Knowledge Shop Blog

June Tax Round Up - over-franked dividends and the corporate tax rate change

The practical issues arising from the SBE threshold changes and the corporate tax rate changes.


Parliament has finally passed the Bill containing the increase in the SBE turnover threshold. While it all seems straight forward, there are a few details for practitioners to get across.

This Bill also includes the company tax rate cuts, changes to the way the imputation system works and the small business tax offset rules. This update provides a summary of the key aspects of the Bill and practical implications to take into account (see legislation).

One possible problem area arising from the company tax rate change is that some companies may have over-franked dividends during the 2017 year. The ATO some released a draft guide which sets out practical steps that these companies can take to rectify the situation.

Join the Knowledge Shop team for all this and more.

Members can download the full June 2017 Tax Round Up from the member-only website. To see what Knowledge Shop membership offers, call Julie on 1800 800 232 or take a tour online. 

 

Join Bradley Beer (CEO, BMT Tax Depreciation), Michael Carruthers (Tax Director, Knowledge Shop), Rae Ni Corraidh (Tax Adviser, Knowledge Shop), and Lisa Armstrong (MD, Knowledge Shop) for just the juicy bits of change for accountants and advisers:

  • The practical issues arising from the SBE threshold and corporate tax rate changes – flow on franking and imputation changes and whether a company is carrying on a business – how far does the definition stretch?
  • A new PCG on companies now subject to the 27.5% limit that have breached the maximum franking rate rules by paying franked dividends at 30%
  • Depreciation deduction changes announced in the Budget – how the measures impact on residential investment clients
  • A case that demonstrates why the assessable recoupment rules can apply in a broader range of situations than you would assume - Denmark Community Windfarm Ltd v Commissioner of Taxation [2017] FCA 478

 Enjoy!

 

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The information in this document has been prepared by BT Portfolio Services Ltd ABN 73 095 055 208 AFSL 233715 (BTPS) and is current as at 1 January 2018. The information provided is factual information and does not take into account your personal needs, objectives or circumstances and therefore, before acting on it, you should consider whether it is appropriate for you. BTPS operates Panorama Investments. BT Funds Management Limited ABN 63 002 916 458 AFSL 233724 (BTFM) is the trustee and issuer of Panorama Super, which is part of Retirement Wrap ABN 39 827 542 991. Westpac Financial Services Ltd ABN 20 000 241 127 AFSL 233716 (WFSL) is the responsible entity and issuer of interests in BT Managed Portfolios. Westpac Banking Corporation ABN 33 007 457 141 AFSL and Australian credit licence 233714 (Westpac) is the issuer of the BT Cash Management Account (BT CMA). Together, these products are referred to as the Panorama products. A Product Disclosure Statement or other disclosure document (PDS) for the Panorama products can be obtained by contacting BT on 1300 881 716 or by visiting www.panorama.com.au. You should obtain and consider the relevant PDS before deciding whether to acquire, continue to hold or dispose of interests in the Panorama products. In addition, BTPS is the provider of the Panorama SMSF Establishment Service. The Guide and Terms and Conditions for this service are available by contacting BTPS. BTPS, BTFM and WFSL are subsidiaries of Westpac. Apart from any interest investors may have in Westpac term deposits, Westpac securities or the BT CMA acquired through the Panorama products, an investment in, or acquired using, the Panorama products is not an investment in, deposit with or any other liability of Westpac or any other company in the Westpac Group. These investments are subject to investment risk, including possible delays in repayment of withdrawal proceeds and loss of income and principal invested. Westpac and its related entities do not stand behind or otherwise guarantee the capital value or investment performance of any investments in, or acquired through, the Panorama products.

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