Monthly Archives: August 2016

SMSFs – diverting income to a ‘personal services entity’ which then distributes profit to the super fund – TA 2016/6 administrative follow up – penalty remission if volunteer before 31 January 2017

The ATO says that it is currently reviewing arrangements where individuals (at or approaching retirement age) purport to divert personal services income to a self-managed superannuation fund (SMSF) to minimise or avoid income tax obligations as described in TA 2016/6 Diverting personal services income to self-managed superannuation funds. Under these arrangements an individual performs services for a client.…

NT Duty – Budget Bill: Stamp Duty Amendment (First Home Owner Discount) Bill 2016 – receives Assent giving a 50% duty discount (capped at $10k) for first home buyers

The Stamp Duty Amendment (First Home Owner Discount) Bill 2016 (NT) on 13 July 2016 received Assent as Act No 31 of 2016. It had passed all stages of the NT Parliament without amendment and implements the NT Budget 2016-17 proposal to introduce a 50% stamp duty discount for first home buyers on the purchase of an established home.…

FCT v Seymour – taxpayers not permitted to give their evidence by video link – High Court refused them leave to appeal

The High Court has refused taxpayers special leave to appeal against the decision in Seymour v FCT [2016] FCAFC 18. The Full Federal Court had by majority (Pagone J dissenting) dismissed a husband and wife taxpayers’ appeal from the 7 April 2015 decision of Buchanan J (in FCT v Seymour [2015] FCA 320) that had set aside an order made by the AAT which had…

Re Hill and FCT – Deductions for car and travel expenses refused; not an itinerant worker

A taxpayer has been unsuccessful before the AAT in relation to deduction claims for work-related car expenses and for work-related travel expenses (ie meals and accommodation) for the 2011-12 income tax year. The taxpayer contended he was entitled to the deductions under s 8-1 of the ITAA 1997 on the basis that he was an itinerant…

$500,000 lifetime cap on non-concessional super contributions – legislation currently being developed (per ATO website)

In the 2016-17 Federal Budget, the Government announced that from 7:30pm (AEST) on 3 May 2016, there will be a lifetime cap of $500,000 on non-concessional superannuation contributions. The cap will take into account all non-concessional contributions made on or after 1 July 2007. The ATO says the lifetime cap will be indexed to the Average Weekly Ordinary Time…

CR 2016/54 Income tax: AMP Capital Infrastructure Equity Fund – Unit trust (for non-controlling interests in infrastructure assets) creates a new unit trust (for controlling interests) and ‘staples’ the units together

On Wed 20.7.2016, the ATO issued the following Class Ruling: CR 2016/54: AMP Capital Infrastructure Equity Fund – creating a new stapled security.It applies from 1 July 2015 to 30 June 2016. [LTN 138, 20/7/16] [Link to income tax law – Income Tax Assessment Act 1997; Income Tax Assessment Act 1936] Subdivision 126-G of the ITAA97 126-220   Object of this Subdivision The object…

CR 2016/53: tax consequences for shareholders in APN News & Media Limited of demerger of NZME Limited

On Wed 20.7.2016, the ATO issued the following Class Ruling: CR 2016/53: APN News & Media Limited – demerger of NZME Limited. It applies from 1 July 2015 to 30 June 2016. LTN 138, 20/7/16] [Link to income tax law – Income Tax Assessment Act 1997; Income Tax Assessment Act 1936]   Extract from Class Ruling Class of entities 3. The class of entities to…

CR 2016/35 – Westpac Tier 1 capital – tax effect of holding non-cumulative, convertible, transferable, redeemable, subordinated, perpetual, unsecured notes (Westpac Capital Notes 4)

On Wed 20.7.2016 issued the following Class Ruling: CR 2016/52: Westpac Banking Corporation – Westpac Capital Notes 4 (‘WCN 4‘). It applies from the income year ended 30 June 2016 until the end of the term of the Capital Notes 4. [LTN 138, 20/7/16] [Link to income tax law – Income Tax Assessment Act 1997; Income Tax Assessment Act 1936] Extract…

DCT v Anglo American Investments Pty Ltd & Ors – Commissioner succeeds in recovering debt under ‘conclusivity’ provisions – no “conscious maladministration” as required in Denlay

The NSW Supreme Court has granted a Deputy Commissioner’s application to strike out amended defences of various taxpayers and enter judgment for the Commissioner for debt recovery action in relation to the issuing of amended assessments to them in connection with their tax affairs, which also involved the Commissioner obtaining information from the Cayman Islands.…

DCT v Fitzgerald – director’s DPN liability for company’s failure to remit $2m of PAYG withheld from salary and wages – deemed service was valid and no defence could be made out

On Thursday 14.7.2016, the NSW Supreme Court gave a judgment in favour of a Deputy Commissioner for a director’s penalty notice (DPN) in the sum of $1,965,485, which was the amount the company deducted from employees salary and wages (PAYG withholding) and failed to remit to the Commissioner. The Commissioner has the power though, to recover the…