The Tax Laws Amendment Regulation 2013 was registered on 16 December 2013 this included technical amendments to the annual “cents per kilometre” rates. Below are the proposed rates for the 2014 Financial year.The Tax Laws Amendment Regulation 2013 was registered on 16 December 2013 this included technical amendments to the annual “cents per kilometre” rates. Below are the proposed rates for the 2014 Financial year.
- Small Car ( 0 – 1,600cc) – 65c/km
- Medium Car ( 1,601cc – 2,600cc) – 76c/km
- Large Car ( 2,601cc + ) – 77c/km
Phasing out Medical Expenses Offset
The government has announced it plans to phase-out the Net Medical Expenses Tax Offset (NMETO) by the end of the 2019 financial year.
There will be two categories of transitional arrangements in place:
Category A – The NMETO will continue for taxpayers until 30 June 2019 but only for those who are claiming medical expenses relating to disability aids, attendant care or aged care.
Category B – The NMETO will continue for taxpayers until 30 June 2015 if they received a NMETO in the preceding financial years. You will need to have received a NMETO in the 2013 financial year to claim the tax offset in the 2014 financial year. In addition, you will need to have received a NMETO in the 2013 & 2014 financial years to claim the tax offset in the 2015 financial year.
Under Category B you will also be entitled to claim the full range of medical expenses allowable by the Australian Tax Office.
Car Fringe BenefitsEmployers using the operating cost method must ensure that their business use percentage estimate takes into account any variations in the pattern of use of the car during an FBT year. An employer cannot simply organise for an employee to prepare a log book during a period when business use is at its highest and then apply the business use for the next four years.
Employers can rely on GPS records for log book record keeping purposes as long as the information retained by the GPS is readily accessible and convertible into written English.
Exemption for Portable Electronic items
Electronic devices provided to employees must be primarily for use in the employee’s work duties before they can qualify for the FBT exemption. If more than one device is provided to an employee they must have substantially different functionality in order for both to be FBT exempt.
For example, a tablet and a laptop do not have substantially identical functions; so both would qualify for the FBT exemption if they were provided to an employee in the same FBT year.
ATO Audit Hot Spots
The ATO has decided to substantially increase the number of FBT audits it conducts in the 2014 FBT year. The ATO will pay particular attention to companies that do not lodge FBT returns. Employers who have not previously lodged an FBT return should review their obligations to ensure that they do not have to lodge an FBT return.
The ATO will also be targeting car fringe benefits and FBT liabilities relating to corporate boxes and hospitality as part of its 2013-2014 compliance program.