In this edition, we delve into crucial updates on:
- Shadow Economy “Most Reported” Industries
- Rise of e-invoicing
- SMSF Annual Report Obligations
- Increase in Age and Veteran Pensioners ‘Work Bonus’
- Update on Credit Reporting Code: Financial Hardship
- and more…
Aperto Finance Service, Perth, Karratha, Broome, Kalgoorlie, and Mt Hawthorn.
Shadow Economy “Most Reported” Industries
The term “Shadow Economy” denotes activities conducted outside of tax and other regulatory frameworks. In the 2021–22 fiscal year, the ATO received 43,000 reports about businesses operating in this manner. Common instances include demanding cash payments from customers, paying employees ‘cash in hand’, or failing to declare all sales.
The industries most reported in the past year were:
- Building and Construction
- Hairdressing and beauty services
- Cafés and restaurants
- Road freight transport
- Management advice & related consulting services Indicators that a business may be operating in the shadow economy include displaying ‘cash only’ signs, offering cash discounts, not accepting card payments, not providing payslips to employees, not recording sales, or even using illegal software that alters or deletes sales transactions.
The ATO estimates that the community loses approximately $11 billion in taxes annually due to “Shadow Economy” activities.
Rise of e-invoicing
Over 18,000 businesses across Australia are already using e-invoicing to make their transactions faster, simpler, and more secure, and the ATO anticipates significant growth in e-invoicing over the next year.
eInvoicing is beneficial for both you and the environment; suppliers no longer need to print, post, or email paper-based or PDF invoices, and buyers no longer need to scan or manually enter invoices into their software. It also minimises the risk of fraudulent or compromised invoices and email billing scams.
To get started with e-invoicing, register your accounting software today, or check with your provider to determine if your software is e-invoicing enabled.
SMSF Annual Reporting Obligations
If your Self-Managed Super Fund (SMSF) held assets on June 30, 2022, you must submit an SMSF Annual Return (SAR) for the 2021–22 fiscal year. Your lodgement due date will vary based on your circumstances.
- If you are a new SMSF and are preparing the SAR yourself, or if you have previously submitted a late SAR, your due date is October 31, 2022.
- If you are a new fund or had no assets on June 30, 2022, you will need to submit a return application or cancel your fund’s registration if you no longer wish to operate your fund. If you require assistance with submitting your SAR, schedule an appointment with our team, and we can advise you on your revised due date.
Increase in Age and Veteran Pensioners ‘Work Bonus’
The federal government has raised the amount that ageing and Veteran Pensioners can earn while still receiving a pension by $4,000 for this fiscal year. This means an immediate $4,000 credit will be added to the ‘income banks’ of Age Pensioners in December to be used this fiscal year.
The maximum amount pensioners can earn in a year before it affects their pension, known as the “Work Bonus,” will be $11,800 instead of the previous $7,800. This measure aims to stimulate the labour supply by reducing financial disincentives for pensioners who wish to work more.
This additional credit will be available until June 2023, pending legislative approval.
Update on Credit Reporting Code
Financial Hardship A revised version of the Credit Reporting Code 2014 took effect in July, pertaining to financial hardship reporting by credit providers and credit reporting bodies in Australia. Under these amendments, credit providers can enter into a financial hardship arrangement with an individual to adjust or defer their loan repayments.
Under the Privacy Act, financial hardship information will be reported on an individual’s credit report alongside their repayment history information. These changes will provide credit providers with a more comprehensive view of a consumer’s financial situation. For instance, they may be able to identify when a consumer is experiencing financial hardship due to an unforeseen event, such as a natural disaster.
The CR Code prohibits the use of financial hardship information to calculate an individual’s credit score and restricts the retention of financial hardship information to 12 months. You can learn more about these new provisions and how they may impact you by visiting the Office of the Australian Information Commissioner’s website.
Speak to Aperto Finance today to discuss how we can help you achieve your commercial finance needs.