ECONOMY

19 June, 2017

A study of 799,000 thousand businesses by the Australian Bureau of Statistics have revealed positive but slow growth in the areas of web and social media presence and an upward trend of innovation.

In the most recent survey period, of years 2015-16, most businesses unsurprisingly had internet access, at 95 percent. Of those, 99.3 percent used broadband. While almost every business uses a broadband internet connection, the number of businesses with an online presence has only recently surpassed 50 percent. The web presence rates in the two preceding years were 48.6 percent and 47.1 percent, respectively.

 

By industry, arts and recreation services had the highest proportion of businesses with a web presence at 76 percent, while the agriculture, forestry and fishing industry had the lowest proportion of businesses with a web presence at 12 percent.

In buying and selling done online, during 2015-16, 57 percent of Australian businesses placed orders online, while 37 percent received orders for their own products and services over the internet. Income generated from customers ordering online from businesses totalled a whopping $321 billion.

In the ABS’ summary of Australian business innovation across the same period, 48.7 percent of businesses reported undertaking innovation activity in 2015-16. Manufacturing, retail trade and the arts and recreation services industries had the highest proportion of innovation-active businesses, all at 58 percent.

The ABS reports that 43 percent of businesses overall introduced one form of innovation, and that it was generally in organisational or managerial processes, with 23 percent of innovating businesses.

https://www.crn.com.au/news/australian-businesses-made-321-billion-online-last-year-465532

21 June, 2017

Small businesses with payrolls under $1 million will get tax relief from the South Australian government in this week’s budget, costing the state an estimated $45 million over four years.

Treasurer Tom Koutsantonis said that the financial blueprint will legislate a 2.5 per cent payroll tax rate for businesses with payrolls between $600,000 and $1 million and also provide some tax relief for businesses with payrolls as high as $1.5 million.

The measure will provide a windfall of almost $10,000 a year to most businesses and should benefit about 1900 companies.

‘Small businesses are the biggest employers in South Australia and are crucial to creating jobs in our economy,’ Mr Koutsantonis said.

http://www.skynews.com.au/business/business/sme_news/2017/06/21/small-business-tax-cut-in-sa-budget.html

24 May, 2017

To analyse the long-term effectiveness of government programs, including corporate welfare, the Turnbull Government will spend $130 million.

The Data Integration Partnership for Australia (DIPA) will be established within the Department of Prime Minister and Cabinet as part of funding provided in the Budget’s Public Sector Modernisation Fund. It aims to link up disparate databases on the efficacy of government programs across all portfolios, from business assistance to health policies.

It will follows a similar longitudinal study of social security recipients interaction with the social security system over the course of their lives, which formed the base for the government’s so-called investment approach to welfare policy where you ‘invest’ in early interventions to ward off lifetime dependence on social security.

While the Productivity Commission has long examined government programs, assistant Minister for Cities and Digital Transformation, Angus Taylor, says it has tended to be given terms of reference on specific issues at specific points of time, whereas the benefits of the new unit will be that it develops data on outcomes over time and will approach assessments very differently.

Issues to be analysed include identifying and preventing risk of disability in the workplace, supporting ongoing workforce participation for those with a disability, and better understanding the effects of medications to avoid adverse reactions.

Integrating administrative data with directly collected survey data increases the capacity of the research community to undertake firm-level analysis and improves the evidence base for policy development and evaluation.

http://www.afr.com/news/canberra-sets-up-long-term-data-unit-20170524-gwc20t

11 May, 2017

Starting July 1, 2018, the Government will require purchasers of newly constructed residential properties or new subdivisions to remit the GST directly to the Australian Taxation Office (ATO) as part of settlement.

Under the current law (where the GST is included in the purchase price and the developer remits the GST to the ATO), some developers are failing to remit the GST to the ATO despite having claimed GST credits on their construction costs.

The Government has recently announced that it will align the GST treatment of digital currency (such as Bitcoin) with money from July 1, 2017.

Digital currency is currently treated as intangible property for GST purposes. Consequently, consumers who use digital currencies as payment can effectively bear GST twice: once on the purchase of the digital currency and again on its use in exchange for other goods and services subject to GST.

