Category Archives: Tax Month – August 2017

Country by Country (CbC) reports – ATO makes a ‘determination’ for exchange of these reports and makes a similar ‘arrangement’ with the USA

The Commissioner of Taxation has made a ‘Competent Authority determination’ setting out the information he will require taxpayers to supply him with, as part of the ‘Country by Country’ (CbC) Reporting arrangements. The Commissioner set out an inclusive list of the information taxpayers may have to supply, in his web post. By way of introduction,…

Google, Microsoft, Apple, Facebook, the ATO and others report on the MAAL, their ATO audits and their restructuring – attracting public attention at the Senate Committee’s public hearing

The Senate Economics References Committee inquiry into corporate tax avoidance has been running since 2 October 2014, whilst there had been much public concern about the amount of tax, and particularly Australian tax, various multinational household names paid – names like Apple, Google, Amazon, Microsoft, IBM and others has generated much publicity. Though it was only…

Lane (Trustee), in the matter of Lee (Bankrupt) v DCT – No priority in bankruptcy proceedings for unpaid part of SGC

The Federal Court has ruled that the ATO did not have priority under the Bankruptcy Act 1966 in relation to part of a Superannuation Guarantee Charge (SGC) payable by a bankrupt trustee. The bankrupt had operated a Subway franchise as trustee of his family trust. Shortly after he sold the business, he was made bankrupt…

BFCB and FCT – Release from Tax Debt on grounds of ‘serious hardship’ rejected because expenses exceeded income and release from debt would not have relieved the hardship

The AAT has upheld the Commissioner’s decision to refuse to release a taxpayer from a tax debt on hardship grounds. The taxpayer was assessed to pay income tax of $70,571 for the 2012-13 income year. She paid part of the tax debt but $61,108 of primary debt remained outstanding plus the GIC. She applied to…

SA ‘Bank Tax’ – Australian Bankers Association threaten SA Government with a High Court challenge to its Constitutional validity

On Tues 22.8.17, the Australian Bankers Association announced that Australia’s major banks have resolved to mount a High Court challenge to the constitutional validity of the proposed South Australian ‘bank tax’, if it is legislated. It also announced that any other State proposing such a tax would also be the subject of a similar High…

PCG 2017/D16 – Super fund asset parcel selection arrangements based on ‘propagation’ arrangements – when it is satisfactory and when it is not

On Mon 21.8.2017, the ATO issued Draft Practical Compliance Guideline: PCG 2017/D16, on propagation arrangements adopted by registrable superannuation entities (RSEs). The draft sets out the ATO’s compliance approach to the use of propagation to select assets for disposal. It is aimed at the large superannuation industry, ie it does not apply to SMSFs. Propagation…

FCT v Normandy Finance and Investments Asia Pty Ltd & Ors – High Court refused taxpayer’s appeal – $4m in payments from a foreign related party were shams not loans

The High Court has refused the taxpayers special leave to appeal from the Full Federal Court decision in FCT v Normandy Finance and Investments Asia Pty Ltd & Ors [2016] FCAFC 180. In its December 2016 majority decision, which now stands, the Full Federal Court allowed the Commissioner’s appeal and found that it was not open to…

Chevron withdraws it’s High Court appeal – transfer pricing case and new principles settled in the Commissioner’s favour – finality welcomed by Government

The taxpayer has discontinued its application for special leave to appeal to the High Court from the Full Federal Court decision in Chevron Australia Holdings Pty Ltd v FCT [2017] FCAFC 62. This was a transfer pricing dispute where the ATO had issued amended assessments under Div 13 of the ITAA 1936 (the old transfer pricing…

Medicare Levy bills – to increase rate from 2.0% to 2.5% as announced in the May 2017 Federal Budget with consequential rate adjustments to other taxes (e.g. FBT)

A package of 10 Bills was introduced in the House of Reps this morning [Thur 17.8.2016] to implement the Government’s 2017-18 Budget announcement to increase the Medicare levy by 0.5% to 2.5% from 1 July 2019 in order to help finance the National Disability Insurance Scheme (NDIS). Other rates that are linked to the top personal tax…

CR 2017/54 – Heemskirk: an Australian listed company that produces minerals in Canada acquired by Canadian Company: Northern Silica Corporation – scrip-for-scrip roll-over available

On Wed 16.8.17, the Commissioner issued the following Class Ruling: CR 2017/54 – scrip-for-scrip roll over: acquisition of Heemskirk Consolidated Limited by Northern Silica Corporation. It provides that participating shareholders who made a capital gain from disposing of their shares in accordance with the scheme can choose scrip-for-scrip roll-over. However, scrip-for-scrip roll over cannot be…