Airport Handling Services Australia Pty Ltd v CofT – Retrospective amendment to JobKeeper rules denied sovereign entities right to JobKeeper payments from day one – no accrued right to be prejudiced

On 15 Nov 2021, the Federal Court held that retrospective amendments, to the JobKeeper Rules, applied to deny 8 Australian resident companies that were sovereign entities, the right to receive JobKeeper payments. Despite the fact that legislative instruments cannot have adverse retrospective application, the taxpayers had no accrued rights, to JobKeeper benefits, as at the date the…

LIV tells ATO there is a ‘counterbalancing offence’ it could commit – even by finalising its ‘protocol’ for claiming ‘Legal Professional Privilege’ in terms that ‘overreach’ the actual law

On Saturday 13.11.2021, the Law Institute of Victoria (LIV) made a submission to the ATO about its draft ‘protocol’ for claiming ‘legal professional privilege’ (a process it does not expect of itself). A central part of this submission is that the Commissioner (and his office) could be committing a State offence, by pushing too hard…

Clough Limited v CofT – payment to cancel employee share rights in takeover not deductible but s40-880 ‘black hole’ write-off allowed

On 12 November 2021, the Full Federal Court has upheld a first instance decision that payments totalling $15m, to cancel entitlements under an employee options plan and incentive scheme, were not deductible under s 8-1 of the ITAA 1997. However, the payments were deductible over 5 years under s 40-880. The taxpayer was a publicly listed company…

Insurance within super: APRA finalised its revised standard (last of Hayne Royal Commission recommendations)

On Friday 12.11.21, the Australian Prudential Regulation Authority (APRA) issued a Media Release, saying it had finalised revisions to requirements and guidance relating to insurance in superannuation following extensive industry consultation over two years. The completion of this work fulfils recommendations 4.14 and 4.15 of the Royal Commission into Misconduct in the Banking, Superannuation and Financial…

Super funds exposure to ‘derivatives’ to be investigated – following reforms to make funds report on their investments

The Government has asked the Council of Financial Regulators to prepare a report on the extent of exposures to derivatives by super funds. In announcing the finalisation of the portfolio holdings disclosure (PHD) regulations (see related TT article), Mr Frydenberg said it became apparent during consultation that some super funds have large exposures to derivatives.…

Charity sector reform – ACNC Amendment (2021 Measures No 3) Regulations 2021 finalised – new thresholds for ‘small’, ‘medium’ and ‘large’ registered entities

The Australian Charities and Not-for-profits Commission Amendment (2021 Measures No 3) Regulations 2021, was registered on Fri 12.11.2021. It implemented several elements of the Government response to the ACNC Legislation Review. The Regulations amend the Australian Charities and Not-for-profits Commission Regulation 2013 to increase from 2021-22 the annual revenue thresholds used for determining whether a registered entity…

DTA with Chile – synthesised text of ‘Agreement’ after working in the Multi-Lateral Instrument (MLI) common form changes

On Friday 12.11.21, the ATO released the synthesised text of Australia’s double taxation agreement (DTA) with Chile. It outlines the modifications that have been made to the Double Tax Agreement (DTA) by the Multilateral Convention to Implement Tax Treaty Measures to Prevent Base Erosion and Profit Shifting (MLI). See also, TT article on the MLI synthesised…

Vac Corporate Pty Ltd v TPB – Tax agent’s registration suspended for 3-months for ‘recklessly’ saying SMSFs were audited (but conduct needlessly described as ‘dishonest’)

A 3-month suspension imposed on a registered tax agent for dishonesty – telling the ATO SMSF returns had been audited when they hadn’t – has been confirmed by the AAT. In the light of many tax agents suffering disqualification for years, for things less than dishonest, this seems unduly light. But there are reasons. Vac…

Registered Superannuation Entities (RSEs) – Corporations Amendment (Portfolio Holdings Disclosure) Regulations 2021 finalised

The Corporations Amendment (Portfolio Holdings Disclosure) Regulations 2021, registered today [Thur 11.11.2021], prescribe how portfolio holdings of a registrable superannuation entity (RSE) must be disclosed for the purposes of s 1017BB of the Corporations Act 2001. The Regulations detail the way PHD information must be made publicly available and presented consistently with the tables in new…

PCG 2017/2 updated – Simplified transfer pricing record-keeping options: 2021-22 interest rates – 1.83%

On Thur 11.11.2021, the ATO released an updated version of Practical Compliance Guideline PCG 2017/2, which gives eligible entities various simplified transfer pricing record-keeping options, including for low-level inbound and outbound loans. In relation to the inbound loan option, one of the eligibility requirements is that the interest rate for small related party inbound loans…