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Technical. Reliable. Fun.
BK Pod brings you the latest bookkeeping news, industry updates and conversations with industry leaders, Kelvin Deer, Peter Thorp, Kellie Powell and Darren Hagarty. From technical content to current events, BK Pod is an easy to listen to audio experience, packed with essential updates and insights for our bookkeeping community.
AustBook (00:10)
Hello, I'm Kellie Powell, and welcome to this episode of the BK Pod. This episode, specifically for bookkeepers, will keep you up to date and informed. From the latest news, legislative changes, and industry updates, there is always plenty for us to have a chat about. Before we get into today's episode, I want to give you a quick update on the bookkeeper event being held on the Sunshine Coast on the 8th to the 10th of October. We are over 70% sold.
If you've been waiting to grab your ticket, don't wait too long. Stay tuned, we are dropping the agenda next week, and I must say it is looking awesome. So keep an eye out for that one. For further information, take a look at the website at bkevent.com.au or if you jump into the ABN Members ⁓ website, you will also see a direct link to the conference website. You can get all the information off that website. We have a great episode for you today.
Kelvin is going to deliver an update today, an important update, on the wins that members don't always see, the quiet technical work that happens behind the scenes to protect BAS agents, bookkeeping, and payroll professions. In Kelvin's session, he unpacks the recent engagement with AUSTRAC around the AML CTF Trench 2 legislation, including why ordinary BAS, payroll, superannuation.
And bookkeeping services should not be unintentionally captured by obligations that are aimed at a higher risk professional gateway activity. He also explains why the recent clarification around Table 6, item three, is such an important outcome for practitioners and small business. This conversation is about more than one regulatory win. It's a reminder of what professional association membership, so ABA.
Really delivers, which is representation, advocacy, practical outcomes, and a collective voice when government and regulators need to understand how policy works in the real world. Next up we have Peter Thorp and Kerry Jarius sharing the latest update as to what is happening in ABA representation space. This edition they have a chat about the impact of the budget not only on clients but also.
your own business. So tune in for that one. And in our final segment, you'll hear from Darren Hagarty Darren will take you through our latest ⁓ getting technical publication, which was a really interesting one. Once again on topic of payday super, but this edition took a deep dive into when is payday? So that was a really interesting one. So let's get into it. We hope you enjoy the episode.
AustBook (03:04)
Well hello everyone and welcome to this segment of the BK Pod. I'm Kelvin Deer and today I want to talk about the wins you don't always see. And I'd like to do that in two parts. Firstly, I want to just update you on a very important AML CTF issue, so that's the anti-money laundering, counter-terrorism financing issues that the industry has been looking at or dealing with for many months now. And ⁓ what I think
was a significant win with the recent engagement that I with AUSTRAC that that about both ourselves and the ICB had. And secondly, sometimes the greatest value of your membership
Is not the thing that you personally downloaded, watched, or attended. Sometimes the greatest value is the problem that you did not have to face alone. And I think the industry obligation, you know, that that didn't land unchecked, or the regulator that did not hear only one side of the story when a reasonable outcome was challenged, as we just saw with AML. But let's start with that AML CTF issue.
And many of you who have been following the changes to Australia's anti-money laundering and counter-terrorism financing regime, so that's called the AML CTF Tranch 2 legislation. Now the expanded regime brings a number of professional services into scope, not because they are in that particular profession, so it's not because you're a BAS agent or a tax agent, but rather it's because of the services that you are actually performing. And understandably.
If a designated service is to be caught under the legislation, then that causes a range of concerns about how to enroll, how to monitor and manage your business to enable correct reporting. And of recent times, that has been the case for BAS agents, bookkeepers, and other payroll professionals around a designated service called Table Six Item Three, and that deals with the controlling ⁓ of a client's bank account or money.
