Go For Research & Development Grants
by Paul St. Clair, F.C.A., Peter Small, B. Bus, F.C.A., and Avinash Lakhan, BFA/LLB. C.A
We are proud to provide you with the 100th Edition of
• The Australian dollar was a regulated currency (it was
our Client Newsletter. Our first newsletter was sent to
clients in April, 1981. The newsletter has always been
Our February, 1984 lead article advised clients on the
a free service to our clients and to associates.
new health system called – Medicare. In May 1985 we
Looking back at our first issue in 1981 we had some
argued against the introduction of Capital Gains Tax. In
interesting articles for that era. The article “What is
our September, 1987 newsletter we stated the following
Word Processing?” discussed and outlined the
on the Australian Stock Market – “.Investors… should
advantages of computerised word processing as
now be adopting investment strategies appropriate to the
opposed to using a typewriter. Another article was on
mature stage of this investment cycle.” In December,
how IBM was working on a supercomputer with the
1987 our lead article was “Responding to the Crash”. In
potential to have a capacity of a dozen of the largest
June 1992 we advised clients on the compulsory
computers in a space of about the size of a grapefruit.
superannuation guarantee charge coming into effect in
Technology indeed has changed in the last 27 years.
the 1992-1993 financial year. Interestingly our lead
Considerable changes have also occurred in the
article in June 1992 was “The Recession Has Bottomed”
taxation, accounting and the business landscape. When
Our “one last thought” item has some classic quotes.
• there were no taxes on capital gains, fringe benefits.
“Always look ahead – there are no regrets in that
• sales tax applied but was substituted and expanded
with the introduction of Goods and Services Tax.
“A smile is a shortest distance between two persons”
• company income was subject to double taxation, and
“If anyone believes that the world owes him a living,
• business entertaining was tax deductible, and there
However our “one last thought” item in our first
were no penalty tax rates on children’s investment
newsletter remains as applicable today as it was in
• interest rates on bank overdrafts were between 12.5%
“We, in Australia live in a privileged corner of a poverty
stricken world. We have one of the highest living
• pensions were not included as taxable income, and the
standards in the world and custody of one of the richest
superannuation system was not subject to tax. inflation
countries. To countless millions elsewhere our lot is
was 9.2% and the All Ordinaries Index was below 800
SUPER NEW STRATEGIES July,
The start of the new financial year on 1st July,
further by the Superannuation Guarantee rules,
superannuation. It is appropriate to summarise
which oblige employers to pay superannuation
the new rules, and to consider strategies that
contributions for most employees, at the rate
of 9% of salary for each eligible employee.
GETTING IN ON SUPERANNUATION WITHIN THE SUPERANNUATION ENVIRONMENT
Participation in the superannuation system is encouraged by tax concessions. Employers and
Provided the superannuation fund complies
the self employed are eligible to claim tax
with all applicable rules, its earnings are taxed
at a rate no higher than 15% (the term income
includes concessional contributions). Capital
(including salary sacrifice arrangements) can
be contributed for a person each year (known
eligible for a one-third discount, so reducing
as concessional contributions). Between 1st
the effective tax rate on gains made by a fund
July, 2007 and 30th June, 2012 a transitional
to 10%. As well, income used to make pension
concession cap of $100,000 will apply to
payments is tax exempt, so if a fund is only
persons aged 50 years and over. As well, non-
paying pensions, its earnings are tax-free, and
concessional contributions of up to $150,000
this exemption also extends to capital gains.
per person may be made each year (three years
These tax concessions make superannuation
worth can be accumulated into one, giving a
the best structure in which to hold long-term
GETTING OUT OF SUPERANNUATION
businesses are eligible to be rolled over into superannuation, instead of being subject to tax
under the Capital Gains Tax (CGT) provisions.
