As the 2022/23 financial year draws to a close, both individuals and organisations should consider the key tax planning and compliance issues they need to attend to by 30 June.
In this special, automotive-focussed, edition of BDO’s Year-End Tax Bulletin, we summarise the key tax measures from the 2023 Federal Budget and important updates from the last financial year. In addition to our broader tax bulletin, we outline ongoing year-end issues and considerations that are most important to dealerships and automotive industry taxpayers.
In addition to our broader tax bulletin, we outline ongoing year-end issues and considerations that are most important to dealerships and automotive industry taxpayers, including:
- The Temporary Full Expensing of Assets (TFE) expiry date: Assets need to be first used or installed ready for use for a taxable purpose, not when invoiced or paid for
- Dividends: Consider dividend policies in place and items which may impact the balance of retained earnings. Consequently, also consider the amount of the dividend which can be declared. For example, the impact of leasing standard AASB16 often impacts the balance of retained earnings
- Trading stock: It is important to consider the appropriate valuation method - cost, market value, or replacement price - and identify any obsolete stock using the special valuation rule, and scrap any unwanted stock before 30 June 2023
- Tax Risk Management and Governance: The ATO is currently undertaking reviews on certain taxpayers’ corporate governance practices. The ATO expects that companies and their directors develop a tax governance and internal control framework to evidence that good corporate governance and internal controls are in place.
The BDO 2023 Automotive Year-End Tax Bulletin provides an outline to help manage your compulsory tax compliance and year-end tax liabilities, but please note this is not comprehensive. Before acting on the information provided, you should consider your individual circumstances and contact us to consult your local BDO Automotive adviser.