John Morgan is a tax specialist lawyer of more than three decades experience now practicing at the Victorian Bar - w: www.FJMtax.com e: f.john.morgan@vicbar.com.au

Tax treatment of compensation paid to individuals from financial institutions for faulty advice or improperly charged fees, etc. – Commissioner posts guidance on website (in light of the Hayne Royal Commission into the Financial Services Industry)

Tax Month - October 2018

With the Hayne Royal Commission into the financial services industry in full swing, exposing significant misfeasance in the Banking, insurance, financial advice and superannuation sectors, there is much talk of the compensation being paid or accelerated. With this in mind, on 8 October 2018, the ATO posted an advice page, on its website, about how…

ASIC recommends SMSF policy reforms – Answers to questions on notice to the Parliamentary Joint Committee on Corporations and Financial Services

Tax Month - October 2018

ASIC has put forward a range of policy solutions for self-managed super funds (SMSFs) to be considered by the Parliamentary Joint Committee on Corporations and Financial Services. In response to Questions on Notice following the ASIC Oversight hearing on 17 August 2018, ASIC said the following policy solutions could be considered by the Committee in terms of: Member…

‘Feminine hygiene products’ to be GST-free – consultation on the definition (removing the ‘tampon tax’)

Tax Month - October 2018

On 8 October 2018, Ministers: O’Dwyer (for Women), Hunt (for Health) and Freidenberg (Treasurer) announced the Government is getting on with the job of removing the Goods and Services Tax (GST) on feminine hygiene products, following the State Treasurers approving this change in the GST base. The proposed definition, which includes tampons, pads and cups,…

ATO guidance on new ‘electronic sales suppression tools’ bans – characteristics; offences; fines; administrative penalties and transitional rules for possessing such tools

Tax Month - October 2018

The ATO has uploaded a page on its website to give more detail about ‘electronic sales suppression tools’ (Suppression Tools) the Treasury Laws Amendment (Black Economy Taskforce Measures No 1) Bill 2018 banned them from 4 October 2018. (See related Tax Technical article about the passage of that Bill into law.) Characteristics of an ESST The ATO…

Treasury Laws Amendment (Tax Integrity and Other Measures) Bill 2018 becomes law – MAAL extended to foreign trusts and partnerships; additional ‘Small Business CGT Concession’ conditions for CGT events affecting shares and interests in trusts

Tax Month - September 2018

The Treasury Laws Amendment (Tax Integrity and Other Measures) Bill 2018 was passed by the Senate on Thu 20.9.2018 and received Royal Assent on 3 October 2018 as Act No. 124 of 2018. It passed with 2 Opposition amendments to which the House of Reps agreed. It contains the following previously-announced measures: Multinational anti-avoidance law…

IGT’s ‘Valedictory Speech’ included calls for the Government address his outstanding recommendations, including: to appoint an independent board to control the ATO; creation of an independent appeals branch under a new 2nd Commissioner and to rename the IGT as the ‘Taxation Ombudsman’

Tax Month - October 2018

The outgoing Inspector-General of Taxation (IGT), Mr Ali Noroozi, has called on the Government to implement various of his outstanding recommendations, in a valedictory speech, on 4 October 2018. This was to mark his retirement. The primary recommendation was that recommendation that the Government (and Parliament) establish an independent management board to oversee the ATO.…

Treasury Laws Amendment (Black Economy Taskforce Measures No. 1) Act 2018 passes into law – introducing offences and penalties for ‘sales suppression tools’ and adding ‘cleaning’ and ‘courier’ payments as reportable to the ATO

Tax Month - October 2018

On 3 October 2018, the Treasury Laws Amendment (Black Economy Taskforce Measures No. 1) Bill 2018 received Royal Assent as Act no. 121 of 2018. See the previous Tax Technical article about the Bill’s introduction to Parliament. Schedule 1 – sales suppression tools – of the Act prohibits the production, distribution and possession of sales suppression…

CofT v Sharpcan Pty Ltd – Full Federal Court held that $600k that a pub paid for 10 year statutory ‘gaming machine entitlements’ were s8-1 deductible (as not ‘capital’) or deductible on a 5-year ‘blackhole’ write-off basis (if it was a capital expense)

Tax Month - October 2018

A majority of the Full Federal Court has dismissed the Commissioner’s appeal against an AAT decision allowing a $600k deduction, for expenditure on gaming machine entitlements (GMEs), allocated by the State of Victoria. The Court held that this expense was deductible under s8-1 of the ITAA97 or, in the alternative (if the expense was ‘capital’…

Draft legislation for 1 Year exemption from the ‘Work-test’ for 65 – 74 year old recent retirees, with a superannuation balance under $300,000 – $25k concessional and $100k non-concessional caps continue (but not 3 year ‘bring forward’)

Tax Month - October 2018

On 2 October 2018, the Government has released draft legislation to give eligible older Australians additional flexibility to contribute more into superannuation as they move into retirement – as announced in the 2018-19 Budget as part of the More Choices for a Longer Life package. Currently, there is a ‘work test’ hurdle, which is that individuals…

GST – States agree to end ‘tampon tax’ and consider the Commonwealth’s new basis for dividing the GST Revenue between the States & Territories – Council on Federal Financial Relations meeting

Tax Month - October 2018

The Treasurer reported that the Council on Federal Financial Relations (CFFR) met in Melbourne on 3 October 2018. The ‘tampon tax’ will be removed – Significantly, he reported, there was unanimous agreement amongst the States  to remove the GST on feminine hygiene products (the States and Territories are the beneficiaries of the GST revenue and have to…