superannuation system must stay there until
This effectively defers CGT until retirement
the person reaches age 55. Withdrawals of
(and may even eliminate the CGT entirely, if
benefits by retirees from age 60 are tax-free,
the benefit is paid out tax-free, as described
whether taken as a lump sum or pension (a
rebate applies for retirees aged between 55 and 60). Taking retirement benefits in the form of a
Low income earners are further encouraged to
pension is generally the better strategy, since
make non-concessional contributions, by a
the earnings on an invested lump sum would
Government Co-Contribution. Contributions
represent taxable income, whereas the pension
made by those on low incomes are matched by
is not taxable. It is not necessary to retire from
a Co-Contribution Payment of $1.50 for every
benefits, although benefits taken prior to
Contribution of $1,500 each year (for eligible
contributions made during the 2006 year, a
Previously, the rules required retirees to
one-off Co-Contribution Bonus of $1.50 has
withdraw their accumulated benefits whether
been announced, bringing the total for that
they wanted to or not. These rules have been
year to $3 for every $1 contributed). The Co-
relaxed, so money can now stay within the
Contribution is available for those with
superannuation environment indefinitely.
incomes up to $58,000 (the full amount is payable on incomes up to $28,000, and then
In our next issue we will look at some
phases out until income reaches $58,000).
strategies designed to take advantage of the new rules. BEATING WINTER BLUES
As a business person, you are too busy to catch
colostrums. It is thought to play an important
a cold at this time of the year. Why not prepare
role in the defence mechanisms against bacteria,
fungi and viruses by enhancing the immune system.
Colds are caused by viruses that are easily passed on through sneezing and other contact.
With no cure yet developed for the common cold, antibiotics are ineffective against cold and
Once garlic is consumed and broken down in
flu viruses. The best prevention for a cold is
the body, its by-products are released through
having overall good health. During the winter
the lungs, where the antimicrobial action helps
months, a good general multivitamin and some
extra anti-oxidant protection will help to boost
your immune system. The following natural remedies may help to fight against the dreaded
Zinc in the gluconate form needs to be taken
when symptoms first appear and then continuously for the duration of the cold. For
treating colds, zinc is best taken in the form of
Echinacea is the most commonly used herb for
colds because of its ability to stimulate natural
immunity. It is also antibacterial, antimicrobial, antiseptic and antiviral.
Olive leaf has antibiotic, antibacterial and antiviral properties that make it potentially
Despite the huge amount of research, debate
Overall, a good diet and a healthy lifestyle
still rages over the effects of vitamin C in
keeps you away from cold and flu in winter:
preventing or treating the common cold. Some researches showed that taking large doses of
vitamin C can stimulate the immune system,
secretions thin and prevent dehydration.
shorten the duration of cold and reduce the severity of common-cold symptoms.
Avoid mucus-forming foods such a dairy
Avoid central heating because it dries out
Lactoferrin is an important natural immune
GO FOR RESEARCH & DEVELOPMENT GRANTS
If your company has an R & D project where
year through its grants, loans, venture capital
you can fund half the R & D cost, and show
proven business success, you may be eligible for funding through AusIndustry R & D
For further information contact Avi Lakhan
grants. Assistance worth nearly $2 billion is
made available to 9,000 businesses every
CARBON TRADING What is Carbon Trading?
“The increasing weight of scientific evidence
environmental regulator firstly determines
damaging growth in the level of greenhouse
total acceptable emissions that a company or
gases arising from human activity. This will
group can emit and then divides this total into
How does it work?
infrastructure and a range of industries,
Participants that emit pollutants must obtain
sufficient tradeable units to compensate for their emissions. Companies or groups whose
emissions are below their given ‘cap’ will
growing acknowledgment that governments,
have surplus units which then may be sold or
individually and collectively, should act to
‘banked’ for future usage. Companies or
mitigate the emission of greenhouse gases.
groups that pollute beyond their allowances
must buy credits or face penalties. This
transfer is referred to as a trade. The scheme
basically rewards companies and groups for
companies and groups for emitting carbon
dioxide and other greenhouse gases in the
What is the intention of Carbon Trading
environment. The overall intention of the
‘Task Group on Emissions Trading’ reported that:-
In October, 2004, the then NSW premier Bob
The laws came into place as at 2nd July,
Carr announced that smoking in indoor areas of
2007 and all hotels, clubs and nightclubs
licensed premises would be phased out by July,
2007. This plan has been implemented in 4
phases; on 3rd January, 2005, 4th July, 2005,
3rd July, 2006 and finally on 2nd July, 2007.
