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June 2001

2001 Tax Return Checklist

Important Tax Changes 1 July 2000
Important Tax Changes 1 July 2001
2001 - Individual Tax Returns
2001 - Companies, Partnerships, Trusts & Other Businesses

Important Tax Changes from 1 July 2000

The following important tax changes may impact on your 2000/01 tax return. Please contact us to find out whether these changes affect you.

Personal Services Income Rule

From 1 July 2000, individual contractors who operate through a company or trust can potentially be taxed on their income as an individual (not the company or trust).

Non-Commercial Losses

From July 1 2000, individuals must satisfy one of four tests to offset losses from business activities against other income. A prime example is an employee who seeks to offset farming or other business losses against salary or investment income.

Capital Gains Tax (CGT) Concessions

Don't forget, whether you're an individual, company, trust or superannuation fund, you can save tax if you qualify for the various CGT concessions.

Important Tax Changes from 1 July 2001

Unit Trusts and the 50% CGT discount

The Treasurer has announced that from 1 July 2001 unit trusts will be able to distribute the 50% CGT discount tax-free to beneficiaries without any adjustment to the cost base of their units.

Prepayments

Small businesses will be subject to the new prepayment rules which will generally limit their deduction on prepayments to 40% of the prepayment.

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2001 - Individual Tax Returns

Income

  • Gross salary, wages, allowances, benefits, earnings, tips and directors' fees.
  • Income from business activities.
  • PAYG payment summary amounts.
  • Details of any non-cash benefits received.
  • Lump sum and termination payments. All documentation should be provided including an ETP Payment Summary from the employer or fund.
  • Government social security payments, including pensions and unemployment and sickness benefits.
  • Details of any CGT asset sales (eg, shares and real estate). Please include dates of, and costs associated with, acquisition and disposal.
  • Annuities including allocated pension.
  • Income from trusts and other partnerships. Statements of distribution should be provided where appropriate.
  • Rental income
  • Interest and dividends received and any tax deducted.
  • Include details of franked dividends
  • Foreign source (employment and pension) income and details of of any foreign tax credits attached to that income.

Deductions

  • Investment and property income expenses (carefully detail interest claims).
  • Subscriptions (not including sporting or social clubs).
  • Expenditure records related to a taxpayer's employment such as work-related motor vehicles, self-education, protective clothing and uniform expenses.
  • Donations of $2 and over, depending on the recipient.
  • For self-employed persons and those without employer superannuation support, details of superannuation contributions made.
  • Tax agent's fees and other accounting and tax audit fees.
  • Special deductions (Australian films, investment shelters and forestry type schemes).
  • Bank fees and FID (where the credit or deposit represents assessable income).
  • Unpreoccupied prior year losses.

Work Related Car Expenses for 2001/2002

Rates per business kilometre
Ordinary car engine capacity Rotary engine car - engine capacity Cents per - kilometer
1600cc (1.6 litre) or less 800cc (0.8 litre) or less 49.3 cents
1601cc - 2600cc (1.601 litre - 2.6 litre) 801cc - 1300cc (0.801 litre - 1.3 litre) 59 cents
2601cc (2.601 litre) and over 1301cc (1.301 litre) and over 60 cents
Depreciation cost limits for the last 10 years
2002-03 $57,009
2001-02 $55,134
2000-01 $55 134 (unchanged)
1999-00 $55 134
1998-99 $55 134
1997-98 $55 134
1996-97 $55 134
1995-96 $52 912
1994-95 $51 271
1993-94 $48 415
1992-93 $47 280
1991-92 $45 462

Rebates

  • Details of private health insurance.
  • Details of superannuation contributions where no tax deductions can be claimed.
  • Any changes in dependents (income of spouse should be provided)
  • Details of any income received in a lump sum which was accrued in earlier income years (eg, assessable pensions).
  • Net medical expenses if they exceed $1,250 in total.
  • Superannuation contributions made by employees with employer superannuation support, and whose assessable income is lees than $31,000

Note: Taxpayers with a dependant child (under 21) or qualifying dependent student should check to see if they are eligible for Family Tax Assistance.

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2001 - Companies, Partnerships, Trusts & Other Businesses

Income

  • Trading income.
  • Other income (eg, rent, interest, royalties).
  • Stock on hand (and basis of valuation) - note any obsolete stock.
  • Work in progress.
  • Primary producer subsidies (if assessable).
  • Details of CGT assets (eg, stock and real estate) sold, including dates of, and costs associated with, acquisition and disposal.
  • Dividends, including details of franking credits.
  • Income from foreign sources, including details of foreign taxes paid.

Deductions

  • Repairs and maintenance.
  • Salaries including fringe benefits.
  • Fringe benefits tax paid.
  • Rates land taxes and insurance premiums.
  • Advertising expenses.
  • Interest on borrowed monies.
  • Deductions relating to foreign source income.
  • Prepaid expenses.
  • Retirement payments and golden handshakes.
  • Bad debts actually written off during the year.
  • Donations of $2 and over, depending on the recipient
  • Commissions.
  • Legal expenses.
  • Lease documents for motor vehicles, premises and equipment.
  • Losses of previous years (or intra-group transfers).
  • Superannuation contributions.
  • Subscriptions.
  • Car expenses ( remember to include petrol, repairs, parking and maintain log books).
  • Tax agent's fees and other accounting and tax auditing fees.
  • Royalties paid.
  • Details of the purpose and destination of any interstate or overseas trip. Expenses must be fully documented where travel involves at least one night away from home. Travel diaries should be included where travel exceeds five nights.
  • Research and development expenditure.
  • Bank fees and FID (where the credit or deposit represents assessable income).

Liabilities

  • New loans taken out during the year and their purpose, including any new lease or hire purchase agreements.
  • Statements from the lending authority detailing the opening and closing balances of existing loans during the financial year.
  • Provisions for long service leave and annual leave.
  • Creditors on hand at the end of the financial year.
  • Details of loan accounts to directors, shareholders, beneficiaries and partners.
  • Accrued expenses (eg, audit fees, interest payments).
  • Commercial debts forgiven.

Assets

  • Details of depreciable assets acquired and/or disposed of during this income year, including:
    • type of assets;
    • date of acquisition/ disposal; and
    • consideration received/paid
  • Lease commitments
  • Debtors on hand at the end of the financial year.
  • Commercial debts forgiven.

Additional Information Required

  • Franking account details/movement.
  • Overseas transactions, exchange gains/losses.
  • Private companies - remuneration or loans to directors, shareholders and their relatives.
  • Changes to the capital of the company.

Note: To ensure that you obtain the maximum deductions to which you are entitled and in consideration of the penalty provisions, FULL DETAILS of any claim should be provided and supporting documentation made available. For employee taxpayers and for travel and motor vehicle claims by self-employed taxpayers, documentation must be a receipt, invoice or similar document which contains certain details. For other taxpayers, documentation may comprise receipts, dockets diary notations or reasonable and supportable estimates.

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