The ATO is providing concessions to businesses affected by Coronavirus (COVID-19), but at the same time is getting tough on employee car parking benefits and investigating lifestyle assets owned by wealthy taxpayers.
Here’s a roundup of some of the latest developments when it comes to tax:
More employers up for FBT on car parking
The ATO has released a new draft interpretation of the FBT legislation that could see more businesses paying FBT if they provide employees with car parking benefits.
Draft Taxation Ruling TR 2019/D5 is due to commence on 1 April 2020 and replaces the former ruling, which was in place for over 20 years.
Under the ATO’s new interpretation, if your staff car parking facilities are both in the vicinity of your business and within 1 kilometre of a car park that offers all-day parking as a ‘commercial’ car park for FBT purposes, you may have to pay FBT on the value of your employees’ car spaces – even if they were tax-free before. A car park can be commercial for FBT purposes even if its fee structure discourages all-day parking by charging a higher fee.
If your business is near a shopping centre, hospital or airport for example, you should review your obligations prior to the new FBT year.
ATO collecting details on lifestyle assets
Taxpayers with ‘lifestyle assets’ like yachts, thoroughbred horses, expensive cars and fine art are likely to find themselves under the tax man’s microscope after the ATO requested five years of policy details from insurers.
Over 30 insurers have been asked to provide details of assets over certain value thresholds for use in the ATO’s data matching program.
Valuations of assets owned by around 350,000 taxpayers will be added to the ATO’s database, providing it with a more complete picture of a taxpayer’s actual financial situation. Although the information will not be used to start automated compliance activities, it will be used for risk profiling purposes.
Early release of super on ATO radar
The tax man is once again warning taxpayers that withdrawing your super savings before a condition of release is met is illegal.
If you are approached by someone promoting a scheme offering early release of your super benefits, the ATO is asking you to contact it on 13 10 20.
CGT blow for non-resident property owners
Property owners who are non-residents for tax purposes are no longer eligible for the main residence exemption (MRE) for capital gains tax (CGT) when they sell their home.
Under new legislation, the MRE is now denied to non-resident taxpayers if they dispose of a property purchased after 9 May 2017, unless certain life events occur within six years of becoming a foreign resident for tax purposes.
For homes purchased prior to 9 May 2017, non-resident taxpayers only have until 30 June 2020 to sell their former home if they do not want to pay full CGT on the capital gain made since the original property purchase.
If you would like to receive further information about the above tax updates, please get in touch with our accountants at our office on 1300 363 866 or via our website at https://mcconachiestedman.com.au/contact/.