As of 2nd July, 2007 the following law comes
into place, “All enclosed areas of hotels, clubs
and nightclubs that are open to the general public
must be completely non-smoking, and all areas
of Star City Casino with the exception of the
negatively affect businesses. This is due to
smoking”. The Star City Casino exception is the
frequent the venues, non-smokers will be
TAX BRIEF Page TAX RATES - 2007 A reminder that the personal income tax rates for the year ending 30th June, 2007 are:- Current tax thresholds to 30/6/07 Tax rate New tax thresholds from 1/7/07 Income range ($) Income range ($)
The income tax rate for companies remains unchanged at a flat 30%.
LOAN REPAYMENTS SUBJECT TO TAX A recent Court decision has major implications for those who operate their business in a corporate structure. The Court decided, surprisingly, that repayments by the business of loans made to it by its owners constituted taxable fringe benefits. While this decision may be, and hopefully will be, overturned on appeal, taxpayers who are employees of their business are warned to take steps to avoid demonstrating the critical factors that led to the Court’s finding. In short, these factors were: no salaries were paid by the business to the owners, the business yielded only small profits, and the repayments covered the regular expenses of the owners. Accordingly, the Court decided that the loan repayments were, in fact, fringe benefits that were made in place of salaries to the owners as a reward for their employment in the business.
We therefore suggest that all owners who work in the business should be paid a reasonable salary for their work. Salary payments should be made on a regular basis, the same as for other employees with tax withheld. Payments should not be made by the employer for the owners private expenses. These should be paid from the owner’s personal bank account. Repayments of the loan account, when required, should show the characteristics of loan transactions: the owner should make a written request to the employer for repayment of a portion of the loan, the repayment requested should be a lump sum, and the entry in the accounting records of the business should describe the payment as “repayment of loan”. MOTOR VEHICLE EXPENSE CLAIMS The new rates for motor vehicle expenses using the cents per kilometre method for the 2006/2007 year are: Engine capacity (cc) # Rate per Kilometre (cents)
Conventional engines only; half these rates for rotary engines.
REMINDERS FOR EMPLOYERS
Employers are reminded that the rate of superannuation contributions required to comply with the Superannuation Guarantee Charge (SGC) laws is 9%, and that contributions must be made every quarter to comply with the rules. As well, employees must be notified, within 28 days of the last contribution each quarter, of the amount contributed for their benefit. There are very few exemptions from SGC (the most common is for those who earn less than $450 in a month), and substantial penalties apply to breaches. Superannuation contributions are only tax deductible when paid. If you fail to make the mandatory contributions, you are liable to pay the SGC, for which no tax deduction is available.
Pay As You Go (PAYG) Payment Summaries must be issued to employees by 14th July, 2007. The originals of these summaries, and the necessary reconciliation statement, must be forwarded to the Tax Office by 14th August. Details of fringe benefits provided must be disclosed on employee PAYG Summaries issued for the 2007 year.
WHAT WE NEED TO PREPARE YOUR TAX RETURN July,
Whilst gathering your tax information for preparation by us, you may like to check the undermentioned items to see if you have included them in your summary of information. Although the following list is not exhaustive, it will serve as a useful guide.
