Could this federal court ruling put your family home at risk?

If your work sees you involved in the world of high-stakes business or puts you at risk of bankruptcy, you may be concerned with how you can best protect your assets. Particularly an asset as important as the family home. One method of protecting assets is to make sure that they are not held in the name of the at-risk person, rather someone trusted, such as a spouse. But a recent judgment heard by the Full Court of the Federal Court will have a profound impact on the way accountants approach spousal assets.

The judgment held that a $4.5 million property acquired in the name of one spouse was in fact owned by both, equally. Below we discuss the ruling, its repercussions, and our advice on how you can best protect yourself and your family.

 

The ruling.

Mr. and Ms. Bosanac purchased a home in Dalkeith, Australia in 2006. They paid a $250,000 deposit with funds from a joint loan account in both their names and borrowed the remainder. Although both contributed to the purchase price equally, the property was transferred to Ms. Bosanac as the sole registered proprietor. Both Mr. Bosanac and Ms. Bosanac lived in the property up until they separated in 2015, after which Ms. Bosanac inhabited the property alone.

The property was used as collateral to acquire other investment assets. Pertinently, Mr. Bosanac used borrowed money secured by the mortgage to conduct share trading.

As a means to recover an outstanding debt owed by Mr. Bosanac to the Australian Taxation Office, The Commissioner of Taxation sought a declaration from the court that Ms. Bosanac, as the sole registered proprietor of the family home, held 50% of the beneficial interest on trust for her husband. The matter primarily centered around the question of whether Mr. Bosanac had an equitable interest in the residential property for $4.5million which had been registered solely in the name of Ms. Bosanac.

Ultimately, the Federal Court judgement held that the property was jointly owned, enabling the Commissioner of Taxation to make a claim on the family home for Mr. Bosanac’s unpaid taxes.

 

Repercussions.

With the Commissioner of Taxation being successful in the second-highest court in Australia, this decision has significant repercussions in accounting. It overturns current asset protection methods used by accountants where an asset is held in a spouse’s name to protect against litigation and other claims against the at-risk spouse.

The case sets a new precedent for such matters. Based on the ruling, effectively this is the new law and the Commissioner of Taxation can be expected to enforce it in future cases. Clients in a similar position should immediately seek advice from their accountant on changes required to be made to their asset protection structures.

 

How you can protect your most important assets.

As accountants, we cannot give asset protection advice. Our expert legal team is on hand to help you ensure your assets are protected. But there are a few takeaways from this new Federal Court judgement for accounting. If your line of work puts your assets, including your family’s home, at risk, here are some things you may like to take into consideration.

  1. The property title should be solely in the name of the not-at-risk person.
  2. The bank account that loan repayments are taken from should also be solely in the name of the not-at-risk person.
  3. The at-risk person should not contribute directly to the loan.

Every situation is different, and there is no one size fits all approach to taxation planning and asset protection. Talk to our professional, approachable, and proactive Geelong Accountants to make sure you are best positioned to make the most out of taxation legislation, including investment-based tax-minimisation measures. If you want extra protection for your assets, seek advice from Hrkac Group Legal Services in Geelong, we have the experience to help you resolve any problems quickly, inexpensively, and with minimal stress.

Make an appointment today via contact us, or phone 03 5224 2366.

Liability limited by a scheme approved under Professional Standards Legislation.

As we’re gearing up for our busy period, we want to make sure your preparation for this year’s Tax Return appointment is easy and hassle free. From experience, providing the right paperwork, receipts and statement information is the key to ensuring you get the best out of your Tax Return appointment. With this in mind, our Accounting specialists have gathered together an informative checklist you can use as a guide.

Anyone can use our business or personal tax return checklists to prepare for their appointment – flag it in your inbox, bookmark it or even print it out. You can keep coming back to these guides, so you know what to bring to make your appointment run smoothly.

Personal Tax Return Checklist

Some important items to remember:

  • A copy of last year’s Tax Return
  • PAYG/Group Certificates
  • Receipts for claims/deductions
  • Self-Education costs
  • Private Health Insurance Annual Taxation Statement

Business Tax Return Checklist

Some important items to remember:

  • Back up or invite your Hrkac Accounting specialists to your accounting program
  • Capital purchase documentation
  • Payroll records

Not all items on these checklists may apply to your return and you don’t have to bring these to your appointment, but they can be handy to keep on file for next year. If you are unsure about any of the items on the checklist, bring as much information as you can to your appointment, and we can help you know what is relevant to your tax return.


This year, The Hrkac Group is taking online bookings for Tax Return appointments. You can use the link below to book your appointment online or use the top right button on our website whenever you’re ready.

Top Tip 2019:

Although technology is helping us improve our taxation processes, we don’t always have online access to the most up to date information available.

It’s important to bring your Group Certificate to this year’s appointment so that we can work with the correct and most recent information (we can’t always access your certificates online.)

If you have any questions or would like to book your Tax Return appointment, please contact The Hrkac Group here.

 

Liability limited by a scheme approved under Professional Standards Legislation.

