Income Information When Lodging Taxes Online
Employer lump sum Payments
Union/Professional association fees
Partner service pension where the partner and the veteran are under age-pension age and the veteran receives an invalidity service pension, or the partner is under age-pension age and the veteran has died and was receiving an invalidity service pension at the time of death.
Special needs wife pension: taxpayer and partner under pension age (or partner deceased)
Wife pension: taxpayer and partner under pension age (or partner deceased)
Remote Area Allowance
Advance pharmaceutical supplement
Apprenticeship Early Completion Bonus: applies to first $1,000 received
Assistance for Isolated Children Scheme: supplementary allowances
Australian-American Educational Foundation (Fullbright Commission) grant
Australian Government Disaster Recovery Payment
Australian Victim of Terrorism Overseas Payment
Abstudy: student under 16 years
Better start for children with disability initiative: Outer Regional and Remote Payment
Carer adjustment payment (CAP)
Carer allowance and one-off payments
Child care benefit or rebate
Child disability assistance
Commonwealth scholarships or bursaries provided to foreign students
Commonwealth secondary education assistance
Defence Force Income Support Allowance, Bonus and Bonus Bereavement Payment
Double orphan pension
Economic security strategy payment
Family Tax Benefit
Farmers hardship bonus
Helping Children with Autism package: Outer Regional and Remote payment
Household assistance package (includes clean energy advance, energy supplement payments, essential medical equipment payment, low income supplement and single income family supplement).
Income support bonus paid under Part VII of the Veterans’ Entitlement Act 1986
Job commitments bonus
Language, literacy and numeracy supplement
Loss of earnings allowance paid under the Veteran’s Entitlements Act 1986
Military Rehabilitation and Compensation Act Education and Training Scheme (MRCAETS) for eligible young persons.
National Disability Insurance Scheme (NDIS): amounts the taxpayer received directly or was paid on their behalf funded under their plan
Pensioner education supplement and fares
Prisoner of War Recognition Supplement
Quarterly pension supplement
Stillborn baby payment paid by Centrelink
Special needs disability support pension: under pension age
Training and learning bonus
Veterans' Affairs disability pension and allowances, war widow's and war widower's pension.
- Defence Force Income Support Allowance where the payment to which it relates is exempt
- Income support supplement (ISS) - under DVA or Military Rehabilitation and Compensation Act
- Youth disability supplement as a component of disability support pension
- Age service pension supplementary amount
- Bereavement payment – lump sum payment
- Coronavirus Economic Support Payment ($750 lump sum payments)
- Disaster income support allowance for special category visa (subclass 444) holders (in relation to 2019-20 bushfires)
- Disaster recovery allowance (in relation to 2019-20 bushfires)
- Education entry payment supplement
- Endeavour awards research fellowship or Endeavour Executive Award
- Essential Medical Equipment Payment
- Invalidity service pension and the taxpayer has reached age pension age – supplementary amount
- Newborn upfront payment and newborn supplement
- Pension bonus – Centrelink closed to new applicants 1 July 2014
- Pension bonus – DVA
- Single income family supplement
- Student start-up loan
- Australian Volunteers Program - allowance received as a volunteer in the Australian government funded Australian Volunteers Program
Departing Australia Superannuation Payments
Active asset - 50% reduction
This concession allows you to reduce the capital gain arising from a business asset (an active asset) by 50%. Individuals and small businesses can generally discount a capital gain by 50% if they hold the asset for more than one year.To qualify for the 50% active asset reduction, you need to satisfy only the basic conditions that apply to all the small business capital gains tax (CGT) concessions.
- A capital gain must arise on disposal of the asset.
- Either your business turnover is less than $2 million, or the net value of your assets and the assets of entities connected with you is less than $6 million (this excludes personal use assets).
- The asset disposed must be anactive asset
If the asset being disposed is a share in a company or an interest in a trust, you must be a significant individual or the spouse of a significant individual and have some ownership interest. Basically, a significant individual is a person who owns at least 20 percent of the company or trust.
Active asset - Rollover relief
Active Asset - CGT retirement exemption
Attributed Personal Services Income
Attributed personal services income involves having your PSI paid to you as an employee, through your personal services entity (i.e. the company you manage your personal services through).