ASSESSABLE INCOME PAYG Payment Summaries Share transactions (full details) Interest and royalties Rent received Business/Partnership – income and expenses Sale of any asset where the asset was acquired Commissions received Trust income Termination payments received (with Allowances, benefits, earnings, tips and accompanying Social Security benefits received Dividends, including imputation details Pension/Annuity payments ALLOWABLE DEDUCTIONS Advertising Leasing costs Bad debts (written off during the year) Legal expenses (in certain cases - full details) Bank charges applicable to earning income Losses of previous years in certain cases. Business Expenses Motor vehicle expenses (including business use Commissions paid Convention/Seminar expenses Newspapers essential to your business Contributions to approved superannuation, Plant, furniture, fittings, motor vehicles etc.,
provident or retirement funds (generally
subject to depreciation (limited to $57,009 for
a vehicle purchased during the 2007 year)
Donations & gifts over $2.00 (approved) Stationery, postage, printing costs Education expenses - for income producing Superannuation contributions Subscriptions to trade, business or professional Film investments Home office expenses Sun protection, where exposure is a risk. Telephone expenses applicable to the earning Purchases for resale Rates and taxes on income producing property Travelling expenses (including overseas with Repairs to income producing property (not Insurance premiums (business) Tools of trade Interest on borrowings for business Tax agent fees, accounting and audit fees Wages and salaries
These claims are subject to the substantiation provisions, where applicable. •
REBATES Spouse and dependants (subject to any amount Net Medical expenses over $1,500 in total Sole Parent Franked dividends OTHER Family Tax Benefit - names and dates of birth Private Health Insurance - rebate and surcharge
for dependant children under the age of 21
details required, as well as Fund membership
(25 if in full time education). Details of
Family Tax Payments received from Stock value at 30th June, 2007 (valued at cost or Centrelink. Spouse’s taxable income and
childrens income and education status if
Trade creditors (at 30th June, 2007, listed under Trade debtors (at 30th June, 2007) N o t i c e b o a r d AUSTRALIAN economy. The latest WORKPLACE information. From
economic data doesn’t get much better. In the first 20th July, 2007 every employer in the federal
three months of this year the economy grew at 3.8 workplace relations system must provide a copy
percent on an annual basis, the fastest in three years.
of the “Workplace Relations Fact Sheet” to all
At the same time inflation actually eased. The their existing employees within three months and
unemployment rate dipped yet again to a 32 year low
to new employees within seven days. This
of 4.2 percent. Despite a tight labour market the cost
requirement applies to all corporations who are
of labour actually fell in real terms by 1.4 percent. In
employers and those employers who are covered
March, 2007, 40,000 new jobs were created. As a by a federal award or instrument. If this applies to
result of inflationary pressures easing, again interest you and you want copies of the “Workplace rates did not rise. Part of the answer to this great news
Relations Fact Sheet” do contact Karen Huynh on
is that immigration is growing at the fastest rate in 17
years and in this coming year growing even faster. AUSSIE dollar.
Employers and Government seeing the need for
are the effects? At time of writing the Aussie
skilled employees have targeted migrants adjusting is heading towards US90 cents. On the basis of
visa requirements. There is a good balance in these information available and on the opinion of most
numbers. If the supply of workers keeps up with the
experts on this subject the Aussie is heading
demand of employers, then inflation is kept in check.
TAX hit list. The Taxation Office has advised Australian view point in a boom economy, of the following occupation hit list for the 2007 tax
depending on inflation numbers, there is upward
year – motor mechanics, electricians, hospitality pressure on interest rates which puts upward workers, mining workers, factory hands, store pressure on the Aussie. Being in the midst of a workers, IT professionals, accountants and high minerals boom further upward pressure is on the wealth individuals. The Taxation Office would pay Aussie dollar. If we go back to the last minerals special attention to the explosion in work-related boom the Aussie dollar well exceeded its present expense claims. The average work-related expense value against the US dollar. In brief our interest
rates and minerals boom is sucking in foreign
capital. On the other hand the US dollar is weaker
ECONOMIC cycle. A common question as a result of its big budget and trade deficits. on the minds of investors is “has the economic cycle
There are winners and losers with a rising Aussie
peaked for the sharemarket and will it now favour dollar. Exports are dearer and imports are the property market?” The sharemarket has
cheaper. Cheaper imports may save us from an
certainly been breaking records and at the time of interest rate rise this year. Not all exporters are writing, shares are down. There are pointers hurting with a rising Aussie dollar. Those that indicating that the share cycle has still not peaked. make their sales in US dollars are not hurting, for Whilst the market has risen over 10 percent this year
example BHP Billiton and Rio Tinto operate in
it is still well supported by strong company earnings.