Now, here at ABN, when we considered the AML Tranche 2 legislation and the accompanying explanatory memoranda, and we also took a look at the underlying tent of the world body that governs that AML CTF legislation across many countries and many regions, and that's a group called the Financial Action Task Force. Well, we were focused on a few things, but one of them was this are ordinary BAS Agent services of paying wages, paying superannuation.
Or paying your clients Telstra bill or typical trade suppliers meant to be the underlying intent of that type of legislation. And should it be caught in a way that requires BAS agents to enroll with AUSTRAC and begin their AML CTF monitoring and reporting? Now, in our view, together with our colleagues at the ICB, was that this needed to be challenged very carefully. And not because money laundering risk is unimportant, it's vital.
Because when I read a report from the world body some years ago identifying that Australia alone accounts for approximately eleven billion dollars annually of money laundering activity, and certainly not because professional service providers should ignore their responsibilities, they certainly should not. That's an underlying premise of being a professional. But I think good regulation must be targeted, it must be practical.
And it must not accidentally capture ordinary activities that it is not designed to do. And as a result, does not advance the intent of the legislatures. Otherwise, the cost of business, and in this instance the BAS Agent Community, would be prohibitive. And it really would see, I think, a grave injustice done in performing what is really an everyday administrative function. Now the key issue that we here at ABN and our colleagues at the ICB raised with AUSTRAC was that
It was around table six item three and the related section, the section called section six, paragraph five C sub B, and that's a carve-out provision relating solely to certain services. Now, in plain English, the point is that this section, section six, five, C sub B, says that where the only designated service that is being provided is table six item three, and that's a service where a business is receiving, holding,
controlling or managing money or property on behalf of their client and that that activity is reasonably incidental to other services that your business provides, then that in itself is not a designated service. Now that section really matters for BAS agents and AUSTRAC has now provided us with that insurance. So let's look a little deeper.
By far the majority of BAS agents are not setting up or establishing complex structures, they are not acting as nominees for their clients, companies or trusts, they are not acting as the registered office or business address for their clients, and they are not arranging or dealing with transactions to buy or sell companies, and they are not operating as a de facto bank account for their clients.
What a BAS agent does do is that they assist clients meet ordinary business compliance obligations when dealing with payroll and superannuation, dealing with activity statements, helping clients pay the ATO and pay a business's ordinary creditors, and keeping the business records in order. And then there are a range of much broader services provided, of which pushing that payment button at the end is just the culmination of a lot of the work that is done.
And the additional services that BAS agents provide. That is very different from the type of professional gatekeeper activity that the AML CTF reforms are aimed at. So the recent win following months of effort raising these issues with AUSTRAC and to finalise reply is this. AUSTRAC has considered section 65C sub B in the context of these broader services and activities.
And have agreed with us that those types of activities do not fall within the intent or the scope of the Tranch 2 legislation. Now, importantly, AUSTRAC is now working on providing improved guidance and examples of that item three, table six, to give genuine certainty to our industry. And that's a big deal, because it has taken a lot of stress and concern away from BAS agents and hopefully ended some of the scaremongering that we've seen in this space.
Now let me be really clear with the next statement. This isn't a free pass for every business that happens to have a BAS agent somewhere in the description of delivering services. You still need to look very carefully at what services you actually provide, how you provide them, and what client authorizations you have in place. And if you are involved in services that are deemed designated services, such as registered office services, acting as a nominee.
Or even holding and managing client monies that are outside that ordinary incidental payment activity, or providing other designated professional services in the legislation, then you do need to look very closely at your obligations, what you provide, and consider your enrolment monitoring and reporting activity. But for the ordinary BAS agent, the practice of doing BAS, payroll, ordinary bookkeeping, STP reporting.
Super support and related compliance work, this is exactly why representation matters. Because without the questioning and pushback from your associations, without that technical argument, without someone taking the time to say, well, hang on, this wording could be read very broadly, and it will have a real word impact on small business and our members, then many BAS agents may have felt they had no choice but to enroll, build programs, start reporting.
