Lynne Cox

OMG! I couldn't resist sharing this news article!

Sat, 12 May 2012 02:24:00 GMT

MPs' super tax dodge slammed

by: David Crowe, National Affairs Editor
From:The Australian
May 12, 201212:00AM
LABOR'S budget strike on wealthy Australians has opened a hornet's nest of inequity, as politicians, senior public servants and judges are spared the full force of changes that will raise $2.5 billion from superannuation.

The Gillard government scrambled to clarify its tax plans late yesterday as experts slammed the measures for hurting workers trying to save for their retirement without imposing the same penalties on others.

Seriously - not that it would affect most of us BUT one set of rules for the Pollies (who are doing such a good job!!! NOT), Judges and Senior Public Servants AND another set of rules for any other Australian Taxpayer.

UNEMPLOYMENT FALLS BELOW 5PC

Fri, 11 May 2012 02:27:00 GMT

The Reserve Bank of Australia is expected to hold tight on rates in June following stronger than expected employment data.

According to the Australian Bureau of Statistics, the nation’s unemployment rate dropped below 5 per cent for the first time in a year, which AMP’s senior economist Shane Oliver says will give the RBA “breathing space”.

“Especially coming on top of strong retail and building approvals… the RBA will probably not be cutting rates in June, but economic data in Australia runs hot and cold,” he said.

“Sooner or later, we’ll return to weakness.”

Unemployment fell 0.2 per cent in April to sit at just 4.9 per cent.

Unemployment in people aged 15-24 years has fallen significantly from 13.3 per cent to 12.4 per cent.

THE ADVISER

MORE BANKS MOVE RATES

Wed, 09 May 2012 01:01:00 GMT

As more lenders continue to move on rates, one thing is becoming very clear: no lender is prepared to pass on the full rate cut to borrowers.

In the last few days, BankSA cut 38 basis points from its standard variable rate to 7.04 per cent, while St George also cut 0.38 per cent from its SVR, taking it to to 7.04 per cent effective from May 14.

Bendigo Bank cut its rate by 0.35 per cent and CUA passed on half of the Reserve Bank's 50 basis point cut by slashing 25 basis points from its standard variable rate.

One of the biggest interest rate cuts so far is the Bank of Melbourne, which passed on a 0.41 per cent rate cut to borrowers.

THE ADVISER

Investment Sector Set To EXPLODE!!

Wed, 02 May 2012 00:50:00 GMT

A rocky share market is bolstering Australian homeowners’ appetite for property investment, with one in four planning to purchase a second property, according to LJ Hooker Finance research.

The research found that 26 per cent of existing homeowners are currently looking to buy an investment or holiday property.

LJ Hooker deputy chairman Leslie Janusz Hooker said over the last decade Australian’s have been listed amongst the highest shareholders per capita globally.

“Residential property is a traditional favourite amongst Australian investors due to the long-term stability of the market, potential capital gains or opportunity to boost income through regular rent,” he said.

“However the multiple double-digit losses experienced by the share market in 2011 are driving a stronger interest in property investment. Data shows that over a 10 year period, property investment yields a higher after-tax return than shares. Uncertainty in the share market is drawing Australians back to traditional investment options to ensure long-term results.”

Mr Hooker said the Australian Tax Office’s recent draft ruling on Self Managing Super Funds borrowing legislation may enable more Australians to use their super to purchase and maintain investment properties using a limited recourse borrowing arrangement.

“Long-term success via residential property investment is dependent on the strategic choices made by the buyer who should always get independent advice,” he said.

“To get the best results, investors should seek properties that are located in potential growth areas, that have low rental vacancy rates and to choose a property that doesn’t require major renovations or modifications for tenants,” said Mr Hooker.

THE ADVISER

Rate Cut Tomorrow 'beyond doubt'

Mon, 30 Apr 2012 01:11:00 GMT

An economist has claimed tepid inflation means a May rate cut is a foregone conclusion.

As tomorrow's RBA meeting looms, Westpac chief economist Bill Evans has said the March quarter CPI figures released last week make it a certainty "beyond doubt" that the Reserve Bank will cut the official cash rate. Evans said housing has shown particular weakness in the inflation data, and has helped build the case for a cut.

"The rare negative read on house purchase emphasises the parlous state of the housing construction sector and certainly that sector's need for some interest rate relief," Evans said.

