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News & Publications

New rules, regulations and updates to ATO processes and requirements often occur.

The publications below are intended to keep you, the client, informed and up-to-date.

ATO target areas this tax time

IPA Technical Advantage - Issue 495

The ATO has issued a media release setting out its three focus areas for what it terms “this tax time”. 

HELP repayment thresholds and rates

IPA Technical Advantage - Issue 495

Government has updated the repayment incomes and repayment rates for the Higher Education Loan Program for the 2023-24 income year.

Federal Budget 2023-2024

1.1 Increasing the Medicare levy low-income thresholds

1.2 Exempting lump sum payments in arrears from the Medicare levy.

2.1 $20,000 instant asset write-off.

2.2 New Energy Incentive for small businesses.

2.3 Lodgment penalty amnesty program.

2.4 Halving the increase in quarterly tax instalments.

3.1 Government to amend the non-arm’s length income (‘NALI’) provisions.

3.2 Increasing the frequency of superannuation guarantee payments.

3.3 Earnings for superannuation balances above $3 million taxed at 30%.

4.1 Expanding the general anti-avoidance rule.

4.2 Extending the compliance program for personal income tax.

4.3 Improving engagement with taxpayers to ensure timely payment of tax and superannuation liabilities.

4.4 Investing in superannuation guarantee compliance.

4.5 Four-year extension for GST compliance program.

4.6 Extending and merging the Serious Financial Crime Taskforce and Serious Organised Crime program.

5.1 Capital allowances – Accelerating the capital works tax deduction for ‘Build-To-Rent Developments’.

5.2 FBT – Electric Car Discount.

5.3 Incentivising pensioners into the workforce – six months extension.

Key Changes for Individuals for the 2022-2023 Tax Year

SELF-EDUCATION EXPENSES THRESHOLD REMOVED:

Until 2021/22, self-education expenses in excess of $250 were deductible. In other words, the allowable work-related self-education expense was calculated after reducing the expense by $250. The $250 non-deductible threshold has been removed for 2022–23.

 

WORKING FROM HOME DEDUCTIONS:

The COVID-19 hourly rate of 80 cents per hour, which is also called the “short cut method of working from home deduction”, can no longer be used from 2022/23.

There are two methods of deducting working from home expenses: fixed rate method and actual method.

 

Fixed rate method

The hourly rate and types of expenses covered by the hourly rate have been revised. A revised fixed rate of 67 cents per hour covers the below expenses:

  • data and internet

  • mobile and home phone usage

  • electricity and gas

  • computer consumables (e.g. printer ink)

  • stationery.

We are no longer required to have a dedicated home office to use this method.

While using fixed cost method we can claim deduction for below expenses on top of the hourly rate:

  • the decline in value of assets used while working from home, such as computers and office furniture

  • the repairs and maintenance of these assets

  • cleaning (only if you have a dedicated home office).

 

(an example working from home diary can be viewed by clicking here)

 

Actual cost method

The actual cost method allows us to claim deductions for all the above working from home expenses based on detailed calculations and records.

Eligibility criteria for using the actual cost method to claim actual expenses are as below:

  • we must incur additional running expenses as a result of working from home

  • we must keep records or other written evidence, which shows the amount:     

    • we spent on expenses

    • we spent on depreciating assets we buy and use while working from home

    • of work-related use for your expenses and depreciating assets.

Cleaning costs can be claimed only if there is a dedicated home office.

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LOW AND MIDDLE INCOME TAX OFFSET REMOVED:

The low and middle income tax offset (LMITO) has been removed from 1 July 2022. Because of this we may receive a lower refund than expected or a tax payable this year.

However, the low income tax offset (LITO) is still available for someone with a taxable income of $66,667 or less. It can provide a maximum offset of $700 depending on the taxable income.

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