SMSF Association – statement on the significance of the $1.6m 2017 super annexation changes – new reporting requirements and effect on estate planning

The SMSF industry is still working through the far-reaching policy and legislative changes that took effect on 1 July 2017, says SMSF Association CEO John Maroney, in a media release issued on 12 January 2018. He says the changes – the most extensive in the past decade – fundamentally altered the superannuation landscape for SMSF…

Decleah Investments v CofT – appeals GST ‘margin scheme’ decision for pre-GST land – AAT held it was not an ‘approved valuation’

The taxpayer has appealed against the decision in Decleah Investments Pty Ltd and Anor as Trustees for the PRS Unit Trust and FCT [2017] AATA 2418. In that case, the AAT ruled that the taxpayer company had not provided an approved valuation for the purposes of the GST Act when applying the margin scheme to…

BXCD v CofT – taxpayer assessed on payments her companies made, purportedly, to gold suppliers that didn’t exist – taxpayer failed to discharge her onus that she received none of this money

The AAT has upheld default assessments totalling $8.9m based on cash withdrawals by the taxpayer from 2 companies conducting a “bogus” gold trading business. The taxpayer held 100% of the share capital in Company 1 and 45% of Company 2 (with the remainder held by her son: Aldo and not, with her other son: Danielle).…

Tyl v CofT – Truck driver’s ‘travel allowance expense’ claims reduced – problems with (difficult) s900-50 ‘reasonable’ substantiation exemption – relevant law explained and also ‘reconstitution’ of the Tribunal (worth a read)

The AAT has found that a truck driver’s work expense claims exceeded the reasonable amounts for the 2012 and 2013 years and he was therefore required to substantiate the expenses, but was allowed some deductions, under the Commissioners s900-195 discretion. It also upheld the Commissioner’s decision to impose a 25% shortfall penalty. In the 2012…

ATO disclosure of Tax Debts to Credit Reporting Bureaus – ATO’s consultation on its proposed administration of the proposed law allowing it to report tax debts, of over $10k owed by ABN holders, that are not suitably managed

The Government announced draft legislation for a ‘tax debt transparency’ (disclosure) measure on 11 January 2018, for consultation purposes (see related Tax Month article). On the same day, ATO uploaded the following article, seeking simultaneous consultation on its proposed administration of this proposed measure (with suitable disclaimers about this only being proposed administration of a…

Delinquent Tax Debt disclosure to credit reporting bureaus – consultation on draft legislation and ATO’s administrative approach

On 11 January 2018, the Minister for Revenue and Financial Services released exposure draft legislation and explanatory material for public consultation that will authorise the Australian Taxation Office (ATO) to disclose business tax debts to credit reporting bureaus (CRBs) where the businesses have not effectively engaged with the ATO to manage their debt. The Government…

Aussiegolfa Pty Ltd (Trustee) v CofT – SMSF investment in property sub-trust, where student unit leased to member’s daughter, breached the sole purpose test and in-house asset test (in s62 & s82 of the SIS Act)

The Federal Court has ruled that an investment of Mr Benson’s self-managed superannuation fund (SMSF) in a property sub-trust, breached the sole purpose test and in-house asset rules under ss 62 and 82 of  SIS Act (respectively). This was because, amongst other things, the ultimate investment was a student apartment, occupied by Mr Benson’s daughter. This underlying substance of the arrangement…

GST – reduced input tax credits (RITCs) – Govt rejects extending system for credit union services to mutual building societies and mutual banks

Under FOI, Treasury has released a policy document indicating that the Government does not support the extension of the GST reduced input tax credit (RITC) scheme for “credit union services” to cover mutual building societies and mutual banks. This follows calls by the Customer Owned Banking Association (COBA) for the RITC scheme, currently available to…

DCT v Lawson – Director Penalties Notice (DPN) liability for SGC upheld – director failed to make out lack of service, or illness defences

The ATO’s claim against the sole director of a company which failed to pay superannuation guarantee charge (SGC) amounts has been upheld. The unpaid SGC amounts were for a number of quarters between July 2013 and March 2015 and totalled just over $550,000. The defendant was potentially liable to pay a penalty equal to each unpaid SGC amount, pursuant…

ACNC – ‘Terms of Reference’ for review released – required, by law, after 5 years in operation

On 20 Dec 2017, the Assistant Minister to the Treasurer (Michael Sukkar MP) released the terms of reference for a review of the legislation governing the national regulator of charities, the Australian Charities and Not-for-profits Commission (ACNC). The Government is required to review operation of the ACNC, under legislation, now that it has been in operation…