Connecting the Dots | July 2024
Carisma Solutions Private Limited
Partner of Choice for Financial Solutions across Australia since 2006
We’re delighted to present our July Newsletter! As we step into the new financial year, we're eager to share our latest news and developments with you. We look forward to sharing more achievements and milestones with you throughout the year. Here’s to a year filled with growth and success!
SMSF Insights 💭
Personal Super Contributions
When considering personal super contributions in Australia, it is important to keep the following points in mind:
1. Personal Contributions:
- Personal contributions are amounts that individuals contribute directly to their super fund out of their own funds.
- If a tax deduction is claimed for these contributions, they become concessional contributions, sourced from pre-tax income and taxed at a rate of 15% within the fund.
- Contributions made without claiming a tax deduction remain non-concessional, sourced from after-tax income or savings and are not further taxed.
2. Claiming Deductions:
- In order to claim a deduction for personal super contributions, individuals must provide their super fund with a notice in the approved form, typically using the ATO form NAT 71121.
- It is important to obtain an acknowledgment from the fund.
- Contributions claimed as deductions count towards the concessional contributions cap.
- Considerations such as exceeding the cap, Division 293 tax (for high-income earners), and super co-contribution eligibility should be taken into account when deciding to claim a deduction.
Example:
- For instance, Christie, a hairdresser, earns $35,000 in assessable income during 2022–2023.
- She contributes $5,000 to her super fund as a personal contribution.
- In order to claim an income tax deduction for the entire super contribution, she must follow the process outlined above.
It is always advisable to seek advice from a financial advisor or tax professional for personalized guidance regarding individual circumstances.
Industry Insights 💭
- Plan ahead to benefit from upcoming stage 3 tax cuts, effective from July 2024. Explore potential tax-saving strategies, especially for SMSF members nearing their preservation age of 60.
- A written declaration is required to access the experienced provider pathway, as per ASIC’s latest guidance. Financial advisers must provide this declaration to their authorising AFS licensee(s) to meet qualification standards without further education.
- Certain superannuation members and earnings on specific super interests are excluded from Division 296 tax, according to recent guidance. This includes recipients of structured settlement contributions and certain death benefit pensions, as well as interests held by high-level state government employees and judges.
- Calculating TSB under new laws is crucial, especially with changes for defined benefit interests, says a technical adviser. The legislation aims to redefine TSB and simplify its calculation, impacting superannuation members in both SMSF and APRA funds.
- A major review of partnerships with over 100 partners has been recommended following a PwC inquiry. The Senate committee's final report calls for enhanced transparency, regulatory oversight, and governance of large partnership structures.
- ATO warns landlords to revise deduction rules and maintain proper records, emphasizing scrutiny on false deductions and incorrect claims. Rental income, WFH deductions, and incomplete tax returns are key focus areas.
- The Greens have called for a 5-year ban on PwC tendering for government work, citing misuse of confidential information and ongoing investigations. They also recommend reducing spending on external consulting services by 15% annually for five years.
ATO UPDATE July 2024
Vertical-Wise Blogs👇🏼
Single Touch Payroll (STP) Finalisation
by Services Management
Are you in need of assistance in completing your STP data?
This task must be finalized by July 12, 2024. To assist you in completing this, please follow the following three steps: Read More >
3 Key Focus Areas for this Tax Time for 2024
by One Business Services
Recommended by LinkedIn
As tax time approaches, the Australian Taxation Office (ATO) has highlighted three common errors made by taxpayers that it will pay close attention to. Read More >
The Effect of Foreign Direct Investment on the Financial Sector Development
by Wealth Management
Foreign Direct Investments (FDI) can play a vital role in boosting the financial sector development of developing countries. Read More >
Tax Benefits and Employment After Retirement
by Smart SMSF
Starting a new job after legally retiring will not cause a person to lose the tax benefits from an existing income stream. Read More >
June Highlights✨
Meet our CS Titan for July👋🏼
Nine years ago, I kicked off my journey with Carisma Solutions, and it’s been an incredible ride ever since. From day one, Jonah Stephen, Prasoon Veerath, and Roshan Carvalho have given me invaluable advice that’s really shaped my goals. They motivate me to dream big and achieve great things, despite my firm self-belief, which has been a mantra I live by.
With six years of previous experience in Indian accounting, I've brought an unique perspective to my role. As the Service Delivery Head of One Business Services at Carisma Solutions, I've overseen various strategic projects and driven initiatives that ensure client satisfaction. The diverse challenges we've faced have turned into opportunities for growth and innovation. The global exposure gained through on-site client engagements has greatly expanded my knowledge and perspective, especially in managing our 360-degree accounting services by coordinating with other delivery heads.
Success, I've learned, comes from effectively managing various 360-degree accounting services, leading a cohesive team, embracing new challenges, and celebrating our achievements. This approach aligns perfectly with Carisma's philosophy: "Happy associates, Happy clients, Sustainable business." This principle forms the foundation of our work ethic and drives us toward our ultimate goal.
Reflecting on my journey, I am grateful for the opportunities and experiences that have shaped my career. I look forward to continuing this path of growth and success with Carisma Solutions, always striving for excellence and making a meaningful impact.
Key Dates 📩
- Single Touch Payroll (STP): Employers must finalise declarations to the Australian Taxation Office (ATO) by 14 July each year for all arm’s length or unrelated employees. Once this declaration is lodged, your employees will be able to access their respective income statements through the ATO online services linked to myGov.
- Superannuation: Employers must pay Minimum Superannuation Guarantee (SG) on time in order to avoid the super guarantee charge. This applies from the day your employees start and as of 1 July 2024 will be equal to 11.5% of wages paid to eligible employees.
> Payments for super guarantee are due quarterly, 28 days after the end of the quarter. For June 2024 Quarter it falls on 28th July 2024.
> When a SG payment due date falls on a weekend or public holiday, your contribution must be received by the super funds on or before the next business day.
> If you have missed or made late super payments, you will need to pay the Superannuation Guarantee Charge (SGC) which is not tax deductible.
- Activity Statements
> Businesses with an annual GST turnover of at least $20 million must report and pay GST monthly by lodging a Business Activity Statement (BAS) via ATO online services for businesses.
> If you’re an employer with Pay As You Go (PAYG) withholding amounts between $25,001 and $1 million a year, you will also need to report and pay your employee’s tax withholding amounts monthly via an instalment activity statement (IAS).
> A quarterly BAS or IAS is due for lodgement and payment on the 28th July 2024.
- Tips For Meeting Your Due Dates
> Schedule recurring events or tasks for every obligation in your digital calendar, ensuring you set a reminder a week before the due date to allow time to finalize any outstanding matters.
> Allocate time to add relevant business due dates to a physical calendar that you frequently check. If you're uncertain about any due dates, feel free to ask us, and we can review your situation together.
> Seek a bookkeeper support to assist with obligations like lodging Activity Statements or request reminders for upcoming lodgements.
Stay connected with our Client Success Executives
👨🏽💻 Prasoon Veerath 👨🏻💻 Roshan Carvalho 👩🏻💻 Pooja Tattia
To discuss, please contact us at (61) 39075 6705 or write to
Disclaimer: The Client Newsletter is issued as a helpful guide to clients and is sent for their private information. You are advised not to act solely on the basis of the material contained in the Newsletter as changes in regulations may occur quickly.
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