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Did you know almost every instance of buying, selling or exchanging cryptocurrency qualifies as a taxable event? Cashing your crypto out for cash may be a given, but even exchanging one type of crypto for another will be treated as a capital gain, and now that the ATO is ramping up their data matching, chances are, they probably know about a crypto gain before you do!
Sometimes even the most savvy of investors can be left scratching their heads when it comes to the tax side of their crypto and as most of us aren’t chartered accountants why don’t you take the headache out of your crypto trading and check out these top crypto tax software options. It will give you more time to focus on your trading and not waste hours miscalculating your crypto taxes.
Proudly Australian made and owned, they promise to solve crypto tax for Aussies. It’s specifically made to be compliant with all ATO TaxGuidelines. CryptoTaxCalculator supports the unique ATO reporting requirements, including Australian specific rules around personal-use, mining, staking, and airdrops, and they also support the trading stock rules that apply to traders.
It syncs with over 500 wallets and exchanges and supports all major Australian and international platforms such as Binance and Coinspot.
Annual subscriptions vary between $49 (supporting up to 100transactions) to $399 (supporting up to 100,000 transactions) billed yearly. It comes with a free 30-day trial and during this trial you can import data, calculate taxes and review transactions.
Check it out here: https://cryptotaxcalculator.io/au/
CoinLedger started exclusively for the United States but now has added support for Australian users. It has a clean user interface and they support all of the major platforms. Some have an auto-import functionality forgetting your data in there, and if not there are detailed guides for importing your transactions.
You can also invite your income tax professional to review the report and download it from the dashboard.
Annual subscriptions vary between $49 (supporting up to 100transactions) to $299 (supporting unlimited transactions) billed yearly.
Check it out here: https://coinledger.io/au?gclid=CjwKCAjw6raYBhB7EiwABge5KlzwLZus1rTIepX_pwn-LbVvDtYRhAKJQlSKoKUx6SxbLfaFe1dc2BoC6cQQAvD_BwE
Koinly has a very generous free subscription that allows up to 10,000 transactions with lots of additional features. It supports data import (both API and CSV) from 350+ exchanges, 50+ wallets and 15 blockchains.
It is built to comply with Australian tax standards, and with catering to over 17,000 crypto coins, Koinly lets you track all crypto holdings in a single place.
Check it out here: https://koinly.io/au/
And of course, if you’re in the midst of wondering where to start or indeed where to go next, the Attune team are here to help with strategic advice that will set your Crypto-tax processes in place. Give the team a call to discuss where you’re at and where you’re headed on 1300 866 113or send us an email to start the conversation.
ATO Assistant Commissioner Tim Loh has revealed the four areas the ATO will be focussing their attention on for the 2022 income tax year. What are they, you ask? Well without any further ado…
Remember, trading in crypto can give rise to capital gains or losses – sometimes even unbeknownst to the investor, and by the sounds of it, the ATO is ready to pounce on these mistakes. If you want a little refresher of what constitutes a capital gain even when it comes to investing in crypto, please refer back to our earlier article here.
If you took a hit with your trading towards the second half of 2022, and you ultimately recorded a loss, just a reminder that this is treated as a capital loss, and it cannot be used to offset any personal income.They can be carried forward, however, and be used to offset any future capital gains.
Make sure your record keeping is crystal clear and provide your accountant with all information relating to your crypto trading. Information and records will be key here! As usual, the Attune team can help ensure your records are full and correct, so if you’re concerned about yours, reach out and we can assist.
One third of all taxpayers claimed WFH expenses in last year’s tax return, and as a result, the ATO expects to see other types of work-related expenses to reduce, like car and travel costs for example. You can’t have your cake and eat it too!
Be mindful of the different methods you can use to claim aWFH deduction for the 2022 financial year:
1. The shortcut all-inclusive rate;
2. The fixed rate method; or
3. The actual cost method.
Once again, the Attune team is perfectly placed to assist you with ensuring that your deductions correct to help avoid future pain or scrutiny from the ATO, you can always call us on 1300 866 133 to make an appointment if you’d like assistance.
The ATO will be paying close attention to this section of your tax return this year, and they will be on the lookout to make sure you are declaring all of your rental income. This includes short term rental income(such as Airbnb properties), insurance payouts and any rental bonds you retain.
Be sure to keep good records in relation to your rental properties, as there is a chance the ATO may ask for more supporting documentation before they process your tax return this year!
Assistant Commissioner Loh has warned that they will be data matching information they receive from banks, insurers, share-economy companies(like Uber) and online marketplaces (like Airbnb), and crypto trading information supplied by exchanges.
With so much information available online, there isn’t much the ATO won’t know about, so it’s important that your income tax return agrees with this information. If there is a mismatch of data, you can all but guarantee the ATO will be knocking on your door.
