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Category: Taxation

Benefits of International Taxation Services in Australia

The international taxation services specialists at International Commercial Services are focused on advising our international clients with local operations and our Australian clients with overseas business and investment interests and requirements. We will help you set up a business structure that is both tax-effective and minimises any double taxation, along with managing compliance and the implementation of tax-effective profit-repatriation strategies for taxation services.

Our global footprint is so vast that we have our international partner firms who can help support your business in other countries if necessary.

International Tax Compliance

We will work closely and communicate concisely with you so you feel at ease with Australian tax compliance requirements but gain an understanding of how it can tie with the rest of your global organisation and be able to predict its future impact.

We understand that the Australian taxation reporting requirements can be complicated for an international business, let us help you in managing your domestic tax compliance obligations, so you can not only meet the taxation services compliance requirements but also capture the knowledge of how it correlates with the rest of your business and be able to anticipate the future of your organisation in Australia.

International Commercial Services will ensure that your reporting systems are set up to accurately report the information required for compliance in a vast array of Australian obligations so that you are kept up to date in a timely manner.

Financing a Corporate Subsidiary

Debt Finance

In Australia, it is not uncommon for companies to be financed using debt. By using debt financing, it can retain full control of the business and governance. What also makes this method popular is that the interest on repayments is tax-deductible.

However, it is important to identify the entity from which the funding is sourced as tax consequences from a director’s loan is different from one acting as a trustee or director of the company.

Equity Finance

Companies can also be financed through the issuance of shares via private equity investors, venture capitalists, or an IPO on the ASX.

The tax treatment of raising equity will vary depending on how exactly the equity was financed.

International Taxes

Transfer Pricing Rules

Transfer pricing rules have been implemented to counter international profit-sharing techniques often used by multinational entities to determine their pricing based on arm’s length methodologies.

This allows for the ATO to reallocate income or adjust deductions accordingly. The rule allows the branches and divisions of the same organisations to reflect non-arm’s length transactions between the Australian entity and the overseas entity of the same organisation.

Country-by-Country Reporting

If your global turnover exceeds AUD$1 billion, please continue reading on. There are new country-by-country reporting rules which affect significant global entities who pass the above test. Australian tax laws also contain various anti-avoidance rules that could cancel tax benefits or even alter the way in which the tax law applies for a particular entity. It is important that we help you stay on top of these rules to ensure you are not caught out unexpectedly.

Fringe Benefits Tax (FBT)

Most international organisations we have come across do give their employers Fringe Benefits which are reportable in Australia.

Fringe benefits are certain benefits that have been provided to their employees or to the associates of their employees. They are not normally deductible expenses for the employee and employer alike and as such FBT would have to be payable by the organisation based on the taxable value of the benefit at the highest personal tax rate of 47%.

This allows employers to claim a deduction for the payment of FBT and eventuates in the similar tax treatment of general salary and wage income and the fringe benefits reportable provided to the employees at the top highest personal tax rate, except for certain concessionally taxed benefits.

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We are conveniently located right in the heart of the Sydney CBD. If you are intrigued about how to become our client and gain access to our services, please get in contact with us to help you focus on what truly matters – your customer.

Avoiding Tax Penalties in Australia

Penalties

The ATO has harsh rules on administrative penalties for conduct. However, it is important to note what penalties are liable for the ATO to impose on individuals and businesses alike.

Avoiding Tax Penalties

Avoiding Tax Penalties in Australia

Making a False or Misleading Statement or Taking a Position That is Not Reasonably Arguable

You are liable for a penalty should you make a false or misleading statement on your tax return, activity statement, or amendment request which results in you having a difference in the amount payable that you calculated and the correct payable that the ATO has calculated based on available information.

It is important to note that the penalty will not be applied if you prove that you took reasonable care in producing the statement and the statement you provided is in line with interpretations of the tax law appropriate to the statement in question. It is best to avoid this altogether using the Australian and International taxation specialists at International Commercial Services.

Below are the base penalties based on the percentage of the shortfall amount taken from the ATO.

  • Failure to take reasonable care: The base penalty is 25% of the shortfall amount. Generally, you fail to take reasonable care if you have not done what a reasonable person in the same circumstances would have done.
  • Recklessness: The base penalty is 50% of the shortfall amount. You are reckless if a reasonable person in your circumstances would have been aware that there was a real risk of a shortfall amount arising and you disregarded or showed indifference to, that risk.
  • Intentional disregard: The base penalty is 75% of the shortfall amount. You intentionally disregard the law if you are fully aware of a clear tax obligation, and you disregard the obligation with the intention of bringing about certain results (underpaying tax or over-claiming an entitlement).