Such measure will ensure that the digital currency purchased will no longer be subject to the GST.

The Government said removing double taxation on digital currencies will remove an obstacle for the Financial Technology (Fintech) sector to grow in Australia.

Finally, the Budget confirms that the GST law will be amended to reflect the introduction of a GST reverse charge for those buying gold, silver, and platinum. This requires that the buyer must remit the GST to the tax authority, rather than the seller, in a move intended to mitigate GST fraud where suppliers collect the GST but fail to pass it on to the tax agency.

http://www.tax-news.com/news/Numerous_GST_Changes_Confirmed_In_Australian_Budget____74227.html

May 23, 2017

In the bank’s week, Westpac and its subsidiaries are raising fixed-rate interest-only loans by 20 basis points and cutting principal and interest loans by up to 30 basis points.

Westpac is increasing rates on fixed-rate investment property, self-managed super fund and non-residential fixed investment property loans with interest-only repayments by 20 basis points.

It follows similar moves by other major lenders aimed at discouraging new interest-only borrowers and encouraging existing interest-only borrowers to switch to principal and interest.

Prudential regulators are concerned that interest-only loans, which defer principal payment, are fuelling strong demand in the nation’s property hotspots, lowering affordability, increasing household debt and vulnerability to financial distress.

 

Westpac’s rate increase will result in rises for fixed rate, interest-only investment loans from one to 10 years. For example, the new three-year rate will rise to 4.96 per cent and seven to 10 year rates will rise to 7.17 per cent.

SMSF loans from one year to 10 years will also be increased with the new three-year rate 6.56 per cent and seven-to-10-year rates 8.52 per cent.

Non-resident, interest-only loans from one to five years will be changed, with three years up to 6.29 per cent and four and five year 6.59 per cent. The bank’s policy of no new lending to non-residents has not changed.

The bank’s subsidiaries, Bank SA, Bank of Melbourne and St George Bank, are announcing increases of 20 basis points for interest-only low documentation and Super Fund loans.

Three-year owner occupier, principal and interest fixed rate loans will be decreased by 21 basis points to 4.03 per cent.

Residential investment principal and interest three-year loans are down by 30 basis points to 4.14 per cent and residential low documentation principal and interest also by 30 basis points.

Property buyers will not be allowed to switch from principal and interest to interest-only during the first 12 months of a loan except for parental leave and hardship reasons.

Last month Westpac announced a similar series of changes to rates involving increases for interest-only and some cuts for principal and interest.

It subsequently announced new clamps on consumer credit, including restrictions on the number of dwellings on a title and tougher conditions for parent loan guarantees.

Interest-only loans represent about one in four of owner-occupied lending and 64 per cent of all investor lending, according to the Reserve Bank of Australia.

Lenders are responding to caps on lending growth imposed by prudential regulators worried about persistently rising property prices in Melbourne, Sydney and, to a lesser extent, Brisbane.

Other measures being imposed by lenders include bigger deposits and tougher terms and conditions.

http://www.afr.com/personal-finance/westpac-cuts-costs-for-some-home-buyers-and-raises-interestonly-rates-20170523-gwb7g1

May 23, 2017

Following the axing of the 457 temporary skilled migration visa scheme, business and university lobby groups remain unconvinced by the Turnbull Government’s fresh assurances that they will still be able to recruit the best and brightest foreign workers.

Immigration department officials are promoting distinguished talent visas and offering to negotiate labour agreements with employers affected by the crackdown amid a backlash from some industries reliant on highly-skilled migrants.

However some industries, including finance, IT, medical research, engineering and education, fear the changes will shut out foreigners in a globally competitive labour market. Firms are also worried about their ability to recruit chief executives.

Although there are other visas available for employers to secure workers, citing the distinguished talent visa, which can be issued to people who have an internationally recognised record of exceptional and outstanding achievement in a profession, sport, the arts or academia and research.

Employers will also be told, they can seek to negotiate a labour agreement with the department, which would typically last three years. Arrangements will be made to get the distinguished talent, eminent scientists and researchers either through distinguished talent arrangements or specified targeted labour agreements.

