Accounting News & Blog


There is so much to understand about Cryptocurrency. Even financial industry experts like us here at Rowe Partners can find it challenging. It’s so complex when compared to the simplicity of cash. Now before you read on, let’s give this warning right from the outset. Prior to investing in any digital assets, be sure to seek specialist advice and trade only through a reputable currency exchange. We can certainly help you work out the tax implications of your investment decisions but the decision to invest in Cryptocurrency in the first place, must be entirely yours and based on a thorough examination of the risks and opportunities.


So, what is Cryptocurrency? Cryptocurrency is a virtual currency that exists only in digital form (digital asset) distributed across many computers, secured by a type of encryption or coding known as cryptography. This process protects the currency, making it almost impossible to counterfeit. This combined with limited releases enables it to hold value. There are several types, the most common being Bitcoin. There are only 21 million Bitcoins in existence. As of February 24, 2021, there were only 2.363 million to be circulated. At the time of writing, 1 Bitcoin is valued at $65,253.98 AUD! Some are tipping that by 2030, one Bitcoin could be worth as much as $500,000. A M A Z I N G! Other cryptocurrencies include Bitcoin Cash, Litecoin, Ethereum, Ripple, Stellar, NEO and Cardano.


Cryptocurrency sits outside traditional, centralised financial authorities which theoretically protects this type of currency from interference or manipulation by governments. To go into more detail than this here would not be useful. We’re not providing financial advice through our blogs, simply discussing interesting subjects and current affairs. Investment decisions must be fully considered and based on specialist, tailored advice. If you’re actively investing or seeking to invest in cryptocurrency, you’re probably already (or should be) across more of the detail.


Rowe Partners recommendation is always that investors should have a thorough understanding of any investment product; it’s risks and potential rewards as well as it’s capacity to deliver on their financial objectives before parting with any of their hard-earned! The wild, daily fluctuations in price of cryptocurrencies should be enough to put all but the most mega rich adrenaline seeking and tech savvy investors off. It’s volatile, high risk and often attracts dodgy fraudsters and scammers. It’s also known to be commonly traded through the dark web by computer hackers, money launderers, terrorist groups and other criminals. Cryptocurrency exchanges are also prone to hacks. The stories of investors scammed and burned are many and increasing. The ACCC warns that Australians are losing more and more money to Ponzi Schemes using Cryptocurrency. Read more here;

Another consideration is the protection of digital assets. Safe storage of digital assets is challenging but its portability and difficulty to trace also makes it easy for those inclined, to steal it or hide money from government agencies. Ultimately, cryptocurrency’s value as a long-term asset will depend on perceived scarcity, safety and wide scale adoption by ordinary people.


Despite the risks, over the last few years, investing in cryptocurrency has been gaining traction with ordinary people seeing it as an investment opportunity with the potential to make fast money i.e., as an investment. More and more businesses now also accepting Bitcoin as a form of payment for Goods and Services. It's circulating.


Tesla’s Elon Musk recently purchased $1.5 Billion (US) of Bitcoin and now plans to allow people to buy their products using it. This decision caused a bit of a buying frenzy and a temporary surge in value. It’s worth noting the company’s stock price dropped 30% soon after and he’s tipped to make a significant loss. Musk has attracted flack for this decision too with many seeing the purchase as a gamble. Bottom line is that he is a high roller and can personally afford to play at the table. However, Tesla shareholders might not like the fact that he’s been playing with their money.


Interestingly too, a share investing service that Chad McKnight has followed for 7 Years recently invested some of their own money in it. On the surface of it, cryptocurrency seems to be gaining legitimacy in investment circles so Chad’s wondering if it’s time he changed his view on Bitcoin. So far though, he’s not been prepared to take the risk.


Tax Implications


In the last few weeks, Chad has had 2 clients ask about Bitcoin and about the tax implications on the sale. The bottom line is that if you make a capital gain on the sale of a Bitcoin or other cryptocurrency investment, the Australian Government requires you to pay Capital Gains Tax (CGT) on it.


Bitcoin is like any other investment and any gains you make on it will be taxable. If you’re a business buying and selling goods in Bitcoin well you will just pay tax on it as ordinary income just like you would if you were trading in cash. If you are buying it and holding it to sell at some future point in time you will have a capital gain and capital gains tax maybe payable. CGT is quite complex and even more so when dealing with cryptocurrency so it's best do your homework and talk to your accountant and financial advisor prior to investing.


