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Buying or selling any business is a complex transaction. Particularly in an RTO, you buy or sell shares, and the registration is not transferable. ASQA regulations create other obligations to prepare for self-assessment and the FVRA Tool for change in ownership. There are also good chances of audit after the first year of change of ownership. I will quickly discuss how to prepare to sell or buy an RTO. PREPARING TO SELL YOUR RTO You need to understand your buyer and the market. Is it just the registration and scope you are selling or the Goodwill (i.e. brand name) and equipment as well? A buyer will look at the financial information, the profits and how well the RTO runs. But ultimately, a buyer is interested in the future and potential of the business. If you can do justifiable forecasts of your business numbers, it will make the process easier for the buyers and attract more buyers. The golden tip is always to run your RTO as if you will sell it. Then, you will get the most value for yourself and show this value to a potential buyer anytime. PREPARING TO BUY AN RTO You need to be an educated buyer to understand what is available and what price. The process starts with due diligence to ensure that the seller's financial and non-financial information (including student & staff numbers, contractors, suppliers, and agent relationships) is correct and contains no concealed material facts. It would be best to organise your finances before the negotiation. The exposure is significant, and you may need to involve the experts, including: Solicitor: To prepare the share purchase contract and to protect you from the undisclosed facts and liabilities. RTO consultant: To ensure that AVETMISS reporting is current, RTO is ASQA compliant, Training and Assessment Strategies (TAS) & Learning Management System (LMS) are valuable and with the self-assessment required by ASQA at the change of ownership. Accountant: To look at the financials and prepare the FVRA Tool. The accountant can also assist with the appropriate structure to purchase the shares for tax planning and asset protection purposes. The above information provides a brief overview but is not meant to be comprehensive.

Background: The latest news on the JMC Pty Ltd v Commissioner of Taxation case , the employee vs subcontractor court case. An individual lecturer initially deemed an employee by the Federal Court for superannuation purposes was later classified as an independent contractor by the full federal court upon appeal by JMC Pty Ltd. Latest Update: The High Court has dismissed the ATO's application for leave to appeal, affirming the lecturer's status as an independent contractor. This decision has significant implications for similar contractual arrangements, emphasizing the importance of clear contracts. Implications: Businesses and individuals should ensure that well-drafted contracts define working relationships accurately. The ATO is expected to issue a decision impact statement, providing guidance on superannuation obligations and criteria for distinguishing employees from contractors. Conclusion: The JMC Pty Ltd case's conclusion clears the lecturer's status as an independent contractor. Staying informed about ATO guidance and future developments is crucial for those in similar situations. We will continue to provide updates on this matter. Click here for the latest update: 10 September 2024: The Tax Office has responded to the case through a Decision Impact Statement.

Last year we discussed the case of JMC Pty Ltd v Commissioner of Taxation, where an individual lecturer engaged as a subcontractor by a higher education provider was held to be an employee by the federal court for superannuation purposes. The agreement allowed the lecturer to subcontract or assign the performance of teaching services. The original blog. JMC Pty Ltd appealed to the full federal court, and the lecturer was found to be an independent contractor rather than an employee, and as such, no superannuation was required to be paid by JMC Pty Ltd. The full federal court’s view was that: The contract did not provide control to JMC Pty Ltd over how, when or where the lecturer was required to deliver its lectures. The right to subcontract or assign teaching services to third parties with the consent of JMC Pty Ltd was also important. The ATO has applied for special leave to the high court. We will keep you posted if the High Court allows the leave. Full details of the case are available at: JMC Pty Ltd v Commissioner of Taxation.

Return to Compliance from July 2023. As of 1 July 2023, you must again comply with the face-to-face delivery requirements in the National Code 2018 and the ELICOS Standards 2018. You must ensure overseas students physically attend an approved course location for most of their course. Suppose you are currently delivering, or will soon deliver, a course at a location where you are not approved for that course. In that case, you should immediately apply for approval of this location via submission of an ‘Application to change CRICOS registration’ via Asqanet. Providers should ensure that their arrangements maintain assessment and quality standards. We have a range of information to support ESOS providers in complying with their obligations, such as guidance on the following: Written agreements with overseas students Overseas student attendance Obligations when facilitating student transfers Education agents Guide to provider default obligations under the ESOS Act The Commonwealth Ombudsman has also recently released several fact sheets to assist ESOS providers in complying with their requirements. Delivery to overseas students is a continued risk priority for ASQA, and we will monitor providers’ return to compliance. We will use various regulatory tools, including performance assessments (audit), site visits (both announced and unannounced) and surveillance. In cases where a provider is found non-compliant, including when providers fail to meet face-to-face-delivery requirements, we will take compliance and enforcement action. We encourage anyone with information about providers not meeting these requirements to contact us via asqaconnect.

The Annual Registration Charge (ARC) will be invoiced in July, so now is an excellent time to ensure your scope of registration is up to date. The ARC is calculated using the total number of qualifications and courses on your scope on 1 July and the number of unique students enrolled in the preceding calendar year. It’s important to note that superseded non-equivalent and deleted training products will be included in your ARC calculations if they remain on the scope. Be sure to add this task to your to-do list: Review your scope now and remove training products you no longer deliver. This will ensure you are not charged in a higher bracket than expected. Learn more at ASQA.