And carrying a compliance burden that was never intended for that type of work being performed. And to me, that's an enormous win, not just for ABN and ICB members, but for the BAS Agent industry as a whole. So, no, it's not a shiny downloadable template, it's not a technical webinar or a readable resource, but it's the kind of result that protects our profession.
And looking beyond AML and CTF, it's not the only area. ABN has produced significant results in recent times around its quality management system and the code of conduct, payday super, client agent linking, single touch payroll, and the list for me goes on. And it's why we as your association get involved. We need to keep saying to government and regulators, don't design policy as if every employer has a payroll and an accounts payable department.
They don't, nor do they have a legal team, and they certainly don't have large system implementation budgets. Small business does not operate that way. And BAS agents are often the people who make these government and bureaucratic rules work in the real world. Now we continue to do silent but amazing work here at ABN around ongoing BAS issues, ATO systems and TPB issues that matter for the community.
And we see countless practical problems arise when policy meets practice. And it's our goal to challenge and rectify those where possible. And again, much of the work we do is not visible every day. So you may not see every meeting, you may not see every submission, you may not see every email exchange, every clarification request, or every pushback conversation that it's had. But the work that is happening matters.
From time to time we hear members say, I'm not really using anything from my membership. but You are using it. You are using it when we are in the room with AUSTRAC You are using it when we push back on Treasury. You are using it when we raise practical problems with the ATO or the TPB.
You're using it when we challenge processes that make it harder for BAS Agents to onboard clients, support employers, and keep small businesses compliant. You are using it when we produce guidance, webinars, technical updates, resources, education, and all the practical support that helped lift the standard of this profession. And you're using it when the collective voice of members gives us the authority to say this is not an isolated complaint.
This is affecting us as a profession as a whole. And that's the part of the membership that's easy to miss. An association is not just a shop where you might buy a webinar, a checklist, or receive a helpline response. An association is a collective effort of our members and all the ABN and ABN team on your behalf. It's a way of saying, I am part of a profession and I want this profession to be heard. I want a seat at the table.
I want regulators to understand what actually happens in practice and I want government to understand that BAS agents are not an afterthought. And yes, I have joined Australian Bookkeepers Network because I want someone fighting the good fight on my behalf. And for me, it is you saying that's why my association membership matters to me and that membership contributes to that part of the success of the profession.
AML CTF was a great example of what your associations do for you.
So for those members who are highly engaged, thank you so much for your participation and that ongoing support. To those of you who are busy and may only dip in occasionally when you need something, that's okay too. Sometimes the value is in the thing that did not go wrong because someone was there to challenge it. The AUSTRAC outcome was one of those moments.
But there will be more. It's why we do the work we do, it's why we keep showing up for industry, and it's why being part of your professional association matters. So thanks for listening today. We'll keep fighting the good fight on your behalf. And until next time, stay informed, stay connected, and keep backing the profession that backs you. Bye for now.
AustBook (15:39)
Well hi there, KJ. Let's let's talk about the federal budget released a few weeks back. ⁓ the CGT and negative gearing changes are being sold as as a measure that's going to help younger Australians get into the housing market. However, the capital gains tax changes were not confined to residential housing sector. Shares and businesses were swept up in these changes. This means that those people that initiate start ups and invest in small cap and developing businesses will lose some of the incentive to do this.
So if as a if as a result of the CGT changes ⁓ that diminishes the incentive to innovate and attract capital to early stage businesses, the whole country loses. Personally, I see no correlation whatsoever between robbing early stage businesses of the incentive to grow, build and employ with the budget spin we're hearing of making it easier for youngsters to buy a house. For me, the CGT changes should have been isolated to residential property.
And broadening the C G T base and selling it as helping youngsters to buy houses is either disingenuous or misguided and is a horrible gamble with the Australian economy. What was your first reaction, KJ?