US dollars. It could be said that despite the
Share yields are about 3.6 percent compared with weakness in the US dollar it is still a de facto property at about 2.8 percent in Sydney. The overall
price earnings ratio of the sharemarket is around 18;
GOLDEN rules applied by Christine
a high but not excessive multiple. The current Manfield of Modern Food Pty Ltd, to good living
downturn in the sharemarket is a natural and business:- consequence after a big run. In general share prices
are still reasonable. On the property side of the
economic cycle that market has seen poor returns over the last four years particularly in NSW. This 3. Stay true to your dreams. may be about to change since vacancy rates on rental
properties have fallen from 4.5 percent to 1.3 percent
5. Don’t ever be scared of jumping into the
in NSW. This is a strong indicator but with a
possibility of a rise in interest rates this casts a Finally, “It’s nice to have money, because it gives
shadow over a residential property pick up. We may
you the freedom to make choices, and that’s
well be moving closer to an economic cycle change
where (on occasions) happiness comes from.”
in the share/property markets but not just yet.
The national unemployment rate for June, 2007 is 4.3%. The inflation rate for the year to June, 2007 is
2.1%, whilst the balance on current account is a deficit of $15.561 billion.
Sydney now ranks as the world’s 21st most expensive city in which to live, with Moscow in first place
followed by London and Seoul. In terms of cost of housing affordability, Sydney now ranks as the world’s 7th most expensive city, behind Los Angeles at the top of the list.
Australia’s superannuation nest-egg increased by 19.2% in the 12 months to December 31, 2006, and
has now passed the $1 trillion (that is $1,000 billion) mark. Australia now has the fourth largest pool of superannuation savings in the world, behind the US, Luxembourg and France.
The second five-yearly Intergenerational Report has found an easing in Australia’s ageing population,
resulting from an increase in the birth rate and increases in skilled migration.
Researchers studying housing affordability have concluded that the rate of population increase is
double the rate of housing construction, resulting in continued pressure on housing prices and rents.
A decision by the High Court has found that an investor who bought shares in a company was entitled
to damages for being “misled” by the company, because he bought the shares at a time when the company failed to disclose its dubious financial position.
In supermarkets, the more a product jumps out at you the more expensive it is likely to be.
A social survey has revealed that working long hours does not destroy marriages but where a husband
works part-time marriage failure is nearly twice as likely.
According to a new report, the rate of payment fraud in Australia is low by world standards, but we
have topped the world for the number of cars stolen each year on a per capita basis. And even on a total basis, we rank number 8 in the world.
An American study has forecast that Western asset values could halve in the short to medium term as a
result of ageing populations, with baby-boomers starting to realise their assets to fund retirement lifestyles. This could, in turn, put downward pressure on real estate and share prices.
Australians paid an average of $11,976 in taxes to the Commonwealth in 2006, a rise of 5.6% on the
previous year. When State and local taxes are added in, the total paid to government in 2006 reached $14,551 per person.
The world has more billionaires then ever before, and they are getting younger. Forbes magazine lists
946 billionaires in 2007 (793 last year) with an average age of 62 (64 last year). Bill Gates tops the list ahead of Warren Buffett. Russians and Indians made up the greatest number of additions to the list.
ONE LAST THOUGHT When the Tax Office make a mistake, they call it an error. When a taxpayer makes a mistake, they call it negligence
Sicherheitsdatenblatt gemäß 1907/2006/EG, Artikel 31 ABSCHNITT 1: Bezeichnung des Stoffs bzw. des Gemischs und des Unternehmens 1.1 Produktidentifikator Handelsname: Super Pellets Registrierungsnummer: AT/2012/Z/00033/14 1.2 Relevante identifizierte Verwendungen des Stoffs oder Gemischs und Verwendungen, von denen abgeraten wird Verwendung des Stoffes / des Gemi
Roll of Successful Examinees in the C.P.A. LICENSURE EXAMINATION Held on MAY 16, 2010 & FF. DAYS Page: 2 of 39 Released on MAY 25, 2010 Seq. No. N a m e 1 ABAD, MICHELLE RAMIREZ 2 ABAD, MYRLA MELCHOR 3 ABAD, SHEE ANN PORRAS 4 ABAD, VERNIEDECK BUTIHEN 5 ABALDE, SHELDON BARANGAY 6 ABALOS, JACQUELINE BAUTISTA 7 ABANGAN, ROSE MARIE LOBO 8 ABAPO, LEA MARIE BEBING 9 ABARCA, MICHELLE BISNAR 10 ABARQ