Category: Newsletters

Applying For A Mortgage Is No ‘Walk in the Park’

The Banking Royal Commission commenced in 2017 and APRA’s crackdown on sub-standard lending practices have seen to new lending criteria being used since 1 July 2018, meaning applying for a home loan can feel like too much work for an applicant.

The new rules mean lenders now apply financial checks beyond what has been applied in the past. An applicant can feel scrutinised and even hounded for the depth of information being requested by banks and other lenders.

A lender is required to make sure that an applicant has the debt-servicing capacity to repay a loan at its interest rate within the specified loan term.

In order to have this assurance, applicants may be asked to provide extensive credit history data, including but not limited to: late bill payments, credit card balances, rental payment transaction lists, life and other insurance policy details, as well as disposable income capacity with detailed household budgets.

If a lender can satisfy itself that an applicant has the ability to service a principle + interest loan over the duration of the mortgage period, then a loan may be approved.

What can you do to improve your application?

Mind Your Credit History – As third-party verification of existing assets and liabilities is often required, keeping a record of your credit history is an important action you can take to improve your chances of receiving a loan.

Allow Time – Although many loans are approved relatively quickly and easily, expect to factor in more time for the application process. Allowing enough time to answer questions from a lender and enough time to supply supporting documentation will help to reduce any anxiety about a longer wait for an approval.

Plan Ahead – Realize you need to consider your financial transactions more carefully these days to best avoid impairing your future borrowing plans.

Seek Advice – It can be a long and intrusive process, requiring large amounts of financial information from you. We can help you weather the application process and can help you better understand what it is you need to do.

Everyone is treated equally

Whether you are buying your first home with a small deposit or buying yet another property for a portfolio with millions of dollars at hand, the process of determining a strong application is the same: evidence of financial capacity to repay a loan – taking in to account an applicant’s reasonable and true living expenditure and disposable income.

Stricter Lending, Safer Borrowing

Banks might be a lot stricter about providing a home loan, but ultimately it can lead to a safer path for many home owners. As the interest-only era of home loans phases out, being able to comfortably repay a home loan will be a ‘walk in the park’.

And that’s home sweet home.

How can YML help?

Talk to our YML Finance Team today to see how YML Group can assist you with your mortgage application. Contact us on (02) 8383 4400, or by visiting the Contact Us page on our website.

Taxable Payments – New Compliance for Couriers and Cleaners

The Australian Government has reviewed areas of the ‘Black Economy’ – the market of people working outside of the tax regulation system – and found that payments made to certain workers, namely contractual couriers and cleaners, must now be included in a company’s Taxable Payments Annual Report (TPAR).

So if you’re running an Australian company with an ABN whose core or auxiliary service offering includes couriers and/or cleaning, then you will need to fulfil your tax payment reporting obligation to the ATO for these payments.

Contractors can be sole traders (individuals), companies or other entities invoicing your company for their services. You only need to report payments you make to contractors for courier and/or cleaning services.

Reporting Contractor Payments

Here are two examples:

Lodging your TPAR 2018-2019

A company using contract courier and/or cleaning services will be required to collect the relevant information from 1 July 2018 and to report it in their 2018-2019 TPAR by 28 August 2019. You need to know that if an invoice from a contractor includes labour and materials, the total amount of the invoice must be reported as the payment. However, an invoice from a contractor for ‘materials only’ will not be included in the report.

The reportable information from an invoice you receive includes but is not limited to:

  • ✔ ABN
  • ✔ Name of Contractor
  • ✔ Contractor’s Address
  • ✔ Gross Amount Paid to Contractor (within FY 2018-2019)
  • ✔ Total GST included in Gross Amount Paid to Contractor

You do not need to report:

  • ▪ Payments for ‘materials only’
  • ▪ Invoices unpaid as at FYE 30 June
  • ▪ PAYG withholding amounts

Seek Advice

Throughout this current financial year, you will need to be garnering data from your courier/cleaner contractor invoices. YML Group can guide you in the process and assist you with your TPAR lodgement.

How can YML help?

