As December is now upon us, so too is summer and the beginning of the festive season. With so many disruptions during the year, we hope you can find some time to reflect on the positive moments from the year, and spare a thought for those less fortunate. As our last newsletter for 2021, the team at Prespa want to wish you and your family a safe and happy holiday season. Most importantly, we wanted to thank you for you support throughout the year, and let you know it’s been our pleasure working with you.
Our team will be taking a bit of break, so our office will be closed from the 23rd of December and returning the 10th of January. However, if your matter is urgent, please do not hesitate to contact Damien and Nick by phone or email.
The gift of giving this Christmas
Christmas is a time when we come together to celebrate with our family and friends. And, for those who haven’t been able to see friends and family due to border closures, it will be an even more joyous occasion this year.
Gift-giving is typically a big part of celebrating Christmas and provides a great opportunity to reach out to support those who have done it tough this year.
Charity is not just about money
There are so many ways you can give back to the community. It’s not always about making a monetary contribution – giving your time is just as valuable. Volunteering at the local soup kitchen on Christmas Day or helping at your local Foodbank or food rescue service like OzHarvest can be just as valuable. Donating clothes, blankets or any other household items that will help those less fortunate or vulnerable is always welcome, especially at shelters for both men and women.
In recent years, gift bags or hampers are becoming increasingly popular too. It’s as simple as buying non-perishable food items or toiletries from the supermarket and creating a food hamper or gift bag.
Every Christmas, Kmart has the Wishing Tree Appeal whereby you can purchase a gift for a child and leave it under the tree in the store.
If you’re unable to donate cash or volunteer your time, a blood donation at the Australian Red Cross is another option. They are always in desperate need of donors. And when you donate, you’ll not only get to enjoy a little snack afterward, but you’ll receive a text message a few days later telling you exactly where your donation went.
Donating regularly
During the pandemic, there was a significant decrease in the number of donations made to charities across the country, and unfortunately, the amount of money we donated declined as well. People were unsure about job security, whilst others had chosen to donate specifically to the Bushfire Appeal early in 2020.i
Now we are coming out the other side of the pandemic economically, reports show donations are rebounding and are on the rise again. Those who donate, do so regularly and they usually have specific charities that they donate to. This may be due to personal circumstances or to support something they are passionate about.
If you’re considering donating to a charity this Christmas, you may want to do a little research first to find out exactly how your money is being distributed. How much goes directly to those in need and how much is being spent on admin and running costs. This is an important factor for many and may impact your decision in terms of which charity you choose to support.
The positive effects of donating or volunteering
Donating – whether it’s our time or money – will always make us feel good, but it shouldn’t be the key driver. Think about the impact your donation or time will have on those who are on the receiving end.
Donating will not only have a positive effect on the recipient, but it can also be beneficial to your children. You can teach them from a young age that giving back to the community can be very rewarding for many reasons.
Maximising your donation
There are so many charities to choose from in Australia, but it’s also worth considering international organisations as well.
You may prefer to donate locally, but if you decide to choose an international charity, your dollar will more than likely go a lot further. Especially in developing countries, where they may need clean water, medical supplies, or even infrastructure to build schools for young children.
Remember, if you donate $2 or more, you may also be able to make a claim on your donation at tax time.
So, whether you’re volunteering at a homeless shelter or soup kitchen or giving a monetary donation – helping others who are less fortunate could be the best gift of all this Christmas.
To find out more about volunteering or donating in your local city go to – Christmas In Australia
i JBWere and NAB Charitable Giving Index
Australia is ripe for a road trip
With much of the country opening up after a long period of travel disruptions due to COVID-19, Australian’s now, more than ever, are taking the opportunity to get on the road and discover our own backyard. And, if you’re able to work flexibly, you may be able to extend that holiday a little longer or work each day whilst you’re on the road.
You may think caravanning was just for the ‘grey nomad community’ or ‘we’re too young to be travelling in a caravan’ but times have certainly changed. Due to our international borders being closed for so long, road trips are becoming increasingly more popular and so is the mode of transport we use to get around.
Thor Industries, owners of Jayco and Airstream, began seeing a marked increase in sales back in May and June 2020, and sales are continuing to grow. So much so, they now have a backlog on orders well into 2022.i
If you are thinking of taking a road trip, there are a number of considerations when choosing the type of caravan or RV for you and your family. You may want a caravan or trailer that is smaller and easier to tow on the back of your car or 4WD, or a large and luxurious RV may be more your style, where you are able to tow a small SUV at the back for off-roading.
Why choose a road trip?
When it comes to road trip destinations in Australia, we are totally spoilt for choice and Mother Nature offers some spectacular scenery along the way. Whether you prefer hugging the magnificent coastline, exploring the lush tropical north, or heading inland and going bush, there is something special for everyone.
While a road trip provides the opportunity to experience some of Australia’s beautiful landscapes, studies have found that being amongst nature also helps alleviate stress and anxiety, improves our physical health and can also boost our mood.ii
There are many other benefits to leaving the big smoke behind and travelling to regional areas to see and experience new and exciting things. You’ll no doubt spend money in most of the towns that you stop in on your journey, boosting the local economy when buying locally made arts and crafts, local produce, or perhaps you’ll book a tour if they are available.
