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End Of Financial Year
Last week, HWL Ebsworth Lawyers' national tax group presented to over 250 accountants and advisors on tax planning topics for FY25.
The group covered the following areas:
10. Trading stock closing balances
9. Bad debts
8. Depreciation and write-offs
7. Deferring income and pre-paying expenses
6. ...
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4. Trusts
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Check out our webinar recording available in the link.
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EOFY Financial Planning - ten tips for business & private clients
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Lodging returns for the 2024 – 25 financial year
Two new legislative instruments have been introduced to outline the requirements for lodging income tax returns for the 2024 – 25 financial year.
Legislative Instrument F2025L00570 specifies who must lodge returns, including income tax, franking, venture capital deficit tax, and ancillary fund returns, as well as when these returns must be submitted, including for self-managed superannuation funds.
For the first time, the instrument also mandates not-for-profit (NFP) self-review returns. Any individual or entity covered by section 6 of the instrument is required to lodge a return for the 2025 year, unless exempt under section 7. This applies to partners, trustees, and full self-assessment taxpayers.
The deadline for lodging returns is 31 October 2025, unless a substituted accounting period applies. In that case, returns are due by the 15th day of the 7th month after the end of the substituted period for full self-assessment taxpayers, or by the last day of the 4th month for others.
Of course, tax agents can obtain a longer period for lodgments under the ordinary tax agent lodgment cycle.
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Taxation Laws (Requirement to Lodge a Return for the 2025 year) Instrument 2025 - Federal Register of Legislation
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ATO issues Interim Decision Impact Statement on Shaw v FC of T case
The ATO has released an interim decision impact statement regarding the recent Shaw v FC of T case [2025] ARTA 224, which involved work-related expenses and record-keeping.
In this case, the Administrative Review Tribunal (ART) ruled that a long-haul truck driver was entitled to claim meal expenses. The Tribunal found sufficient evidence linking the driver’s bank statement expenditure to his work, and it concluded that exceptions to the substantiation requirements in sections 900-50 and 900-200 of the Income Tax Assessment Act 1997 applied.
The ART’s decision represents a notable outcome for taxpayers seeking to claim deductions for work-related expenses without having to fully comply with standard substantiation provisions. However, following the ruling, the ATO has filed an appeal to the Federal Court, challenging the Tribunal’s decision.
This ongoing appeal may have significant implications for the treatment of work-related expenses and the substantiation requirements for taxpayers in similar situations.
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Shaw and Commissioner of Taxation [2025] ARTA 224 (Published 28 May 2025) | Legal database
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Small business restructure roll-over
Since 1 July 2016, small businesses can transfer active assets between entities as part of a genuine restructure, without triggering an income tax liability.
This rollover applies to specific assets, including active CGT assets, trading stock, revenue assets, and depreciating assets.
However, it's important to ensure that the transaction qualifies as a genuine restructure to benefit from the roll-over.
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Small business restructure roll-over | Australian Taxation Office
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Deductions for home office and car expenses during COVID-19
The ART has ruled in favour of allowing deductions for occupation and car expenses incurred by a taxpayer working from home during the COVID-19 pandemic.
The case involved a taxpayer employed by the ABC who, due to strict lockdowns and his employer’s policies, was required to work from his Melbourne apartment for the majority of his duties. The taxpayer sought deductions for a proportion of his rent, attributable to the use of his apartment's second bedroom as a home office, and for car expenses related to travel between his home and the ABC’s Southbank Studios.
In rejecting the Commissioner’s arguments that the expenses were personal or domestic, the ART noted that the nature of the modern work environment, particularly during the 2021 lockdown, differs significantly from past standards. The Tribunal emphasised that the taxpayer's apartment served not only as his home but also as his primary workplace, where he carried out most of his income-generating activities.
The ART recognised the extraordinary circumstances of the COVID-19 restrictions, which made the home office setup essential for the taxpayer’s ability to earn income.
The ART also upheld the taxpayer’s claim for car expenses, noting that he regularly travelled between his home and workplace to fulfill his role. The Tribunal concluded that the car expenses were directly related to his employment duties, and the taxpayer had sufficiently supported his claims with reasonable estimates of business-related travel. As a result, the ART allowed both the home office and car expense deductions, emphasising that these costs were incurred in the course of generating assessable income.
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Hall v FC of T [2025] ARTA 600
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ATO boosts support for new small business owners
The ATO is offering enhanced support to new small businesses to help them meet their tax, superannuation, and registration obligations.
As part of its "Ready for Business" campaign, the ATO will soon begin emailing ABN holders with helpful tips on topics such as ABN responsibilities, business restructuring, GST registration, and employer obligations.
The ATO also encourages new business owners to consider the following:
- Whether registering for GST is required for their business
- Setting aside PAYG withholding and superannuation payments as necessary
- Understanding if any side hustle activities qualify as a business and the associated obligations
- Voluntarily entering the PAYG instalment system and prepaying their estimated tax liability as soon as their business commences
The ATO aims to assist small businesses in navigating their early tax and compliance responsibilities, helping them start off on the right foot.
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ATO announces additional support for new small business owners | Australian Taxation Office
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Important dates
- 30 June 2025:
- Superannuation guarantee contributions must be paid by this date to claim a tax deduction for the current financial year.
- Last day for late-balancing companies to choose to have their franking deficit liability calculated as of 30 June instead of the end of their financial year.
- End of the 2024–2025 income year!
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TPB Warning: Do not trust the 'finfluencers'!
The Tax Practitioners Board (TPB) has issued a strong warning to consumers about relying on tax advice from "finfluencers" on social media platforms. While these influencers may seem knowledgeable, their advice could lead to serious financial consequences, including significant tax liabilities and penalties.
The TPB has highlighted that many self-proclaimed financial experts on platforms like Instagram, YouTube, and TikTok are offering tax-related tips without the proper qualifications. This can mislead individuals into making incorrect claims on their tax returns, potentially costing them thousands of dollars in fines and back taxes.
The TPB stresses that only registered tax agents, who are bound by strict professional standards, can legally provide tax advice. These professionals are trained to interpret complex tax laws and ensure that taxpayers comply with all legal requirements, reducing the risk of costly mistakes.
Taxpayers are encouraged to verify the qualifications of anyone offering tax advice and to seek help from a registered tax agent or financial advisor if they are unsure about the accuracy of the information they receive online.
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Tax advice from ‘finfluencers’ can cost you thousands | Tax Practitioners Board
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