If you are a significant Global Entity, it is possible for the tax penalties percentages to be doubled.

Safe Harbours

You may not be liable to an administrative penalty for making a false or misleading statement if the following conditions apply:

  • The statement was lodged by your registered tax agent. At International Commercial Services, we have our own in-house registered tax agent to take care of any queries or issues that may potentially arise.
  • You provided your tax agent with all the relevant tax information to ensure that the statement was made in a correct manner. Our system means that we have all records on file since the day you begin using our services, which will help if you are ever picked for an audit.
  • The false or misleading statement was the result of your agent failing to take reasonable care. With just under two decades of dealing with international entities in Australia, we have seen almost every scenario imaginable to ensure that you are never put in a position that would cause us to fail to take reasonable care in handling your business in Australia.
  • The statement was made on or after 1st March 2010.

Penalty for Failing to Make a Statement

Failing to lodge a tax return or activity statement all together can have some serious consequences. It can result in a penalty of 75% of the tax-related liability if the following two conditions apply.

  • You fail to lodge a document necessary to establish your tax-related liability. i.e., a tax return.
  • In the absence of that document, the ATO determines your tax-related liability based on the information they have.

To make this as simple as possible, just lodge your tax returns on time and as accurately as possible. The ATO simply wants to know the tax position you are in by the lodgement date. Even if you can not pay the liability upfront due to other circumstances, the ATO is lenient if you lodge your returns on time and can provide payment arrangements to help you pay the debt.

Remission of Penalties

The ATO can remit the penalties imposed according to varying scenarios. They consider whether there were situations beyond your control that prevented you from meeting your obligations. With the recent COVID wave spreading through Sydney you might find your business has been disrupted and cash flow is tighter than usual. Again, the best result would simply be to lodge your return and then allow us to negotiate a payment arrangement on your behalf with the ATO to avoid being put in this position in the first place.

Essentially, tax penalties provisions are there to encourage all taxpayers to take reasonable care in complying with their tax obligations. The ATO will aim to consider each circumstance case-by-case when deciding which action to take if any at all. If the ATO has found that you are liable for a penalty, they will notify you in writing and include three key details:

  • The reason for the penalty
  • The amount of the penalty
  • The due date for payment (usually at least 14 days after the notice has been issued)

The tax penalties imposed are not tax-deductible in any year.

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Long story short, to avoid tax penalties in Australia, it is important to lodge returns with reasonable care, on time, and pay the amounts due within the appropriate period. What the ATO is most focused on is ensuring that you produce returns that are prepared in a reasonable fashion and are lodged on time. The payment aspect is possible to be arranged in installments without any late payment fees and penalties.

The team at International Commercial Services has just under decades in dealing with an array of global entities setting up businesses in Australia. That is why it is best to talk to us in ensuring that you know your obligations associated with setting up business in Australia. Australia has many tax laws subject to interpretation which can be difficult for an untrained eye to decipher. 

Accounting & Tax Outsourcing

What is CFO Outsourcing?

There are many benefits of CFO outsourcing services. First and foremost is that you will be saved from the hassles of managing your finance department. Outsourcing your finance department to a professional will free you up to attend to other more important issues like raising capital or handling employee issues.

Another benefit is CFO outsourcing services to ensure a smooth, easy, and convenient transition for your company. You can focus on your core business activities. Rather than having to deal with administrative issues like payroll preparation, employee hiring, cash flow, and so on. By delegating these tasks to an outsourced CFO, you get to spend your time focusing on other important areas. The same holds true when raising capital.

Virtual or Outsourced CFO?

By outsourcing your requirements to an independent virtual CFO, you get to enjoy greater flexibility. When raising money through equity or loans. Since the CFO service provider handles the finance and accounting functions of your firm. They are well placed to ensure that your transaction is completed in a timely manner.

Hassle-Free Reporting & Accounting

Virtual CFO services also help you manage financial reporting and accounting needs. You can focus on your core business activities and do away with the need to outsource your financial reporting requirements.

Team of Experienced Professionals

When you hire an outsourced CFO service provider, you get a team of experienced professionals. They are highly trained to take care of all your financial reporting and accounting needs. You can relax while the outsourced CFO team handles the day-to-day administration. And financial reporting responsibilities while you keep yourself in the loop by checking quarterly CFO reports at your leisure.

Cost Cuts of Your Company

When you hire outsourced CFO services, you also get cost cuts. This is because the costs associated with hiring a full-time CFO to work in-house are extremely high. The rate for a CFO to provide services on behalf of your firm is three times higher than the rate of a regular employee. You can reduce the cost to a large extent by contracting with an outsourced CFO service provider. Who provides services at much lower costs.

