Important January Updates
Deductible gift recipient reforms
The administration and oversight of organisations holding Deductible Gift Recipient (DGR) status will undergo several reforms, as announced by the government. These changes aim to enhance governance structures, streamline administrative processes, and maintain trust and confidence in the sector.
The Treasury Laws Amendment (Refining and Improving our Tax System) Act 2023, enacted on June 28th 2023, incorporates amendments to the Income Tax Assessment Act 1997. These modifications involve the transfer of administrative responsibilities for four distinct DGR categories from various government departments to the Australian Taxation Office (ATO).
These adjustments became effective from January 1, 2024, and involve the repeal of provisions mandating each of the four departments to maintain a separate register. Transitional provisions are in place for organisations that:
Already hold DGR endorsement in one of the four unique DGR categories.
Have an ongoing application with one of the four government departments and have not received a notification of the outcome by December 31, 2023.
Organisations that were already DGR endorsed in one of the four unique categories before January 1, 2024, will retain their endorsement as long as they continue to meet the eligibility criteria.
For organisations with applications in progress at one of the four government departments, their applications will be transferred to the ATO from January 1, 2024.
Changes in reporting requirements for sporting clubs
Not-for-profits (NFPs), including sporting clubs, societies and associations, with an active Australian business number (ABN) need to lodge an annual NFP self-review return to continue accessing income tax exemption.
To ensure compliance, your first NFP self-review return for the 2023–24 income year must be lodged between 1 July and 31 October 2024. Even if affiliated with a broader sporting group, organisations with their own ABN must complete their individual NFP self-review return.
To streamline the process:
Confirm an active ABN through ABN Lookup.
Update the organisation's address and responsible persons' details promptly.
Identify the main purpose and governing documents of the sporting organisation.
Conduct an early self-review to validate eligibility for income tax exemption.
Set up myGovID and Relationship Authorisation Manager (RAM) in advance for timely completion of the NFP self-review return in Online services for business.
Stay informed by subscribing to monthly Not-for-profit news.
Failure to submit the return may result in ineligibility for income tax exemption and potential penalties.
Voluntary HELP debt repayments
You have the flexibility to make voluntary repayments at any point to decrease your outstanding debt. However, even after making a voluntary repayment, you might still be required to fulfil a compulsory repayment or settle an overseas levy if:
You still have an outstanding debt.
Your repayment income exceeds the minimum repayment threshold.
It's crucial to note that voluntary repayments are separate from compulsory repayments/overseas levy and are non-refundable.
If you're planning to clear your entire loan balance through a voluntary repayment, it is advisable to do so before filing your tax return or reporting worldwide income.
NSW Farmers Effective Worker Induction
NSW Farmers provide guidance on developing your own worker induction program including an introduction to work health and safety, roles and responsibilities, hazard and risk management, emergency procedures, safe work practices, reporting and incident management, health and wellbeing, and legal obligations.
Register now by clicking the links:
22 January 2024 - Online Via Zoom (6.30pm to 8.30pm)
19 February 2024 - Online Via Zoom (6.30pm to 8.30pm)
13 March 2024 - Online Via Zoom (6.30pm to 8.30pm)
Setting up super for your business
As an employer, it is essential to establish procedures for remitting superannuation contributions to the chosen super funds of eligible employees or to their stapled super fund in the absence of a preference.
If an employee has not indicated a choice and lacks a designated stapled super fund, you can direct their superannuation contributions to your default super fund.
Here's what you need to do:
Choose your default super fund.
Present employees with a selection of super funds and maintain documented evidence of this offering.
Request stapled super fund details from employees who haven't made a choice.
Furnish employees' Tax File Numbers (TFNs) to their respective funds.
Configure your systems to electronically remit super contributions to the correct fund.
Should you be making additional superannuation contributions for an employee under a salary sacrifice arrangement, refer to the guidelines on setting up salary sacrifice for super. Additionally, ensure the proper reporting of these amounts by consulting the information on identifying reportable employer super contributions.
When you should enter into a payment plan
The Australian Taxation Office (ATO) offers valuable information to assist you in determining the appropriate time to consider entering into a payment plan.
If you find yourself encountering financial difficulties, it's worth noting that you may be eligible to establish a payment arrangement with the ATO. This option provides a structured approach to managing your financial obligations in a manner that aligns with your current financial circumstances.
Cyber security: Don't set and forget
Maintaining cybersecurity should not be treated as a one-time task for businesses; instead, we advise conducting regular security checks, preferably on a monthly basis. The Australian Cyber Security Centre (ACSC) reported one cybercrime every 7 minutes during the 2021–22 period.
To safeguard against becoming a target for such criminal activities, the ATO has outlined four straightforward steps to implement:
Don't compromise your device/s. Install updates for your devices and software. Regular updates ensure you have the latest security in place. You can turn on automatic updates so future updates are made as soon as they're available.
Turn on multi-factor authentication (MFA) to protect your valuable information and accounts from criminals. MFA options include an authenticator app, physical token, email or SMS.
Back up your files regularly. Hardware failure, theft, or a virus could result in the loss of critical business information. Recovering data can be expensive and sometimes impossible.
Change your password to a passphrase as they're more secure. Passphrases use 4 or more random words and tend to be more unique, longer in length and less predictable than a password. You can even use a password manager to help you generate or store passphrases.
Cybercrime can be costly for businesses, but there are resources for business to help you improve the cyber security of your business and the cyber practices of your staff.
MoneySmart's Budget Planner
Are you considering mastering budget management as part of your New Year's resolutions for 2024? Crafting a budget proves to be a valuable tool for overseeing the flow of your personal or business finances. Simplify the budgeting process by making use of MoneySmart's budget planner!
Their template empowers you to:
Track the allocation of your funds.
Customise and add your own specific items.
Adjust the currency according to your preferences.
Image: Bush & Campbell Directors, David Rosetta, Rebecca Nicoll, Daniel Uden, Mathew Smith, Sharon Ferguson, Amanda Powell and Peter King
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If you have any questions or concerns, or would like further information about these articles, please do not hesitate to get in touch with our team of Bush & Campbell experts.