Newsletter - February 2020 Edition​ 2

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Cents & Sensibility | Tax News | Views | Clues 

How can I find the right investment?

 

We find ourselves in a very interesting situation. Interest rates are at record lows and inconsistent market pricing have resulted in a potential asset price bubble. In this environment you may be asking yourself, “where should I be investing my money right now?”

 

Whilst it is a relatively straight forward question, the answer is decidedly more difficult.

 

The challenge faced by investors is to generate attractive returns whilst preserving capital during times of market volatility. Ultimately, whilst there will always be an emphasis to seek capital growth, capital preservation in volatile market conditions can sometimes be overlooked.

 

Put simply, it is the question of risk vs return. No matter in the asset class or type of investment, you should always feel comfortable. Many factors can affect one's risk appetite. These include age, investment horizon, personal circumstances & your personal attitude to risk. This means that risk appetites are truly individual.

 

Sometimes it can be difficult to determine exactly what your risk appetite truly is.

 

Having a dialogue with a financial adviser about your personal circumstances & risk appetite can be the difference in reaching your investment goals..... and sleeping sound at night. 

Ali Roshan is an Authorised Representative (ASIC No. 000378611) of Lifespan Financial Planning. ABN 23 005 921 735 AFSL Number 229892

 

No Advice Warning / General Advice

 

The purpose of this article is to provide general information only and the contents of this website do not purport to provide personal financial advice. knp Solutions strongly recommends that investors consult a financial adviser prior to making any investment decision.

 

The contents of this knp Solutions article does not take into account the investment objectives, financial situation or particular needs of any person and should not be used as the basis for making any financial or other decisions.

 

The information is selective and may not be complete or accurate for your purposes and should not be construed as a recommendation to invest in any particular product, investment or security. The information provided on this website is given in good faith and is believed to be accurate at the time of compilation.

MYEFO – 2019/20

Treasury has released its Mid-Year Economic and Fiscal Outlook (‘MYEFO’) for 2019/20 forecasting a surplus of approximately $5 billion.

 

Proposed new record-keeping course

One new tax-related measure of note in the MYEFO was the announcement the ATO would be provided with a new discretion to direct taxpayers (found to be lacking in their substantiation efforts under audit) to undertake an approved record-keeping course, instead of applying financial penalties.

 

This is yet another measure designed to tackle the ‘black’ or ‘cash’ economy.

 

Specifically, the Commissioner will be given the discretion to direct taxpayers to undertake the course where he reasonably believes there has been a failure by the taxpayer to comply with their reporting obligations.

 

The Commissioner will not apply this discretion to those who disengage with the tax system or who deliberately avoid their record-keeping obligations.

 

Note: Such a proposal raises obvious concerns as to the onerous nature of having to comply with such a course, particularly for small business owners whose main priority is to run their business.

 

Interestingly, there is a precedent for similar ATO directions to taxpayers (i.e., to undertake an approved course), with legislation passed earlier this year allowing the Commissioner to require employers to undertake a superannuation guarantee obligations course where there has been a failure by an employer to comply with those obligations.

New ‘gig’ economy reporting

Additionally, the MYEFO also announced the Government’s intention to implement a new third-party reporting regime for the sharing economy.

 

This will apply to businesses who operate via online platforms within the ‘sharing’ or ‘gig’ economy (e.g., Uber and Airbnb).

 

It is proposed to be introduced in two stages, starting from 1 July 2022 (for ride-sharing and accommodation platforms) and from 1 July 2023 (for asset sharing, food delivery and tasking-based platforms).

 

The online platforms will be required to report identification and income information for all its participating members (i.e., both the sellers and providers).

 

These reports will go directly to the ATO for data-matching (i.e., review and audit) purposes. Ref: MYEFO 2019/20

The ATO’s Bushfire crisis response

In response to the devastating bushfires across large parts of Australia, the ATO has been keen to advise those impacted that it understands people’s priority is their family and community.

 

If taxpayers live in one of the identified impacted postcodes, the ATO will automatically defer any lodgements or payments, meaning that income tax, activity statement, SMSF and FBT lodgements (and their associated payments) are deferred until 28 May 2020.

 

For those affected not in the current ATO postcodes list, assistance can still be provided, with impacted taxpayers encouraged to phone the ATO’s Emergency Support Infoline on 1800 806 218.

 

Note: Please contact our office if you have been impacted by this or another disaster for assistance. Ref: ATO website, 20 January 2020 and ATO media release, 20 January 2020.

Important:

Clients should not act solely on the basis of the material contained in Cents & Sensibility. Items herein are general comments only and do not constitute or convey advice per se. Also changes in legislation may occur quickly. We therefore recommend that our formal advice be sought before acting in any of the areas. Cents & Sensibility is issued as a helpful guide to clients and for their private information. Therefore it should be regarded as confidential and not be made available to any person without our prior approval. Please contact us if you wish to discuss how the points raised in this edition specifically affect you. 

 

Yours faithfully,

The knp Team