Yeah, hi Pete. ⁓ there was a lot of noise around the budget and clients were definitely apprehensive about what the budget changes were going to bring. I had many discussions with both young and old, or let's say more experienced ⁓ clients, worried about what was to come. The frustration was widespread spread. ⁓
Personally, I'm a big believer that the next generation should get the exact same shot at building wealth and choosing their own investment vehicles as the rest of us did. I can't see that this is a good thing for young people trying to start a new business. But enough about the disappointment. Let's chat about the impact on the budget, not only for our clients, but also on our own bookkeeping business.
Yeah, look, that's the end of the rant component. So look, just get into the nitty-gritty of the budget. ⁓ yes, there were some clear negatives to me, ⁓ but there are also some positives. So let's have a look at the budget changes most likely to impact both our clients, but also ⁓ listeners of the with their own bookkeeping businesses. It's look it's probably worth qualifying this discussion that it's based on the budget papers, which are subject to last minute change and final legislation. So look, let's start with the CGT changes.
So Pete, in a nutshell, capital gains made after the 1st of July 2027 will be taxed on the above inflation gain at a minimum rate of 30%. Big change. Gains on existing CGT assets up to that date are quarantined under the old 50% discount rate. The new rules apply to residential and commercial property, so not just Resi, as well as shares and business assets.
Or any asset that can give rise to a capital gain, basically. Yeah. It's importantly, it also brings pre CGT or capital gains assets into the CGT net at their 30 June 2027 market value. So the rest of the pod, we really need to focus just on business assets of our clients, but also our own on our own bookkeeping businesses. Yeah, if we look too wide at shares and everything else, we won't finish this today. So
Yeah, focusing just on the business assets of clients and our own bookkeeping businesses. The important issue here for existing businesses is ⁓ is the preservation of the pre 30 June 2027 gains under the old rules, as you mentioned. So that allows ⁓ for a 50% discount in the capital gain up to the 30th of June 2027. So any gain beyond ⁓ that date ⁓ is taxed under the indexation method.
So this means that for an existing business sold after 30 June 27, there will be a split capital gains tax calculation on the sale of the business asset. So what is the value of the business asset at the 30th of June 2027? ⁓ The budget material makes it really clear that you'll be able to seek out your own valuation at that date or rely on an ATO formula, which is yet to see the light of day. What that ATO formula will look like is
Pretty well anyone's guess, but given the organisation is not really geared up for business valuations, I'm gonna guess that it's probably ⁓ probably gonna based on a time based valuation method. So businesses sold five years after the rules come in for ten million and was sold for and it started five years before at at a cost base of nothing, then I'm I'm guessing they're gonna go on a time based ⁓ valuation and say that the business is worth five million at twenty twenty seven.
If you don't like that, you can go and get your own. So given that that that the taxpayer has that option for seeking own their own market assessment, ⁓ I I figure that valuers and accountants are going to be kept really, really busy around the end of next financial year. the benefit of your own valuation is that it it gives you the choice to pick the most beneficial CGT outcome, and you get to do that ⁓ with the benefit of hindsight.
This might be a great time to build relationships with valuers and and accountants for bookies as well. So what does this mean for our clients? Yeah, you're right. I think valuers are gonna be are gonna be quite busy. ⁓ should ⁓ I guess ⁓ most business owners should be seeking out a business value at the thirtieth of June twenty seven. The rules around these valuations are not yet known, so the details are a little bit hazy.
but presumably the the valuation needs to be a defendable one backed by normal valuation principles. ⁓ and this value needs to be retained until such date as the business is sold. And that could be many years or even decades into the future, which is a bit of a record keeping issue. Yeah, ⁓ just on a side note on that record keeping issue, we had ⁓ something in a re pre representation the other day was
Who's going to store all these? Yeah. Where are they going to be held? And in 20 years' time, where are these valuations going to be? Are they going to be on an old computer that's now sitting in the in the tip? Yeah. That was a I thought that was a really valid question. But yeah. So presumably the same approach applies to bookkeepers in their own practices and businesses. I can hear my fellow bookies saying, how on earth am I going to do that?
