M o r g a n’ s T a x M o n t h
– April 2015 Developments –
This is a collection of developments in Australian tax law and practice that occurred in April 2015 and which aims at being of relevance to tax lawyers.*
F John Morgan
A member of the Victorian Bar (www.FJMtax.com)
Liability limited by a scheme approved under Professional Standards Legislation
Table of Contents
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ACTS, BILLS AND ANNOUNCEMENTS
Acts, Bills & Draft Legislation
*Managed investment trusts – proposed tax system: draft legislation [1]
*ESS Bill: Tax and Superannuation Laws Amendment (Employee Share Schemes) Bill 2015 – introduced [2]
*CGT scrip-for-scrip rollover – integrity rules to be tightened: draft leg released [3]
*Consolidation loopholes addressed: draft legislation released [4]
Cents per Kilometre Car Deductions – Treasury Laws Amendment (2015 Measures No 1) Regulation 2015 [5]
Higher education loan scheme (HECS): 2015-16 repayment rates and income thresholds [6]
Announcements
*GST to cover intangible supplies by non-residents; $1,000 threshold may also be lowered [7]
*Structure of the tax system: Treasury paper released on theoretical aspects [8]
Negative gearing – no changes says the Prime Minister [9]
UK and Australia agree to collaborate on multinational tax [10]
Serious tax offenders brought to justice – ATO and DPP [11]
CASES AND APPEALS
High Court
Justice Gordon appointed to the High Court [12]
*Queensland Nickel Pty Ltd v The Commonwealth of Australia – issue of free ‘carbon units’ did not give preference to one state and therefore valid [13]
*FCT v Australian Building Systems Pty Ltd (in liq) & Anor – special leave to appeal – liquidator does not have to retain funds for tax on disposal [14]
Full Federal Court
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Federal Court
Bond v FCT – Pilot’s insurance proceeds on losing his license for medical reasons was an ETP and not capital for personal injury under s82-135 [15]
*Commissioner of Taxation v Seymour – AAT should not have permitted the taxpayer to give video evidence for fear of arrest or DPO [16]
*Donoghue v FCT – recovery proceedings dismissed – underlying assessments invalid because of intentional use of material protected by LPP [17]
Hii v FCT – Failure to consider ‘fraud or evasion’ issue not s39B invalid – Notice of Assessment conclusive except in Part IVC proceedings [18]
Administrative Appeals Tribunal (AAT)
*Trustee for the Payne Superannuation Fund v FC of T – ‘net exempt income’ losses cannot be carried forward to reduce future ‘net exempt income’ [19]
*Re Applicant and FCT – no reduction in tax on capital gain for prior year capital loss; lot compulsorily acquired and holding costs [20]
Re Pacific Worldwide Pty Ltd and CEO of Customs – taxpayer wins as imported wontons, dumplings not classified as ‘pasta’ [21]
Re Creation Ministries International Ltd and Screen Australia – Refundable film tax offset disallowed [22]
Other Courts & Tribunals
*Westpac Banking Corporation v Jamieson & Ors – Judgment for damages resulting from financial loss upheld; gross-up for taxable damages [23]
*In the matter of 4 Doonan Street Collinsville Pty Ltd (in liq) – FCT can set off amounts in the taxpayer’s RBA without breaching liquidation rules [24]
*Paloto Pty Limited v Herro – No variation in trust vesting date to avoid tax liabilities [25]
*Robson & Ors v FCT – Incorporated association legislation does not import Corporations Act provisions about unfair preferences on winding up [26]
Appeals
FCT v Macoun – taxpayer seeks leave to appeal to the High Court from decision that a World Bank pension was not exempt from tax [27]
COMMISSIONER’S PUBLICATIONS & NEWS
Decision Impact statements
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Rulings
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Determinations
TD 2015/10 – Interest arising from arrangement funding return through connected entities [28]
Class Rulings & Product Rulings
Class Rulings on 1.4.15 [29]
Product Ruling 1.4.15 [30]
CR 2015/28 & PR 2015/5 [31]
CR 2015/29 – Chandler Macleod Group Limited Scheme of Arrangement and Permitted Dividend [32]
ATO Interpretative Decisions
