Tax Return

Hi Guys

I am not sure if this is the right area to post this question so if I am wrong sorry in advance.

I have a family trust , company pty ltd but it has not really being active for 2 years , what I mean with that is there are no investments has taken place what so ever and I do have a job for income.

For the last 2 years my tax returns have been less than the other guys I work with on a similar pay and expenses and I have been paying around $ 1000 or more for my tax preparation where the guys I work with are paying like $ 60 for theirs and getting 2 or 3 times more than I have.

I am starting to think that I may need to close my trust or change my accountant
because it has cost me $$$ lot of them over the 2 years and it will happen again in 2010

Any suggestions ??

Thanks

 

Something is not right. The Trust tax return is seperate to your individual return. The $1,000 you pay annually is an expense to the Trust. Therefore worst case scenerio is that the Trust has a $2,000 loss to be carried forward.

It is difficult to compare your situation to your colleagues as you may not be totally aware of their full financial position.

Maybe you need to sit down with a financial planner and your accountant to discuss strategies to maximise the usefullness of the trust before you decide to close it out of hand. Look before you leap.

 

If your trust has income less than the tax-free threshold and there are no franking credits to distribute etc., then there is no need to file a trust tax return.

If there are no assets (including the original settled amount) then the trust has ceased to exist.

You are probably being charged $1000 to lodge an ASIC company annual return for the trustee, which costs $200.

Cheers,

Rob

 

Thanks guys for your answers.

Here is little bit more info from last years tax return.
Family Trust Loss $ 68.00
My Tax return $ 1538
My wife's $NIL She did not work

From prior years there are $22.000 of losses available in the trust

The fee I being charged is $ 1095
so my tax return is $ 443

I paid total tax from my regular job $14.000.

To answer Sim's question " yes I am planning on using the trust and there are no investments or assets held by the trust.

To Rob question " what I paid to ASIC is separate from the fee's "

Intellikev question " My colleague is pretty much in a similar financial situation that makes it even worse because for the last 2 years he has been getting back heaps more returns than I have with a $ 60 fee .

Hopes this makes sense guys

Zengin

 

Zengin,

Based on what you have said your accountant is ripping you off.

I would hit him/her up and ask for an explanation - ask the following questions:

1. What specifically are they charging you for?
2. In their opinion do you still need the trust?
3. Is the reason for setting the trust up in the first place (i.e. investment purposes) still there?

One option is to remove the corporate trustee of the trust and appoint yourself personally as the trustee (you will need to engage a lawyer for a few hundred dollars to prepare a deed of change / appointment of new trustee) and you will need to pay ASIC $33 as a de-registration fee (or simply not pay the ASIC fees and after a few angry letters ASIC will de-register your company for you at no cost to you!).

As Rob G. said - if your trust is not trading and has no income then there is no reason to be lodging a tax return - and hence no reason to pay your accountant $1000 per annum.

If your colleagues feel that their accountant is doing a better job - then ask them for a referral.

It also may be easier seeing a new accountant and explaining your situation and frustration to them. They can then contact your old (existing) accountant and request all the documentation / company registers / trust deeds etc and subsequently go about finding a solution to your problem - i.e. paying a lot of money for nothing.

I hope this turns out OK for you. I also feel that as you are coming here looking for answers rather than asking your accountant directly that they have already failed you.

Good luck and feel free to share the outcome.
SM

 

Thanks everyone and Superman for your help.

I will ask them tomorrow about why they are charging me so much and I will post their reply here .

I am planning to get into some investment in the near future ( 12 months ? ) but in meanwhile I did not want to pay such a high fee's for something I am not really using .

Thanks again.