They're shuddering in their boots because many of the smaller practices, they haven't had a lot of ⁓ experience with business valuations, let alone having an evaluation on their own business. Yeah, that's true. True. Bookkeepers business, but the book that that bookkeeper business is a saleable asset ⁓ and it could ultimately be sold into the future. So this means bookkeepers will have the same challenge as their clients and may well need a valuation as at the thirtieth of June next year. But with let's watch this space and we'll
No doubt feed more information through. So other than the 50% CGT discount that is to be scrapped, the old rules provided for a range of CGT concessions known as the small business capital gains tax concessions that could reduce CGT on the sale of a business. Some bookies may have provided information to accountants to facilitate rollovers of this kind in the past for their clients.
So were the small business CGT concessions or at the acronym that we all love are acronyms, C B C G T also affected by the budget changes? Was there any changes to to that particular method? No, look, ⁓ that that's the only good news out of this is that ⁓ they were absolutely unaffected. so those concessions and we spoke about those ⁓ we did a roadshow with ⁓ MYOB late last year.
And we spoke about succession and sale of business and looked at the small business CGT concessions. But no, that they weren't affected by the budget, and they're going to continue to provide relief, particularly for smaller businesses. And the ability to access the small business CGT, ⁓ it does have concessions. That's probably the only ⁓ proviso in this. So it's not automatic that all small businesses get it. But if you do satisfy those conditions, you can still access them and minimize the capital gains tax.
on the sale of your business. And as those rules currently stand, I would figure that most bookkeepers could access the concessions on the sale of their business, depending on their structure and their other and their income and and other assets. ⁓ But this is of course tongue in cheek here, but subject to the federal government not breaking another election promise or coming to a different view like they did with the 50% CGT discount.
I think that's a huge relief because even if bookies are not aware of the small business concessions, they're a good thing for small businesses, particularly bookies. So, and I know of a few bit bookies who have actually already done that. So that is a big relief for those people who have already gone through that process because it is quite onerous. The budget document said that trusts are to be taxed like companies at a 30% tax rate.
And those rules kick in on the 1st of July 2028. They have a lot of consequences. The core rule from 1 July 2028, discretionary trust will be taxed at a flat rate of 30%, paid out of the trust before any money is distributed. So the impact on the people is that when a trust distributes to an individual, that person pays their personal tax on the distributed.
But receives a credit for the 30% the trust has already paid. However, if your personal tax rate is under 30%, you lose that leftover credit. So that means there's a minimum 30% tax on the trust profits. There's an impact on companies as well. If a trust pays out money to a company, that company gets no credit for the tax that the trust has already paid. So this effectively taxes the same money twice, creating a
highly punitive tax rate. How do you view these proposed changes, Pete? Yeah, look, I I think you've you've nailed it there. It it's ⁓ these are a little bit more intangible because they're a little bit further out. They're another year away after the CGT changes. But yeah, look, it's a really, really blunt instrument. ⁓ it seems to be targeting a number of specific situations that have challenged the tax office or ATO. You're not only calling the tax office anymore, are you? Or are you allowed to call them?
Well, I'll be getting in trouble for calling them the tax authors. Yeah, just call them the ATO. But ⁓ these situations have challenged the ATO over the years. ⁓ they include the distribution of trust profit to companies, as you touched on, to limit the tax rate to either twenty-five or thirty percent, depending on the company. ⁓ and it also ⁓ affects distributions to beneficiaries that have a tax rate of less than thirty percent. ⁓
And it and that's typically that kicks in under the current personal rates where an adult has earned less than forty-five thousand in a year. ⁓ and it also affects ⁓ trust distribution to entities that have losses, ⁓ where they can sop up the losses and ⁓ not pay tax on tax on income that would otherwise have been taxable. so look, they're the probably the the the three blind areas I can see that they're actually chasing out of this thing.