Evans said that the bank expects 50bps of cuts in the near term, but has dismissed the idea that the bank will cut 50bps in May.

"We would tend to dismiss that prospect given the general cautious approach of the RBA. While we would not argue with such a decision, given that our view was that the case had already been made for a cut in February of this year, we expect that the RBA will prefer to assess the impact of the rate cut on financial conditions and confidence before it moves the full 50bps," he said.

AUSTRALIAN BROKER ONLINE

'Less Upbeat' RBA gearing for cut

Mon, 23 Apr 2012 09:08:00 GMT

A "less upbeat" RBA may indicate a strengthening case for a May rate cut.

Westpac chief economist Bill Evans has said the Reserve Bank appears more concerned with economic weakness, a shrinking labour market and business investment, likely foreshadowing a rate cut when the Board meets next week.

"Since July last year, Westpac has forecast that the easing cycle was likely to entail 100bps in reductions in the RBA's cash rate with the final cut occurring in the September quarter of 2012. That forecast remains intact, with our expectation of a 25bp cut on May 1 to be followed by a further move in June or July. It is clear to us that the case for a second cut will be strong, despite the impact of the first
cut on financial conditions," Evans said.

The RBA had previously tipped that it would await fresh inflation data before making any moves to cut the cash rate. CPI data is due 24 April, and Evans said the figures should strengthen the case for a cut.

"The prospect of a CPI print on April 24 that might delay a rate cut seems low," he said.

THA ADVISER ON LINE

Investment Activity Awakening in WA

Fri, 20 Apr 2012 01:24:00 GMT

Top brokers have said investors are returning to the WA market after a long period of inactivity.

MPA Top 100 Broker Troy Cameron of Stratique Finance in Wembley, WA, has seen investors reawaken in the Perth market after a long period of slumber.

“Investor activity from the start of 2012 with renewed interest in the Perth property market as opposed to the former focus of Queensland and Melbourne,” Cameron said.

The Real Estate Institute of Western Australia has echoed Cameron’s claims, saying it has seen a rush of investors that is only set to grow as the end of the financial year approaches.

“Many potential investors who have been waiting and watching the Perth market, in particular, following the decline in prices since 2010, now sense that it’s an opportune time to look at entering the market,” the group said.

Cameron said the rental market was the key to the surge in activity.

“Rental yields are the talk of the Perth market and are going through the roof at the moment. Renters are lining up to view properties and landlords are reaping the benefits. This is having a flow on to investor activity and confidence,” Cameron said.

Fellow MPA Top 100 Broker Darin Yacopetti agreed, and said Perth metro areas were seeing rental yields of 4.5-5%, while mining areas could yield as much as 10%.

REIWA data has borne out the claims, showing that median rents in the Perth metro area increased by 8.1% over the past year. The median weekly rent for Perth now sits at $420 per week. Vacancy rates in the city are tight as well, at 2.3%.

AUSTRALIAN BROKER ON LINE

ANZ HITS BORROWERS AGAIN

Mon, 16 Apr 2012 03:15:00 GMT

Out-of-cycle hikes are becoming the norm as ANZ has again hit homeowners with a rate increase.

ANZ announced Friday it would lift rates on its home and business loan customers by 6bps, taking its standard variable rate to 7.42%. ANZAustralia chief executive Phil Chronican tried to highlight the benefit to depositors in breaking the news.

“The funding environment changed quite dramatically in late 2011 as a result of the economic and financial crisis in Europe. This has seen wholesale funding costs rise and competition increase dramatically among banks for deposits. We accept our response to the new funding environment is difficult for some of our customers - even though deposit customers have benefited from better rates," he said.

Chronican said the bank had left rates untouched last month because it wanted to ensure higher funding costs were sustained before passing them on to borrowers.

AUSTRALIAN BROKER ONLINE

Borrowers hope for Rate Cut

Mon, 02 Apr 2012 01:10:00 GMT

While it looks all but certain that the Reserve Bank will keep the official cash rate on hold when the Board meets tomorrow, borrowers are still hoping for a 25 basis point reduction.

According to a recent Loan Market Group survey, almost 70 per cent of borrowers expected a rate cut in March – a figure that hasn’t changed in the three weeks since.

“Although some progress has been made in the European debt crisis, and many economic indicators are within target, there remain stalled sectors that would benefit from an April rate cut by the RBA,” Loan Market spokesman Paul Smith said.

