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June eNews

Updated: 2 days ago

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IMPORTANT NOTE

Important updates to Anti Money Laundering / Counter Terrorism Financing (AML/CTF) laws take effect on 1 July 2026. As a result of these changes, we may be required to seek additional identity verification for certain services such as setting up a new company. These are similar to “Know Your Client” (KYC) requirements that exist for banks and will require us to do “Client Due Diligence” approximately each 3 years. Whilst this is a lower requirement than that which banks are subject to, we will from time to time be required to seek verification of identity from you.


Discretionary trusts – changes to apply from 1 July 2028


The Government is indicating that a 30% tax would initially be paid by the trustee, with beneficiaries (other than companies) receiving a non-refundable tax credit for the tax paid at the trust level.


This measure is aimed at curbing income splitting to lower-taxed family members and corporate beneficiaries (often known as bucket companies).


Some exemptions would apply, including for fixed and widely held trusts, superannuation funds, special disability trusts, deceased estates, charitable trusts, primary production income and some other specific trust types. 


The Government has now indicated that existing discretionary testamentary trusts would be exempt from these changes.


To assist with transitions, three years of roll-over relief will be available for restructures into companies or fixed trusts.


Example (adapted from budget materials)

Kurt operates his business through a discretionary trust and makes a profit of $300,000. Kurt pays himself a salary of $100,000 and distributes the remaining $200,000 to four family members who have no other income. In total, Kurt and his family members pay around $42,000 in tax on this income.


If the 30% minimum tax rate rules are introduced then Kurt and his family members would pay around $86,000 in tax on this income. This is a significant increase in the total amount of tax paid on the same level of profit.


In situations like this there might be scope to restructure the business into a company to potentially access a lower 25% tax rate or pay salary / wages to some family members who are genuinely working in the business.


Practical issues

Many business and investment structures will face higher effective tax rates under the proposed changes, although the Government is planning to undertake a consultation process to refine the rules. It is possible that the final version of the rules will look a bit different to the proposals announced in the Budget. 

While the start date for this measure isn’t until 1 July 2028, now is the time to start modelling scenarios and comparing the pros and cons of other options. In some cases the overall impact of the changes might be minimal and no material changes will be required. In some cases it might still make sense to continue utilising discretionary trust structures, but with some alternative distribution strategies in place. In other cases it will make sense to explore whether a restructure might provide better long-term outcomes.




Budget measures worth noting


  • $250 Working Australians Tax Offset (from 2027–28) – increases the effective tax-free threshold for wage earners and sole traders. 

  • $1,000 standard deduction for work-related expenses (from 2026–27) – simplifies tax time for many employees. 

  • Small business measures – a permanent $20,000 instant asset write-off for plant and equipment. 



Payday Super: myth vs fact


We’re clearing up some common myths about Payday Super and what SMSFs need to do now.

Employers will be making super contributions more frequently and will rely on super funds, including self-managed super funds (SMSFs) to be set up correctly to receive them.


Let’s clear up some common misconceptions.

Myth 1: There’s nothing I need to do before the start date.

Fact: You need to act now to prepare if you receive contributions from unrelated employers.


Make sure you have SuperStream arrangements in place for unrelated employers, ensuring contributions are able to be sent electronically using the correct data and payment formats.

 

Under Payday Super, employers must be able to send contributions with each pay run. To enable this, your SMSF must be set up and ready to receive contributions.


This means your SMSF must have:


All fund and member details need to match, otherwise contributions may be rejected or delayed, creating compliance issues for employers and extra work for your SMSF.


Myth 2: Payday Super only affects big super funds

Fact: Payday Super requirements extend to SMSFs.


Even though most SMSFs don’t process high volumes of contributions, they still need to comply with Payday Super and SuperStream changes for unrelated employers. Under the SuperStream upgrades, additional checks are being introduced including:

  • new error messages

  • a member verification request that confirms your ESA is active.


Employers will need this confirmation before they can make a contribution to your SMSF or continue making contributions. If your SMSF isn’t set up correctly, payments may be stopped.

Myth 3: If there’s an issue, it will sort itself out later

Fact: Problems will be identified earlier.


The member verification request is being introduced in SuperStream to help prevent employer contribution errors. It’s important your SMSF details are accurate and up to date so that contributions can be made to your fund.


With tighter processing timeframes, super funds and SMSFs will need to identify and return incorrect payments faster so employers meet their obligations.


All SMSFs should consider how they can speed up allocation and processing to assist employers in being compliant where an error occurs.

Myth 4: SMSF actions don’t affect employer compliance

Fact: SMSF readiness directly impacts employer outcomes.


SMSFs support employer compliance by:

  • keeping ESA details active and current

  • ensuring member information is correct

  • responding promptly when issues or errors are flagged

  • ensuring your SMSF lodgments are up to date so that your Super Fund Lookup status does not prevent employer contributions being made to your fund.