Talk to our YML Chartered Accountants Team today to see how YML Group can assist you with your TPAR. Contact us on (02) 8383 4400 or by visiting the . Contact us on (02) 8383 4400 or by visiting the Contact Us page page on our website.

Government announces Changes to the Working Holiday Maker Programme

The Australian Government undertook a review of its Working Holiday Maker (WHM) programme and made changes to the criteria for overseas travellers wishing to work in Australia. These changes are now law and will hugely benefit Australian farmers and regional Australia’s workforce.

The WHM programme has two visa types: Visa Subclass 417 – known as Working Holiday Visa and Visa Subclass 462 known as Work and Holiday Visa. Which visa is issued to a travelling worker will depend on their country of residence.

Likewise, the Australian Government’s changes to the WHM programme are dependent upon the nationality of the travelling worker and, therefore, as an employer you will need to assess the visa rights of an individual working for you.

Generally, the changes for travelling workers include:

  • WHM Age Limit – May be aged 18 to 35 (no longer 18 to 30)
  • WHM Extension Period – May work with the same agricultural employer for up to 12 months (no longer up to 6 months)
  • WHM Third Year – From 1 July 2019, may opt for a third year visa after completing 6 months of regional work on their second year visa
  • WHM Work Period – May work altogether within Australia for up to 9 months a year (no longer up to 6 months for some countries)
  • Subclass 462 – May undertake regional plant and animal cultivation work in new regions within Australia for eligibility for a second visa
  • Subclass 462 – Annual caps lifted and an increase in available work places for some countries

Employers must now:

  • Validate Seasonal Labour Market Testing for 6 months (up from 3 months) prior to employing a travelling worker on an WHM visa
  • Repay their travelling seasonal workers for their out-of-pocket expenses up to $300 (no longer up to $500)

Overall, these changes are targeting genuine regional and rural workforce shortages by not only increasing the number of WHM visa holders but by giving WHM visa holders the option to extend their time in Australia. To achieve this goal, the Australian Government is allowing travelling workers to undertake longer periods of work in a broader scope of Australia’s agricultural sector.

Furthermore, the Australian Government is negotiating with yet more countries to enable an even greater number of participants in the WHM programme.

How can YML help?

Talk to our YML Migration Team today to see how YML Group can assist you with your WHM visa nominees. Contact us on (02) 8383 4400 or by visiting the Contact Us page page on our website.

NEWS! CGT Main Residence Exemption to End for Foreign Residents

A property defined as a main or primary place of residence (PPR) for an Australian resident is exempt from Capital Gains Tax (CGT) even when an Australian resident chooses to live offshore for up to six years.

Currently, during their time offshore, an Australian resident may sell their main place of residence in Australia and benefit from the CGT main residence exemption, resulting in significant saving on CGT at the time of sale.

CGT Changes – What are they?

Recent changes by the Australian Government will see the end of the main residence exemption from CGT for all non-resident Australians, regardless of how long they have been living and working out of the country. The termination of this particular CGT exemption is 30 June 2019 for properties held prior to 9 May 2019.

Important Dates for Foreign Residents to Know:

  • Exemption may be claimed on PPRs held prior to 7:30pm (AEST) on 9 May 2017 and disposed of up to 30 June 2019
  • Exemption NO LONGER applies to PPRs acquired after 7:30pm (AEST) on 9 May 2017

If you are an Australian resident living overseas, in possession of a main Australian residence and you sell your home after 30 June 2019, then this legislative change will affect you.

I am a foreign Australian resident with an Australian PPR – What now?

You will need to consider your intention to return to Australia to live. You will need to assess your personal situation about living in your main residence or selling it, and the possible tax consequences of both scenarios.

Your current and future tax residency status can be determined for the purpose of selling your Australian property. You might solicit professional guidance on the tax implications of living and working offshore whilst still holding your main Australian residence.

Upon returning to Australia, residents may be eligible to claim a partial – if qualified – CGT exemption upon selling their main residential property.

If you are a foreign resident and you are required to lodge a tax return for Australian-assessable income, then the ATO has the power to collect CGT via a tax return, depending on individual circumstances.