If your PSI is paid to a personal services entity, the income (minus the expenses incurred while producing that income) is attributed to you unless:
* the personal services entity gained the income in the course of conducting a Personal Services Business; or
* the income was immediately paid to you by the entity as salary.
Primary vs non-primary production
Cost of sales
If you are registered or required to be registered for GST, the following apply:
* Consider your assessable income, exempt income and amounts received or receivable. For tax purposes you should exclude GST from them when you calculate your income and deductions.
* You should reduce deductible losses and outgoings by the amount of input tax credit entitlement. In certain circumstances you could make an adjustment for GST purposes. This could alter your assessable income or deductibles. For example, a change in how much you use an asset for business purposes could increase or decrease your GST component.
* You should also exclude GST under rules such as capital gains tax and capital allowances.
If you are not registered for GST or required to be, you do not need to adjust your income and deductions for GST. You can claim the GST-inclusive amount incurred on deductible outgoings.
Other business income
Other business income includes:
- Assessable government payments
- gross sales of trading stock
- gross sales from produce
- goods taken from stock for your own use
- value of livestock killed for rations
- value of livestock exchanged for other goods or services
- gross earnings from services
- rent derived from carrying on a business of renting property
- income earned through the sharing economy, or other marketplace, where you're carrying on a business
- taxi driver and ride-sourcing earnings (income you earned as a non-employee taxi driver if it is not shown at Personal services income)
- amounts received as recoupment of expenses
- bad debts recovered
- profit on sale of depreciating assets
- insurance recoveries
- employee contributions for fringe benefits
- assessable non-government assistance from all sources
- foreign exchange (forex) gains
- payments and grants reported in a Taxable payments annual report where tax has not been withheld and they relate to business income
- business-related income statements/payment summaries where no tax has been withheld.
Simpler depreciation for small business
You can choose to use the simplified depreciation rules if you have a small business with an aggregated turnover of less than 10 million dollars for the 2020 financial a year.
Aggregated turnover is based on the income of your business and that of any associated businesses.
Simplified depreciation rules for small businesses include:
* an instant asset write-off for assets that cost less than the relevant threshold
* a general small business pool for assets that cost the same or more than the relevant threshold, which has simplified calculations to work out the depreciation deduction.
If you are eligible and choose to use the simplified depreciation tools you must use the rules to work out deductions for all your assets except those that are excluded (ie, assets that are leased out, assets previously allocated to a low-value pool prior to the rules being brought in, horticultural plants, software allocated to a software development pool, assets used in research & development and capital works including buildings.) You can only claim a deduction for the taxable/business use of the asset.
Instant asset write-off
By using Instant Asset Write-off, you can immediately write off the cost of each asset your business bought and uses that costs less than the relevant threshold amount. You can only write off the business/taxable use portion. The entire cost of the asset must be less than the relevant threshold, not including any trade-in amount. The amount you can write-off will also depend on when the asset was purchased and the associated threshold amount:
* 2nd April 2019 - 11th March 2020 - $30,000 threshold
* 12th March 2020 to 30th June 2021 - $150,000 threshold
A car limit applies to the cost of passenger vehicles (except a motorcycle or similar vehicle) designed to carry a load less than one tonne and fewer than 9 passengers. The car limit is $57,581 for the 2019–20 income year . The car limit does not apply to vehicles modified for use by people with disability. You cannot claim the excess cost over the car limit under any other depreciation rules.
Small business pool
Motor vehicle expenses
Date of first rental income
Rental losses carried forward from a prior year
These are expenses directly incurred in taking out a loan for the property. They include:
- Loan establishment fees
- Title search fees charged by your lender
- Costs for preparing and filing mortgage documents
- Mortgage broker fees
- Stamp duty charged on the mortgage
- Fees for a valuation required for loan approval
- Lender’s mortgage insurance
The following are not borrowing expenses:
- Insurance policy premiums on a policy that provides for your loan on the property to be paid out in the event that you die or become disabled or unemployed
- Interest expenses
- Stamp duty charged on the transfer of the property
- Stamp duty incurred to acquire a leasehold interest in property (such as an ACT 99-year Crown lease).
If your total borrowing expenses are more than $100, the deduction is spread over five years or the term of the loan, whichever is less. If the total deductible borrowing expenses are $100 or less, they are fully deductible in the income year they are incurred.
