• Superannuation for Same-Sex Couples
• Surprise ATO Visits to Businesses
• Australian Taxation Office Delays
• Tax-related email scams
• Investing in Dodgy Schemes
• Tax Cuts Next Financial Year
• Tax Planning Time

Changes to the law mean same-sex partners can now have their relationship recognised by their superannuation fund. The changes amend tax and super laws affecting super death benefits, death benefit termination payments, making contributions for your spouse and other aspects of the super system.

The result is that:

• The definitions of ‘spouse’, ‘child’ and ‘relative’ in the super laws and income tax laws include same-sex partners and their children.
• Same-sex partners and their children under 18 years are treated as dependents for the purposes of taxing super death benefits and benefit termination payments.

Businesses may be surprised by a visit from the Australian Taxation Office as the review of the governing rules has been given the all clear by the federal watchdog.

The ATO has been given the right to enter a business’s premises without notice in cases where there is concern the client is fraudulent and may destroy documents if notice of the audit was given. The desired outcome is to strengthen public accountability and transparency in the tax system. The wide-ranging powers allow the ATO to enter a business or private premises without the owner’s consent to examine and copy documents relevant to an investigation.

There are temporary delays at the ATO as they have been shut down the last couple of weeks in order to upgrade their systems. They have apologised for longer processing periods for Income Tax Returns and refunds.

They have processed the backlog of activity statements and are up-to-date with issuing activity statement refunds. They have begun processing income tax returns in the new system in smaller volumes, with their staff checking the outcomes. Their numbers will gradually increase as they build up to their normal processing levels. They plan to clear the income tax return backlog by the end of February.

There are currently various tax related scams going around the World Wide Web. UPA have been contacted by various clients advising they have received an email from the Tax Office claiming they have a refund.

From time to time the ATO will send out an SMS or email messages to clients promoting new services or alerts regarding due dates, but they will never send you an email requesting confidential details to be given or confirmed. The ATO will contact you via postal mail for those issues.

Please check the ATO website regularly for updates on current tax scams that are in circulation.

There are many promoters trying to get clients to invest in schemes promising high returns and generous tax breaks. If it sounds too good to be true, it probably is.

Be prepared and do the research. Promoters can be very convincing and the product very tempting. Here are some steps to help avoid these situations:

• Seek independent advice to make sure the investment is sound.
• Make sure the salesperson works for a licensed business.
• Make sure the investment has a Product Disclosure Statement or prospectus.
• Check with the ATO to make sure the arrangement has a product ruling.

The government implemented a plan that has been gradually but significantly reducing the amount of tax payable for individuals. These tax cuts result from the Rudd Government Budget in 2008 following on from an election promise. From 1 July 2010, the 30% threshold will be increased again to $37,001 and the top marginal tax rates will be cut to 37% and 42%.

The fringe benefits tax rate will also be reduced in line with reductions in the top marginal tax rate to 43.5% from 1 April 2010.

New Personal Tax Rates

2009-2010		2010-2011
$0 - $6,000	0%	$0 - $6,000	0%
$6,001 - $35,000	15%	$6,001 - $37,000	15%
$35,001 - $80,000	30%	$37,001 - $80,000	30%
$80,001 - $180,000	38%	$80,001 - $180,000	37%
$180,000 +	43%	$180,000 +	42%

The last quarter of the financial year will start on April Fool’s Day. Traditionally, April, May and June are our biggest months for Tax Planning and to be sure that you don’t miss out on our help during this time, we urge you to start thinking about your tax planning now. One of the better tools for assisting with your tax planning is the preparation of interim financial statements. Because it does take some time to prepare the interim financials, please don’t leave it to the last minute to request them. Making superannuation contributions is our favourite tax planning tool, but with the reduction to the amounts that can be contributed to superannuation this year tax planning just became a whole lot harder. The new maximum limits that can be contributed as deductible contributions are $25,000 for people under age 50 and $50,000 for people aged 50 or more. If you turn 50 this financial year, you must make a contribution (of any amount) on or after you birthday to get the higher limit.