He has also provided three golden rules we all must adhere to when completing our tax returns for 2022:
1. You must have physically spent the money yourself and you weren’t reimbursed
2. If the expense is a mix of business relate and private use, you can only claim the portion that relates to producing income.If you use your mobile phone to call mum and dad, this means you can’t claim100% of your phone costs!
3. You must have a record to prove it.
While warnings like this may seem stern, there’s no reason why lodging your tax return needs to be stressful. With the Attune team on your side, we’ll ensure the process is as pain free as possible and with the right information and records in hand, even Assistant Commissioner Loh will be happy for you. For help with your tax this year, give us a call on 1300 866 133 or send us an email.
During the 2022 Federal election, the government announced it would support a reduction to the downsizer eligibility age to 55years. Confusion ensued for some, as this reduction is not yet law.
Instead, from 1 July 2022, people aged 60 years and over will be eligible to make downsizer contributions of up to $300,000 per person or$600,000 per couple from the sale proceeds of their home into a complying superannuation fund.
Off the back of the aforementioned election confusion, it’s important to note that any contributions made from members who are 55-59 years old will be ineligible to be treated as downsizer contributions. If you fall into this age bracket and have made contributions under the guise of a downsizer contribution, they will instead need to be reported as personal contributions.
Sadly for some, the result may mean you could exceed your non-concessional contributions cap. Although this is not ideal, it’s not the end of the world yet and you should discuss the situation with the Attune team to ensure the outcome fits your goals and superannuation strategy before going further.
If however, you are 60 or older and you have or are looking at making downsizer contributions (which are eligible), they won’t impact or count towards your concessional or non-concessional super contribution caps.
Lastly, the downsizer contribution is a once-off option that can not be applied to the sale of any residences in the future.
1. You must be 60 years of age or older
2. You must sell a property that is located inAustralia
3. You must have owned the property for at least 10years
4. The proceeds from the sale of your home must be either exempt or partially exempt from CGT under the main residence exemption (details can be found here).
Making large contributions to your superannuation (SMSF or not), should always be discussed with your accountant and indeed your fund first. The Attune team has extensive experience with superannuation and SMSFs and are in the perfect position to give you sound, strategic advice that help you achieve your future goals.
To discuss contributions and putting the right processes and structure in place for your super, contact the Attune team on 1300 866 133 or send us an email to start the conversation.
Over a decade ago now the rules of borrowing in self-managed superannuation funds (SMSFs) were relaxed, meaning that SMSFs can borrow to invest in some circumstances.
The relaxation meant that instead of just being able to borrow for investing in shares SMSFs can now use funds for property asset purchases. Further to this, legislative changes in 2020 also made it possible for SMSFs to acquire property with limited recourse borrowing arrangements (LRBA) using a holding trust.
Obviously, there’s more to the story, but with that snapshot behind us let’s dive a little deeper …
Using your SMSF to invest in property can be a great strategy for tax purposes; help diversify your investment portfolio; and it can put the cash in your fund to good use. With the introduction of the LRBA, this investment strategy has grown in popularity over recent years, but this is one area you really do need to make sure you know what you’re getting into.
The rules imposed by the ATO and the Superannuation IndustrySupervision Act (SISA) can be super complex so we recommend you speak to our qualified team at Attune before jumping into anything, but let’s look at the overview…
• The property must not be purchased from a related party or SMSF member
• The property can be a residential property, but it must not be lived in or rented by a fund member or any related party
• For a commercial property, it can be rented to a related party, but it must be used solely for their business, and it must be rented at market value
• As always when it comes to your SMSF, it must meet the ‘sole purpose test’ of solely providing retirement benefits for its members
Obtaining finance can sometimes be hard as the borrowing criteria can be stricter, and the banks usually demand a higher loan to value(LVR) ratio when compared to borrowing outside of super.
The bank will also make sure the fund will be able to service the loan over the years to come, and they will factor in the estimated rental returns plus how much the fund will receive in super contributions, based on what you’ve contributed over recent years. It’s important to remember that loan repayments must be made from your SMSF, and as the ATO can sometimes limit your ability to put money into super, this cashflow needs to be carefully considered.
The tax benefits can be a massive pro to this strategy if you can get it to work. SMSFs are generally a low tax environment compared to entities outside of super and can even end up tax-free based on your age and retirement status.
The SMSF generally pays 15% tax on any rental income it receives from the property. If the property is held for more than 12 months, the fund receives a one-third discount on any capital gain it may make upon sale. This brings the capital gains tax liability down to 10%.
Maintaining a SMSF and staying on top of your annual compliance requirements can be a big job, and as trustee of the SMSF you are responsible for this.
However with help from your trusted Attune advisor we can help you make the right decisions when it comes to your SMSF and if embarking on a LRBA is the right path for you and your investment needs.
If you’d like to discuss options for investing using yourSMSF, get in touch with the team today on 1300 866 113 or send us an email to start the conversation.
