In a decision handed down on Fri 12.9.2014, the AAT has affirmed a decision of the Commissioner that a payment made to a taxpayer for compensation for domestic assistance was assessable as ordinary income under s 6-5 of the ITAA 1997. In February 1997, the taxpayer’s husband suffered a serious injury while white water rafting during a team…
The AAT has affirmed a decision of the Commissioner to impose on a taxpayer a 50% administrative penalty of the tax shortfall amount on the basis of “recklessness”. The taxpayer was a carpenter by trade. The Commissioner audited the taxpayer in relation to his BASs for the period 1 January 2007 to 30 June 2010 and found he had…
The AAT has allowed most of a taxpayer’s claims for R&D expenditure at the 125% rate, but disallowed other claims in respect of overlapping expenditure. Between 2003 and 2007, the taxpayer undertook R&D, conducted by way of plant trials, to test various possible improvements to its copper and lead concentrators and its copper smelter. Many…
The Commonwealth Ombudsman, Mr Colin Neave, appeared before the Federal Parliamentary Standing Committee on Tax and Revenue on Wed 24.9.2014 to discuss complaints made to his office on tax disputes. The Ombudsman has identified the following areas of concern: 1.the ATO’s engagement with taxpayers prior to litigation; 2.perceptions of a power imbalance between the ATO…
The AAT has affirmed that a taxpayer was liable to CGT on a settlement payment of $350,000 made to her in respect of litigation she pursued for damages for breach of contract and negligence. In particular, the AAT found that CGT event C2 applied to the payment, and that the CGT assets in question were…
The Full Federal Court has unanimously dismissed the taxpayer’s appeal from the decision in Task Technology Pty Ltd v FCT [2014] FCA 38 and confirmed that licensing payments by the taxpayer company (an Australian distributor) to a Canadian software supplier were not excluded from being royalties that were subject to Australian withholding tax. The taxpayer…
The Business Council of Australia (BCA) Thur 11.9.2014, released its paper Future of Tax: Australia’s Current Tax System. It is the first in a series of papers that the BCA will release in the lead-up to the Commonwealth Government’s tax white paper reform process. The BCA says its paper presents a platform for discussion and…
The Treasurer has announced that the Cairns meeting of the G20 Finance Ministers and Central Bank Governors has agreed to modernise global tax rules and close gaps that have emerged in recent years. He said the meeting endorsed the automatic exchange of tax information on a reciprocal basis using a Common Reporting Standard (CRS), as…
The OECD has released its first recommendations for a co-ordinated international approach to combat tax avoidance by multinational enterprises, under the OECD/G20 Base Erosion and Profit Shifting (BEPS) Project designed to create a single set of international tax rules to end the erosion of tax bases and the artificial shifting of profits to jurisdictions to…
Parliament’s Northern Australia Committee Thur 4.9.2014, tabled in both Houses its final report on the development of Northern Australia, titled Pivot North. The Committee was tasked with the important role of helping to define the future of Australia’s North. The report made 42 recommendations including investigation of the potential and practicality of special economic zones,…