A quick search on the ATO’s website outlines under what circumstances a CGT event occurs when dealing with cryptocurrency. A disposal can occur when you:

  • sell or gift Cryptocurrency.

  • trade or exchange cryptocurrency (including the disposal of one cryptocurrency for another cryptocurrency)

  • convert cryptocurrency to fiat currency (a currency established by government regulation or law ), such as Australian dollars, or

  • use cryptocurrency to obtain goods or services.

As with any capital assets the rules are quite complex and sometimes the timing of when you trigger a capital gain can be important. Delaying a sale by as little as 1 day could reduce the CGT by half.


View the ATO website information here https://www.ato.gov.au/general/gen/tax-treatment-of-crypto-currencies-in-australia---specifically-bitcoin


If you do have Cryptocurrency and are unsure about the taxation consequences, call one of our accountants today on 1800 04 7693.

So, you’ve been put off SMSF? True, there have been some horror stories in the past and as an investment strategy SMSFs are certainly not for everyone but we think it’s worth revisiting for a few reasons - the laws pertaining to financial planning advice are much tighter and more controlled now than ever, for many investors SMSF can provide excellent benefits compared to APRA regulated Superannuation Funds and new research shows that cost is likely to be less than you think.


Prior to the changes in government regulations for SMSF Advisors, accountants at Rowe Partners Accountants & Business Advisors helped many clients set up their own SMSF assisting with paperwork and fund administration to ensure they remained compliant with the ATO and looked after their retirement savings. Today, our Rowe Partners Financial Planning business takes on much of that work.


The key with SMSF and for any investment strategy for that matter, is to ensure you get comprehensive advice and consider the pros and cons before making a move. Rowe Partners can help you determine likely costs, assess your level of financial expertise as required to self-manage your investments and assess if you’ve got the time required to build and manage your portfolio so that it's profitable and will deliver on expectations. So, speaking with your accountant at Rowe Partners Accountants & Business Advisors is the perfect starting point. In the meantime, let's answer a couple of general queries you may have.


Why should I care what happens to my super?

If you’re a homeowner, besides your house, your super is likely the most valuable financial asset you own. If you’ve been in the workforce for some time but don’t own a property, it’s quite possibly the only significant asset you own. At some point in your life, you will need to rely on these savings to support you in retirement. It’s important to protect it! It’s also important to leverage it to improve your financial position over time so that when you need it, you have significant accumulated financial resources to draw on. This can be done in many ways such as shares, property, resources, managed employer superannuation funds, even investing in precious gems and metals but today we’re talking about SMSF.


Is SMSF risky?

Any investment strategy presents risk. The key is to be aware of the risks and manage for them. Today, SMSF is safer than ever due to increased scrutiny by regulators. We’ve always adopted a professional and ethical approach to SMSF advice but in the pre-regulation environment, it was not uncommon for investors to lose money at the hands of unscrupulous, unqualified operators encouraging people to use SMSF as a way (illegally) to access secured superannuation funds and invest in property they themselves had personal interest in. Values and returns were frequently overstated and, in some cases, properties never even existed. People were being duped out of valuable retirement savings and so it was necessary for the Government to step in and tighten things up.


Can I set up my own SMSF?

The short answer is yes. The better answer is unless you’re very financially astute, you probably shouldn’t. There are many legal requirements on SMSF Directors for the fund to be compliant and remain so. Failure to comply attracts significant penalties and not investing adequate time and effort to research, plan and implement your investment strategy could potentially lead to administrative oversights, poor investment choices and even lower returns. Let us help you get it right.


How much money do you need to start an SMSF?

This is a question that we are asked very often. New research has been released showing the true costs of running an SMSF. It has been shown to be less than first thought. For several years regulators maintained that the minimum amount needed to set up a viable SMSF is $200,000. Under the right circumstances, it’s possible to set up an SMSF quite early and with funds enough cover initial setup costs. The research highlights that SMSFs with a low complexity can begin to become cost-effective at $100,000.


The findings of the research allow SMSF trustees and potential SMSF trustees to compare appropriate estimates of fees for differing SMSF balances with institutional superannuation funds (commonly referred to as APRA regulated funds). This helps significantly to guide decision making and in determining both the viability and likely performance of an SMSF. The costs include establishment, annual compliance costs, statutory fees and some investment management fees. Direct investment fees have been excluded.


