Category Archives: Tax Month – February 2015

*FCT v Arnold (No 2) – Tax promoter penalties of $1.5m imposed – 92.5% of cost purchase price of donated pharmaceuticals delayed 50 years at low interest [9]

The Federal Court has found that a promoter of a scheme, involving the purchase and donation [of] pharmaceuticals to charities with foreign operations, engaged in conduct that resulted in himself, and 2 other entities being a promoter of a tax exploitation scheme. As a result, civil penalties totalling id=”mce_marker”.5m were imposed. The Court said the…

*SPI Powernet (now AusNet Transmission Group) gets special leave to appeal decision that purchase related payment was ‘capital’ in nature [8]

The ATO advises that the High Court will hear the appeal by AusNet Transmission Group Pty Ltd (formerly SPI Powernet Pty Ltd) on 9 April 2015. The appeal concerns the deductibility under 8-1 of the Tax Act of a payment under the Electricity Industry Act 1993 by AusNet as holder of a licence to transmit…

Corporate tax compliance issues investigated by Senate Committee – ATO submission identifies risks: transfer pricing, thin cap, stateless income etc [7]

The Senate Economics References Committee is conducting an inquiry into corporate tax avoidance. The Committee is looking at tax avoidance and aggressive minimisation by corporations registered in Australia and multinational corporations operating in Australia. It is due to report by the first sitting day in June 2015 ie 1 June 2015. The Committee has received many submissions, including from…

PPL scheme “off the table”; small business company tax cut – Prime Minister pledge [6]

In his address at the National Press Club on Mon 2.2.2015, the Prime Minister announced that a “bigger parental leave scheme is off the table”. He also announced that the Government is working on a small-business and jobs package. He said at the heart of that package will be a small business company tax cut…

*Royal Assent – Repeal Acts; Statute Law Revision and Unexplained Wealth Acts [5]

The following Bills received Royal Assent on 25 February 2015: Treasury Legislation (Repeal Day) Bill 2014 – Assent as Treasury Legislation (Repeal Day) Act 2015, Act No 2 of 2015 – makes various amendments, including rewriting ss 6AA and 7A of the ITAA 1936 into the ITAA 1997 and the Taxation Administration Act 1953. Amending Acts 1970…

*Taxation and Superannuation Laws Amendment (2014 Measures No 7) Bill 2014 – IGT takes over from Ombudsman; excess contribution refund etc [4]

The Tax and Superannuation Laws Amendment (2014 Measures No 7) Bill 2014 and Excess Exploration Credit Tax Bill 2014 were both passed by the House of Reps [on Wed 25.2.2015] without amendment and now move to the Senate. The Measures No 7 Bill contains amendments: transfer the tax investigation function from the Commonwealth Ombudsman to…

*Treasury Legislation (Repeal Day) Day Bill 2014 passed by Senate – payslip reporting; evidence powers; repeal; regs into Act; definition of Australia [3]

The Treasury Legislation Amendment (Repeal Day) Bill 2014 has been passed by the Senate without amendment including the following matters. Payslip reporting The Treasury Legislation Amendment (Repeal Day) Bill 2014 (the ‘Bill’) amends the Superannuation Industry (Supervision) Act 1993 (‘SISA’) to repeal the payslip reporting provisions. The payslip reporting provisions in SISA require employers to…

Developing country relief funds declared and revoked [2]

The Assistant Treasurer has gazetted a notice declaring, under s 30-85(2) of the ITAA 1997, that the following funds are developing country relief funds: Kyeema Foundation Developing Country Relief Fund; Microloan Foundation Relief Fund; Network Kokoda Overseas Development Fund; JSF Public Fund; Adara Overseas Development Aid Fund; The International Children’s Care (Australia) Relief Fund; Be Kids Australia…

*Taxation Laws Amendment (Research and Development Bill 2013 –amendments to replace $20b turnover limit with R&D cap for incentives [1]

Senate amendments The Tax Laws Amendment (Research and Development) Bill 2013 was passed late [on] Tue 10.2.2015 by the Senate with 2 amendments moved by the Palmer Unites Party (PUP). Those amendments provide for a reduced tax offset for expenditure above id=”mce_marker”00m. The amendments introduce a cap of id=”mce_marker”00m on the amount of R&D expenditure…

Tax Month – February 2015

M o r g a n’ s   T a x   M o n t h – February 2015 Developments – This is a collection of developments in Australian tax law and practice that occurred in February 2015 and which aims at being of relevance to tax lawyers.* F John Morgan A member of the Victorian…