GSTR 2018/1 – GST: supplies of real property that are ‘connected with’ Australia – including rights to occupy a hotel in Australia, created by a foreign tour operator (via the local hotel operator)

Tax Month - August 2018

On Wed 22.8.18, the ATO issued GST Ruling GSTR 2018/1, which sets out the ATO view on when supplies of ‘real property’ are ‘connected with the indirect tax zone’ (ie Australia) under s 9-25(4) of the GST Act. GSTR 2018/1 states that a supply of real property ‘is connected with the indirect tax zone’ [broadly Australia]…

PCG 2018/D6 – CGT – extension of the 2-year period for main residence exemption in deceased estates – favourable and unfavourable factors and ‘safe harbour’ for 12 month extension

Tax Month - August 2018

On Wed 22.8.2018, the ATO issued Draft Practical Compliance Guideline PCG 2018/D6. This relates to the operation of the 2 year rule in s118-195(1)(b), item 1, column 3, of the ITAA97. This provision deals with a dwelling that was the deceased’s main residence, at the date of death, and gives some latitude for that exemption to,…

PCG 2018/4 – When an Court appointed Executor or Administrator of a Deceased Estate will be treated as having ‘notice’ of a tax liability – safe harbour guidelines for distribution of the Estate without personal liability for tax

Tax Month - August 2018

On Wed 22.8.2018, the ATO issued Practical Compliance Guideline PCG 2018/4, which one might be forgiven for thinking was about thepersonal liability of a legal personal representative (LPR), of a deceased person’s estate, for the tax liabilities of the deceased, at the time of death. In fact, it is only about when the Commissioner will…

Unexplained Wealth Legislation Amendment Bill 2018 – relies on States referring powers for National Co-operative Scheme on the Proceeds of Crime

Tax Month - August 2018

The Unexplained Wealth Legislation Amendment Bill 2018 was introduced into the Lower House on 20 June 2018; was referred to the Senate Legal and Constitutional Affairs Legislation Committee on 28 June 2018, which reported on 14 August 2018; and moved to the Senate on 21 August 2018. It will amend the Proceeds of Crime Act 2002 (POC…

Dadwal v TPB – Tax agent not a fit and proper person in light of 3 indecent assaults, 15 years on sex offenders register; evasiveness or dishonesty before and after conviction

Tax Month - August 2018

The AAT has confirmed a Tax Practitioners Board’s decision to terminate a tax agent’s registration because he was not a fit and proper person. In March 2016 the Board terminated the applicant’s registration as a tax agent as it did not consider he was a “fit and proper person”, as required by s 20-5 of the Tax Agents…

ASIC disqualifies former director from managing companies for maximum period of 5 years for engaging in illegal phoenix activity

Tax Month - August 2018

On 16 August 2018, ASIC announced that it had disqualified Jason Andrew Hammond of Cameron Park, NSW, from managing companies, for the maximum period of five years, as a result of his involvement in three failed companies – in essence for being involved in ‘illegal phoenix activity‘. The ‘three failed companies‘ were: LLM Rivits Pty Ltd (ACN…

Fox v CofT – ESS discount assessable despite shares becoming worthless the next year as the taxpayer was not coerced into accepting rights offer

Tax Month - August 2018

The AAT has confirmed that the taxpayer was assessable on the discount on rights to shares acquired under the ‘NewSat’ Employee Share Scheme (ESS) after it dismissed the taxpayer’s argument that she was coerced into accepting the ESS offer. NewSat was an Australian specialist satellite communications company that delivered internet, voice, data and video to…

Treasury Laws Amendment (Tax Integrity and Other Measures No 2) Act 2018 (becomes law) – Hybrid Mismatch Rules; Film Producer Offset; Tax Exemption for World Twenty20 Cricket; Korean War Memorial DGR (Act No. 84 of 2018)

Tax Month - August 2018

The Treasury Laws Amendment (Tax Integrity and Other Measures No 2) Bill 2018 was: introduced in the House of Reps on Thursday, 24.5.2018 and was passed in that House on 25.6.2018. introduced into the Senate on 27.6.2018 and finally passed both Houses on 16.8.2018. Received Royal Assent as Act No. 84 of 2018 on 24.8.2018…

Draft Treasury Laws Amendment (Combating Illegal Phoenixing) Bill 2018 & Insolvency (Related Creditor Voting Rights) Rules – proposed legislation for various ‘anti-phoenixing’ measures announced in 2018 Federal Budget

Tax Month - August 2018

On 16 August 2018, Treasury released draft legislation to give effect to a range of measures to both deter and disrupt illegal phoenixing and more harshly punish those who engage in  and facilitate this illegal activity. The Government announced these measures in the 2018 Federal Budget. There is both legal and illegal ‘phoenix’ activity, and it…

IGT Review into GST Refunds – Report recommends improvements in ‘automated risk assessment tools’; notifying commencement of objection rights; awareness of hardship consequences and remedies

Tax Month - August 2018

On 16 August 2018, the Inspector-General of Taxation (IGT) released his report into the ATO’s verification of GST refunds (before releasing the funds to the taxpayer). The IGT’s review into Goods and Services Tax (GST) refunds arose from concerns raised through the IGT’s complaints handling service and during consultation, to develop his 2017 work program. These…