Blank v FCT – taxpayer seeks leave to appeal to High Court – USD160m paid under ‘profit participation scheme’ held to be ordinary income

Tax Month 2016-01

The taxpayer has applied for special leave to appeal to the High Court against the decision in Blank v FCT [2015] FCAFC 154. In a majority decision, the Full Federal Court dismissed the taxpayer’s appeal and confirmed that payments of US$160m he received in instalments following his termination from a company was assessable to him as…

PFGG v FCT – taxpayer appeals decision that it was not entitled to ‘small business CGT relief’ because it was not a ‘small business entity’

Tax Month 2016-01

The taxpayer has appealed to the Federal Court against the decision in Re PFGG and FCT [2015] AATA 972. In that decision, the AAT confirmed that the taxpayer involved in the mining industry which made a capital gain of $5.4m from the sale of Western Australia mining tenements was not eligible for the CGT small…

Australian Building Systems Pty Ltd (In Liquidation) case – no s254(1)(d) retention obligation and no preference for Commissioner

Tax Month 2016-01

In the cases of Commissioner of Taxation v. Australian Building Systems Pty Ltd (In Liquidation) and Commissioner of Taxation v. Ginette Dawn Muller and Joanne Emily Dunn as Liquidators of Australian Building Systems Pty Ltd [2015] HCA 48, the High Court held (3-2 on 10 Dec 2015) that s254(1)(d), of the ITAA 36, did not…

TR 2014/D1 on tax consequences of Employee Share Schemes operating outside the statutory regime – ‘Discussion Paper’ for further draft ruling

Tax Month 2016-01

The Commissioner has issued a ‘Discussion Paper’ to assist in drawing a second draft of TR 2014/D1 Income tax: employee remuneration trusts was published on 5 March 2014. Comments are sought be 12 February 2016. This draft sought to explain, in a preliminary way, the Commissioner’s views on the taxation consequences for employers, trustees and…

CR 2016/6 – Swinburne University Academic Staff Voluntary Early Retirement Scheme 2015-16 is a s83-180 early retirement scheme

Tax Month 2016-01

On Wed 27.1.2016, the ATO issued Class Ruling CR 2016/6 (the Swinburne University Academic Staff Voluntary Early Retirement Scheme 2015-16). The Class Ruling provides that the Swinburne University Academic Staff Voluntary Early Retirement Scheme 2015-16 is an early retirement scheme for the purposes of s 83-180 of the ITAA 1997. It applies from Wed 27.1.2016 to…

Draft Practice Statement on retrospective ‘transfer Pricing Penalties’ put on hold pending review of Chevron Case – no separate taxing power in DTA’s

Tax Month 2016-01

On 20 January 2016, the ATO put the following advice on it’s website about LAPS 3687. Publication of the LAPS has been put ‘on hold’ due to the Federal Court’s decision on the Chevron case dated 23 Oct 2015. The court rejected the Commissioner’s view that tax treaties can be relied on, independently of the…

General anti-avoidance Practice Statement – release of reviewed PS LA 2005/24 delayed by further consultation

Tax Month 2016-01

There have been significant changes to Part IVA since the original PS LA 2005/24 was drafted. The PS LA is being updated to reflect relevant court decisions and provide guidance on the amended legislation. The publication of PS LA 2005/24 is temporarily on-hold to allow for additional external consultation to take place. Refer to Matters…