Budget announcements seem to give people with affected trust the option to do the small business rollover to convert their trust to a company if they didn't like the outcome of the trust taxing. The government basically said that if you don't like the new trust rules, you can pack up your trust and move it to a company structure instead. Yeah. But they've actually shared the instruction, they haven't actually shared any information or the instruction manual that we need on how to do it. So the devil's in the detail.
Do you think that the clients will be reorganizing their trading business and their entities? Yeah, look, as you say, the the terms of the rollover ⁓ aren't known, they're not spelled out. and whether there will actually be any state government stamp duty relief on the transfer, because they're different animals. So the state ⁓ e each of the individual states have the ability to levy stamp duty on the transfer of a business. ⁓ and that can be quite punitive. and given that the states are not.
horribly flush with funds at the moment. I can't see them wanting to voluntarily give up something that would have otherwise been stamped. But putting those issues to one side, I would think it's quite likely that many businesses will take the opportunity to reorganize. But each client is different and each will need to work through the personal impact of the change to taxes with their accountant. Where the decision is made to reorganize, there's going to be a lot to do. The trading entity will need
Fresh tax file numbers, ABNs, GST registrations, pay-to-go registrations, bank accounts, suppliers and customers are gonna need to modify their records and open new open new trading accounts. Employees are gonna have to be terminated and offered fresh employment with the fair work obligations being met all the way along. Insurances and workers come are gonna need to be redone, as will any other statutory registrations with federal, state and local instrumentalities.
you'll have a whole pile of subscriptions that are going to need to be redone, as will ⁓ super guarantee, default superphone arrangements, and much more. So you can sort of see that there's going to be a huge amount of work to be done. ⁓ and some clients are definitely going to be leaning on their bookkeepers for assistance with some of these things if that comes to fruition. And on top of those organizational issues, there will be fresh accounting files, general ledger files for bookkeepers to create for new companies.
That's really true, but we're familiar with this. Many bookkeeps routinely help their clients set up a new entity. It's not anything new to most of us, but maybe it is a really good time to refresh those checklists on setting up a new entity and setting up a company. In a way, it's a bit like setting up a new client. You go through all those checks anyway. ⁓ so
Do these issues apply to bookkeepers who are currently trading through trust in their own practice or in their own business? Because I know a lot of bookies who actually do trade through trust. Yeah, you're right. ⁓ yeah, I've spoken to quite a few and they've used discretionary trust. ⁓ and again for for lots of valid reasons, including asset protection. But yeah, the bookkeeper's going to need to work through exactly the same issues, and perhaps on a smaller scale than than for some of their clients. But a discussion with their accountant will ascertain whether or not it's worth
reorganising their trust structures. But you know, I've looked at a few of them and it it's not necessarily going to adversely affect everyone. So it may well be that some ⁓ these trust structures are preserved. Yeah, well that's probably enough of all that. ⁓ let's look at another budget measure that may impact you haven't got a trust structure, have you? You seem to be ducking there. Yeah. Some of it gets a little bit depressing. So
Let's move on to dynamic PAYGI. So how does dynamic PAYGI work? It's been a recent topic in our rep work and it will be a topic at the next BASAG as well. Yeah. ⁓ look, dynamic pay-as-a-go instalments, that's a good name for it. ⁓ it's essentially monthly pay as a go instalment payments instead of quarterly for most people. very few people are more frequent than monthly now. ⁓
They turn over over 20 million and taxi drivers and and and there's a very few other exceptions. but this change that they put in with the budget or is going to affect two groups of businesses. The first group is ⁓ what they have termed non-compliant taxpayers. Essentially, the ATO can designate certain employers to be non-compliant, and they must pay pay as you go instalments monthly, just like the taxi industry. ⁓
The second group are compliant businesses that opt into paying monthly. They want to do this monthly. To enable opting in, the ATO are going to provide a formula to the DSPs to embed in your accounting software. That's going to automate a pay as you go instalment calculation, saving you, in theory, saving you the time in preparing pay as you go instalment variations and then lodging them. So if you accept the automated calculation ⁓ and it
under happens to understate the instalment, ⁓ you're gonna get s what they call safe harbor protection. ⁓ and ⁓ you can't be penalized for an incorrect variation, which is really big of them when you think about it because it's their formula. ⁓ look the advantages of opting in to me are pretty tenuous as I see them. What do you think, KJ? I agree. ⁓ the basis of opting in would be that you wanted to pay your PAYGI A Y G I to the best approximate
To make your annual tax bill more accurate so you that you don't you're not owing as much at the end of the year. But that's basically what we're doing now, anyway, with quarterly PAYGI. It means you could end up with a more or less less tax paid than you've already simply stayed with the current instalment rate. So under the existing methods, nothing stops you from prepaying your PAYGI monthly if you choose to do so. So you can do it voluntarily if you'd like to.
