T a x T e c h n i c a l – M o n t h l y N e w s – May 2018 Developments – This is a collection of developments in Australian tax law and practice that occurred in May 2018 which aims to be relevant to tax practitioners.[i] Compiled By F…
The Federal Court has upheld an appeal against an AAT decision that the taxpayer had not provided an approved valuation when applying the margin scheme on the supply of subdivided lots. The ‘margin scheme’ can be applied to taxable supplies of ‘real property’ by way of sale (or grant of a long term lease) –…
The Full Federal Court has dismissed the taxpayer’s appeal and held that a Commonwealth grant of almost $2.5 million, for the establishment of wind farms, was an assessable recoupment of deductible expenses, under s20-20 of the ITAA97 – despite the deductions being amortised rather than an ‘outright deduction’. The case involved the development of a…
On Friday 25 May 2018, Treasury released a consultation paper to implement the 2018 Budget Measure to introduce an economy-wide cash payment limit of $10,000. It invites comments by 24 June 2018. Minister O’Dwyer also released a Press Release. The measure would apply from 1 July 2019. The Government proposes that a cash payment, over…
The ATO published the ‘Assessing the Risk: Allocation of profits within professional firms’ guidelines and ‘Everett Assignment’ web material in 2015, and said, at that time, they would be reviewed in 2017. In reviewing the guidelines the ATO become aware of situations that had misinterpreted the guidelines or gone beyond the scope of the guidelines.…
We have reported that there has been a lot of activity around the allocation of profits within professional firms, in the last 6 months (December 2017 to May 2018). [See Related TT Article] In the light of this, we thought it worth surveying the types of structures, and some of the history, that gets us to the…
The ATO has established a ‘Professionals Firms’ Working Group’ to consult on what is acceptable, and unacceptable, allocation of profits within professional firms (put bluntly: how much income splitting is ok). This group has been meeting since the Commissioner suspended his guidance, on this subject, on 14 December 2017 [see related TT Article]. This group…
There has been a lot of activity around the allocation of profits within professional firms, in the last 6 months (December 2017 to May 2018). The key events and (where applicable) related Tax Technical articles, are set out below. On 14 December 2017, the Commissioner of Taxation ‘suspended’ (not cancelled) his 2015 guidance on what…
In the 2018 Federal Budget, the Government announced a change to the Small Business CGT Concessions (in Div 152 of the ITAA97) that would adversely affect many partners who ‘alienate’ their partnership income assigning their interest in the professional partnership, to a related entity (and thus ‘split’ what would otherwise be, their income). Such assignments…
On 16 May 2018, the Inspector General of Taxation’s (IGT) announced his investigation into the allegations made during the ABC Four Corners Program (aired on 9 April 2018), regarding the ATO’s use of ‘garnishee notices’. The Program quoted an ATO collections officer and the nub of his allegations was that ATO collections officers, particularly in…