TD 2017/20 – Family Trust Distribution Tax: extended definition of ‘distribute’ is not limited to beneficiaries but will exclude ordinary business transactions on arm’s length terms

Tax Month - November 2017

The ATO issued TD 2017/20 on Wed 15.11.2017. It contains guidance on, when family trust distribution tax is payable under Div 271 of the ITAA36. This arises when trustee of a trust, that has made a family trust election and then makes a ‘distribution’ outside the ‘family group’. ‘Family Trust Elections’ are significant in that they…

Treasury Laws Amendment (Housing Tax Integrity) Bill 2017 enacted – limit travel deductions for residential rental; limit depreciation deductions; implement an annual foreign owner vacancy fee (dwelling occupied less than 183 days)

Tax Month - November 2017

The Treasury Laws Amendment (Housing Tax Integrity) Bill 2017 has been enacted as Act No. 126 of 2017 (getting Royal Assent on 30 Nov 2017). This Act: amends the: Income Tax Assessment Act 1997 (ITAA97) – to provide that travel expenditure incurred in gaining or producing assessable income from residential premises is not deductible, and not recognised in…

NSW land tax: Teebee Holdings Pty Ltd atf Teebee Property Trust v Chief Comr of State Revenue – primary production exemption denied for nominal tree farming on 9 of 73 hectares – zoned rural and environmental and residential

Tax Month - November 2017

The NSW Civil and Administrative Tribunal has found that land owned by a taxpayer was not eligible for a land tax exemption as the dominant use of land was not for primary production, and in any case it did not meet the commerciality test. The taxpayer purchased land that was zoned partly rural, partly environmental…

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

Tax Month - November 2017, Uncategorized

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…

OECD/BEPS – Multi-lateral Convention (MLI) – Parliament’s Joint Standing Committee on Treaties’ Report supports the ‘multi-lateral treaty’ approach

Tax Month - November 2017

The OECD’s new approach to tackling multinational tax avoidance has been backed by the Federal Parliament’s Joint Standing Committee on Treaties. The Committee supports the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the MLI) and recommended that binding treaty action be taken. The MLI will only apply to…

Zappia v CofT – Taxpayer fails to discharge her onus of proof by relying on facts found by the Commissioner in his objection decision

Tax Month - November 2017

The Full Federal Court has dismissed a taxpayer’s appeal, agreeing with the primary judge, that the taxpayer had not discharged the burden of proof that, default assessments, that included $2 million, that was received into a bank account, held in the taxpayer’s name, were excessive. The Court said the taxpayer submitted that she was able…