Name: AdvisorCorp | accountants, bookkeepers, business advisors & mortgage brokers
Address: 5/48 Corinna St, Phillip, ACT, 2606
Telephone: 02 61900800

Business Tax Return

Our Tax agents can help you to legitimately reduce your tax liability in your returns.

AdvisorCorp is registered with the Tax Practitioners Board

We are also a member of a professional accounting organisation Institute of Public Accountants. We abide by professional and ethical standards.

Company tax return

Companies are subject to self-assessment and calculate their own tax payable. A return must be lodged under s 161 ITAA 36. On the basis of this return the Commissioner will normally be deemed to have made an assessment under s 166A ITAA 36 on the date that the return is furnished.

A company’s taxable income may differ from its accounting profit because of various permanent and timing differences. For example,

the decline in value for tax purposes may not be the same as depreciation applied for accounting, especially for companies which are also eligible small business entities utilising the simplified depreciation rules;
deductions may be allowed for capital items for which there is no accounting expense;
no deduction may be allowed for certain accounting expenses (such as doubtful debts).

Reconciliation must be performed to convert accounting profit to taxable income, by adjusting for those items where differences occur. Amounts that are expensed for accounting purposes but which are not allowable as deductions must be added back in calculating taxable income. Conversely, amounts that are allowable as deductions for tax purposes but which are not expensed for accounting purposes will then be deducted in arriving at the taxable income figure.

Similarly, if an amount was included in income for accounting purposes that is not assessable income for tax purposes, it must be deducted, and an amount that is assessed for tax but not recognised for accounting purposes must be included in the calculation of taxable income.

Further reduction of the company tax rate

The lower company tax rate applies to base rate entities with an aggregated turnover less than $50 million from the 2018–19 income year. The rate will then reduce to 25% by the 2021–22 income year.

Partnership tax return and payment of tax

While a partnership is not a separate legal or taxpaying entity (although it is treated as an entity for GST purposes), s 90 of ITAA36 requires the determination of partnership net income (or loss), to be calculated based on the partnership’s assessable income and allowable deductions as if the partnership was a resident taxpayer. By treating the partnership as a resident taxpayer, income from all sources (both foreign and domestic) will be included.

Section 91 of ITAA36 confirms that while a partnership must submit a tax return, the partnership itself does not pay tax- the return is for information purposes only. Pursuant to s 92 of ITAA36, an individual partner must include that partner's share of the net income (loss) of the partnership in their assessable income (allowable deductions).

Taxation of trust income

Section 97 of Division 6 of ITAA 1936 provides that where a beneficiary is:

presently entitled to a share of the income of the trust estate;
the beneficiary (or trustee on their behalf) is assessed on so much of their share of the net income of the trust estate.

This means that the net income of a trust is taxed to beneficiaries in an income year to the extent that they are presently entitled to trust income. The beneficiary pays tax on its share of trust income at its own tax rates. In certain circumstances, the trustee pays tax on the beneficiary’s behalf. This applies where the beneficiary is:

under a legal disability (see below); or
a non-resident

Need help with your business tax return?

Our comprehensive deduction questioners capture each and every deduction you are entitled to based on your business industry.

Key topics for business

Income and deductions

Fringe benefits tax (FBT)

Super for employers

Paying the ATO

Income and deductions

As a business owner, you can use this information to help work out your business income and deductions for tax purposes. Paying the right amount of tax is fair. Tax contributes to public services like schools, roads and hospitals, which is why it's important that everyone pays the right amount of tax.

Most income you receive from carrying on your business is assessable for income tax purposes.

You can claim tax deductions for most business expenses. You may also be eligible for certain concessions, offsets and rebates.

You must:

keep accurate and complete records of your assessable income and expenses
use the correct method for calculating and reconciling the amounts you claim
report all income and deductions to us at the right time
pay any amounts owed on time.

Fringe benefits tax (FBT)

Fringe benefits tax (FBT) is paid by employers on certain benefits they provide to their employees or their employees’ family or other associates. FBT applies even if the benefit is provided by a third party under an arrangement with the employer.

For FBT purposes, an employee includes a current, future or past employee, a director of a company, or a beneficiary of a trust who works in the business.

Examples of fringe benefits:

allowing an employee to use a work car for private purposes
giving an employee a discounted loan
paying an employee's gym membership
providing entertainment by way of free tickets to concerts
reimbursing an expense incurred by an employee, such as school fees
giving benefits under a salary sacrifice arrangement with an employee

FBT is separate to income tax and is calculated on the taxable value of the fringe benefit. The employer must self-assess their FBT liability for the FBT year (1 April to 31 March) and lodge an FBT return.

Employers can generally claim an income tax deduction for the cost of providing fringe benefits and for the FBT they pay. Employers can also generally claim GST credits for items provided as fringe benefits.

Super for employers

Super is money you pay for your workers to provide for their retirement.

Generally, if you pay an employee $450 or more before tax in a calendar month, you have to pay super on top of their wages.

The minimum you must pay is called the super guarantee (SG):

the SG is currently 9.5% of an employee’s ordinary time earnings
you must pay the SG at least four times a year, by the quarterly due dates
you must pay and report super electronically in a standard format, ensuring you meet SuperStream requirements
your super payments must go to a complying super fund – most employees can choose their own fund
if you don’t pay the SG on time, you may have to pay the super guarantee charge.

Paying the ATO

The quickest and easiest way to pay is with BPAY or a credit/debit card.

Make sure you provide the correct unique payment reference number (PRN) in the reference field every time you make a payment. This guarantees your money goes to the right account without delay.

BPAY®

Biller code: 75556
Reference: Your payment reference number (PRN)

Credit/Debit card

You will need:

your payment reference number (PRN)
a Visa, MasterCard or American Express card.

A card payment fee will apply.

Pay online

Click here to pay now with the Government EasyPay service

Pay online – individuals and sole traders

Click here to log in using a myGov account linked to the ATO

Pay by phone

Phone the Government EasyPay service on 1300 898 089.