Daily Archives: November 6, 2018

DCT v Wilson – DPN liability for director of construction company – despite shareholder/director agreements to avoid PAYGw liability by not hiring employees, broken by the other directors, in their area of geographic responsibility and timely meetings to appoint an administrator or liquidator (where he was outvoted)

The NSW District Court has rejected a director’s defences to a director’s penalty notice (DPN) for $111,798. The defendant was the director of a construction company, formed in April 2015. Its activities were mainly conducted in Western Australia. The company lodged BASs in respect of the periods 1 April 2015 to 30 June 2015 and 1 July 2015 to 30 September 2015. The BASs identified…

PCG 2018/7 – restructuring out of arrangements likely to offend the new ‘anti-hybrid rules’ – 6 examples where the ATO will NOT apply Part IVA and a list of ‘low risk’ features (for deploying audit resources)

Practical Compliance Guideline PCG 2018/7, issued on Thursday 25.10.2018. It sets out the ATO’s compliance approach to restructures out of existing hybrid arrangements to avoid the potential application of the hybrid mismatch rules. The anti-hybrid rules, will generally take effect from 1 January 2019, and they address certain hybrid arrangements that exploit differences in the tax treatment…

Consultation on proposed amendments to Div 7A – 10 year complying loans; self-correct ‘inadvertent’ breaches; UPE’s brought within Div 7A

On 22 October 2018m, the Assistant Treasurer, the Hon Stuart Robert MP, released a consultation paper seeking views on the proposed implementation of the amendments to Division 7A of the Income Tax Assessment Act 1936 (ITAA36). He said the proposed amendments drew on recommendations from the Board of Taxation and will provide clearer rules for taxpayers…

IGT’s report – no evidence of systemic internal fraud or corruption in the ATO – report prompted by ATO fallout following the high profile ‘Project Elbrus’ investigation – IGT made 13 recommendations to ATO & 1 to Government (all accepted, at least in part)

The Inspector-General of Taxation (IGT), Mr Ali Noroozi, has announced the release of his report into the ATO’s fraud control management. The review arose because of the concerns surrounding Operation Elbrus (a major phoenixing operation conducted by the son of a senior tax officer), including allegations of tax fraud that may be associated to abuse of position…

Watson v CofT – Super Div 293 tax upheld against AIRC Vice President – legislation giving him the same status as a judge did not make him a judge for the purposes of the s293-190 exemption and did not offend s72(iii) of the Constitution

The AAT has upheld superannuation Division 293 tax assessments against a former Vice President of the Australian Industrial Relations Commission (AIRC) after ruling that he was not a “judge” for the purposes of the exemption under s 293-190 of the ITAA 1997. The taxpayer, the Hon Graeme Watson, is a former Vice President of the Australian…

Inspector General’s last (2017/18) Annual Report – covering its recent Complaints/Ombudsman Role and Systemic Reviews recently completed or ‘in progress’

The Inspector-General of Taxation released its 2017-18 Annual Report on 18 October 2018. The Inspector-General, Ali Noroozi, confirmed that this would be his last Annual Report, following his decision not to seek another term. The themes in the Annual Report included the following. The creation of the IGT in 2003 to investigate systemic problems in the ATO –…