*ATO ID 2015/1 – FBT – work-related counseling under worker retraining program [22]

Tax Month - January 2015

The ATO on Fri 23.1.2015, issued ATO ID 2015/1 (FBT: exempt benefits: work-related counselling – training courses or activities for employees being made redundant). According to the ID, the payment for, or reimbursement of, a training course or activity provided under a worker retraining program by an employer to an employee being made redundant does…

Class Rulings – 28.1.15 [21]

Tax Month - January 2015

The ATO on Wed 28.1.2015, issued the following Class Rulings: CR 2015/4: The Belmont Christian College Limited 2014-15 Early Retirement Scheme; CR 2015/5: Scrip-for-scrip roll-over: acquisition of units in Folkestone Social Infrastructure Trust by Folkestone Education Trust; and CR 2015/6: GDF SUEZ International Employee Share Ownership Plan. The ATO also issued an Addendum to Class…

Re GHP 104 160 689 PTY LTD v FCT – ‘feedstock expenditure’ allowed under R&D provisions – not ‘overlapping expenditure’ [18]

Tax Month - January 2015

Re GHP 104 160 689 PTY LTD v FCT [2014] AATA 515 – The AAT allowed most of a taxpayer’s claims for R&D expenditure at the 125% rate, but disallowed other claims in respect of overlapping expenditure. The case concerned R&D “feedstock expenditure” by a mining company. The ATO said it accepts the Tribunal’s decision…

*MBI Properties Pty Ltd v FCT – GST: whether purchaser of land subject to a lease continues to make supplies to the lessee? [17]

Tax Month - January 2015

On 22 December 2014, the ATO released Decision Impact Statements MBI Properties Pty Ltd v FCT [2014] HCA 49. The High Court had unanimously allowed the Commissioner’s appeal, holding that the conditions for the operation of s 135-5 of the GST Act were met, and the Commissioner was correct to assess MBI to an increasing adjustment under that…

*John Holland Group Pty Ltd & Anor v FCT – Taxpayer appeals FBT ‘otherwise deductible’ decision on ‘fly in – fly out’ expenditure [16]

Tax Month - January 2015

The taxpayers have appealed to the Full Federal Court against the decision in John Holland Group Pty Ltd & Anor v FCT [2014] FCA 1332. The Federal Court had dismissed the taxpayers’ appeal. The issue was whether John Holland was entitled to reduce, by the “otherwise deductible rule”, the FBT payable on the value of return…

*Re Raschta Coatings Pty Ltd as trustee for the Raschta Coatings Trust and FCT – assessments excessive though records lost in Brisbane floods [15]

Tax Month - January 2015

A company has been successful before the AAT in discharging the burden of proof that GST and income tax assessments issued to it following an audit by the Commissioner were “excessive”. The company was the trustee of the Raschta Coatings Trust and its business was involved buying and selling protective coatings used on steel and…

*Re The Engineering Manager and FCT – Taxpayer visited his family when of leave from 7 years overseas – not resident for the whole year he returned [14]

Tax Month - January 2015

The AAT has held that an engineer, who returned to Australia in April 2011 after working overseas since 2004, was not a resident of Australia for the whole of the 2011 year. The taxpayer was working as a lead instrumentation engineer and manager in Oman for a multinational company in the oil and gas industry from 4 January 2010…

*Confidential and Commissioner of Taxation – No foreign tax offset for Irish ‘Pay Related Social Insurance’ – not a “substantially similar tax” [13]

Tax Month - January 2015

The AAT has held that an amount of Pay Related Social Insurance (PRSI) deducted from a taxpayer’s Irish salary was not a “substantially similar tax” to Australian income tax for the purposes of Australia-Ireland double tax agreement (Irish Agreement) and he was therefore not entitled to a foreign income tax offset for that Insurance. The…