Implementation of Your Plan

When you outsource CFO services, you can rest assured that your financial strategy will be implemented as per your stipulated requirements. When you have a financial policy implemented, it will become difficult for you to change it, if ever, due to the large number of employees employed in the payroll department.

Improve Your Financial Strategy

However, when you outsource your CFO services, your CFO will sit with you and discuss the financial strategy with you before taking it to the next level. Your CFO will assist you in implementing the best CFO services for your firm and thus will work closely with you to ensure that your firm implements the best CFO policy. Outsourcing your CFO services will enable you to focus on your core business activities and free up your staff for more important tasks.

Financial Strategy will be Executed Efficiently.

Another benefit of outsourcing your CFO services is that your financial strategy will be executed efficiently. With a single CFO service provider in-house, you will be forced to divide your attention between different projects. A single CFO will handle the cash flow, accounts receivable, accounts payable, and the overall financial strategy for your firm. This will lead to a situation where there will be a lack of coordination and communication between the various departments leading to a delay in the execution of your financial plan.

Boost Cash Flow Option

If you want to improve and boost your cash flow operations, then it makes sense to outsource CFO services. In fact, there are many benefits of hiring CFOs, including significant cost cuts and time savings. The use of outsourced CFO services will result in a significant reduction in overhead expenses. If you are looking to reduce your cost base, CFOs will be an ideal option. The CFO service will take care of all the cost-related matters like processing invoices, credit card payments, receiving payments from customers, and so on.

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Apart from all these advantages, when you outsource your CFO services, you can expect quality services at a low cost. As mentioned earlier, a single full-time CFO will handle the entire financial strategy for your firm, reducing your need to hire additional staff for such matters as payroll and employee benefits administration. When you consider all these advantages, it becomes obvious that CFO outsourcing is the best way to take your business to the next level.

The full CFO Outsourcing function available at International Commercial Services is very enticing for the International business looking to set up in Australia. We work alongside various multinational firms to ensure they get the best output from their Australian team. With 15 years in the business, we understand how each organisation works so please get in contact with us to start the Australian journey of your business

A Guide to Taxation in Australia for International Businesses

If you are setting up an International Business or expanding an existing business in Australia, it is advisable that you consult with an Accounting firm. There are many accounting specialists in Australia offering the same services as The Intercomserv. There are a few differences between the services provided by taxation and accounting offered by a Certified Accounting Expert. In this article, I will provide a brief outline of the differences and advise you accordingly.

Taxation in Australia

Taxation in Australia

Intercomserv: An Experienced Professional with Knowledge of Taxation

The Intercomserv is an experienced professional with knowledge of taxation. Its professional services are typically sought when there is a complex situation requiring accurate accounting and financial reporting. When setting up an International Business it is not uncommon for a company to require professional advice on taxation issues. An accountancy expert who has significant knowledge of Australian business law can assist you from the very beginning. This can be extremely beneficial for your business and provide a clear path to obtaining all of your Australian tax liabilities and documentation in order.

Benefits of Hiring Intercomserv

 

Cost-Effective

The Intercomserv can also be utilized by companies to save money. Most firms offer to package programs that include their accounting services along with other tax reduction services. They are well versed in the complexities of incorporating a business in Australia and operating here. They can help you navigate the hurdles that may be associated with incorporating in Australia and provide advice and assistance with tax planning and payments.

Offshore Banking Services

The Intercomserv is also skilled in advising you on various options available to you including the use of offshore banking services, transfer of bank account balances, and other options that may be available to you. Many professional accountants are also International Businesspersons who can assist you with expanding your business overseas. They will also be helpful in maintaining proper records and reports required for the ongoing operations of your business. The Intercomserv is the best professional you can entrust your accounting needs to and you should only work with highly qualified and professionals.

 

Taxation Services: A Great Resource


A tax consultant is a great resource for individuals who are inexperienced and do not fully understand the intricacies of tax laws and their application in an Australian context. A tax consultant can provide detailed advice on tax matters for both individuals and businesses.

This guide to taxation in Australia for International businesses provides the essential advice and guidelines necessary to ensure that you are fully compliant with all of your tax obligations. In addition, it will help you identify ways to reduce your tax liability. It will also assist you with selecting the appropriate professional services, including reliable accountants, professionals who are knowledgeable about the taxation law and various taxation programs available in Australia, and relevant organizations.

