• The Farmers Accountant

Small Business Fees & Charges Rebate. Also, Tax Treatment of Cryptocurrencies

Small Business Fees & Charges Rebate

Many of you will have applied for the Small Business Fees and Charges Rebate from Service NSW. If you haven’t and you are an eligible business, make sure you apply through your Service NSW account. If you don’t have one, set one up so you can apply for the rebate. The aim of the scheme is to support businesses recover from the effects of Covid 19 and reduce the cost of running a business. The rebate will be available from April 2021 until 30 June 2022. Businesses can claim the rebate against invoices (re local and state government expenses) that were due and paid from 1 March 2021. Who is eligible? Small businesses (including sole traders and not for profit organisations) are eligible for the rebate on government charges if they:

  • Have wages below $1.2m

  • Have an ABN and are physically located and operating in NSW.

  • Are registered for GST.

  • Have a turnover of at least $75,000 per year.

It is worth noting that for each trading entity that meets the above conditions, they are entitled to a separate rebate amount. Applicable license fees and charges. The rebate covers NSW Government charges and fees and local council rates and charges related to the cost of doing business. All NSW Government fees and charges will be eligible, excepting those that are specifically excluded under the exclusion criteria. Exclusion criteria include:

  • Fines and penalties;

  • Fees and charges in place that are for the purposes of inducing behavioural change;

  • Rent on government premises;

  • NSW and Commonwealth government taxes.

Other points worth noting:

  • It is important to be able to demonstrate a turnover of $75K for the year. The default year on the accountants letter is 1 March 2019 to 1 March 2020, however there does not seem to be a problem with changing the dates to a different period so long as it represents a year of trading that is above $75K GST exclusive and is after 1 March 2019 as the start date. BAS lodgements give reasonable evidence for this.

  • If a new business has been set up recently and you cannot demonstrate $75K turnover for a prior year period, but you will be able to in the future, it is advisable to wait until you have a BAS quarter that shows at least $18,750 and make application at that point based on the fact that the business has now turned over ¼ of the $75K in one quarter.

  • Don’t forget that vehicle registrations (for business) and water license costs could be eligible for the application of this rebate against them.


ATO Scams

ATO Warns of new phone scam involving your Tax File Number.

The ATO have warned about a spike in automated scam calls impersonating the ATO. The scammers claim that they have suspended their target’s TFN following suspected fraudulent activity.

Since 1 January 2021, the ATO has received 638 reports of this scam, with 7 victims paying out nearly $118K. It seems that these scammers are stealing money under the guise of saving it from other fraudsters, trying to access their account. The ATO advised that while it does call taxpayers, it will never:

  • Send unsolicited pre-recorded phone messages;

  • Use aggressive or rude behaviour, or threaten taxpayers with immediate arrest, jail or deportation;

  • Suspend their TFN;

  • Request direct transfers of money to a personal bank account;

  • Project its number onto the recipients caller ID.

If you are unsure about a phone call, text or email, it is okay to not reply or hang up. The ATO’s dedicated scam line is 1800 008 540 to check whether it is legitimate. Alternatively direct them to us (as your accountant) and we will be happy to address the issue.


Tax Treatment of Cryptocurrencies

The term cryptocurrency is generally used to describe a digital asset in which encryption techniques are used to regulate and verify transactions. It generally operates independently of a bank, central authority or government.

The use of cryptocurrency is rapidly evolving. If you are involved in acquiring or disposing or cryptocurrency, you need to be aware of the tax impact of your actions. A capital gains tax event occurs when you dispose of your currency in any way. A disposal can occur when you:

  • Sell or gift cryptocurrency;

  • Trade or exchange cryptocurrency;

  • Convert cryptocurrency to Australian dollars;

  • Use cryptocurrency to obtain goods or services.

If you make a capital gain on the disposal of cryptocurrency, some or all of the gain may be taxed. If you incur cryptocurrency transactions, give us a call and we will be happy to discuss.

Ph: 02 6884 5542