ATO ID 2015/9 – No SGC on attributed personal services income (it’s not actual salary and wages) [33]
Practice Statements
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Tax Alerts
*TA 2015/1 : Private company dividends diverted to SMSF – concerns that it might be dividend stripping or ‘non-arm’s length income in the fund [34]
Other ATO news or statements
Wealthy individuals and their private groups: ATO starts “tax assurance talks” [35]
Early ATO warning – franked distributions funded by capital raisings [36]
Tips for trustees of death benefits [37]
Choose reporting options for PAYGi and GSTi – election of method must be made in the first quarter [38]
Federal Taxation Statistics 2012-13 [39]
GST DEVELOPMENTS
Legislation & Announcements (GST)
GST to cover intangible supplies by non-residents; id=”mce_marker”,000 threshold may also be lowered [40]
Cases (GST)
*Re Andrew Garrett in his capacity as an Authorised Officer of various trusts – no standing as holder of trustee’s power of attorney – breach of Corps Act [41]
Australia Pacific LNG Pty Ltd & Ors v Building & Construction Industry (Portable Long Service leave) Authority – levy on GST-inclusive cost [42]
Rulings, Determinations & Other things (GST)
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SUPERANNUATION DEVELOPMENTS
Legislation, Announcements etc. (Super)
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Cases (Super)
Temporary Residents – draft legislation to exempt employers having to offer choice of funds for superannuation contributions [43]
Trustee for the Payne Superannuation Fund v FC of T – ‘net exempt income’ losses cannot be carried forward to reduce future ‘net exempt income’ [44]
Rulings & Other things (Super)
Ward’s case – ATO’s view of AAT’s approach to reviewing ‘excess super contributions tax assessments’ [45]
AUSTRALIAN CHARITIES & NOT-FOR-PROFITS (ACNC) SECTOR
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BOARD OF TAXATION
*‘Debt – Equity’ report released by Minister and draft legislation foreshadowed to implement recommendations to reduce uncertainty and cost [46]
EXTERNAL SUPERVISORS – IGT; OMBUDSMAN, JCPAA & ANAO
*IGoT tax over Ombudsman’s tax function from 1 May 2015 [47]
TAX PRACTITIONERS BOARD & LEGISLATION
Tax (financial) advisers: TPB info sheets on sufficient/relevant experience for advisers applying for registration during the ‘transition period’ [48]
Re ATP Group Pty Ltd and FCT – AAT grants stay in tax agent’s deregistration [49]
STATE TAXES
Legislation & Announcements (State)
*NT Budget 2015-16: payroll tax; stamp duty changes [50]
Vic stamp duty: Nanos & Anor v Comr of State Revenue – substantially one arrangement, so dutiable value aggregated [51]
Cases (State)
NSW land tax: Bright & Anor v Chief Comr of State Revenue – principal residence exemption refused because of lease longer than 6 months [52]
NSW land tax: Perumal v Chief Comr of State Revenue – Applicant could not get PPR concession for both their ‘previous’ and ‘new’ residences [53]
Qld payroll tax: Comr of State Revenue v Gympie Noosa Broadcasters Pty Ltd & Ors – summary judgment for Commissioner – no prospect of success [54]
SA land tax: T & S Liapis Pty Ltd v Comr of State Taxation – primary production exemption allowed [55]
Rulings & Other (State)
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OTHER DEVELOPMENTS
Global tech giants give evidence (or fail to) at the Senate hearings into corporate tax avoidance [56]
THE END
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NB: I have gathered these articles from various sources for the purposes of study and teaching and I have acknowledged the sources. None of this publication should reproduced in breach of copyright belonging to the acknowledged source. The headings to the articles are often mine (and shouldn’t necessarily be attributed to the publisher).
Source Abbreviations: ‘EDTN’ = Electronic Daily Tax News, published by CCH; ‘LTN’ = Latest Tax News published by Thomsons; and ‘Taxvine’ is the weekly publication by the Tax Institute of Australia; Greenfields = Greenfields Financial Services; TaxBar = Melbourne Tax Bar Association Newsletter at www.vicbar.com.au / Members / Bar Associations / Tax