However the government’s intent is very clear not to use the 457 visa as effectively as a churning recruitment tool, which often then detours into permanent migration. Thus, the original intent of the visa is distorted.

http://www.afr.com/news/companies-will-still-be-able-to-hire-foreigners-after-removal-of-457-visas-20170523-gwb0mh?login_token=TsyoUhjYX0PvqPIMl7u5oDZUi2GQ0Q067FZyY9Tq4PNpGNudqMQC0c9YbTLBZB_vCDpIAM6gAitwndoTzIxM-w&expiry=1495530678&single_use_token=TXgXZRJMjGFEnr7M3VP652BvyVFPgZRIbaC-8oNqLz-rLJdAWUNrO7rA8ZZVtE6kkO_ljHMOpYK8lty7O7gBEg

FINANCIAL NEWS

 

May 10, 2017

The Australian Bankers’ Association (ABA) has condemned the Government’s proposed new levy on the country’s five largest banks as a “direct attack on jobs and growth.”

In the  2017 Budget, Treasurer Scott Morrison announced a six-basis point levy on Australia’s five largest banks with liabilities of more than AUD100bn (USD73.7bn). Customer deposits of less than AUD250, 000 and additional capital requirements imposed on the banks by regulatory authorities will be excluded from their assessed liabilities.

According to Morrison “This represents an additional and fair contribution from our major banks, is similar to measures imposed in other advanced countries, and will even up the playing field for smaller banks.”

The levy will enter into force on July 1. The Government expects the measure to raise AUD6.2bn over the forward estimates period.

Responding to the announcement, Anna Bligh, Chief Executive of the ABA, said: “It is a tax that will hit Australians by hurting investment and could have unintended consequences. Contrary to the Government’s claim that the tax will only be levied on banking liabilities, the reality is that it will affect the entire banking system.”

According to Bligh, banks are the largest corporate taxpayers in Australia. She said: “In 2016, banks paid around AUD11.5bn of income tax. This new tax represents in the vicinity of a 10 percent increase in tax.”

She argued that “banks are not unusually profitable,” and said in 2016 the average return on equity of Australia’s four major banks was just under 14 percent. This “ranked them around the middle of the returns of the top 50 listed companies,” she explained.

Morrison has defended the measure in his post-Budget interviews. Answering questions on WSFM radio as to whether the levy would be passed on to customers, Morrison said: “Well this is a very small levy on the banks: its 0.06 of a percent. So if banks are going to go around and hit their customers, then what they’ll be doing is what they want to do anyway and I think that would be a very dishonest thing for the banks to do, and I think that would just confirm in everybody’s minds why they’re so angry at the banks.”

http://www.tax-news.com/news/Australian_Banks_Criticize_New_Levy____74206.html

May 15, 2017

The ATO has issued finalised guidance on how the Transfer Balance Cap works with superannuation death benefits.

LCG 2017/3 (a Law Companion Guideline, which is a type of ATO public ruling) focuses on how the Transfer Balance Cap works with reversionary and non-reversionary death benefit income streams.

Where no superannuation income stream is cashed and a superannuation death benefit is paid out of the superannuation system as a superannuation lump sum, a transfer balance credit does not arise in the recipient’s transfer balance account, says the ATO in LCG 2017/3.

However, where the deceased member’s interest is retained within the superannuation system and cashed to a dependant beneficiary in the form of a death benefit income stream, a credit arises in the dependant beneficiary’s transfer balance account.

“If you are the recipient of a non-reversionary death benefit income stream, a transfer balance credit arises in your transfer balance account on the later of 1 July 2017, or when you start to be the recipient of the death benefit income stream (that is, when you become entitled to be paid the death benefit income stream).”

“If you are the recipient of a reversionary death benefit income stream, you are a reversionary beneficiary and a transfer balance credit arises in your transfer balance account.”

The LCG goes on to set out the different rules for when the credit arises:

If you are the recipient of a reversionary death benefit income stream, you are a reversionary beneficiary and a transfer balance credit arises in your transfer balance account. The time at which the credit arises is:

(a) For death benefit income streams commencing before 1 July 2017

  • the later of 1 July 2017 or 12 months from the day the death benefit income stream first became payable, and

(b) For death benefit income streams commencing on or after 1 July 2017

  • 12 months from the day (the starting day) when you started to be the retirement phase recipient of the death benefit income stream.

