The third wave of the Stimulus Package – JobKeeper payment

Today our Prime Minister and Treasurer announced a third wave of their Stimulus package – the Jobkeeper payment, to assist both businesses and employers to get through the Coronavirus pandemic.

Let’s break it down based on whether you are a business owner (an employer) or employee.

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Where is my PAYG Payment Summary?

It’s tax time and everybody is in a hurry to get their tax returns lodged for a nice little surprise refund from the new Low & Middle Income Tax Offset that has recently passed the Parliament and became law.

 

For those who worked as an employee in the 2019 financial year, you may notice that your employer did not provide you with a PAYG Summary (or Group Certificate). Before storming off to the payroll manager and questioning them, it is nice to know that the law has changed: Single Touch Payroll may now apply to your employer’s business. (What is Single Touch Payroll, or STP?)

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Employers’ PAYG Withholding obligations

Business owners normally are able to claim a tax deduction on their wages paid, regardless of whether they have fulfilled the ATO’s PAYG Withholding and reporting obligations for that payment.

The rules are changing from 1 July 2019…

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Single Touch Payroll – get sorted now!

Think your good old spreadsheet or notepad is good enough to keep track of employees’ wages? Think again!

On 12 February 2019, the Parliament has passed the laws requiring all businesses use single touch payroll from 1 July 2019.

This means that from 1 July 2019 onwards, all businesses that employ staff, whether it is 1 or 100, are required to register for single touch payroll to keep track of their employee wages, PAYG Withholding and superannuation obligations.

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Updates from Office of State Revenue & ATO – January 2019

A few important updates from Office of State Revenue affecting businesses that is registered for payroll tax, or those who pays motor vehicle allowance to employees.

December 2018 Payroll tax lodgement due date extended

For businesses that are registered for payroll tax, the due date for lodgement and payment of your December 2018 payroll tax return has been extended to midnight 14 January 2019. You may still receive reminders to lodge by 7 January 2019 – feel free to ignore them.

New cents per km rate for work-related car expenses

The ATO has increased the cents per km rate from 66 cents/km to 68 cents/km from 1 July 2018. This change applies to eligible individuals who claims work-related car expenses under the cents per km method.

Using the new rate, eligible individuals can claim a maximum of $3,400 as tax deduction against their income.

Note the work-related car expenses deduction is still subject to the following:

  • You may be asked to show how you worked out your business km
  • There is no separate claim for depreciation expenses on the car
  • This amount includes all your vehicle running expenses.

Reasonable rate for motor vehicle allowance for Payroll tax purposes

Although the ATO has increased the reasonable rate for work-related car expenses claim to 68 cents per km from 1 July 2018, for payroll tax purposes, you are only entitled to claim 66 cents in your payroll tax returns for the 2018-2019 financial year. The 68 cents per km claim comes into effect on 1 July 2019 (2019-2020 financial year).

The motor vehicle allowance for payroll tax purposes refers to an allowance paid to an employee who uses their own car for business-related travel is exempt from payroll tax up to a reasonable amount (currently 66 cents per km for 2018-19 financial year). To claim this exemption, business km travelled must be recorded.

Do you know Aston Accountants can help you with your payroll tax matters?

We can help you in the following ways:

  • Answer your burning question: Do I have to register for payroll tax?
  • Register for payroll tax
  • Preparation and lodgement of payroll tax
  • Annual reconciliation of payroll tax
  • Liaise with Office of State Revenue in relation to your payroll tax matters

Have a specific payroll tax question? Contact us for help!