How can YML help?

Talk to our YML Chartered Accountants Team today to see how YML Group can assist you with your PPR and CGT. Contact us on (02) 8383 4400 or by visiting the Contact Us page page on our website.

Should I ‘fix’ my home loan?

If you’re wondering whether ‘fixing’ your home loan is worthwhile and to help you decide what to do, consider the following:

The main advantage  of a fixed rate home loan is that it gives you cash-flow certainty. That is, you know exactly how much your loan repayment will be over the fixed term period. When you are a new homeowner or are setting up a business, this certainty can give you great peace of mind.

The main disadvantage of a fixed rate home loan is that fixed term loans tend to be inflexible – and can be expensive if you break the contract!

If I decide to ‘fix’ my home loan, what interest rate is on offer?

For a fixed 2-year investment home loan, where principal + interest repayments are made, you can access an interest rate from 3.98% per annum.

For a fixed 2-year home loan for a first home buyer-owner-occupier, where principal + interest repayments are made, you can access an interest rate from 3.69% per annum.

For a fixed 2-year home loan for other owner-occupiers, where principal + interest repayments are made, you can access an interest rate from 3.72% per annum.

You don’t have to answer the question alone.

At YML Group we can help you to find out more about your home loan interest rate options and decide whether ‘fixing’ your home loan is in your best interest.

How can YML help?

Talk to our YML Finance Team today to see how YML Group can assist you with your home loan. Contact us on (02) 8383 4400, or by visiting the Contact Us page on our website.

Working with Remote Staff – Business Process Outsourcing

One of the fastest-growing sectors in the business world, particularly in the Information Technology (IT) sector, is Business Process Outsourcing (BPO). And The Philippines is leading the way with its third-party outsourcing availability for companies in Australia.

Third-party management of virtual employees offshore combines managerial control with cost effectiveness for an Australian company whose head office and senior management may be located onshore in Australia.

Whether you’re a fast-growing business with a need for more employees to carry the load or your business requires business process services without the need for on-the-ground workers, BPO could be the answer for your business processing demands.

The types of work a virtual employee could engage in are: IT, data entry, customer service, call centre operations, bookkeeping and other back-of-house administrative functions, as well as many other work areas related to general business processing.

Major Benefits of BPO:

There are many advantages to remote staffing practices. Your company may benefit from any or all of these:


The cost-effectiveness of remote staff may make financial sense to your company. BPO may contribute to enriching your business and its economic results by delivering on KPI objectives and ensuring a more streamlined application of your business processing tasks.

At YML Group we have the expertise in BPO – both as a company itself utilising this workplace-of-the-future scenario and with a specialist team at your service – to advise and assist your company towards finding and integrating a BPO solution.

Consider your company’s current growth and future BPO opportunities by exploring your options with us.

How can YML help?

Talk to our YML Innovation Team today to see how YML Group can assist you with your BPO. Contact us on (02) 8383 4400, or by visiting the Contact Us page on our website.

ATO Payment Arrangements – Avoid Overseas Travel Ban

Owe the Australian Taxation Office (ATO) a debt? You are not alone. Many businesses – sole traders and companies – cannot pay a debt to the ATO upfront. So the ATO offers you recourse with its payment arrangement system that allows you time to pay off your debt, saving you the stress of finding the money to pay a debt upfront in full.

A payment arrangement with the ATO will also ensure you are not subject to the new Departure Prohibition Order (DPO), an action enforceable at the border when you wish to travel overseas. This order provides that you pay your taxation debts – or have an active payment arrangement in place – prior to being allowed to leave the country.

What is a payment arrangement?

A payment arrangement is an agreement between the ATO and you, whereby you agree to pay off your debt gradually – in instalments – over an agreed period, usually 12 months.

Once you are in a payment arrangement with the ATO, it’s important to stay on track with your repayments and make sure that you:

    ✔ Pay the exact amount expected to be received by the ATO – it is matched to repayments
   ✔ Pay in to the correct account – check if you normally use more than one
   ✔ Pay on time – check due dates
   ✔ Pay all future ATO obligations by the due date - keep up to date with your future ATO lodgments

Fulfilling these requirements precisely will help you to avoid defaulting on your payment arrangement, avoid penalty and a General Interest Charge (GIC) accruing on your remaining unpaid debt.