If you obtained the loan part way through the income year, the deduction for the first year will be apportioned according to the number of days in the year that you had the loan.
Some legal expenses incurred in producing your rental income are deductible. These include the costs of:
- evicting a non-paying tenant
- taking court action for loss of rental income
- defending damages claims for injuries suffered by a third party on your rental property.
The following legal expenses, however, are of a capital nature and therefore not deductible:
- purchasing or selling your property
- resisting land resumption and defending your title to the property.
Interest on loans
Generally, the repairs must relate directly to wear and tear or other damage that occurred as a result of your renting out the property. Maintenance generally involves keeping the property in a tenantable condition, for example repainting faded or damaged interior walls.
However, the following expenses are capital and not deductible:
- Replacement of an entire structure or unit of property, such as a complete fence or building, a stove, kitchen cupboards
- Improvements, renovations, extensions and alterations,
- Initial repairs, for example, in remedying defects, damage or deterioration that existed at the date you acquired the property.
You may be able to claim a deduction for these costs as Capital Works (Special Building Write-Off) deductions.
Sundry rental expenses
Income received including taxes paid
Taxable foreign income is the total income earned plus any taxes withheld or paid to the foreign entity.
Example: John received a net amount of $22,000 from a New Zealand rental property, and the expenses he incurred maintaining the property were $5,000. John lodged a New Zealand tax return and paid $3,000 in taxes. Therefore, John should enter $25,000 ($22,000 + $3,000) as Foreign income including taxes paid, $5,000 as deductible expenses, and $3,000 as foreign tax paid. Although income derived from overseas activity or investment is still taxable in Australia, a credit is given for taxes paid to the foreign government where the income was earned.
However, debt deductions (such as interest and borrowing costs) related to your overseas rental property are not reported in this section. These types of debt deductions should be entered in the "Other deductible expenses" page under the "Deduction" section.
Foreign tax credit
"Other Income includes:
- an amount released by one or more of your superannuation funds greater than the liability stated on a release authority
- an assessable First home super saver (FHSS) released amount
- lump sum payments in arrears;
- income you earned from the sharing economy or other marketplace, except income from rent (include this on the rental worksheet), or income from carrying on business (include this at the business section), or income from being an employee (include this at the Salary & Wages section)
- jury attendance fees
- foreign exchange gains
- bonus amounts distributed from friendly society income bonds
- taxable scholarships, bursaries, grants or other educational awards
- benefits or prizes from investment-related lotteries and some game-show winnings
- income from activities as a special professional (author of a literary, dramatic, musical or artistic work, inventor, performing artist, production associate or active sportsperson)
- reimbursements of tax-related expenses (including amounts imposed by us as an interest charge) or election expenses which you have claimed as a deduction
- any assessable balancing adjustment when you stop holding a depreciating asset (for example, because of its disposal, loss or destruction) for which you have claimed a deduction for depreciation or decline in value in previous years
- payments made to you under an income protection, sickness or accident insurance policy where the premiums were deductible and the payments replaced income, except payments from which tax has been withheld and which you have already shown at the Salary & Wages section
- gains derived on disposal or redemption of traditional securities that are assessable under section 26BB of the Income Tax Assessment Act 1936
- allowances or payments you received as a member of a local government council that you have not shown at any other section
- other taxable allowances or payments you received from Services Australia that you have not shown at the Government Payments section
- work-in-progress amounts assessable under section 15-50 of the Income Tax Assessment Act 1997 that you received and have not included as income or loss from business."
Life insurance bonus
Please include as income:
- Bonus received within 10 years from when the policy started.
- The whole bonus amount you received if you received it during the first eight years of the policy
- two-thirds of the bonus amount you received if you received it during the ninth year of the policy
- one-third of the bonus amount you received if you received it during the 10th year of the policy.
Please do not include as income:
- Any bonus amounts received after the 10th year of the policy
- Any life insurance bonuses from policies that matured due to the death of the person insured
- You surrendered due to an accident, illness or other disability of the person insured
Deductible amount of un-deducted purchase price
Only some foreign pensions and annuities have a UPP. The UPP is the amount you contributed towards the purchase price of your pension or annuity – your personal contributions.
Australian income tax withheld
Income derived from foreign investments
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