If contributions are rejected due to incorrect SMSF details, employers may face compliance risks, and trustees may experience delays in receiving super.

Act now to make sure you’re ready to receive more frequent contributions for a smoother changeover to Payday Super.


For more Pay Day Super information visit: Payday Super



SMSF year end reminder – what to check before 30 June

The end of the financial year is fast approaching.


For SMSF members and trustees, a few timely checks now can avoid headaches later and help preserve valuable tax and contribution opportunities. Below is a checklist of the things members and trustees should consider before 30 June.


Contributions - timing matters

  • Get contributions into the fund by 30 June: For both tax deductibility and contribution cap purposes, cash and electronic transfers generally need to be received by the SMS's bank account on or before 30 June.When transferring amounts between different banks allow extra days for bank processing times.

  • Personal deductible contributions: If you want to claim a tax deduction for a personal contribution, you must notify the fund and receive the fund's acknowledgement by the required deadline (usually before the earlier of lodging the tax return or 30 June the following year).

  • If you're looking to start a pension early in the new year, you'll need to get your notice of intent to claim a deduction processed even earlier (ie, before you start the pension). Otherwise, you may miss out on the opportunity to claim a deduction for the contribution made.

Contribution strategies you might use

  • Carry forward concessional amounts: Eligible members with lower total super balances (less than $500,000) at 30 June in the prior year may be able to use unused concessional caps from previous years to make larger deductible contributions this year.


This may be useful if you have a larger capital gain in your personal name for the 2025/26 financial year.


  • SMSF-only 28-day allocation rule: SMSFs can temporarily hold a June contribution in an unallocated reserve and allocate it to a member in July so it counts for the following year’s caps — but this must be done correctly, documented in minutes and the fund’s deed must allow it.


Commonly referred to as a contribution reserving strategy. Again, this may allow members to take advantage of claiming a larger tax deduction this year.

Post-tax personal contributions and limits

  • Non-concessional contributions and bring-forward: Whether a member can use the bring-forward rule depends on their total super balance on the prior 30 June.

  • Pension paperwork and minutes: Check that pension commencements, commutations and lump sums are supported by correctly signed documents and trustee minutes.




Security features are available to help protect individual and sole traders ahead of tax time. By using the ATO app on their registered device, individuals can:

  • receive security messages for verifying certain ATO online services transactions, such as transferring or consolidating super

  • access security features even if their ATO account is locked, including initiating a call to the Client Identity Support Centre.


These protections help prevent unauthorised access.


Ending card surcharges: What you need to know

ahead of 1 October 2026


The Reserve Bank of Australia (RBA) has confirmed that all surcharges on credit and debit card payments — across eftpos, Mastercard and Visa — will be banned from 1 October 2026. 


For many businesses this will mean simpler pricing, fewer compliance headaches and potentially better margins — but it also means some preparation is needed.


What’s changing?


The RBA’s reform package has three key components:

1. Surcharges banned

From 1 October 2026, businesses cannot add any surcharge — percentage or flat fee — for payments made using eftpos, Mastercard, Visa or related networks. Customers must see and pay one final price, whether they purchase online, at the counter, or via mobile payment.

2. Lower interchange fees

Interchange fees (the wholesale fees charged between banks when a customer pays by card) will be reduced, with new caps for foreign-issued cards. This should directly lower the cost that a business needs to pay to accept card payments.

3. Greater transparency

Banks, card schemes and payment providers must publish clearer information about fees and margins. 


They must also demonstrate how reductions in wholesale fees are being passed through to retailers. This gives businesses more power to compare providers and negotiate.

These changes are supported by oversight from the Australian Competition and Consumer Commission (ACCC) and guidance from the Australian Small Business and Family Enterprise Ombudsman.


What your business should do now:

1. Review your merchant fees

Look at your recent statements and determine:

  • How much you currently pay in card-acceptance fees; and 

  • Whether you have been relying on surcharges to offset part of those costs. 

If surcharges are part of your pricing strategy, you may need to adjust prices to maintain margins, where commercially appropriate.

2. Speak to your payment provider

With lower interchange fees coming and more transparency required, it’s a good time to negotiate:

  • Better merchant service fees 

  • Updated pricing plans 

  • POS or terminal upgrades 

Small businesses often pay closer to the current fee caps, so they stand to gain the most.

3. Update your pricing and POS systems

You’ll need to remove:

  • Surcharge signage 

  • Online checkout surcharges 

  • Automatic percentage add-ons 

All displayed prices must become all-inclusive.

4. Build changes into your cash flow

Lower merchant fees won’t appear immediately, but most businesses should see reduced costs flow through during the 2026–27 financial year. This is a good time to revisit budgets, especially for cafés, retailers, trades and service-based operators that have a high proportion of small card transactions.



If any of the above raises questions for you or your business, please contact our office.




 
 
 

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