Entertainment Expenses...

This is just a reminder of a few things to be aware of, which are even more relevant at this time of year with all of the parties and presents....

"Entertainment Expenses" can be a tricky thing to figure out. They almost have to be judged on a case by case basis, but it's worth thinking about because in many circumstances, input tax credits on these items cannot be claimed, are not tax deductible and some may attract Fringe Benefits Tax.

While we are not in the business of providing tax advice, here are some general rules and things to consider:

• As a general rule, input tax credits cannot be claimed for Entertainment Expenses, and are not tax deductible.
• Entertainment Expenses are the cost of providing entertainment with food or drink or providing recreation, accommodation or travel in connection with the entertainment. E.g. business lunches, parties, tickets to sporting events.
• Not all food and drink is classed as "entertainment". Generally, if it is for the purpose of providing refreshment, for example, during a meeting or training session, it will not be classed as entertainment. Such as tea and coffee and light sandwiches. However, lunch at a restaurant during a business meeting is more likely to be "entertainment".
• If providing Christmas presents or putting on a Christmas party for clients, employees and perhaps their partners, the treatment of these differs for each group and can depend on the cost per person.

Given the ambiguity of this type of expense, it is worth discussing with your Tax Advisor.

When we prepare your BAS we will ask you a few relevant questions to be sure input tax credits are claimed in the correct way.

Until next time...
Leesa & Samantha

Tax Time!!!

Well, it's here. The end of the financial year. Happy New Year?? Generally this seems to just make people think of all of the things they need to do and to worry about how much tax they will have to pay! The best thing to do before June 30 is BE ORGANISED.

Do things like: have all accounts reconciled as close as possible to 30 June so that you aren't reconciling 6 months worth of transactions before you can give it to your Accountant. Also, try and make sure you have little things like employees addresses and other details up to date to make preparation of PAYG Instalment Certificates easier.

You could also think about when to pay your expenses - should they be paid before 30 June to ensure they can be claimed as a deduction this year (which will help to reduce this year's income and therefore tax bill) or do you want to put them off until next year? Or should you defer receiving some of your income which would have the same effect?

Also, be aware of key dates such as when Superannuation payments must be paid by, when your quarterly or annual BAS is due and when your tax returns are due.

If you are worried about your tax bill it might be possible to ask your Accountant if your Tax Returns can be prepared a bit earlier and lodged as late as possible to give you a chance to prepare for the bill and avoid causing cashflow problems.

Hopefully the week will go smoothly for everyone. Of course, if you have any concerns be sure to give Samantha or I a call.

Leesa