Where to go – that is the big question…
Australia is made for a road trip and there are plenty of Instagram worthy photo opportunities to take advantage of too, so whether it be long or short, here are some of the most scenic drives in our country:
Cairns to Cape York (QLD): Cape York Peninsula (northernmost point in Australia), Mossman Gorge
Great Ocean Road (VIC: The Grotto, Loch Ard Gorge, 12 Apostles
NT – Nature’s Way (NT): Kakadu National Park, Katherine Gorge, Litchfield National Park
Perth to Albany and return (WA): Silo trail, Stirling Range National Park
Waterfall way (NSW): Bellingen, Dorigo National Park, Ebor Falls,
West Coast Wilderness (TAS): Cradle Mountain, Lake St Clair, Pencil Pine Falls
The Epicurean Way (SA): Fleurieu Peninsula, McLaren Vale, Adelaide Hills and Barossa wine regions
Plan ahead
You may be a seasoned caravanner or a first timer, but here are some travel tips to help you and your family on your next adventure:
Ensure everything is mechanically sound before you head off. Check if are there any weight limits along the way, what are the roads like – are all the roads sealed or will there be dirt tracks or rivers you may need to cross? Check the weather forecast. Pack essential items like medical kits, physical road maps as there may not be phone reception in some areas and if necessary, pre-book accommodation sites.
If you’re travelling with children, you may need to stop more frequently, so you must factor in the additional time it will take to reach your destination – timing is everything.
All in all, remember to appreciate what we have in this big, beautiful country, it truly is one of a kind. As the saying goes – ‘take only photos and leave only footprints’ and prepare yourself for what could be the holiday of a lifetime.
i https://www.businessinsider.com.au/rv-thor-industries-has-14-billion-order-backlog-inventory-2021-6
ii https://www.stress.org/how-being-outdoors-and-getting-active-impacts-stress-management
Tax Alert December 2021
As COVID-19 turbulence starts to settle, the ATO is moving away from its supportive position and returning to its more usual compliance focus.
That means taxpayers need to be aware their financial affairs will come under renewed attention in the year ahead.
Data gathering programs increase
In recent months the ATO has announced programs to gather data on various aspects of Australians’ financial lives to use in its ongoing data-matching projects.
Recent programs include gathering data on property management and rental bonds, cryptocurrency, online selling and novated leases for the upcoming financial year (2022-23). The ATO will also be collecting data on payments made by government agencies such as Comcare, the Department of Health, the NDIA, Department of Veterans’ Affairs and the clean energy regulator.
Taxpayers who buy and insure high-value lifestyle assets will also be under the microscope, with the ATO looking to collect details that will “assist with profiling [to obtain] a holistic view of a taxpayer’s wealth”. Under this program, the taxman will be obtaining information from insurance companies for the period 2020-21 to 2022-23 about assets exceeding certain nominated thresholds.
These high-value assets include boats valued over $100,000, motor vehicles (including caravans) and thoroughbred horses valued over $65,000, fine art worth over $100,000 per item and aircraft valued over $150,000. Data obtained from insurers will include individual client identification and policy details.
Overseas gifts or loans under scrutiny
The ATO has also announced it will be increasing scrutiny of undeclared foreign gifts or loans from related overseas entities, including family and friends.
The regulator says it has encountered many situations where Australian taxpayers are deriving assessable income or capital gains offshore but failing to declare these in their income tax returns. The ATO will be looking at arrangements where taxpayers are attempting to avoid tax on foreign assessable income by disguising amounts as gifts or loans.
Anyone receiving genuine monetary gifts or loans should keep supporting documentation. Inheritances count as gifts, so if you receive an inheritance from overseas, get a certified copy of the person’s will or estate distribution statement.
Focus on working from home deductions
On a positive note, if you are still working from home due to COVID-19, you can continue using the shortcut method for claiming deductions until 30 June 2022.
From 1 July 2022, you will need to use either the traditional fixed rate or actual cost methods and meet their eligibility and recordkeeping requirements.
The ATO says it’s currently reviewing the 52 cents per hour fixed rate method to make it easier and simpler to use, given more people will be working from home in the longer term.
Backpacker tax under fire
Employers paying working holidaymakers will need to keep a close eye on developments in this area following a decision by the High Court that tax rates applied to these employees is discriminatory as it is based on nationality.
The decision could affect the applicability of the backpacker tax for workers from countries with double tax agreements with Australia. According to the ATO, this means working holidaymakers from Chile, Finland, Germany, Japan, Norway, Turkey, UK, Germany or Israel.
The ATO is currently considering the implications of the High Court decision and will provide further guidance for employers. In the meantime, employers should continue using the tax rates in the ATO’s published withholding tables for backpackers.
Self-education expense threshold to go
The government has made good on its May 2021 Budget promise to remove the $250 non-deductible threshold for claiming work-related self-education expenses.
The Treasury Laws Amendment (2021 Measures No.7) Bill 2021 is currently before Parliament. If passed, it will remove the current threshold for taxpayers claiming self-education expenses. It’s also expected to simplify the claims process in your annual tax return.
The start date for the change is likely to be 1 April or 1 July 2022.
Reminder on super stapling
If you are an employer, don’t forget to request super fund details from new employees, now the government’s super stapling rules are in place.
If a new employee doesn’t choose a super fund, you must request their stapled super fund from the ATO if they have one. This fund is linked to them and must be used for your Superannuation Guarantee (SG) contributions unless the employee requests otherwise.
If you would like help getting your tax affairs in order for the new year, contact our office today.
“Liability limited by a scheme approved under Professional Standards Legislation.” This advice may not be suitable to you because it contains general advice that has not been tailored to your personal circumstances. Please seek personal financial advice prior to acting on this information.