What does the research tell us?


  • SMSFs with $100,000 to $150,000 are competitive with APRA regulated funds (SMSFs of this size can be competitive provided the Trustees use one of the cheaper service providers or undertake some of the administration themselves).

  • SMSFs with $200,000 to $500,000s are competitive with APRA regulated funds even for full administration. (SMSFs above $250,000 become a competitive alternative provided the Trustees undertake some of the administration, or, if seeking full administration, choose one of the cheaper services).

  • SMSFs with $500,000 or more are generally the cheapest alternative regardless of the administrative options taken. (For SMSFs with only accumulation accounts, the fees at all complexity levels are lower than the lowest fees of APRA regulated funds).

This research highlights that SMSFs with a low complexity can begin to become cost-effective at $100,000. This is a significant departure from what many had believed to be the case. For simple funds, $200,000 is a point where SMSFs can become cost-competitive with APRA regulated funds or even cheaper if a low-cost admin provider is used. With the proposed expansion to six-member SMSFs, we may see many more take up this option at this threshold.


Comparing 2 member funds

From a cost perspective, the real benefit of an SMSF is when it achieves scale in balance and this can occur when members pool their superannuation savings. The below comparison can be used to grasp the ranges you might fall into.



Always remember, cost is not the only consideration.

When determining whether an SMSF is right for you, your analysis must go further than just a simple comparison of the costs versus APRA Regulated Funds. It should also factor in your retirement and income goals and whether you have the desire, time, and expertise to take on the role of an SMSF trustee. It’s also worth factoring in SMSF members may not receive the same level of protection in the event of theft or fraud that members in APRA regulated funds do.


How can we help?

If you would like to discuss whether an SMSF is right for you, please feel free to give Chad, Patrick or Robert a call on 1800 04 7693. Alternatively, you can refer to the SMSF Association’s trustee education platform, SMSF Connect.

The ATO is increasing pressure on employers to comply with obligations and make Super Guarantee payments on time, every time. You need to be aware of your obligations and put systems in place to ensure you remain compliant.

Innocent oversights (that can happen all too easily when people get busy) will attract the same penalties as deliberate non-compliance so it's better to be safe than sorry. In future, there will be little leeway for businesses failing to make required payments by the due date and you could face hefty fines for failure to comply. So please note carefully that; The ATO website states "if you don't pay the minimum amount of super guarantee (SG) for your employee (s) into the correct fund by the due date you may have to pay the super guarantee charge (SGC) which is not tax-deductible." The charge is made up of shortfall amounts, interest (currently 10%) and an administration fee of $20 per employee, per quarter." Why risk paying late fees, charges and super payments not being deductible when you can be on time every time? Engage Rowe Partners today to handle all your business bookkeeping needs for you. By engaging us as your outsourced business bookkeeping and payroll service provider, you can have greater peace of mind knowing your obligations to staff and the ATO are met and you can reclaim precious time in your day to do other, more enjoyable things. Rowe Partners ensure all your staff Super payments are made and reports completed on time keeping you in the ATO good books. Our rates are affordable and our team is always there to support. They will have you up and running in no time flat and meeting all your Super deadlines. The systems, support and processes we set up for you are tailored to suit your specific circumstances.

Call 1800 04 7693 today!

When you call, ask us about our range of service options for;

  • Fully outsourced business bookkeeping services - affordable red carpet treatment!

  • Pain-free payroll with expert support.

  • Cloud-based tech solutions to integrate with Xero for a super sleek, efficient system.

  • New business set up and systems to make sure you're fully compliant from day one.

Level 1, 4 Smart Rd

PO Box 570

Modbury SA 5092

33 Florence St

PO Box 639
Port Pirie SA 5540

8 Church St

PO Box 2247
Port Augusta SA 5700

Murray Bridge

Ground floor, 30 Seventh St

C/- PO Box 570
Modbury SA 5092

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Rowe Partners Pty Ltd (ACN 105 365 688) as an agent for Rowe Partners Partnership (ABN 65 250 711 759). Directors: R P McDonald FCPA, C R McKnight FCPA, P J Connolly MIPA, F B Cammarano AIPA, M R Nutt CPA. Liability limited by a scheme approved under Professional Standards Legislation other than for the acts or omissions of financial services licensees.

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