Guide to Taxation for International Companies in Australia


A guide to taxation in Australia for international businesses provides many tips and strategies that are helpful when starting a business. The guide will first discuss general tax matters and how they should address to ensure maximum compliance. It then goes into more specific details about the taxation regime for businesses that operate in Australia, such as corporations and partnerships. Specifically, the guide to taxation in Australia for international businesses recommends that you avoid making any investments in business properties. Instead, you should focus your attention on buying residential properties or investment properties that will be used by your company only.

  • The Guide to Taxation in Australia for International Businesses recommends that
  • All business owners conduct company maintenance in Australia and pay all of the tax that they owe.
  • It also recommends that you avoid using offshore banking and other jurisdictions that have lower taxation rates.
  • International business owners can obtain advice about tax planning in different countries.
  • Intercomserv provides assistance to Canadian businesses that want to provide the most efficient taxation services.

 

 A guide to taxation in Australia for international businesses also gives advice on capital gains and capital expenditure. And provides an estimate of the tax required. International business owners should make sure that they are properly establishing their business. That they have the necessary bank accounts, loans, and credits to meet the tax obligations. They should also keep in mind that income and business expenses can be complex and should be prepared accordingly. It is advisable to take professional advice in order to provide the most effective tax planning possible.

Why Businesses Need Taxation Services

The question of why you should hire taxation services has been on the lips of many small business owners. Unfortunately, the reason is not as simple as hiring a normal employee. In fact, it’s very hard to hire someone who will be a good fit for your business. You have to ask yourself, will the local taxation service be there for me when I need them? The answer to this question can make or break your chances of success when you decide to hire a taxation service.

why taxation services

Why Is It Important to Hire Taxation Services? 

State Tax Debt

One of the most common reasons to hire a tax service in person is because of state tax debt. Whether you owe property tax, income tax, sales tax, or any other type of local tax. You need to hire a local tax professional to help you resolve your issues with the IRS and local governments. If you don’t, you could be facing serious financial problems

Avoid Costly Mistakes

Another reason to hire local taxation services is to avoid costly mistakes. There are too many tax professionals who seem to make a wide variety of mistakes when they prepare your taxes. Some of these mistakes include making entries in the wrong place, double filing. Using the wrong forms, providing incomplete information, and other such mistakes. Hiring a tax service that is well versed in these kinds of mistakes. And understanding what they are doing will go a long way in ensuring that your taxes are ready and get payment in a timely manner.

Keeping Your Business Running Smoothly

It’s also important to hire local taxation services because of the time factor involved in keeping your business running smoothly. When you’re just beginning your business, you may not have a lot of time to deal with the intricate details of your tax situation. By hiring a local tax professional, you’ll be able to handle all of the necessary tasks related to your business, as well as have the peace of mind that your taxes are being handled properly. This will help you grow your business faster and increase the number of profits that you earn.

Different Payment Option

While tax services do charge fees for their services, you’ll be happy to know that they generally provide a number of different payment options. Depending on your own personal budget and the budget that your business has set aside for taxes, you can decide on which methods of payment are appropriate. Many tax professionals offer their clients a paper tax certificate so that you can print out the needed forms at home. In some instances, the forms are mailed to your house. However, if your business provides mail-order tax services, you’ll likely be required to pay the postage costs.

The Outsourcing Firm will do all

The convenience of the hiring tax services has made it even easier to handle the local tax issues that you’re likely to face. With these online tax service companies, you can easily calculate your tax bill from any location in the world at any time. You don’t have to waste time, energy, or gas going from office to office or sitting in traffic just to get your taxes done. By using these online companies, you can spend more time dealing with the important aspects of your business rather than focusing on paying your taxes. Instead, you can handle other things that need your attention.

What to Make Sure Before Hiring a Taxation Services Company

Hiring a tax service is not a decision to take lightly. You want to make sure that you’re working with an expert, experienced professional person. Who should know how to deal with the local authorities and state taxation agencies. If you’re considering hiring a tax service, it’s a good idea to request references from previous customers. And also ask the company for documentation proving their long-standing track record of meeting state and federal tax obligations. It’s also a good idea to ask the company for proof of insurance and bonding. These items may be offered as perks or incentives to gain your business. However, it’s usually best to go with tax professionals that offer these services without any strings attached. Remember, your tax dollars are important, and it’s important to protect them.

Conclusion

Don’t just take the word of the tax expert you’re considering. Get as many quotes, fill out an application, and visit a few companies before making a final decision. The information you gather before you hire can help you make a more informed decision about your local tax services. Armed with this information, you’ll be able to focus on the important aspects of your business instead of worrying about your local tax burden. 

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