What is the instant asset write-off? The instant asset write-off incentive allows eligible businesses to claim an immediate deduction for certain costs relating to depreciating assets in the year the asset is first used or installed ready for use. That means the asset needs to be ready for the business to use. What is classed as a depreciating Asset for my business? A depreciating asset is an asset that has a limited life expectancy (effective life) and can reasonably be expected to decline in value (depreciate) over the time it is used. For example, equipment, computers, furniture, lab equipment etc. When does it end? June 30 2023. What happens after it ends? Normal tax rules will apply, which means you will need to depreciate assets over their effective life rather than being able to write them off immediately. Hence, the tax deduction will be spread out over a much more extended period. Can I still finance the Asset purchase? Yes! As long as you set up the correct type of loan under the correct entity, you can finance the goods and still receive the tax benefit. Your interest cost on the loan would also be tax deductible. Is there anything else I need to know? Goods must be used or installed and ready for use by June 30 2023. Ideally, you would also have received the invoice before June 30 2023

A Fringe Benefits Tax (FBT) exemption may apply if your business provides an electric car to an employee for their private use. If you are running a business and thinking of buying an Electric Vehicle, there are significant tax benefits to purchasing the vehicle in the business name.

Individuals Marginal tax rates are to remain the same for 2023-24. Short-term rental owners The ATO and Treasury have received additional funding of over $90 million to extend the Personal Income Tax Compliance Program. The program addresses non-compliance in key areas and emerging risks, such as improper deductions for short-term rental properties that are not genuinely available for rent. The program is expected to generate an extra tax revenue of approximately $475 million. If you own a holiday home or short-term rental, it's essential to be aware of this development. SMSF Suppose an individual has a total superannuation balance of over $3 million at the end of June. In that case, they will be subject to a 30% tax on their earnings greater than $3 million starting from July 1 2025. This tax only applies to the portion of earnings that exceed the $3 million threshold. If an individual has negative earnings, they can carry them forward and offset them against future earnings. The individual or their superannuation fund can pay the tax. Superannuation Superannuation Guarantee set to increase to 11% on July 1 2023. Employers - PayDay Super At present, employers are required to make super contributions every quarter. However, proposed changes would require employers to pay super contributions on payday starting July 1 2026. Medicare To triple Medicare bulk billing incentive for most common GP consultations for children under 16, pensioners and other Commonwealth concession card holders. Instant Asset Write-off disappears The existing instant depreciation measures for businesses will end on June 30 2023; refer to our Instant Asset Write-Off blog. Small Business Energy Incentive For small and medium-sized businesses with a combined turnover of under $50 million, a 20% additional deduction is available for eligible depreciating assets that support energy efficiency and electrification. This incentive allows for a maximum additional deduction of $20,000 on up to $100,000 of total expenditure. Examples of eligible assets include energy-efficient fridges, heat pumps, and electric heating or cooling units. To qualify, these assets must be first used or installed between July 1 2023 and June 30 2024. While full details are still being finalised, it's worth noting that exclusions will apply to electric vehicles, capital works, renewable electricity generation, assets not connected to the electricity grid, and assets that use fossil fuels. Compliance In 2023/24, small businesses and individuals can benefit from reduced tax instalments, PAYG, and GST instalment adjustment factor to 6% instead of 12%. This applies to those with an aggregated turnover of up to $10 million for GST instalments and up to $50 million for PAYG instalments. Small businesses will soon have the opportunity to amend their income tax returns for up to four years starting from July 1, 2025. Small business amnesty Small businesses can use a lodgement penalty amnesty for failure to lodge penalties. This amnesty will apply to tax statements originally due between December 1 2019 and February 28 2022 as long as they are lodged between June 1 2023 and December 31 2023. The global minimum tax rate For multinational groups with consolidated revenue surpassing Euro 750 million (approximately $1.2 billion), a minimum tax rate of 15% applies. Finally There have been funding cuts for the Export Market Development Grants program, and the ATO has been given an additional $600 million to increase GST compliance. The capital works tax deduction rate for build-to-rent development programs have increased to 4% per year. The final withholding tax rate on eligible fund payments from managed investment trust (MIT) investments has been reduced from 30% to 15%. Furthermore, the clean building MIT withholding concession has been expanded to include data centres and warehouses.

The last thing a business owner wants is negative news about their company. Yet, more companies than ever are facing scrutiny regarding wage theft. Don't worry; we have you covered, and wage underpayment can be avoided by understanding your employees' entitlements and setting them up correctly. To help you implement best-practice processes, this accessible guide explains: + common causes of underpayment; + employee entitlements; + how to conduct a wage audit; and + actions if you identify wage underpayment. Ensure your employees are paid correctly with this free LegalVision guide on preventing wage underpayment. Remember, our team at RTO Accounts is always there for you should you need further guidance, or if you need help, please book a meeting with me online.

For all businesses with staff, the deadline of 31 March 2023 to transition to Single Touch Payroll (STP) Phase 2 is fast approaching. With the first phase of Single Touch Payroll now underway, businesses will be well-versed in using the new ATO initiative to streamline their reporting requirements. We want to ensure you have all the details you need to transition to STP Phase 2 to avoid ATO penalties. To make it easier for you, we've included the software provider's guides to help you transition. Just click the link for instructions if you use Xero, MYOB or QuickBooks. Remember, our team at RTO Accounts is always there for you should you need further guidance, or if you need help, please book a meeting with me online.