“The RBA has noted that the banks no longer face the cost of funding pressures that caused them to lift their home loan rates independently of the central bank.

“So if we get a cut in the cash rate on Tuesday consumers will be hoping their lenders follow suit and pass on the reduction in full.”

THE ADVISER

Out of Cycle hikes see banks cop it from customers

Tue, 27 Mar 2012 02:21:00 GMT

Major banks have copped it from customers following February's rate hikes.

Roy Morgan Research's monthly banking satisfaction survey has indicated banks saw their first decline in customer satisfaction since March 2011, and out-of-cycle movements following February's RBA rate hold were the culprit. Communications director Norman Morris said holding the dubious position of first mover has proven to bring the most customer heat.

"On this occasion it was the ANZ who increased their home loan rate first and as a result their home loan customers showed the largest drop in satisfaction among the home loan customers of the big four. This was despite the fact that the increase in the ANZ rate was the lowest of the big four. It is worth noting that Westpac were the next to announce their home loan rate increase and as a result they also showed a significant drop in the satisfaction level of their home loan customers," Morris said.

NAB recorded the largest drop in overall satisfaction, but Morris said this was due to a decline in satisfaction among non-home loan customers. The bank's home loan customer satisfaction rating remained "virtually unchanged", Morris said.

"This may have something to do with the fact that they were the last of the big four to announce an increase in their home loan rate," he said.

The banks have still managed to hold onto the overall satisfaction gains they clawed back over the year. NAB remains in first place, with 78.7% satisfaction, up 6.5% since February 2011. ANZ held onto its second spot at 77.9% satisfaction, with CBA coming third at 77.3% and Westpac at the bottom of the pile with 75.8%.

NAB gained the most traction in overall satisfaction over the year, whileCBA saw the greatest increase in satisfaction among its home loan customers, improving 9.2%.

Smaller banks continued to outdo the majors in the estimation of their customers. Heritage Bank was the top performer, with 91.9% satisfaction, while ING Direct rated 90% satisfaction and Bendigo Bank saw an 89.8% satisfaction rating.

AUSTRALIAN BROKER

2012 FBT TIME AGAIN

Mon, 26 Mar 2012 02:26:00 GMT

With the end of the 2012 FBT year almost upon us, now is a good time to start thinking about preparing your FBT return.

This alert will assist you prepare for the FBT season and help with compliance.

FBT - CARS

1. Ensure you have records of vehicle odometer readings at the start of the FBT year (i.e. April) and at the end of the FBT year (i.e. 31 March). Without odometer readings, under the Statutory Formula Method, it is assumed the car travelled less than 15,000 kms which means maximum FBT is payable on the car.

2. Under the Statutory Method if you have cars that have travelled significantly varying kms in the FBT year, consider reallocating those cars to take advantage of the FBT calculation concessions. In other words, if you have cars that have travelled less than 15,000 kms, either increase the travel in those cars for the last few weeks of the FBT year or allocate them to users who are on the road more. Be aware of cars on the edge of thresholds as a few extra kilometers can result in considerable savings.

3. Under the statutory method, cars acquired after 7.30pm AEST on 10 May 2011, or if the finance commitments changed for existing cars after this date, will have a new statutory percentage rate.

The rate will be phased in over 4 years so from 1 April 2014 cars will attract a flat rate of 20%. You should keep details on record showing the date of acquisition or when the finance commitments changed to ensure FBT is calculated correctly.

4. Shared cars (i.e. used by more than one employee for private use during the FBT year) are not considered to be Reportable Fringe Benefits and the taxable value is not included on the PAYG Summary. The Reportable Fringe Benefits is taken into account when applying the following relevant income tests to determine entitlement to claim or pay:

Deductions for personal superannuation contributions
Medicare Levy Surcharge
Child Support
Certain Centrelink payments
The new Flood Levy

5. Voluntary employee contributions can reduce or eliminate a FBT liability. Employee contributions can take the form of a cash payment or car expenses personally contributed by the employee.

Examples of "car expenses" eligible as employee contributions are as follows:

Petrol and oil
Car Servicing
Insurance excesses on motor vehicle claims
Car repairs
Car washes
Car registration
Car air fresheners and deodorisers

Car wax and leather protection products

COMPLIMENTS YHY HAINES NORTON

NERVOUS BORROWERS LOOKING TO LOCK IN RATE

Tue, 20 Mar 2012 01:49:00 GMT

Wary borrowers are locking in their rates as the gulf between the banks and the RBA widens.

