Christmas is upon us once again, how time seems to fly by.   However, it is also a good time to actually reflect on where we were 12 months ago, and where we are today, given the upheaval in the world economy over the last couple of years.   Most of our clients have come through relatively unscathed, with none having lost their business or homes etc.

There will be issues to manage in the short to medium term, given interest rates appear to be going up, the Australian dollar moving higher and inflation looking to increase as well.   This does not mean there won’t be opportunities though, for all of us in business to grow and better our futures.

It may also be a good time to reflect on where we are at with our plans for life after business – are we making provision for an income stream, building our assets outside of our business, do we have a succession plan in place to leave our assets as we want to and to have some lifestyle choice in our retirement?   This can involve wills, Powers of Attorney, Powers of Guardianship, reviewing our trusts, superannuation, investments etc.   Should you wish to start reviewing these issues, please give us a call and we can assist with this process.   This is not necessarily an easy or quick process, given family is involved.   However, in our experience, once people have started and have a plan in place, they are quite relieved to have some certainty in their future plans.

Now for some good news regarding our team members:

     - You may have recently noticed that Lena (and her husband Jason) are expecting their first child.   Their baby is due in early January.   Lena will then be on maternity leave for six months.

     - We have hired Lisa to fill in for Lena over this time.   Lisa is working here Tuesday’s and Friday’s over the next month or so to learn the role and processes.   She will then be here full time while Lena is away.   Please feel free to introduce yourself to Lisa when you come in.

     - Brett (and his wife Kerrie) are also expecting a child, their fifth, in January.   We wish both Lena and Brett and their respective partners the best.

     - Michelle Drake was married (to Adam) in October and is now Michelle Hennessy.

     - We have our very own World Masters Games gold medallist working in our midst.   Angela and her softball team were successful in winning the gold medal in their division in the recent Masters Games held in Sydney .   I think she is now saving for the next games being held in Italy .

We are always looking for new business clients, so if you have any friends or business colleagues looking for an accountant that can help them with their business, wealth creation or superannuation, please feel free to pass on our name.   We offer an obligation free first interview at no cost to any prospective client.

Finally, on behalf of everyone at Symes Accountants, we wish you and your families a Merry Xmas and happy and prosperous New Year.

The Investment Allowance is set to finish on the 31 ^st December 2009.

The Investment Allowance has been a bonus tax deduction, over and above the normal depreciation that can be claimed by Australian businesses undertaking capital investment in 2009.

Small businesses (turnover of less than 2 million dollars) can claim a deduction of 50% for eligible assets costing $1,000 (GST exclusive) or more. For other businesses the deduction available is 10% on eligible assets costing $10,000 (GST exclusive) or more.

The asset must be acquired under a contract or started to be constructed between 1/7/09 and 31/12/09. This asset must be installed and ready for use by 31/12/10 or you will not be eligible for the   bonus deduction .

The deduction will be claimable in the year in which the asset is installed ready for use. Eg the allowance on contracts entered into by 31/12/09 but where the asset is only installed and ready for use by 31/7/10 can be claimed in the 2010/11 financial year.

If you are contemplating any new capital purchases in the next period of time then it may be worth your while to organise and have contracts in place by 31/12/09 .

Christmas parties for your employees do not have a separate fringe benefit tax (FBT) tax treatment category.   You will encounter many different circumstances when providing these benefits.

Fringe benefits provided by an employer to staff, associates, under arrangements to current employees, past and future employees and/or associates, spouses and children may be subject to FBT.

Exempt property benefits

The food and drink expenses for your Christmas party are exempt from FBT when they are held on a working day at your business premises and for current employees.    Should associates of an employee attend the party, a taxable fringe benefit will arise if not exempt under the minor benefits exemption.

Exempt minor benefits

The minor benefit threshold of $300 may apply to Christmas parties and gifts but relates to each benefit provided, not to the total value of all benefits.

Your Christmas party may be considered a minor benefit and therefore exempt from FBT if the cost of the party is less than $300 per employee.   The benefit to an associate/spouse of the employee may be considered   minor if the cost is less than $300.

Christmas Gifts for employees

Your Christmas gifts to your employees will be considered a minor benefit if the value of the gift is less than $300.   If the gift is given at the Christmas party, the benefits are associated benefits, and each benefit needs to be considered separately to see if the minor exemption applies.

Christmas party – tax deductible ?

Your Christmas party is tax deductible only if it is subject to FBT.   Therefore, any benefits that are exempt from FBT (exempt minor benefits and property benefits) cannot be claimed as tax deductions.   Entertaining clients is not subject to FBT and also not tax deductible.   Where the benefit is not tax deductible the GST cannot be claimed.    

As always, if you have any queries regarding any of these articles, please contact your team accountant.

XMAS CLOSURE

Our office will close on Wednesday the 23 ^rd December at 1 pm and reopen Monday 4 ^th January 2010 at 8.30am

WISHING A HAPPY & SAFE FESTIVE SEASON