Decision Impact Statement on Aussiegolfa case – non-arm’s length tenant, did not breach SMSF’s s62 ‘sole purpose test’ but ‘in-house asset’ test breached because the Sub-Trust was the relevant ‘fund’ for ‘related party’ definition purposes

On Monday 3.12.18, the ATO issued a Decision Impact Statement (DIS) on the Full Federal Court’s decision in Aussiegolfa Pty Ltd (Trustee) v FCT [2018] FCAFC 122. Aussiegolfa was the trustee of an SMSF, that invested in a publicly offered managed investment scheme: the DomaCom Fund. This ‘Master Trust’ provided for classes of unit holder,…

‘Earn-out arrangements’ – ATO releases Discussion Paper on the tax treatment of rights that don’t qualify for the ‘look through’ approach provided for under Subdiv 118-I

On Monday 3.12.18, the ATO issued a Discussion Paper for comment on Issues concerning earnout arrangements (excluding arrangements that create look-through earnout rights). ‘Earn-out’ arrangements usually involve the grant of a right (or multiple rights) to one or more future payments which are contingent on future events in connection with the business. The quantum of…

Tax Month – January 2020

T a x  T e c h n i c a l  –  M o n t h l y  N e w s – January 2020 Edition – Tax developments for tax practitioners by a tax practitioner.   Compiled by F John Morgan A member of the Victorian Bar (www.FJMtax.com) Table of Contents ______________________________________________________________________________  …

‘Tampon Tax’ gone – Health Minister makes a s38-47 determination, making the supply of various ‘feminine hygiene products’ GST-free from 1 January 2019

On 26.11.18, Health Minister Hunt, made the A New Tax System (Goods and Services Tax) (GST–free Health Goods) Determination 2018, which removes GST on feminine hygiene products from 1 January 2019. This has been done by way of a ‘determination’ under s38-47(1) of the GST Act, which provides that the Health Minister may make the supply of…

ATO appoints provisional liquidator for 8 labour hire businesses – preserve assets and records whilst ‘broader enforcement’ action is underway

On 29.11.18, the ATO announced that it had successfully applied to the Federal Court for the appointment of a provisional liquidator for 8 labour hire businesses providing services to the meat processing and abattoir industry. Provisional liquidators have been appointed for Ausmart Services Pty Ltd, Ezyrol Trading Pty Ltd, Gamma One Pty Ltd, Goyx Pty…

‘Small business’ – Minister announces support for resolving Federal tax disputes: (1) new Concierge service for advice about an AAT appeal and (2) special division in the AAT for post application support and legal fee support, if ATO appeals AAT decision

On  29.11.18, the Assistant Treasurer, announced that the  Government will make it easier, cheaper and quicker for small businesses to resolve tax disputes with the Australian Taxation Office (ATO) by:  establishing a Small Business Concierge Service within the Australian Small Business and Family Enterprise Ombudsman’s office, to provide support and advice about the Administrative Appeals…

Burton v CofT – only 50% ‘foreign income tax offset’ (FITO) for US capital gains tax, levied on the whole gain (because of our 50% CGT discount)

On 27.11.18, the Federal Court held that a taxpayer, was only entitled to a Foreign Income Tax Offset, for 50% of the US tax paid, on the sale of investments, as only half the capital gain had been included in his Australian ‘assessable income’ (after applying the standard 50% CGT discount, for assets held for…

APRA releases superannuation statistics for September 2018 – $2.7b total assets, SMSFs $775b, equities 51%, Rate of Return 8.1%, Industry Funds 48 (SMSFs 500k)

On 27.11.18, the Australian Prudential Regulation Authority (APRA) released its Statistics reports for the September 2018 quarter. Total asset sizes, by category of superannuation funds – at 30 September 2018 (compared with 30 Sept 2017): Total superannuation assets: $2,759 b (+8.8% over $2,536 billion – one year earlier) Total ‘APRA regulated’ assets: $1,808 b (+10.4% over $1,637 b – one…

Sandini Pty Ltd v Ellison & ors. v CofT – ATO’s ‘Decision Impact Statement’ – Subdiv 126-A Family Law Rollover must be ‘to’ a spouse, can be from a trust, must result in ‘change of ownership’ and must be ‘because’ of the Court order

Sandini Pty Ltd atf the Karratha Rigging Unit Trust & Ors v. Ellison & Ors v. Commissioner of Taxation of the Commonwealth of Australia & Ors Full Federal Court decision: [2018] FCAFC 44 High Court of Australia – refusal to give leave to appeal: [2018] HCA Trans 190 Précis This case concerns the availability of marriage breakdown…