Follow our handy Personal and Business Tax Time Checklists to make sure you’re prepared.

So it’s that time of year yet again! If you are new to lodging a tax return or if you are a new Start-Up Business or Sole trader/contractor – even if you’ve been doing it for years – getting all of your financial documentation together can be a daunting task.

If you just don’t know where to start, the Hrkac Group are here to help. We strive to take the guesswork out of Tax time and have put together helpful checklists for both personal and business taxation clients, so that you can be confident that you have everything in order.

For those looking to lodge a personal tax return, here is a list of some of the items required by your registered tax agent:

  • A Copy of your previous years income tax returns (new clients only)
  • PAYG payment summaries Group Certificates
  • Dividends and other investment income
  • All Rental Property Information
  • Receipts for any possible claims/deductions including:
  • Motor Vehicle expenses
  • Any Travel expenses
  • Uniform purchases and Laundry costs
  • Self Education Costs
  • Any Work related expenditures
  • Tax agent fees paid during last financial year (new clients only)
  • Your account bank details for any refund
  • Any Gifts or Donations
  • Income Protection premiums paid
  • Private Health Insurance Annual Taxation Statement

For those of you running a business, here is a list of some of the items required by your registered tax agent:

  • Backup or invite your agent to join your Accounting program
  • (i.e MYOB/Reckon/Quickbooks/Xero)
  • Bank Statements for all business accounts including loan statements
  • Documentation for any new Capital purchases such as Motor Vehicles or properties
  • Trade Debtors listing as at the end of the period
  • Trade Creditors listing as at the end of the period
  • Detailed payroll records
  • Do you have any carried forward capital losses? If yes, how much

New clients will also need:

  • a copy of most recent years financials and tax returns
  • Previous accounting fees paid
  • Personal and business details

Download our Personal Tax Checklist or our Business Tax Checklist here!

If you would like to know more or to make a time to see one of our Geelong based Personal or Business Tax Specialists, feel free to contact the Hrkac Group today!

Follow our handy Personal and Business Tax Time Checklists to make sure you have everything in order.

So it’s that time of year again! For some it has become like driving a car or riding a bike, you just go into autopilot and you can get everything in order without breaking a sweat. For others, in particular those that are new to lodging a tax return or for a new Start-Up Business or Sole trader/contractor, it can be a daunting task. Where do you just don’t know where to start?

Luckily at the Hrkac Group, we strive to take the guess work out of Tax time, and have put together some helpful hints, so you know that you have everything in order.

For those looking to lodge a personal tax return, here is a list of some of the items required by your registered tax agent:

  • A Copy of your previous years income tax returns (new clients only)
  • PAYG payment summaries Group Certificates
  • Dividends and other investment income
  • All Rental Property Information
  • Receipts for any possible claims/deductions including:
  • Motor Vehicle
  • Any Travel expenses
  • Uniform purchases and Laundry costs
  • Self Education Costs
  • Any Work related expenditures
  • Tax agent fees paid during last financial year (new clients only)
  • Your account bank details for any refund
  • Any Gifts or Donations
  • Income Protection premiums paid
  • Private Health Insurance Annual Taxation Statement

For those who own a business, here is a list of some of the items required by your registered tax agent:

  • Backup or invite your agent to join your Accounting program
    (i.e MYOB/Reckon/Quickbooks/Xero)
  • Bank Statements for all business accounts including loan statements
  • Documentation for any new Capital purchases such as Motor Vehicles or properties
  • Trade Debtors listing as at the end of the period
  • Trade Creditors listing as at the end of the period
  • Detailed payroll records
  • Do you have any carried forward capital losses? If yes, how much

New clients will also need:

  • a copy of most recent years financials and tax returns
  • Previous accounting fees paid
  • Personal and business details

 

Download the version of our Personal Tax Checklist or our Business Tax Checklist here!

If you would like to know more or to make a time to see one of our Geelong based Personal or Business Tax Specialists, feel free to contact the Hrkac Group today!

What to look out for to ensure you’re not falling victim.

Have you received emails, phone calls or letters from the Australian Tax Office, demanding payments for outstanding tax bills using iTunes cards? Be careful, these could be part of a new sophisticated tax scam defrauding Australians.

Typically, when emails are used as correspondence, these emails contain links to fake websites that look remarkably genuine and may have attachments containing system-corrupting Malware or, in some cases, “Ransomware” which seeks payment for unlocking access to your own computer files.

Little can be done to stop scams such as these, with the criminals responsible often being based offshore and using techniques that are near-on impossible to trace by local authorities.

As your authorised Tax Agent, contact from the ATO about your taxation affairs should always come via our office. In particular the Australian Tax Office DOES NOT make phone calls soliciting payments for outstanding debt without first writing to taxpayers. Should you receive any direct contact purporting to be from the ATO, notify us immediately and we will work to verify it as genuine. Alternatively you can take matter up directly with the ATO in 1800 008 540.

Under NO circumstances should you pay an alleged Tax Debt without establishing its validity with us first.