May 19, 2017

The Australian Institute of Superannuation Trustees told the Productivity Commission that the underperforming default funds should be relegated to the ranks and replaced by better performers on the default lists,

AIST CEO Eva Scheerlinck called for better regulation to help consumers compare super fund net performance across both the default and choice sectors.

AIST has backed the publication of a net benefit league table of super fund offerings by Australian Prudential Regulation Authority (APRA) across both sectors. “Default members might want to leave a default option at some stage, and both members and employers might reasonably want to understand and compare their selection/default against the wider superannuation market,” Ms Scheerlinck said.

Ms Scheerlinck also said that the benefits of industry-specific default funds needed to be recognised. “One of the very positive aspects of the current default system is that many employees are connected with default superannuation arrangements that are most appropriate to them.

Such a system recognises that different industries have different demographics that may require a different investment management style, different services, such as intra-fund advice, and different insurance offerings.

AIST’s submission on the Commission’s draft report on Alternate Default Models strongly supported an industrial-based legislative framework for the selection of default funds, noting that the best performing retirement income systems globally are industrially based. The AIST submission also supported the use of a quality filter and a multi-criteria selection process.

Other key recommendations in AIST’s submission include support for an independent government body in the selection process. The need for greater recognition of the role of Super Stream and Single Touch Payroll and their ability to tackle account proliferation.  Insurance offerings need to be a core consideration of default fund selection

Disclosure must be improved to allow better comparability and greater transparency on fund mergers.

http://thenewdaily.com.au/money/superannuation/2017/05/10/aist-wants-underperforming-funds-dropped-from-the-default-list/

May 23, 2017

Under current tax laws, individuals can claim all their expenses related to managing taxation, such as accountancy and legal fees, software costs and the like however the Australia Institute has backed a plan by Labor to limit deductions for the cost of managing tax affairs to $3,000.

The 2014-15 statistics from the Australian Taxation Office showed more than $2.3 billion in deductions were claimed for managing tax affairs.

Analysis of the ATO statistics by The Australia Institute found that less than half (47 per cent) of taxpayers claimed a deduction for getting assistance to manage their tax affairs.

Presumably the majority used the ATO’s online e-tax system without professional help.

Of those who did claim a deduction, the average amount was $378, but the median was just $165. That indicates that a relatively small group are making much larger deductions, pulling the average higher.

The Australia Institute’s analysis showed that those earning more than a million dollars claimed an average $12,657 in deductions for help managing their tax affairs.

The average amount claimed dropped off sharply from there as incomes declined.

The Labor proposal is expected to affect around 90,000 taxpayers, which is only 1 per cent of the total, but still raise just short of $2 billion over a decade.

Apart from improving fairness in the tax system, a cap on tax advice deductions might also help reduce the economically inefficient allocation of resources to tax minimisation.

http://www.abc.net.au/news/2017-05-22/tax-deductions-for-advice-should-be-capped/8546170

SMSF

 

It is a pressing time for accountants, tax agents and SMSF specialist advisors due to the complexity of the changes taking effect on 1 July, and the ATO’s decision acknowledges this. The ATO has extended the due date to 30 June 2017 for lodgement of the SMSF Annual Return for the 2015/16 financial year.

This decision was made as a result of feedback from professional and industry representatives. This extension will give advisors, who have the onerous responsibility of helping trustees comply with the current legislation, the time to plan, prepare and advise their clients about the upcoming changes during this crucial transition period.

Accountants, tax agents and SMSF advisers play a key role in ensuring that their SMSF clients are ready for the changes on 1 July. They will ensure their clients are in the best position to make informed decisions about their superannuation savings in light of the changes. The extra time will allow SMSF trustees to make well informed decisions instead of hasty ones.

As this is a crucial transition period for the SMSF sector, we head towards the most significant superannuation reforms for several years, we have extended the lodgment due date for 2015-16 SMSF annual returns.

The ATO has taken this step to reduce some of the burden of compliance work so that accountants, tax agents and SMSF advisers can focus on providing appropriate advisory services to their SMSF clients ahead of the changes.

