2020 has been a year of unpredictable circumstances; we were all caught off guard.
Now is the time to speak to your tax professional to ensure you have a plan in place to manage the changes that may affect your tax liabilities.
These changes are best managed in advance!
Tax Planning in COVID 19 times
- Tax planning for businesses, groups and family groups can provide significant tax efficiencies
- Having the appropriate business structure in place facilitates tax efficiency
- Taxable Income actual and predicted for businesses and individuals for 2020 and 2021 is likely to have changed due to COVID 19
- Tax credits have also changed too due to the PAYG Cash Boost
Taxable Income – changes from COVID 19 include:
- Revenues have decreased and in other businesses increased
- Employment costs may change for many businesses due to reduced staff
- JobKeeper has increased revenue
- Tax Credits from the PAYG Cash Boost will change tax and cash outcomes
- Rent expense may have reduced for affected businesses
- Interest paid may be less and therefore the deduction is less
- Home office costs may have increased
There are a lot of changes affecting your tax liabilities, that are best managed in advance
Capital Gains Tax for Foreign Residents on Main Residence
- There are significant changes to the rules on Capital Gains Tax rules that may catch out some taxpayers, leading to a nasty surprise for a large tax amount payable on a sale of their residence
- Long time Australian residents that have recently become foreign residents would have planned to pay no tax on the sale of their main residence
- The changes have been swift, catching taxpayers on the hop and not able to change their circumstances or plans to qualify for the exemption
- Foreign residents will need to sell their main residence by 30 June 2020 to qualify for the existing exemption