TR 2018/6 – Trust vesting – taxation effects: too late to extend after vesting; no E1 event (resolved interests not new trusts); no E5 event until beneficiaries entitled to particular assets

On Wed 15.8.18, the ATO issued Taxation Ruling TR 2018/6, in final form, on the tax consequences of vesting a trust. These views are the same as those contained in Draft TR 2017/D10, although the final ruling includes some fine-tuning. Overview of vesting A trust’s “vesting” or “termination” date, can be the same date but…

Multilateral Instrument (MLI) – OECD BEPS Measure 15 – A round up of relevant international choices and resulting effects – at time legislation introduced into the Australian Parliament

  By Pointon Partners – June 21, 2018 [FJM 22.7.2018] A Bill to enact the OECD BEPS Measure 15 – the Multilateral Instrument (MLI), in Australia: the Treasury Laws Amendment (OECD Multilateral Instrument) Bill 2018,  was introduced into our Lower House, on 28 March 2018. At that time the Government hoped that it would become law before the…

ASIC approved SMSF auditors – ATO identifies problem areas: (1) auditing your own accounts; (2) auditing relatives’ funds; (3) low cost audits; (4) CPD compliance

On 26 Feb 2018, the ATO updated their page ‘ ASIC approved auditors of SMSFs (Self Managed Superannuation Funds) which are by far, the greatest number of funds, and which hold a very substantial share of the overall pool of superannuation assets. Approved SMSF auditors do have a critical role in maintaining the health and…

DIS – Cable & Wireless Australia & Pacific Holding BV (in liquidatie) v CofT – ATO accepts FFC decision that the $6.2b Optus buy-back amount was a ‘dividend’ correctly giving rise to the $452m withholding tax

The ATO has issued a Decision Impact Statement on the Full Federal Court decision in Cable & Wireless Australia & Pacific Holding BV (in liquidatie) v FCT [2017] FCAFC 71, which held that an off-market share buy back receipt was a ‘dividend’ to the overseas recipient and that and the withholding tax paid was correctly paid…

SMSF $1.6m ‘transfer balance cap’ reporting – when pre & post 1 July 2017 events and pre-existing income streams must be reported – ATO guidance

Following our announcement on 9 November 2017 on when self-managed super funds (SMSFs) need to report events affecting their members’ transfer balance, we have developed this article you can use as a quick reference guide. The ATO put out this guidance on 5 Dec 2017. Events you need to report You only need to report events…

Carr v CofT – Federal Court refuses to remit the AAT decision on Default Assessments back to the AAT (taxpayer hopelessly unprepared in the AAT)

The Federal Court has dismissed a taxpayer’s claim to have a default assessment matter remitted to the AAT for rehearing. In April 2012, the Commissioner issued default assessments under s167 of the ITAA 1936 to the taxpayer based on his failure to lodge returns in respect of the 2003, 2004, 2005 and 2006 income years. In total,…

VPRX v CofT – Agreement to sell domain name with website, produced a stream of receipts, detected by AUSTRAC, and assessed as income under an associated ‘revenue share agreement’ with 75% penalty

The AAT has held that regular international payments received by a taxpayer in relation to the sale of a website domain name were ordinary income and not capital. The Applicant, who is a resident of Australia, created a domain name and website in 2006 (“the domain name”). The website generated revenue through Google Advertising. In…

News Australia Holdings Pty Ltd v FCT – interest income not yet paid was still held to have been ‘derived’ during the year as this was the correct ‘reflex’ of income for that year

The Federal Court has held that an accruals basis of accounting for the interest accruing to a company (SRC Holdings Limited, which was owned by News Limited) provided the correct reflex of the company’s true income and that the taxpayer applicant in the case (News Australia Holdings Pty Ltd) was to be assessed on SRC’s…

CPI: March quarter 2014 indexation factor for FBT purposes – running at 2.9% to the year ended 31 March 2014 [41]

The CPI indexation factor, which is used for FBT purposes concerning remote area benefits (under ss 60 and 60AA of the FBTAA), for the March quarter 2014 increased 0.6 from the December 2013 quarter to 105.4. The Australian Bureau of Statistics (ABS) said inflation was running at 2.9% through the year to 31 March 2014 (up from 2.7% through the year…