Inquiry into the External Scrutiny of the Australian Taxation Office – a submission of the Inspector-General to the House of Representatives Standing Committee on Tax and Revenue (copy attached)

A submission of the Inspector-General to the House of Representatives Standing Committee on Tax and Revenue inquiring into the External Scrutiny of the Australian Taxation Office (copy attached) EXECUTIVE SUMMARY The IGT welcomes the opportunity to make submission to the House of Representatives Standing Committee on Tax and Revenue (the Committee) to assist in its Inquiry…

External scrutiny of ATO: Tax Inspector-General submission to Parliamentary Committee

The Inspector-General of Taxation has made a submission to the House of Representatives Standing Committee on Tax and Revenue’s inquiry into the external scrutiny of the ATO. While supporting the removal of duplication and inefficiencies, the Inspector-General said any major policy change to reduce external scrutineer functions needs to be informed by a comprehensive analysis that weighs…

Re The Trustees of the WT & A Norman Superannuation Fund and FCT – AAT finds that s177EA operated to cancel the ‘imputation benefits’ from an SMSF’s ‘dividend washing’ transactions

The ATO on Thur 17.3.2016, issued Decision Impact Statements on the following: Re The Trustees of the WT & A Norman Superannuation Fund and FCT [2015] AATA 914 – In this case, the AAT confirmed that the imputation scheme benefit provisions in s 177EA of the ITAA 1936 applied to an arrangement whereby 2 related trusts disposed…

Orica Ltd v FCT – Federal Court found that interest deductions for an international ’round-robin’ were denied by Part IVA

The ATO on Thur 17.3.2016,  issued Decision Impact Statements on the following: Orica Ltd v FCT [2015] FCA 1399 – In this case, the Federal Court held Pt IVA applied to a scheme whereby deductions of $112m were claimed for interest on inter-corporate loans made by an Australian subsidiary of a US corporate group. In doing so,…

Treasury Legislation Amendment (Repeal Day 2015) Bill 2016 – Sched 1 removed (SGC simplifications removed)

The Treasury Legislation Amendment (Repeal Day 2015) Bill 2016 was on Wed 16.3.2016, passed by the House of Reps with 2 Opposition amendments. The amendments removed Sch 1 from the Bill. The Bill now proceeds to the Senate. Schedule 1 had proposed to simplify the superannuation guarantee (SG) charge and make the SG charge and penalty more proportionate to…

Tax Laws Amendment (Tax Incentives for Innovation) Bill 2016 – Early Stage Investment Companies: 20% tax offset on up to $200k investments & 10-year CGT exemption

The Tax Laws Amendment (Tax Incentives for Innovation) Bill 2016 was introduced in the House of Reps on Wed 16.3.2016. It proposes the following amendments. Early Stage Innovation Company amendments to the ITAA 1997 to encourage new investment in Australian early stage innovation companies with high growth potential by providing investors, who invest in such companies, by providing…

PCG 2016/D1 – Practical Compliance Guidelines – Draft to introduce the ATO’s new product: advising defacto ‘safe harbours’ in terms of allocating audit resources (‘swim between the flags’)

On 16 March 2016, the ATO announced a new product being the Practical Compliance Guideline, by way of a draft of the first of these: PCG 2016/D1. These Guides will provide taxpayers with “broad law administration guidance”. The ATO says that a PCG may set out the Commissioner’s view on relative levels of tax compliance risk, so that…

‘Backpackers’ Tax’ – Government announces a review of their 2015 Budget Measure to impose treat temporary working holiday makers as non-residents (32.5% tax rate from $1)

On 16th March 2016, the Minister for Tourism: Senator Richard Colbeck issued a press release announcing that the Government would review the so called ‘backpackers’ tax announced in the 2015 budget measure (see below). They are now concerned about it’s impact on Working Holiday Makers plans to visit Australia and particularly our global competitiveness as…

Rigoli v. Commissioner of Taxation – Full Court agreed that the taxpayer failed to discharge his onus by only relying on the report the Commissioner used to raise the default assessment

On 15 March 2016, judgment was handed down by the Full Federal Court (Kenny, Davies and Moshinsky JJ) in the matter of Rigoli v. Commissioner of Taxation [2016] FCAFC 38  (VID 475 of 2015).  Mr Rigoli’s appeal was dismissed with costs. This appeal concerns what Mr Rigoli is required to prove to discharge the burden of…

Forestry & Agricultural MIS – Senate Economics Committee’s report after the collapse of Timbercorp, Great Southern and others – 24 recommendations

The Senate Economics References Committee on 11 March 2016 finally released its report into the structure and development of forestry (or agribusiness) managed investment schemes (MIS). It was originally due for release by 27 October 2014. Their terms of reference were issued after the spectacular crash of Timbercorp, Great Southern and others, creating legal turmoil, agricultural fall out and harrowing financial…