StewartBrown Chartered Accounting Firm

News and Articles

GST On Low Value Imported Goods - Risk For Aussie Retailers

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Imported Goods

From 1 July 2018, GST applies to sales of low value imported goods (valued at $1,000 or less) to consumers in Australia. This measure attempts to treat such imported goods in the same way as goods purchased domestically.

Australian retailers need to be careful with this new law to ensure that they aren’t incorrectly charged GST by overseas suppliers. Overseas suppliers, if they have to register for GST, can get what is called a simplified GST registration. This means that they don't have to obtain an ABN and they can't claim input tax credits, but they don't have to issue a tax invoice to the Australian retailer they sell through. It’s only when they sell direct to an Australian customer that they need to charge and collect the GST.

The GST changes are meant to target consumers, so Australian retailers registered for GST should not be charged GST on low value goods imported for use in their business. To avoid any confusion, Australian retailers should therefore provide their ABN and state they are registered for GST to their overseas suppliers.

It's quite common for Australian retailers to warehouse stock in China, Singapore, or elsewhere in Asia, and then sell goods directly to a customer. These goods are generally mailed to customers through the post and previously no GST was added to the sales value. Australian suppliers who deliver goods to Australian consumers from overseas into Australia will now have to levy GST on each of those sales.

If you think this may be an issue for your business and are unsure of the new rules please contact your StewartBrown Partner or Manager to discuss further.

FBT - ATO Attacks Work Vehicles

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Work Van

The ATO has recently revised its guidance on how fringe benefits tax (“FBT”) applies in relation to the private usage of work vehicles.

Previously the ATO issued a definitive list of eligible work-use vehicles (typically tradie, dual cab and panel vans etc), but from 1 April 2017 this list has been withdrawn and employers now have to self-assess.

In the past this law has always been about minor, infrequent travel for work vehicles, but this new ATO guidance puts the onus very much on the employer to prove that work cars are not used just as a perk to retain and attract staff. The ATO’s guidelines now suggest that a vehicle’s private use cannot exceed 1,000km in a year, and no return journey can exceed 200km. This is thought to be much more restrictive than previously understood.

While home to work travel is generally not considered private for these work vehicles, according to these new guidelines, any trip in which a home to work route varies by more than 2km will be considered a personal trip.

This new approach will potentially catch many employers unaware as they have in the past assumed that “work vehicles” (ie on the eligible vehicles list), means no FBT.

Our advice to clients who provide these work vehicles to employees is to make sure you have a policy on work-related vehicles and make sure you can monitor how it is enforced.

2018 End of Financial Year Tax Planning Checklist

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For the information of clients we enclose this checklist which you may find helpful in planning your year-end tax strategies.

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Federal Budget 2018 – How will it impact you and your business?

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The tax and superannuation highlights of Tuesday night’s Budget are summarised below:-

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May 2018 Newsletter - Tax policies of major political parties

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You may have read a lot in the media recently about the different tax policies and proposals coming out of the major Australian political parties. To help you understand these policies and potentially the tax changes that are coming, we thought you’d appreciate a summary and brief explanation of them to be better informed for the future.

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