Under Div 7A of the ITAA 1936, certain amounts paid, lent or forgiven by a private company to shareholders or their associates may be treated as being a deemed dividend for tax purposes, subject to some exclusions. However, the Commissioner has a discretion to disregard this outcome if the deemed dividend arises as a result of an honest…
On 31 October 2014, the ATO released ATO ID 2014/32 – Is a term deposit a qualifying forex account? [FJM note: “No”. A term deposit is not a qualifying forex account for the purposes of Division 775 of the ITAA 1997. A ‘qualifying forex account’ means an account that is denominated in a particular foreign currency and…
The ATO on Wed 26.11.2014, released the following Class Rulings: CR 2014/94: FBT: employers of employees who take out a health insurance policy under a Health Link Consultants Employee Health Plan; CR 2014/95: Lend Lease Corporation Limited Capital Reallocation; and CR 2014/96: Multiplex Development and Opportunity Fund – Return of capital. The ATO also issued…
The ATO on Wed 19.11.2014, issued the following Class Rulings: CR 2014/92: Expiry of sub-leases: RQYS Nominees Pty Limited as trustee for the RQYS New Marina Trust; and CR 2014/93: Research and development: membership funding for the Australian Coal Association Research Program. The ATO also issued an Addendum to PR 2008/11 (AIL Almond Grower Project…
The ATO on Wed 12.11.2014, issued the following Class Ruling and Product Ruling: CR 2014/91: Scrip-for-scrip roll-over: acquisition of units in Federation Centres Trust No 2 and Federation Centres Trust No 3 by Federation Centres Trust No 1; and PR 2014/18: AgriWealth 2015 Softwood Timber Project. [LTN 219, 12/11/14]
The ATO on Wed 12.11.2014, released Draft Taxation Determination TD 2014/D19 which states that the “interest” referred to in the phase at the end of s 974-80(2) of the ITAA 1997 is the interest held by the “ultimate recipient” and not the interest held by the “connected entity”. DATE OF EFFECT: When the final Determination is…
The ATO on Wed 12.11.2014, released Draft Taxation Determination TD 2014/D18 which states that the fact that a non-resident entity has decided to invest indirectly in an Australian resident company through one or more interposed entities and the final leg in the chain is a debt interest will not of itself be sufficient to form…
The ATO on Wed 5.11.2014, issued an Addendum to Taxation Ruling TR 2005/7 (The taxation implications of “partnership salary” agreements). It amends the Ruling to include the taxation consequences of a partner’s salary where the partnership is a corporate limited partnership. As a consequence, the ATO has also withdrawn ATO ID 2002/564 (Partner Salary in…
The ATO on Wed 12.11.2014, issued Taxation Ruling TR 2014/6, which provides the Commissioner’s views on the application of s 815-130 of the ITAA 1997 regarding the relevance of actual commercial or financial relations to the identification of conditions relevant to ascertaining whether an entity gets a transfer pricing benefit from the actual conditions, which operate…
The ATO on Wed 26.11.2014, released Decision Impact Statements on the following cases: AAT Case [2013] AATA 920, Re Gleeson and FCT – In this case, the AAT allowed a truck driver’s claims for unsubstantiated food and drink expenses that were claimed on the basis of the Commissioner’s daily rates. The ATO said the decision…