Category Archives: Tax Month 2016-02

Crimes Legislation Amendment (Proceeds of Crime and Other Measures) Bill 2015 – passed – false dealing with accounting documents now an offence

The Crimes Legislation Amendment (Proceeds of Crime and Other Measures) Bill 2015 has, on Tue 23.2.2016, passed the Senate without amendment and received on 29.2.2016 as Act No. 15 of 2016. It contains a range of measures to improve and clarify Commonwealth criminal justice arrangements, including amending the Criminal Code to insert 2 new offences of false…

Tax Laws Amendment (Small Business Restructure Roll-over) Bill 2016 – now law – sub-$2m turnover businesses can now roll from any structure to any structure with no tax consequences

The Tax Laws Amendment (Small Business Restructure Roll-over) Bill 2016 passed the House of Reps without amendment on 22 February 2016 and likewise the Senate on 29 February 2016. The Bill proposes to amend the ITAA 1997 to provide greater flexibility for small businesses to change their legal structure. The Bill effectively seeks to allow small businesses to…

Water access entitlements – proposed national register of foreign ownership – Treasury consultation

On Mon 22.2.2016, Treasury issued a consultation paper seeking views on a proposed national register of foreign ownership of water access entitlements (WAEs). As part of the foreign investment framework reform package, the Government agreed to introduce legislation for the establishment of a register of foreign ownership of WAEs before 1 December 2016. The purpose of the proposed register is…

Foreign investors must now satisfy tax compliance obligations as a condition of FIRB approval: Treasurer

On 22 February 2016, the Treasurer issued a press release announcing tax compliance obligations would be a condition of applications of foreigners to make investments in Australia. The Turnbull Government will apply new requirements on foreign investment applications to ensure multinational companies investing in Australia pay tax here on what they earn, Treasurer the Hon.…

Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill 2015 – becomes law – CGT changes on earn outs and 10% non-final CGT withholding from non-resident vendors sale proceeds

The Tax and Superannuation Laws Amendment (2015 Measures No 6) Bill 2015 has, Mon 22.2.2016, passed the Senate without amendment and, on 25.2.2016, received Royal Assent as Act No 10 of 2016. The Bill contains the following amendments: Amends the ITAA 1997 to change the CGT treatment of the sale and purchase of businesses involving certain earnout rights – rights to…

Capital works (Div 43) deductions – proposed new ruling on ‘alteration, extension or improvement’ and its interaction with other deduction provisions

  The purpose of the new ruling is to assist taxpayers in understanding the meaning of the phrase ‘alteration, extension or improvement’ in the context of Division 43 of the Income Tax Assessment Act 1997 (ITAA 1997) to enable a taxpayer to determine whether there is an extension, alteration or improvement for the purposes of the capital works…

General purpose financial statements – significant global entities must lodge with ATO if not lodged with ASIC: ATO will consult on procedures

On 3 December 2015 the Senate amended the Tax Laws Amendment (Combating Multinational Tax Avoidance) Bill 2015 to require corporate tax entities that are significant global entities to give the Commissioner a general purpose financial statement if they do not lodge one with the Australian Securities and Investments Commission (ASIC). The financial statement must be for the…

Large multinationals must pay “fair share of tax”, says Commissioner: no more ‘operate here and bill overseas’; 6 added to highest risk quadrant; MNE unable to give reports to auditors? (don’t game the system)

At a Senate Economics Legislation Committee hearing on 10 February 2016, the Commissioner delivered his opening remarks highlighting the ATO’s efforts to tackle tax avoidance by large corporates. Mr Jordan said the majority of large corporates, especially Australian owned companies, pay the right amount of tax; however, he said there was a minority of large corporates who try to avoid…

Tax Practitioners Board v Lamede Group Pty Ltd – company fined $77,000 and director fined $4,000 for advertising and providing tax agent services whilst not registered

The Federal Court has imposed over $80,000 in penalties on an individual and her company after they admitted to breaches of the Tax Agent Services Act 2009 by providing and advertising tax agent services whilst unregistered. Between July and December 2010, the individual provided tax agent services on 7 occasions, receiving around $1,000 for her work. From January 2011 to August 2013, the company provided…

Re Miley and FCT Devi and FCT – CGT: MNAV test – shares sold arm’s length but market value less because it was not a controlling interest

The AAT has ruled that, for the purposes of working out whether a taxpayer satisfied the $6m maximum net asset value (MNAV) test, the “market value” of shares that he sold was not the actual selling price of the shares, even though the shares were sold in an arm’s length dealing. Instead, the AAT accepted…