The extension by the ATO has been welcomed by the SMSF Association.

https://www.ato.gov.au/Media-centre/Media-releases/ATO-extends-due-date-for-2015-16-SMSF-returns/

May 23, 2017

A range of superannuation and SMSF penalties will increase after legislation to raise the Federal Penalty Unit rate to $210 passed the Parliament.

The Federal Penalty Unit will increase from $180 to $210, with effect from 1 July 2017, with the passage of the Crimes Amendment (Penalty Unit) Bill 2017.

The Explanatory Memorandum to the Bill says: The increase to the penalty unit value will only apply to offences committed after the amendments come into force. The amendment to the value of the penalty unit will not impact on current proceedings for Commonwealth offences.

The Federal Penalty Unit is used in calculating a range of ATO and superannuation penalties.

The ATO Failure to Lodge penalty, for small entities, carries a maximum of 5 penalty units – so the maximum penalty increases from $900 to $1,050. The ATO SMSF Administrative Penalties will also increase. These range from 5 to 60 penalty units, so an increase of $900-$10,080 to $1,050-$12,600.

The penalty for failing to comply with an Education Direction or a Rectification Direction – 10 penalty units – will rise from $1,800 to $2,100. Penalties for breaches of the Collectables and Personal Use Asset rules – also 10 penalty units – will rise by the same amount.

There are a range of other penalties in the SIS Act which will increase as a result of the change in the Federal Penalty Unit, some of which have penalties of 100 units – now $21,000.

The Penalty Unit rate was set to be automatically indexed to CPI on 1 July 2018, and every three years after that. This first indexation has now been delayed until 1 July 2020. The increase was announced as part of the 2016/17 Mid-Year Economic and Fiscal Outlook (MYEFO).

COMPANY NEWS

May 23, 2017

As last month confirmed plans to roll out its full retail offering in the next few years,

Amazon is in talks with almost 20 per cent of Australian food and grocery suppliers, confirming that the e-commerce giant is preparing to take on Coles and Woolworths in the $3 billion online grocery market.

About 23 per cent of packaged food suppliers and 29 per cent of non-food grocery suppliers have been in contact with Amazon.

 

About 96 per cent of suppliers believe the online behemoth will launch Amazon Pantry within three years, challenging Coles and Woolworths’ dominance of the online grocery market, which now accounts for about 3 per cent of the total $90 billion market.

 

The new entrants will increase the level of competition for market leaders Coles and Woolworths, independent retailers supplied by Metcash and discounter Aldi, which now accounts for about 10 per cent of the Australian market.

However, the new players promise to provide a lucrative new channel to market for food and grocery suppliers, who face ongoing pricing and ranging pressure as the major chains protect their turf.

Investors fear grocery retailer earnings will fall 12 per cent and sales by an average 2.6 per cent within years of Amazon entering Australia, according to a separate survey of fund managers and brokers by UBS, with Metcash likely to be hit harder than Wesfarmers and Woolworths.

 

The UBS supplier survey, which covered 49 suppliers with combined revenues of $25 billion, will be presented at the Australian Food and Grocery Council’s annual conference in Brisbane.

UBS partnered with the AFGC to assess whether the lower growth market was here to stay and which retailers and suppliers were best placed to win.

JP Morgan has downgraded profit forecasts for JB Hi-Fi, Harvey Norman, Myer and Super Retail Group by as much as 30 per cent after assessing the impact of Amazon’s expansion and deteriorating consumer spending.

“The outlook for the Australian consumer is deteriorating, in our view, while the pending entry of Amazon is a negative for multiples and earnings per share forecasts,” JP Morgan’s retail team, led by director Shaun Cousins, said in a report.

JP Morgan said Amazon’s expansion into Australia would be good for consumers, but would put downward pressure on prices and margins across a wide range of retail categories, squeezing earnings and reducing share price multiples.

http://www.afr.com/business/retail/amazon-gears-up-to-take-on-coles-woolworths-20170523-gwaxb2

May 24, 2017

A recent study by investment firm Taronga Group’s technology investment arm Real Tech Ventures and KPMG has found that investment capital into proptech companies will reach $20 billion by 2020 as new players and traditional real estate corporates pour money into technology and property.