How do you apply for an interest-free payment plan?

 First, your business’s eligibility is assessed using these criteria:

GIC will be remitted as long as you meet your payment plan obligations during the 12-month interest-free period.

Should your circumstances change, the ATO may be able to vary the terms of a payment plan to make it easier for you to repay your debt. Make sure you contact the ATO if you cannot pay an instalment.

Seek Advice

There is no need to go it alone when it comes to debt and the ATO.

YML Group can not only help you to determine your eligibility for an ATO payment arrangement but also help you to administer your 12-month interest-free repayments.

How can YML help?

 Talk to our YML Chartered Accountants Team today to see how YML Group can assist you with your ATO payments. Contact us on (02) 8383 4400 or by visiting the Contact Us page page on our website.

Proposed Partner Visa Changes – NEW Two-Step Process

Partner visas are subject to legislative changes by the Australian government, and this year it is expected that certain proposed changes will be made law. These changes would affect all married and de facto relationships where a foreign national with an Australian Citizen or Permanent Resident partner wishes to apply for a Partner visa.

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Non-Residents and SMSFs – Tax Alert!

The Australian Taxation Office (ATO) considers a self-managed superannuation fund (SMSF) to be an Australian super fund, so long as it meets certain residency conditions. Any SMSF trustees and members need to be aware of their residency within and outside of Australia to avoid breaching the residency rules and rendering their SMSF subject to the highest marginal taxation rate of 49%!

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Superannuation Guarantee Amnesty – Self-Correct your past Super Guarantee Liability

Superannuation entitlements payable by employers continue to be short-paid or unpaid and the Australian Governments wants to rectify this with a one-off Superannuation Guarantee (SG) Amnesty. The 12-month amnesty is currently legislated and available to you. It will run until 23 May 2019.

From now until 23 May 2019, you can take advantage of the amnesty by calculating the amount of SG payable (shortfall plus nominal interest) and preparing and lodging a SG Amnesty payment form.

Undeclared SG shortfalls between 1 July 1992 and 31 March 2018 are allowed under the amnesty. Beware that from 1 April 2018, deference to the law of timely SG payments is advisable, as any shortfalls from this date will not be considered under the amnesty.

You may choose to pay the SG shortfall directly in to the employees’ super fund/s or to pay the SG shortfall via the ATO.

Are you eligible under the amnesty?

Yes, if you voluntarily disclose a previously undisclosed SG shortfall within the amnesty period, exempting any SG shortfall disclosed prior to the 12-month amnesty start date.

You remain eligible so long as you commit to a payment plan and comply with the payment plan. The ATO will notify you to help you avoid a default or failure-to-comply.

No, if you are subject to a current SG audit by the ATO. Consult your financial advisor if you aren’t sure about your eligibility.

Why use the amnesty?

For some very attractive benefits to your company and your staff:

Resume SG-Compliancy… You will ensure your company resumes its SG-compliant status. Avoid Administration Fees*… You will avoid the *$20 administration fee on all SG shortfalls for new employees during the amnesty period.

Tax-Deductibility… All catch-up payments made during the amnesty period are tax-deductible.

Up-to-date Employee Super… Your employees’ fund/s will be up-to-date and your employees can more readily assess their contribution caps.

So, breathe a sigh of relief that you can rectify your SG shortfall (and avoid penalties). You can get back on track with your employee super payments, making for a far healthier financial future for both your company and your staff.

At YML Group we can guide you through the steps. Let us identify your unpaid SG, assess your eligibility and then prepare and lodge your SG Amnesty payment form.

For more information… https://www.ato.gov.au/Tax-professionals/Newsroom/Superannuation/Superannuation-guarantee-amnesty/?landingpage

 

How can YML help?

Talk to our YML Chartered Accountants Team today to see how YML Group can assist you with the SG Amnesty. Contact us on (02) 8383 4400, or by visiting the Contact Us page on our website.