Find Accountancy, Audit and Tax expertise in Australia
- Overview
- Profession
- Tax
Overview
Australia is home to many accounting firms, especially in Canberra and Sydney including those from popular international accounting networks and firms. Leading native accountancy firms include Kennas Chartered Accountants, Horwath Australia, Alan Morse and Co. Chartered Accountants, Felsers Corporate, Moore Stephens Priestley and Morris, William Cosson and Co, Sothertons Chartered Accountants and Ferrier Hodgson Chartered Accountants. Accountancy must be transparent, as per the Corporate Law Economic Reform Program (Audit Reform & Corporate Disclosure) Act 2004, the Australian equivalent to the United States’ Sarbanes-Oxley Act. The governmental organization responsible for monitoring and regulating the accounting industry is the Australian Accounting Standards Board. The Board has issued Australian equivalents to the International Financial Reporting Standards (IFRS), which replaced previously accepted Australian accountancy principles in 2005. In doing so, Australia was amongst the pioneers in the developed world in adopting IFRS for domestic purposes. In the World Economic Forum’s Global Competitiveness Report (2012-13) Australia ranked in a very prominent 8th place in the world (out of 144 countries) in relation to the strength of its auditing and reporting standards. In the 2011 World Bank’s Ease of Doing Business Index it placed 17th in the world (out of 183 countries) in relation to resolving insolvency.
Profession
Australia has three main accountancy bodies – the Institute of Chartered Accountants (around 50,000 members), Certified Practicing Accountants Australia (around 100,000 members with a quarter working overseas) and the National Institute of Accountants (around 14,000 members). The main professional body is the Institute of Chartered Accountants in Australia, which provides an education in accounting and related jobs that is highly recognised by the industry professionals. To become a member of the Institute of Chartered Accountants Australia, an individual needs to have successfully completed the Chartered Accountants program and three years practical experience. The program incorporates postgraduate teaching with practical work experience and mentoring by an experienced Chartered Accountant. To be accepted to train one must have a degree level qualification, either in accounting, or in another subject followed by an institute accredited conversion course.
Tax
There is a flat 30% company tax rate, regardless of industry, but dividends are not double taxed. Capital gains tax is at 20% of net income, but if an asset is held for a year or more, the asset acquires a 50% discount for individuals or 33.3% discount for superannuation funds. Financial statements must be prepared annually and submitted to the Department of Finance and Deregulation. Australia operates a progressive income tax scale, with four different levels, sliding from 19% for incomes over $18,201 to 45% for incomes over $180,001 (2012-13). The sales tax or VAT rate stands at 10% (2012). In July 2012 a carbon price was introduced by the Federal government, taxing selected fossil fuels. The revenue of this was partly used to reduce income tax by increasing the tax-free threshold. In the 2011 World Bank Ease of Doing Business Index Australia came 53rd in the world for paying taxes, placing it significantly below Canada, the United Kingdom and New Zealand. In the Global Competitiveness Report Australia came 106th in the world (out of 144 countries) with a total tax rate of 47.7%, compared to the higher-ranked United States in 103rd place with a value of 46.7% and the United Kingdom in 67th place with a value of 37.3%.