While global capital allocations to direct real estate have doubled, rising to $US320 billion from $US166 billion between 2012-2016, funding in proptech companies increased 1200 per cent to $US2.6 billion from $US221 million.

“RealTech companies will continue to increase, eventually exceeding the annual level of capital currently invested in fintech,” the report says.

In Australia, proptechs such as BuyMyPlace, Rent.com and Local Agent Finder have hit the sector as well as international groups like Airbnb and Purple bricks.

Areas that will see more technology disruption are urban planning, design and construction, search, sale and acquisition, leasing and management, data analytics and sustainability.

Companies in the urban planning sector will focus on improving processes related to land release and planning approvals. Examples include virtual reality and simulation technology and beacon technology.

Agent search tools, online brokerage and auctions, inspection management software, marketing automation and crowdfunding finance platforms will dominate the proptech disruption in the search and acquisition space.

The leasing space will be hit by more online peer-to-peer leasing platforms, leasing and management software, and even tenant screening technology.

Big data aggregation and management tools including tenant and visitor in-venue experience and engagement solutions will help investors and developers find future investment opportunities. Furthermore, traditional real estate specialists will begin to exit the major real estate corporates and consulting firms to build new proptech businesses and these corporates themselves will be looking to invest in proptech to keep ahead.

“More and more major corporates will establish corporate venturing functions and these teams will become as important as the M&A function,” the report says.

Taronga’s Real Tech fund is raising $100 million to invest in proptech companies, with a minimum investment of $10 million per investor.

http://www.afr.com/real-estate/20-billion-in-proptech-globally-by-2020-taronga-and-kpmg-20170523-gwb6h6

TECHNOLOGY

By business reporter David Chau
Updated 1 Jun 2017, 10:18am

The digital currency bitcoin has broken new records – surging by more than 245 per cent since the start of the year.

Key points:
Total cryptocurrency market is worth $US75b (or $101b)
The top ten currencies (including bitcoin and ethereum) have a 94 per cent market share
Government will make changes to GST so bitcoin transactions are not double taxed
In just five months, the price of one bitcoin rose from $1,337 (US$997.69) to its all-time-high of $3,704 (US$2,766.56) on May 25.

People buy bitcoins for all sorts of reasons. They range from those seeking to invest in safe haven assets in the face of political instability, speculators wanting to ride the wave of what some regard to be an asset bubble, to purchasers who want to purchase illegal goods anonymously on the dark web.

Since mid-2010, when the highly-volatile currency was worth just 9 cents, it has surged by more than 4 million per cent.

When you add the value of every bitcoin, its current market capitalisation is $49.6 billion – almost half of the value of all cryptocurrencies.

Bitcoin explained: digital millionaires

Can’t tell a bitcoin from a blockchain? Read our explainer to see how the cryptocurrency works.
Bitcoin, however, is not the only digital currency which has enjoyed a strong market rally.

“We’ve had the total market capitalisation of all cryptocurrencies rising three-fold this year – from around US$25 billion to now US$75 billion,” according to Steve Sammartino, entrepreneur and technology author.

In Australian dollar terms, the total market capitalisation is more than $101 billion.

“The big two, bitcoin and ethereum, are heading the charge,” Mr Sammartino told ABC’s The World Today.

Cryptocurrency bubble risks
Mr Sammartino believes the cryptocurrency market is in a bubble.

“The question is which of these cryptocurrencies is going to fail, and which will ones are going to be the winners?”
The ten largest cryptocurrencies are worth more than $95 billion – approximately 94 per cent of the total market share.

However, the remaining 6 per cent of the market is flooded disproportionately by more than 800 of these currencies.

“People are investing, I think, exuberantly. In a way, they are hoping for irrational economic profits they are not going to get,” Mr Sammartino said.

“There have been more than 100 ICOs (initial coin offerings) this year.”
Unlike the IPO (initial public offering) of a company in the share market, ICOs are not backed by any real, intrinsic value.

“Anyone could start a coin by putting a platform out there and releasing coins on the market using open source software,” Mr Sammartino said.

“The problem is these ICOs fall outside the governance of the SEC [US Securities and Exchange Commission] and ASIC [Australian Securities and Investments Commission], but they behave like IPOs in the stock market.