Follow the link here to read the Tasmanian Police Media release. Follow the link here to read the Australian Tax Office Media Release.

If you have any queries or concerns or feel you may have been caught up in this scam, feel free to contact one of the Geelong based Tax specialists at The Hrkac Group.

What has changed and what you need to know.

In early November the Federal Government passed a bill to make an amendment to legislation regarding the repayment of Fee HELP/HECS Loans for those people who have moved overseas.

Previously, the legislation was that If you went overseas and said that you were no longer an Australian tax resident, i.e. you had no intention of ever returning to Australia (different to being an Australian citizen); your HELP/HECS Debt would just sit there regardless of what you earn overseas. If you never returned to Australia, you would never repay your debt.

Under the new amendment, regardless of whether you are an Australian Tax Resident or not; if you have a HELP/HECS debt and total worldwide earnings are over the relevant Australian Taxable income threshold; you are now required to make repayment under Australian law.

The following bills passed the Senate without amendments:

Education Legislation Amendment (Overseas Debt Recovery) Bill 2015 and Student Loans (Overseas Debtors Repayment Levy) Bill 2015 .

The Bills propose amendments to implement a 2015-16 Budget proposal to ensure that the same debt repayment obligations that apply to debtors who live in Australia apply to those who live overseas.

The Overseas Debt Recovery Bill will create an obligation to make repayments on their HELP and TSL debts based on their total Australian and foreign-sourced income, known as their worldwide income. This will be imposed as a levy (to be known as the “overseas debtors repayment levy”) through the other Bill.

If you would like to know more about how this may impact you either currently or in the future, feel free to contact one of our Geelong-based Tax specialists!

Get in fast to ensure you receive the Tax Agents lodgement extension for your Income Tax Returns for the financial year ended 30th June 2014*.

If you notify the Australian Taxation Office (ATO) of your appointment of an Accounting tax agent before 31st October 2014, you may be eligible for the tax agent’s extension up until May 2015.

So there is no better time than now to lock in The Hrkac Group’s Taxation Services to look after all your Accounting needs.

*To be eligible for the tax agent’s extension, all prior years’ tax must be up to date.

Are you looking at purchasing a new or used vehicle over $35,000?

Then get in quick to see our Geelong Finance specialists to grab a great deal, with interest rates at a low 4.99%* (*used vehicle up to three years old)

Not only could you score a competitive deal but it could also be a Tax Planning advantage if purchased before the End of Financial Year!

Want to know how a vehicle purchase can benefit you when it comes to Tax? Why not come in and discuss with one of our experienced Geelong Accounting team members.

So act now! Please contact one of The Hrkac Group Geelong Finance specialists today via Contact Us, email or phone 03 5221 2355.

Planning is essential for you to achieve the optimal Tax outcome.

The Hrkac Group, located in the heart of Geelong, is ready to assist with all your Tax Planning needs.

There is still a little time left to take advantage of any Tax Planning strategies that may be applicable to you before another Financial Year comes to a close. However we suggest that you act now to have any strategies in place well before the 30th June.

So act now! Please contact one of The Hrkac Group Geelong Financial Services specialists today via Contact Us, email or phone 03 5221 2355.

John Hrkac (B.Com, FIPA) is proud to announce The Hrkac Group Accountants is celebrating its 20 year anniversary of supporting Geelong and the wider community.

When The Hrkac Group Accounting firm commenced 20 years ago, he never imagined he would be running such a successful Geelong Accounting, Taxation Services and Business Services (Advisory) business with over 3000 clients.

It began as a small accounting firm and has since grown to include Financial Services, Finance and Conveyancing, supporting some 18 staff locally.

The Hrkac Group look forward to supporting you with all your Accounting, Financial Services, Finance and Conveyancing needs for many years to come.

Please take control of your financial future by meeting with a member of The Hrkac Group today. Make an appointment via Contact Us, email or phone 03 5224 2366.

Welcome to the year 2014! Well Financial Year anyway!

This time of year can be quite stressful for a lot of people but we are here to make things as quick and simple as possible!

Our dedicated team of Geelong Taxation Services professionals at The Hrkac Group Accountants is enthusiastic about what the new Financial Year can bring for our clients.

Our professional Taxation Services team can help with all forms of Taxation requirements including Personal Tax Returns, Business Taxation Returns and Self-Managed Superannuation Funds.

To ensure you get the best result possible for your Business or Personal Tax Return, please Contact Us now at The Hrkac Group Taxation Services and Tax Planning Team.

With the New Financial Year just around the corner, it is important to get your Tax Planning organised in order to maximise your time and money.

Some things considered when Tax Planning are Tax deferral strategies, Superannuation obligations, GST and Fringe Benefits Tax (FBT) advice, PAYG Withholding obligations, Salary Packaging, maximising refunds and minimising liabilities… and that’s just the start!

Our dedicated team of Geelong Taxation Services at The Hrkac Group Accounting division is eager to work with you for a smooth transition into the 2014 Financial Year! Please Contact Us now at The Hrkac Group.