The ongoing devastating bushfires that has ravaged south eastern Australia will leave an everlasting scar on the Australian landscape. Below is a brief summary of initiatives that could help address some of the tax issues that the fires have caused.
Tax Obligations – ATO will automatically grant deferred lodgment and payments
The ATO has announced that is does not want those affected by the bushfires to be concerned with their tax. The ATO will automatically grant deferred lodgment and payment due dates for those in impacted postcodes. For those impacted but not in the ATO identified postcode – contact your tax agent.
The ATO will be assisting the affected by providing additional payment extension, fact tracking refunds and providing interest free payment plans as well as helping with reconstructing your tax records that were lost or damaged.
Financial Assistance – Access to Superannuation Benefits
Those directly affected by the fires may be able to access their super benefits under a special condition of release. For a SMSF, the special conditions need to be assessed by the ATO/Centrelink.
- Severe financial hardship
- Have been receiving government support for a continuous 26 week period
- Cannot meet reasonable and immediate family living expenses
- A lump sum payment $1,000-$10,000 for any 12-month period.
- Permanent or temporary incapacity
- If you have permanently or temporarily ceased employment due to physical or mental ill health
- Permanent – nil cashing restrictions
- Temporary – income stream paid for the period of incapacity
- Compassionate Grounds
- Medical expenses that aren’t readily available through the public health system
- Loan or council expenses so you don’t lose your home
There are several recovery allowances available from the Government – contact Centrelink or your tax agent to review your eligibility.
Donations to registered organisations are tax deductible
Individuals can claim a tax deduction for any donations provided they are $2 or more, given to a registered organisation and you receive a receipt. With any online donations, ensure you are directly donating to a registered organisation not to an unregistered social media influencer.
Self-managed superannuation funds (SMSFs) sole purpose is to provide for retirement benefits of the members. This provision ultimately restricts SMSFs directly donating to any charitable organizations.
A member, if they have met a condition of release, can draw down and personally donate.
Ensure you’re adequately insured
The extent of the devastation has prompted many people to review their current insurance policies.
Australian is chronically underinsured resulting in them being out of pocket or settling for an inferior outcome.
Many people don’t factor in the costs of demolition or the increased rebuild cost of properties in a higher risk area which can be in the 100s of thousands.
Please contact your insurer today to ensure you are appropriately covered.
We’re here to help…
If you have been effected by the devastating bushfires, please do not hesitate to contact your accountant for assistance. They can help you navigate the options and assistance available to you and speak with the ATO on your behalf.