“Creative technologists can raise large amounts of capital with the new cryptocurrency, [then] exit their own position without any regulatory approvals or oversights.”

The rise of number two – ethereum
Investors who think bitcoins are too expensive, or are looking for higher yields, are turning to some of the alternative cryptocurrencies.

Bitcoin’s 245 per cent surge this year is just a blip, when compared to the bull run of ethereum, which was launched in 2014.

Since January 3, the price of an ethereum unit has surged by more than 2,000 per cent – from $12.69 (US$9.48) to its record-high of $257.59 (US$192.32) on May 24.

One reason for the massive uptake in ethereum is the endorsement it has received from multinational powerhouses including Accenture, Microsoft, Intel, JPMorgan Chase and UBS.

In late-February, those corporate giants (plus two dozen other companies) teamed up to form the Enterprise Ethereum Alliance (EEA).

Credit Suisse, ING, Bank of New York and Thomson Reuters were also among the founding members of EEA.

The alliance was formed to “build, promote and broadly support ethereum-based technology best practices, standards and a reference architecture,” according to a statement released by the EEA.

Since its formation, more than 80 other multinationals have joined the EEA including Toyota, State Street, Merck and Rabobank.

The EEA is essentially attempting to create a new kind of computing system based on ethereum’s blockchain.

Blockchain is the technology that bitcoin, ethereum and other cryptocurrencies use to facilitate anonymous transactions.

It is basically the register of all transactions in a cryptocurrency, like a bank ledger – which is updated whenever a transaction occurs.

Whereas bitcoin’s blockchain is used as consumer payment technology, ethereum’s blockchain can also be used for its ‘smart contract’ applications – which is what attracted the interest of those multinationals.

A smart contract is a computer program that automatically executes the terms of a contract when certain conditions are met.

Through automation, this technology has the potential to reduce the amount of human labour needed to complete a deal.

The future of cryptocurrencies
Although Mr Sammartino considers bitcoin, ethereum and the wider cryptocurrency market is in a bubble, he believes they are the future of payment systems.

“People are starting to realise, within the financial and governmental community, that cryptocurrencies are not going to go away, and they are going to be a staple of our modern economy.”

The Australian Government shares some of that sentiment, given its new stance on financial technology and innovation.

“The Government will encourage the exploration of blockchain technology, including through a study and pilot testing by the CSIRO’s Data61,” it noted in the latest federal budget.

“We will also introduce changes to the GST to ensure that consumers are no longer double taxed when using digital currencies such as bitcoin.”
This is a reversal of the Australian Taxation Office’s stance.

In 2014, the ATO released guidance stating that it would not treat cryptocurrencies as money – and that it would therefore be taxed in the same way as a non-cash barter transaction.

This is interesting opinion piece from Hayley. Just so you know, our VIDEN APP is FREE and our VIDEN VAULT service is complimentary for all clients….

Hayley Williams

While tax time usually conjures the image of piles of paper and shoeboxes full of old receipts, it doesn’t have to be that way forever. If you’re sick of shuffling through hard copy documents to get your finances sorted every July, here are our top five apps that’ll save you time and stress this tax time.

 

Note that this list is collated from online reviews, recommendations and popular opinion. We have not reviewed these products ourselves unless otherwise stated.

Australian Taxation Office

Price: free

Platforms: iOS, Android, Windows Phone

The official app is mentioned first for two reasons — for one, it’s the only app on this list that supports Windows Phone as well as both Android and iOS, and secondly because you can trust it to be accurate to all the ATO’s rules and regulations.

The ATO’s official app has gone through a number of upgrades since it was first released, most recently a tool that lets you digitally keep track of your deductions throughout the year and then export them directly into your tax return. This myDeductions feature will also let you log car trips if you use your car for work.

It also has a number of tools and calculators, such as a tax withheld calculator, and the ability to set your voiceprint for biometric authentication with the ATO. While you’ll be redirected to either myTax or e-Tax to actually lodge your return, data entered into myDeductions will sync up, and you can even use this app after the fact to check the status of your tax return. If you’re a small business owner, the ATO app has a couple of tools for you as well, such as a business performance check that’ll show you how your business matches up against its competitors in your industry.

