With the big financial institutions rushing to compensate their customers as a result of the media exposure from the Royal Commission, now is the time to look at the tax consequences of such payments. Put simply, the tax treatment of this type of compensation received depends on what the compensation is being paid for and how the investment was held. The tax consequences of each amount must be carefully considered to ensure that each component is treated appropriately.

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If you have an ongoing fee arrangement with a financial adviser or a AFS licence holder, they are required by law to provide you with a Fee Disclosure Statement (FDS) every 12 months and a renewal notice every 2 years. These measures are designed to enable consumers to get a better understanding of the advice services they are being charged for and to reduce the likelihood of passive or disengaged consumers being charged ongoing fees. ASIC is currently undertaking a review on these 2 requirements to ensure continuing confidence in the industry.

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With Christmas fast approaching, the ATO has reminded employers and business owners about the potential FBT implications of providing office Christmas parties and gifts to employees. Whether or not the party or the gift attracts FBT depends on a number of factors including how much it cost, where the party is held, or the type of gift that is given. One of the essential things to remember is to keep good records so if you’re unsure about your FBT implications down the track an experience professional can help.

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As a part of hearings into ASIC’s oversight functions, the regulator presented the Parliamentary Joint Committee on Corporations and Financial Services with a range of policy solutions to be considered to remedy deficiencies identified in the SMSF space from its recent reports. Recommendations raised by ASIC include compulsory education for trustees, prohibiting limited recourse borrowing arrangements, and mandating a minimum SMSF balance.

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When it comes to buying a home, it can be both an exciting and stressful time. There are many things that need to be considered (and taken care off) before you receive the keys and start the next chapter in your life. Importantly, in our animation, ‘First Home Super Saver Scheme (FHSSS)’, we talked briefly about the impact that housing prices, wage growth and livings costs are having on prospective first home owners.

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Victoria’s Long Service Leave Act 2018 applies from 1 November 2018. This will mean new rights and responsibilities for employers and employees. The State Government of Victoria has an obligation to keep businesses informed of critical changes which present regulatory compliance obligations.

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Since the global financial crisis, demand for reverse mortgages have grown steadily. It allows older individuals, perhaps retirees, to unlock the equity in their homes while they continue to live in the property. However, reverse mortgages may not be all it’s cracked up to be. A recent review by ASIC found that borrowers had a poor understanding of the risks and future costs of their loan, inadequately documented long-term financial objectives, and lack of protection for non-borrowers who live in the property. When it comes to reverse mortgages, it may be a case of buyer beware.

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The government has started a crackdown on individuals who owe welfare debts by preventing them from leaving the country, even for a holiday, until either the debts have been paid or they enter into a repayment plan. Some of the welfare debts are as small as $10,000, so is this the start of the government using Departure Prohibition Orders (DPOs) more frequently as a tool to pressure individuals from paying their government debts, including money owed to the Tax Office?

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The deadline for lodging your tax return is fast approaching. Before you rush off to gather all the documents for your tax return, beware of some changes in this year’s return, particularly in the areas of rental properties and superannuation. In addition to the changes in the tax return, the ATO has also outlined the top 5 most common mistakes they have seen and will be following up on.

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