you can either of these options still give you a access to the funds up to the due date for the payment. Whereas if you pay your PAYGI monthly, then it's gone and you cease to have access to those funds. So you do see a lot of clients who have a tax account or a GST account that they can put money away in. And as far as saving time in calculating and lodging a varied PAYGI
YGI, I don't think the savings would be huge as the agent still feels inclined to check the calculation that the ATO's made because I know that we're all we're all ⁓ a little bit of control freaks. So we're gonna check it anyway. Correct. And the ATO don't pay interest on the PAYGI monthly if you've got it with them. So why wouldn't you put it set it aside into an interest bearing account?
The safe harbour protection is comforting for agents 'cause I know a few bookies that have a lot of angst about getting it wrong. They worry about getting it outside the ten percent, which is an anomaly that people still think, which is it's just out there. The bookies just don't they prefer to let their clients make that decision, I suppose. Yeah. Yeah, it's ⁓ it's an interesting one. I
me it seems to be dressing it up ⁓ for ⁓ to make it sound a little bit more appealing to opt in. ⁓ to me opting in ⁓ with a whole lot of noncompliant people doesn't I don't seem to get the connection with that, but we will see as that ⁓ plays out. But I at the stage I can't see a lot of opterinner is if that's the right word. Maybe we should be opting in representation for them to pay interest if people pay monthly. That would be ⁓ you you you would almost think about it then, wouldn't you? Like if you
'cause their interest rate that they pay on early paid income taxes not ⁓ is is is somewhat generous, it's somewhat fair. ⁓ so if you said, Okay, well you paid everything on time and you we're gonna give you a bit of interest for paying early, which is what it is, ⁓ then you'd you'd think about it. but without the interest, ⁓ then I I just don't see the appeal being there. ⁓ so anyway. Look, the last budget is too we got time for in this episode of BK Pod is the instant asset write off.
So essentially what they've done is they've made the existing twenty thousand ⁓ instant asset write off a permanent thing. That's ⁓ until they decide to have a different view at some stage in the future. ⁓ but on face value, I think it's a good thing. ⁓ although ⁓ it's not horribly notable because that's been there for a while. But is that how you saw it? I think it's a really good incentive and it brings a base more in line with reality.
So from a business perspective, making it permanent gives SMEs more certainty around end of year when they're buying business assets. In the past, business owners have bought assets based on a May budget. Announcements were made and then they were actually taking a gamble that the government would eventually pass the law to give them the tax deduction. So I think it's a good thing. Yeah, I I'm I'm fair enough. I I I'm a supporter. ⁓ look, there's nothing ⁓ there's nothing new in this budget measure. ⁓
So structurally, other than the permanency it it made, ⁓ it's still a twenty thousand dollar claim per asset, not a per taxpayer or per annum claim. So you can have multiple multiple asset claims in any year. ⁓ and in terms of bookkeeping for those claims, ⁓ that's there's no new developments here. Look, we've actually got a bookkeepers' knowledge base number ninety seven that gives you a bit of guidance on how to deal
with the instant asset write-off style expenditure. And we've also done a a number of instant asset webinars over the years. So you can access those off the members section of the ABN website. Simply type instant asset into the search box at the top of the screen and they'll all pop up.