Best of all, it’s free.

eTax Return by Pocketbook 2016

image: https://edge.alluremedia.com.au/m/l/2016/06/etax.jpg

Price: free to start, $49+ to lodge

Platforms: iOS

eTax Return by Pocketbook promises to help you lodge your tax return in just ten minutes. The app is exclusive to iOS, and is free to download and start your tax return. You only have to pay once you’re ready to lodge, with fees starting at $49. You can even opt to have your fee taken out of your return, as many do when handling their tax through an accountant. Your tax return, submitted through Pocketbook, will of course be reviewed by a registered accountant before lodging.

Pocketbook’s tax return app is largely designed to make the process of lodging through e-Tax far easier. Questions are asked in plain English rather than tax-office jargon, and you’re even able to message an accountant if you need help. Like ATO’s app, Pocketbook also allows you to snap photos of your important documents to easily import them.

If you only have an Android device, you can get Pocketbook’s free budgeting app to help get your everyday finances in order, though it won’t let you do your tax return as the iOS exclusive app does.

my Tax

image: https://edge.alluremedia.com.au/m/l/2016/06/mytax.jpg

Price: $5.99-$12.99

Platforms: iOS, Mac OS X

While my Tax (not to be confused with the government’s myTax tool) hasn’t added a new tax return app since 2013, its standard app is still a great tool for tax time, developed by a chartered accountant. The Mac OS X version will set you back $5.99, while the iPad and iPhone edition is a bit more pricey at $12.99.

my Tax is a collection of tax calculators, which have recently been updated for the ATO’s 2016 rates. Its tools cover a huge range of tax-related areas, with everything from HELP debts to PAYG witholding to working out whether it’s in your best interest to salary sacrifice your superannuation. For investors, it also has a Capital Gains Tax calculator so that you can plan your next move with your shares, investment properties or other capital assets.

While my Tax is one of the more expensive apps on this list, it’s really a catch-all tool once you’ve made that purchase, and is especially useful for those with more complicated finances.

Shoeboxed

Price: Monthly plans from $26.95

Platforms: Web, Android, iOS, add-ons for various business services

Shoeboxed’s app isn’t really a standalone, but a companion app for the service that Shoeboxed runs — receipt tracking. The core of the service allows you to physically mail your documents to Shoeboxed, who will scan and digitally store them, as well as securely destroying the original physical documents. Don’t worry about the ATO with this one — Shoeboxed is ATO registered, and the ATO will happily accept digital documents as well as physical.

Shoeboxed is a little pricey, requiring you to keep up a monthly subscription for as long as you want access to your documents and receipts. Most of the levels of subscription are intended more for businesses than personal users, though the cheapest $26.95 plan gives you 50 documents a month and a 2-5 day turnaround for digitising them.

The app is a lot easier than most receipt-keeping apps, however, Shoeboxed will extract all the information from your receipts automatically — all you need to do is snap a picture. Outside of tax time, you can even use this to keep track of expenses to be reimbursed by your workplace. If you already use accounting software, Shoeboxed is compatible with a number of them including MYOB, Xero, QuickBooks and more.

VehicleLog / Vehicle Logger

image: https://edge.alluremedia.com.au/m/l/2016/06/calendarintegration1.png

Price: $13.99 / free

Platforms: iOS / Android

As the popular VehicleLog is only available for iOS, we tracked down an Android equivalent as well — Vehicle Logger. These apps are for those who use their vehicles for work, or workplaces who have to keep track of various company vehicles. ATO requires you to keep a logbook for a continuous 12-week period in order to claim deductible expenses on your vehicle. That log, once kept, is then valid for the next five years, so long as the logbook is indicative of its everyday use.

Both include support for multiple vehicles and are ATO compliant, as well as allowing a choice between GPS tracking of vehicles and manually entering your trips. Though similar, Vehicle Logger is free and VehicleLog will cost you almost $14. However, as the app’s page points out, the cost of the app is actually a deductible expense itself.

Read more at https://www.lifehacker.com.au/2016/06/top-five-apps-for-tax-time/#vDYIbtrS3S5CHdYF.99