Daily Archives: July 17, 2018

NSW: Foreign person Duty and Land Tax ‘surcharges’ as applied to discretionary trusts – foreign beneficiaries must be removed irrevocably or the surcharge will apply

On 5 July 2018, the NSW Commissioner of State Revenue issued Commissioner’s Practice Note No CPN 004 on Foreign surcharges and discretionary trusts. It applies from 21 June 2016 and outlines how surcharge purchaser duty and surcharge land tax will be applied in certain situations where land is held by a discretionary trust. CPN 004 further expands…

HELP and SFSS repayment thresholds and rates 2018-19 – nil% up to $51,957 rising to 8% above $107,214 of ‘repayment income’

The ATO has released the repayment thresholds and rates for 2018-19 for the compulsory repayment of Higher Education Loan Program (HELP) debts and Student Financial Supplement Scheme (SFSS) debts. HELP repayment thersholds and rates 2018-19 Repayment income* Repayment rate Below $51,957 Nil $51,957 – $57,729 2% $57,730 – $64,306 4% $64,307 – $70,881 4.5% $70,882…

Board of Taxation – July Update from CEO – ‘earn-outs’ review; Small Business Concessions review; FBT compliance costs; Residency Rules review; aligning tax and accounting treatments; Tax Transparency Code; not-for-profits review

In July, the CEO of the Board of Taxation released her July 2018 Update. The Board held meetings in Canberra on 25 May 2018 and in Melbourne on 5 July 2018. At these meetings, the Board discussed the progress and direction of its current projects, including: Post implementation review of contingent consideration rules (earn-out arrangements). A review of small…

Car expenses: cents per km rate from 1 July 2018 – 68c/km (up from 66c/km)

The ATO issued a Determination (F2018L01023) on Wed 11.7.2018, to increase the cents per kilometre deduction rate to 68c/km (up from 66c/km) for claiming work-related motor vehicle expenses for income years commencing from 1 July 2018 – under Div 28 of the ITAA97. The Determination is the legislative instrument, provided for in s28-25(4). After changes to the…

PR 2018/7 – Tax consequences of investing in PTrackERS – Portfolio Tracking Exchangable Redeemable Securities

On Wed 11.7.2018, the ATO released Product Ruling PR 2018/7 on the tax consequences of investing in PTrackERS, being exchangeable notes offered by PM Capital GO 2025 Limited. In particular, PR 2018/7 provides that security holders have a non-share equity interest in the company and that various anti-avoidance rules do not apply. DATE OF EFFECT:…

PCG 2018/3 – when employers can let employees drive ordinary vehicles home without FBT under s47(6) of the FBT Act – ATO guidance for allocation of audit resources

On 11 July the Australian Taxation Office (ATO) released Practical Compliance Guide PCG 2018/3 (the PCG).  The PCG sets out circumstances in which the ATO will generally accept that certain vehicles used privately by employees may be exempt from fringe benefits tax (FBT).  The PCG applies from the year of tax commencing 1 April 2018.…

Harding v FCT – Taxed on Saudi employment income as a ‘resident’ despite long history of Middle Eastern work because he retained an Australian ‘domicile’ and his serviced apartment was not sufficiently ‘permanent’

A taxpayer has been unsuccessful before the Federal Court, in establishing that he was not a ‘resident’, for Australian income tax purposes, on a basis that centred around whether he had a ‘permanent place of abode outside of Australia’ for the purposes of the Australian ‘domicile’ arm of the definition of ‘resident’ in s6(1) of…