With negative gearing now quarantined for established dwellings, new house and land has become the sensible play for investors — but there is a trap in the first eighteen months. Interest on the land is denied, while interest on the construction is not. If the bank has written one loan, someone has to do the sums. Here is why it pays to split the loan before you sign.
When the draft legislation for the trust minimum tax was released, it came with a reassurance: if you do not want to restructure, you can simply make an election instead — no restructure, and no state stamp duty. That is accurate, but it is also a very small part of the decision. Here is why you should choose your structure for the eventual sale of your business, not for the announcement.
