Cash economy benchmarks by Austvision Taxation Services 
Cash Economy Benchmarks
The ATO has developed new cash economy benchmarks for the building industry. It consulted widely with the building industry and, depending on the size of the business, has developed expected levels of income, expenditure and profits. The new industries for which benchmarks have initially been developed are: - Bricklaying.
- Concreting.
- Fencing.
- Roofing.
- Floor sanding.
- Painting.
The Tax Office is adamant that the benchmarks will not be used by tax auditors, but will be available to encourage taxpayers to comply with the law once they are aware of their existence. Protecting Clients' Tax File Numbers
The Tax Office has reminded taxpayers to keep their tax file number (TFN) as safe as they would a passport or bank account details. It said that people are increasingly being asked to provide their TFN when it isn't needed and the ATO has seen instances of bogus job advertisements on the internet and in newspapers that ask for all sorts of personal details including TFNs. Only certain people can ask for a taxpayer's TFN. The most common are: - the Tax Office when discussing a taxpayer's tax records;
- a new employer once a person has started work;
- a bank or other financial institution;
- tax agents;
- Centrelink; and
- a taxpayer's superannuation fund.
It does not have to be provided to potential employers. The ATO says that anyone who believes their TFN has been stolen or misused should contact their tax evasion line on 1800 060 062 for help. New Benchmarks
In addition to the benchmarks released for the painting, roofing, tiling, floor sanding and polishing, and taxi industries, the Tax Office has now issued benchmarks for the concreting industry. These benchmarks indicate an expected range of income for concreters based on the labour and materials used, and apply to concreters who work directly with household customers. Superannuation and Business Real Property
Trustees of SMSFs are generally prohibited from acquiring assets from related parties and may only maintain 'in-house assets' (i.e., assets involving dealings with related parties) when their value is less than 5% of the total value of the fund's assets. An exclusion from both of these requirements applies in relation to 'business real property'. When considering whether or not a particular property is business real property, most trustees usually need guidance regarding the 'business use test', which requires that the real property be ‘used wholly and exclusively in one or more businesses' carried on by any entity. A new draft ruling released by the ATO to assist trustees contains a number of examples that highlight the importance of understanding business real property, including the following. Business Real Property Examples
Letting Holiday Flats - No Business
Ms Hend owns two holiday flats, which she lets for short-term accommodation at a popular holiday destination. Ms Hend and her partner manage and maintain the flats, which includes cleaning and repairing the flats, and financial tasks such as banking. Ms Hend and her partner set up the Hend Super Fund and both become members of the fund. They propose that the Hend Super Fund acquire the flats from Ms Hend. The elements of repetition and continuity of acts and transactions indicate the possibility of there being a rental property investment business being carried on. However, the scale of the operation is such that it is not considered to be a business. As there is no business conducted in respect of the premises, the property is not business real property, and so the Hend Super Fund cannot acquire the flats from Ms Hend (a related party). Bed and Breakfast - Business
Dean Lamont owns a house with five bedrooms and two living areas. He uses one of the bedrooms himself. The other four bedrooms are let year-round as part of a bed and breakfast business. One living area is set aside for the exclusive use of guests. Breakfast is included in the room cost and other meals are available by arrangement. Dean advertises his rooms with Worldwide B&B Internet bookings agency. Dean has a business plan, pays tax, and has three permanent part-time employees. The business has operated since Dean acquired the house 17 years ago. In this case, a business is being carried on. Dean's non-business use of the property is incidental and relevant to that business. Therefore, the property is used 'wholly and exclusively' in the business and is business real property. 
For further information contact:
Austvision Taxation Services
phone: 02 9897 2426
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