Practice Update - September 2022

Lowe Lippmann Chartered Accountants

More COVID-19 business grants are now tax-free


The Federal Government has expanded the list of State and Territory COVID grant programs that may be tax-free to eligible businesses.


A State or Territory Government COVID grant payment will generally be tax-free if:

  • the payment is received under a grant program that is formally declared to be an eligible program;
  • the recipient carried on a business and had an aggregated turnover of less than $50 million in the income year the payment was received, or in the previous income year; and
  • the payment was received in the 2021 or 2022 income year.


The following Victorian and ACT COVID-19 grant programs have recently been declared as eligible grant programs for these purposes:

  • Business Cost Assistance Program Round Two – Top Up (Victoria).
  • Business Cost Assistance Program Round Three (Victoria).
  • Business Cost Assistance Program Round Four (Victoria).
  • Business Cost Assistance Program Round Four – Construction (Victoria).
  • Business Cost Assistance Program Round Five (Victoria).
  • Commercial Landlord Hardship Fund 3 (Victoria).
  • Impacted Public Event Support Program Round Two (Victoria).
  • Licensed Hospitality Venue Fund 2021 – Top Up Payments (Victoria).
  • Live Performance Support Program (Presenters) Round Two (Victoria).
  • Live Performance Support Program (Suppliers) Round Two (Victoria).
  • HOMEFRONT 3 (ACT).


We previously released a special Tax Alert on this topic, to see click here.



ATO reminder about appointing an SMSF auditor


The ATO is reminding trustees of self-managed super funds (SMSFs) that they need to appoint an approved SMSF auditor no later than 45 days before the lodgment of their fund’s SMSF annual return (for example, for the 2022 income year).


In particular, the ATO says:


“Don't risk approaching an auditor the day before you need to lodge as it will result in an overdue lodgment. Approved SMSF auditors are an important part of your lodgment and reporting obligations. They review your fund's financial statements and make sure you're complying with super law.”


Importantly, an audit is required even if no contributions or payments were made to or from the SMSF in the financial year.



Super comparison tool updated


The YourSuper comparison tool helps individuals compare MySuper products and choose a super fund that meets their needs. 


It ranks the performance of these products by fees and net returns.


Each year, the Australian Prudential Regulation Authority (APRA) assesses the performance of each MySuper product, and this information is displayed in the comparison tool. Updated information for the 2022/23 year is now available.


The comparison tool provides one of the following results for each MySuper product:

  • Performing – the product has met or exceeded the performance test benchmark.
  • Underperforming – the product has not met the performance test benchmark.
  • Not assessed – the product had less than five years of performance history and has not been rated by APRA.


Individuals who are members of underperforming MySuper products will receive correspondence to notify them of the underperforming status.


Individuals can access a personalised version of the tool which allows them to view and compare their existing MySuper products by doing the following:

  • Log in to ATO online services through myGov.
  • Go to the 'Super' drop-down menu and select ‘Information’, then select ‘YourSuper comparison’.


To access a non-personalised version of the tool (without logging into myGov), visit:

www.ato.gov.au/yoursuper


Small business tax incentives back on the table


The Labor Government has confirmed its commitment to implementing two tax incentives aimed at supporting small businesses to train and upskill employees, and improve their digital and tech capacity.


The Technology Investment Boost and the Skills and Training Boost were announced in the 29 March 2022 Federal Budget but remain unlegislated. 


Small businesses with an annual turnover of less than $50 million will be able to claim a ‘bonus’ 20% deduction for eligible expenditure on:

  • external training of employees until 30 June 2024; and
  • the uptake of digital technologies until 30 June 2023.



The incentives will be backdated to 29 March 2022.


We note that these incentives are not yet law. 



Rental properties and second-hand depreciating assets


The ATO is reminding taxpayers that have a residential rental property, to take care when making claims for ‘second-hand depreciating assets’ used in their properties.


In most cases, these are items that existed in the taxpayer's property when they purchased it, or were in their private residence (which they later rented out), such as:

  • flooring and window coverings;
  • air conditioners, washing machines, alarm systems, spas, pool pumps; and
  • items used for both the rental property and the taxpayer’s own home.


Since 1 July 2017, taxpayers generally cannot claim the decline in value of second-hand depreciating assets (some limited exceptions do apply). 


However, this rule does not apply to a property that was rented out before this date, or if it is newly built or substantially renovated (conditions apply).


If you have a residential rental property, to help us get your claim right, please answer the following:

  • When did you purchase the property?
  • Was it a new or existing build?
  • Did you live in the property before renting it out?
  • When did you start renting the property?
  • Was the asset already in the rental property when you bought it?
  • Is the property used for business purposes?


Please do not hesitate to contact your Lowe Lippmann Relationship Partner if you wish to discuss any of these matters further.




Practice Update – July 2025

July 4, 2025
Changes to car thresholds from 1 July The car limit for the 2026 income year is $69,674. This is the highest value that a taxpayer can use to calculate depreciation on a car where they use the car for work or business purposes and they first use or lease the car in the 2026 income year. If a taxpayer is buying a car and the price is more than the car limit, the highest input tax ( GST ) credit they can claim (except in certain circumstances) is one-eleventh of the car limit. For the 2026 income year, the highest input tax credit they can claim is $6,334 (i.e. one-eleventh of $69,674). The luxury car tax ( LCT ) threshold for the 2026 income year is $91,387 for fuel-efficient vehicles, and $80,567 for all other luxury vehicles. Input tax credits need to be claimed within the four-year time limit. A taxpayer cannot claim an input tax credit for luxury car tax when they buy a luxury car, even if they use it for business purposes.

Audit Lowe Down – Large proprietary limited – are you one? Tips and traps for your assessment

July 1, 2025
Large proprietary limited – are you one? Tips and traps for your assessment. In Australia, being classified as a large proprietary limited company means that you have to prepare, and lodge audited financial statements with ASIC under the Corporations Act 2001 (the Act), however many companies are not necessarily applying the thresholds appropriately. A proprietary company is large if it meets at least 2 of the following thresholds: Consolidated revenue ≥ $50 million Consolidated gross assets ≥ $25 million 100 or more employees. These thresholds seem simple, however some points to note: The calculations must be performed applying ALL accounting standards so even if you are preparing special purpose financial statements, then you will need to assess these thresholds as if you were applying all standards, including: AASB 16 Leases – this standard would add a right of use asset to your balance sheet potentially significantly increasing your gross assets. AASB 10 Consolidated Financial Statements – if you have controlled entities then the inclusion of their income statement and balance sheet may significantly increase each of the thresholds. AASB 128 Investments in Associates and Joint Ventures / AASB 11 Joint Arrangements – if you have entities over which you have significant influence or joint control then applying equity accounting or including your share of assets and revenue would affect the thresholds. In determining the number of employees, the Act is clear that it is all full-time and part-time employees (on a pro-rata basis), however casual employees need to be considered. For example, are they genuinely casual with varying hours / shifts each week or are they in substance a permanent member of your team but just employed on a casual basis.  The thresholds need to be met at the end of the financial year and therefore entities should track their performance during the year so they are aware if they will meet the definition of a large proprietary company at year end.

Audit Lowe Down – Incorrect presentation of your liabilities could significantly affect your balance sheet

June 17, 2025
In a previous blog, we discussed the changes to the accounting standards relating to classification of current / non-current liabilities on the balance sheet. We have been receiving a number of questions on this topic and have provided some practical scenarios below as well as some actions for you as we approach 30 June reporting dates.
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