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

*Re XTJT and FCT – interest and other holding costs, in acquiring her husband’s brother’s share of land not deductible – private not business purposes [11]

Tax Month - January 2014

The AAT has dismissed a taxpayer’s appeal and upheld amended assessments that had disallowed deductions claimed concerning a property. In 2000, the taxpayer’s husband and his brother inherited a property, which had been in their family since the 1950s. In 2006, the taxpayer purchased her brother-in-law’s interest. She and her husband’s plans were to subdivide…

*Taras Nominees Pty Ltd as Trustee for the Burnley Street Trust v FCT – CGT liability arises on transfer of land to “joint development trust” [10]

Tax Month - January 2014

The Federal Court has held that a taxpayer who owned land in Melbourne, and who transferred it to a “joint-venture trust” established for that purpose in the 1999 income year (together with other adjacent land-holders who did likewise for the purpose of the commercial development of the parcels of land), was liable for CGT made…

*Watsford v FCT – assessed discount on shares acquired under employee share option scheme on date employment terminated, despite no options being exercised until next year (Div 13A) [9]

Tax Month - January 2014

The Federal Court has dismissed a taxpayer’s appeal and upheld a 2012 AAT decision in AAT Case [2012] AATA 815, Re Watsford and FCT that a taxpayer was required to include as assessable income a discount from the market value of shares he acquired on the exercise of options under an employee share scheme (ESS)…

*DCT v Specialised Finance Group Pty Ltd – instructions for AAT review of disallowed ITCs and offer to pay half of tax not enough to stave off winding up [8]

Tax Month - January 2014

The Federal Court has ordered that a company be wound up in insolvency concerning a tax debt of around $90,000, despite its claim that it proposed to commence proceedings in the AAT that, if successful, would mean that it owed no tax debt. The Deputy Commissioner had applied under the Corporations Act 2001 for an…

*Government (still) looking for an alternative to the ACNC [7]

Tax Month - January 2014

Minister for Social Services Kevin Andrews has reiterated the Government’s intention to abolish the Australian Charities and Not-for-profit Commission (ACNC). Speaking at an Australian Institute of Company Directors NFP Lunch, he said the Government considers the ACNC “imposes an unnecessary and ponderous compliance burden on the sector”. The Minister said the Government was looking to…

*Small business superannuation clearing house going from Medicare to the ATO as part of the Government’s plans to reduce ‘red tape’ [3]

Tax Month - January 2014

The Federal Government has released further details on its election proposal to streamline employer superannuation reporting and cut red tape by transferring the running of the Small Business Superannuation Clearing House from Medicare to the ATO. Under the proposal, small businesses would report superannuation payments to the agency that already collects their PAYG payments, and…

*Investment Manager Regime: 3rd and final draft of legislation released for investment in or through Australia by Qualifying Foreign Funds [2]

Tax Month - January 2014

The Government on Fri 31.1.2014, released a further exposure draft of legislation for the 3rd and final element of the Investment Manager Regime (“IMR”). The draft legislation will amend the ITAA 1997 to include a new Subdiv 842-I to set out rules about the taxation of certain foreign funds (known as IMR foreign funds) that…