Delay to financial adviser registration
The Government has announced that it will delay the financial adviser registration requirement until 1 July 2023. By way of background, the Financial Sector Reform (Hayne Royal Commission Response—Better Advice) Act 2021 (the Act) introduced a central registration requirement for financial advisers, in line with recommendation 2.10 of the Financial Services Royal Commission. The Act had required that all financial advisers who provide personal advice to retail clients be registered by 1 January 2023. However, ASIC (who has been engaging closely with industry about how best to implement the measures) has now identified ways to improve the registration process. As a result, the requirement for financial advisers to be registered has been delayed until 1 July 2023.
FBT: meaning of “primary place of employment”
The ATO has released TR 2021/2 Fringe benefits tax: car parking benefits. It amends this Ruling to incorporate changes which address the concept of “primary place of employment”, in light of the decision in FCT v Virgin Australia Regional Airlines Pty Ltd [2021] FCAFC 209.
Draft PCG 2022/D4: claiming expenses for working from home
The ATO has released Draft PCG 2022/D4 Claiming a deduction for additional running expenses incurred while working from home – ATO compliance approach. It will allow taxpayers working from home to use a new method to claim the additional running expenses they incur as a result of working from home. When this Guideline is finalised, the new method (the revised fixed method) will be available for taxpayers to calculate their working from home expenses from 1 July 2022. Note: From 1 July 2022, the shortcut method outlined in Practical Compliance Guideline PCG 2020/3 Claiming deductions for additional running expenses incurred whilst working from home due to COVID-19 and the fixed-rate method outlined under ‘Special rules for home office running expenses’ in Law Administration Practice Statement PS LA 2001/6 Verification approaches for home office running expenses and electronic device expenses are no longer available for taxpayers to calculate their working from home expenses. Comments due by 30 November 2022.
TSA comment on Draft PCG 2022/D4
The draft PCG proposes an update to the 52c fixed rate method currently available in PS LA 2001/6. The “revised fixed rate method” set out in the draft PCG offers a new rate of 67c per hour for each hour worked from home during the income year, but there is a sting in the tail.
The Sting
The current PS LA 2001/6 para. 5 allows:
Taxpayers who use the rate per hour method to claim a deduction for home office running expenses only need to keep a record to show how many hours they work from home. They can do this over the course of the year, or if their work from home hours are regular and constant, by keeping a record for a representative four-week period.
By contrast the draft PCG requires that
For the 2023-24 and later income years, you must keep a record for the entire income yearof the number of hours you worked from home during that income year. An estimate for the entire income year or an estimate based on the number of hours you work from home during a particular period and applied to the rest of the income year will not be accepted.
And additionally,
For the 2022-23 income year only, you need to keep … a record of the total number of actual hours you worked from home for the period 1 January 2023 to 30 June 2023.
While the draft PCG offers a transitional arrangement until December 2022, taxpayers (and their advisors) currently availing themselves of the 52c fixed rate method will need to consider whether they can meet the additional administrative burden from 1 January 2023, or whether the “actual expenses” method is a more achievable alternative.
