Fuel Tax Credits
Businesses can claim credits for the fuel tax, which is excise or customs duty, included in the price of fuel they acquire and use in business activities in machinery, plant, equipment and heavy vehicles.
Some eligible activities include road transport, construction, manufacturing, agriculture, fishing, forestry, electricity generation, landscaping, panel beating, cement kilns, quarrying, and industrial furnaces.
In fact, most businesses can claim fuel tax credits. The rate that varies depending on the fuel used and business activity.
Examples of fuels eligible for fuel tax credits include petrol, diesel, kerosene and LPG. Some fuels aren’t eligible such as fuel you use in light vehicles of 4.5 tonne gross vehicle mass or less, traveling on public roads. A business must be registered for both GST and fuel tax credits before claiming fuel tax credits.
Contact Expert Tax on 0449 952 855 or 1300 8 MY TAX (1300 869 829) for further assistance.
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Instant asset write-off increased and extended
Attention – Business Owners
The threshold has increased to $30,000, and has been extended to 30 June 2020.
The instant asset write-off now also includes businesses with a turnover from $10 million to less than $50 million. These businesses can claim a deduction of up to $30,000 for the business portion of each asset (new or second hand), purchased and first used or installed ready for use from 7.30pm (AEDT) on 2 April 2019 until 30 June 2020.
Businesses with a turnover of up to $10 million can also claim a deduction for each asset purchased and first used or installed ready for use, up to the following thresholds:
• $30,000, from 7.30pm (AEDT) on 2 April 2019 until 30 June 2020
• $25,000, from 29 January 2019 until before 7.30pm (AEDT) on 2 April 2019
• $20,000, before 29 January 2019.
Businesses can’t immediately claim a deduction for individual assets that cost $30,000 or more. They can continue to deduct these over time using the small business pool or the general depreciation rules, depending on their turnover.
For further assistance contact Expert Tax on 0449 952 855 or 1300 8 MY TAX (1300 869 829)
Check your supplier’s ABN
Attention – Business Owners
It is important that every business making a payment should check the validity of their suppliers ABN to ensure:
1. Suppliers have provided a valid ABN that belongs to them.
2. That the supplier is registered for GST and allowed to charge GST.
3. A valid tax invoice has been received from suppliers.
If your supplier provided an invalid ABN on the tax invoice, or is not registered for GST but they have charged it, and you pay it to that supplier, then the ATO position is that you are not allowed to claim back that GST from the ATO. You will be considered to not have received a Valid Tax Invoice.
In case ABN mentioned on the tax invoice is invalid and supplier is not registered for GST, you must not pay GST and deduct ABN Withholding Tax @49% of the Ex GST invoice amount and remit this on the next BAS report and complete an Annual Payment Summary for the payee.
There are increasing reports of the ATO conducting reviews of businesses in the areas of supplier registration and validity of GST claims. Therefore, the Business Owner needs to understand that these are matters that should not be ignored and will be reviewed in an audit, with potential penalties applied by the ATO if GST is incorrectly claimed when the Business Owner knew it shouldn’t have been claimed.
There has been instances where suppliers might provide correct details on the invoice and then subsequently backdate cancellation of their GST registration. This will make your GST credits invalid. It would be a good idea to take a print out of supplier’s ABN details from ABN Lookup showing their ABN and GST status as evidence every time you receive an invoice from your supplier.
Contact Expert Tax on 0449 952 855 or 1300 8 MY TAX (1300 869 829) for further assistance on business and GST related matters.