A Loan Market poll has asked borrowers if they will consider fixing their rate given recent decisions by the RBA and the ensuing rate changes by lenders. The survey found 60% of respondents were considering a fixed rate.

The poll indicated 46% of respondents were definitely looking to fix their home loan rate, while 14% said they would consider fixing part of their loan. Thirty-six per cent said they would eschew fixed rates altogether.

A Loan Market spokesman said out-of-cycle moves by the banks have left consumers shaken.

"The banks acting independently of the RBA and lifting their variable rates has caused quite a bit of concern and confusion among consumers. Home loan customers are uncertain about the direction rates are heading while the RBA has left the cash rate at 4.25%, yet the banks increased their variable rates by modest amounts," he said.

The spokesperson commented that the combination of attractive fixed rates and ongoing uncertainty over the European debt crisis could cause borrowers to flock to fixed rate products.

AUSTRALIAN BROKER NEWS

Reduction in company tax rate

Fri, 16 Mar 2012 10:11:00 GMT

This week the Federal Treasurer, Wayne Swan, released draft legislation to cut company tax to help Australian businesses right across the economy - including the many businesses that are not in the mining boom fast lane and face challenges such as those flowing from a higher dollar.

The draft legislation cuts the company tax rate for all companies from 30 per cent to 29 per cent for the 2013‑14 income year and subsequent income years.

The Government recognises that many small businesses (with turnover of less than $2 million) are under extra pressure and so the draft legislation provides a head-start for small business, with the 29 per cent rate applying from 2012‑13.

The Government have announced the cut in the company tax rate should increase productivity, promote broad-based economic growth and encourage more investment and jobs across Australia's entire economy.

The reduction in the company tax rate is funded by super-profitable mining companies through the Minerals Resource Rent Tax.

UHY Haines Norton: Bean Thinking...Company Tax

CBA takes ASIC medicine over credit limit bungle

Thu, 08 Mar 2012 04:01:00 GMT

COMMONWEALTH BANK has copped a slap on the wrist from ASIC for misleading customers about credit cards.

The bank accepted an enforceable undertaking from ASIC for sending misleading messages to internet banking customers between 12 and 13 December last year, in the wake of NCCP rules regarding credit limits.

New regulations commencing 1 July restrict card issuers from sending out unsolicited invitations for customers to increase their credit limit, unless a customer has consented. In informing its customers of the new laws, CBAsent messages suggesting that if customers did not urgently consent to receiving credit limit increase offers, they could miss out on the chance to access extra funds and wouldn't be able to receive credit limit increase offers in the future.

ASIC dubbed the messages misleading, because customers can request a credit limit increase at any time, and can provide or withdraw consent for unsolicited credit offers at any time.

ASIC said CBA immediately withdrew the message after ASIC raised its concerns. In addition, the bank agreed not to rely on any consents obtained from customers between 12 and 13 December, and said it would contact customers who consented to correct "any misleading impression" and properly inform them of their rights.

ASIC commissioner Peter Kell claimed the result as a win for the watchdog.

"This enforceable undertaking demonstrates that ASIC will act quickly to ensure that consumers are in a position to make an informed decision under the new law and to prevent the risk of consumer decision making being compromised by misleading impressions of urgency or of a loss of rights," he said.

AUSTRALIAN BROKER NEWS

Investors advised to buy now

Wed, 29 Feb 2012 01:28:00 GMT

Australians that are happy to put their money into property for the long term, are being advised to buy now.

Housing Industry Association chief economist Harley Dale said investors with adequate savings would do well to invest in property as it is a real “buyer’s market” at the moment.

“Now is definitely a good time to get into the market,” he said.

“There is a lot of competition between vendors at the moment, which is putting the bargaining power firmly in the hands of the buyer.

“On top of that, the interest rate environment is very kind, thanks to the 50 basis point rate reduction we saw at the end of last year.

“So, if you have the funds to make a financially responsible decision to buy property, then now is definitely a good time to buy.”

Of course, Mr Dale warned any investors entering the property market to bide their time before selling.

“We are not seeing the yields we saw 10 years ago. In many instances, this makes the buying environment even better. But, if you want to see a return on your investment, you have to be in it for the long haul.”

THE ADVISER