New DTA between Australia and Germany (signed 12 November 2015) – draft legislation to enact it into domestic law released for comment

On 1 April 2016 Treasury released an exposure draft of the legislation that would give legislative effect to the new double tax agreement (DTA) between Germany and Australia, which they signed on 12 November 2015. This treaty replaces a previous double taxation agreement between Australia and Germany signed in 1972. The new provisions/amendments include measures…

National Innovation and Science Agenda – draft Bill to allow self-assessment of s40-95(7) intangible assets

The current law mandates the effective life to be used for certain intangible depreciating assets in calculating their decline in value, which may not necessarily reflect the period of time that the assets provide economic benefits to the taxpayer. [Intangible assets per s40-95(7) below] On 7 December 2015, the Government announced a package of measures designed to…

Intangible asset depreciation: draft legislation released to implement ‘Innovation’ statement – self-assess ‘effective life’ etc.

On 7 December 2015, the Government announced a package of measures designed to incentivise and reward innovation as part of its National Innovation and Science Agenda. One of those measures will allow taxpayers the choice to either self‑assess the effective life of certain intangible depreciating assets or use the statutory effective life. The current law only provides…

Statutory interpretation – ATO releases Episode 10 of ‘interpretation NOW’

On 30 March 2016, the ATO released interpretation NOW! – Episode 10. The documents (or “Episodes” as they are called) are an ATO Tax Counsel Network (TCN) initiative and aim to raise awareness about what courts are saying about statutory interpretation. Topics and cases mentioned in Episode 10 include: meaning of “person” – Plaintiff M68 v Minister [2016] HCA 1;…

Car expense deductions: ATO information about the move to a single 66¢/km rate from 1 July 2015, with alternative 3 rate option for the 2016 FBT year (ended 31 March 2016)

The ATO has updated information about use of the cents per km basis for claiming care expenses and for fringe benefits calculations. From 1 July 2015, separate rates based on the size of the engine are no longer available. Taxpayers can use a single rate of 66 cents per kilometre for all motor vehicles for the 2015-16 income year.…

SMSFs that receive trust distributions – ATO is reviewing for ‘non-arm’s length income’ purposes (beware)

The ATO is reviewing self-managed super funds (SMSFs) that have received trust distributions. The income diverted into these SMSFs appears to be non-arm’s length and utilise tax concessions. We are looking at complex arrangements between related entities in a private group that result in large capital gains or inflated income being distributed to SMSFs. This is…

CR 2016/18-20; PR 2016/2 & addendum  – FBT salary packaging arrangements; liquidation of forest MISs; CommBank PERLS VIII Capital Notes; investing in ‘ANZ Cobalt’ and GST on dentist’s supplies

On Wed 30.3.2016, the ATO issued the following Class Rulings and Product Ruling: Class Ruling CR 2016/18: FBT: employer clients of Community CPS Australia Limited trading as Beyond Bank Australia who are subject to the provisions of either s 57A or s 65J of the FBTAA and make use of the Salary Packaging Card facility; Class Ruling CR 2016/19: Liquidation…

SME employers to be ready for electronic ‘SuperStream’ contributions to superannuation funds by 30 June 2016 – ATO reminder

More than 60% of all Australia’s small businesses are already on board with SuperStream. If your business is not one of them, you’ve got just 100 days remaining to get it done. With the 30 June 2016 rapidly approaching, the Australian Taxation Office (ATO) is encouraging small businesses to make becoming SuperStream ready a priority.…

LCG 2016/D2 and LCG 2016/D3 – Small Business Restructure Rollover – guide on consequences of rollover and meaning of ‘genuine restructure of an on-going business’

On Thur 24.3.1016, the ATO issued 2 Draft Law Companion Guidelines on the new small business restructure roll-over in Subdiv 328-G of the ITAA 1997, which takes effect on 1 July 2016. Draft Law Companion Guideline LCG 2016/D2 explains the consequences and adjustments that occur when the transferor and transferee choose to apply the small business restructure roll-over. This is…