So look, that's enough for me. Any final words, KJ?
Think the latest budget definitely drops some heavy changes on us. It's going to impact our clients' businesses and honestly our own bookkeeping businesses as well. Yeah. Before anybody hits the panic button, deep breath. Yeah. We're all in the same boat here. And the best thing we can do right now is just keep an eye on things as they crawl through parliament and turn into actual legislation. As I said previously, the devil's in the detail until the government gives us the actual legislation to dissect.
We can't react with absolute certainty. So no sudden moves or light n late night stress sessions. Just we wait for the fine print. Okay, doke Well, ⁓ thanks for that. thanks for your insight and your time today, KJ. ⁓ see you next time and thanks to our listeners for tuning in.
AustBook (38:35)
Hello and welcome to the BK Pod. My name is Darren Hagarty and I'm a director of ABN. Today I want to spend a few moments telling you about a recent edition of our Getting Technical publication entitled Payday Super, When is Payday? Now at first glance that might sound like a simple question, but under Payday Super, the answer is more technical and more important than many employers may realise.
This edition looks at the concept of Qualify and Earnings Day or QE Day and why that date sits at the heart of the new payday super timing rules. In particular, we explore why QE Day should not simply be assumed to be the pay period end date, the payroll processing date, or even the day an ABA file is uploaded to Internet banking. That distinction matters because the timing of super contributions will be measured by reference to when qualifying earnings are paid.
We also consider some of the practical tensions this creates for employers, payroll systems, and BAS agents, especially where the date recorded in payroll may not perfectly align with when payment is actually made. The addition then turns to the ATO's likely data matching approach and why the STP reported pay date may become a critical operational anchor in practice. Finally, we touch on out-of-cycle payments such as bonuses, commissions, allowances, and back pays.
And why they require their own careful timing analysis under the Payday Super framework. Overall, this is a practical look at one deceptively simple question: when does the clock actually start? And as PaydaySuper approaches, that is a question employers and advisors will need to be ready to answer. Enjoy the read.
AustBook (40:20)
Well that's a wrap for us today. I'd like to thank all our guests for joining us. We hope you enjoyed the episode. Just a couple of reminders of some great resources that we have released in the last month. So in case you missed them, Darren and I held a let's get technical and that covered off on End of Financial Year and looked at it from two lenses. So not only ⁓ your client's side and how to prevent pre prepare them for end of financial year, but also your own practice.
If you miss that one, you will find a recording in your members centre. On the subject of End of Financial Year, don't forget we have the End of Financial Year checklist that is available in your Member Centre. This is a really great checklist that you can use to review your client files and make sure they're ready, ⁓ tax ready, ready for the accountant at the end of the year. If you aren't already using it, I definitely suggest you take a look at that. You can once again find that in the members' centre.
If you go into the search button at the top of your member centre and search ⁓ EOFY checklists or end of financial year checklists, whichever you prefer, you will see it pop up. I also wanted to draw your attention to the next bookkeeper radio, which is on the topic of AML and these recent changes that Kelvin was speaking about earlier. In this episode, you'll hear from
Pete and Kelvin on all aspects of the AML legislation and its impact on the bookkeeping industry. It is being held on the 24th of June, so watch your inboxes for that invite. Lastly, good luck with End of Financial Year. We know it's a really, really busy time for everyone. Make sure you take care of yourself, take a break when you need to, and get through the madness that June brings.
And we will chat to you next time. Thanks for joining us today. Take care and until next month. Cheerio from the ABN team.