Tax Month – August 2020

T a x  T e c h n i c a l  –  M o n t h l y  N e w s

– August 2020 Edition –

‘Tax Developments’ for tax practitioners by a tax practitioner.

 

Compiled by F John Morgan
A member of the Victorian Bar (www.FJMtax.com)

Table of Contents

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COVID-19 related matters

• Victorian ‘stage 4’ limitations on Melbourne businesses – announced by Premier on 3 August 2020 (some effect on legal, accounting and tax services)
• Victorian ‘Stage 4 lockdown’ restrictions – impact on lawyers – Victorian Legal Services Board + Commissioner update
• More on the Victorian Stage 4 lockdown – the Tax Institute advises on impact for tax practitioners and taxpayers and policy lobbying
• JobKeeper 1.1 changes enacted – adding an alternate 1 July 2020 employment testing date (additional to 1 March 2020)
• Treasury fact sheet updated for JobKeeper 2.1 revisions – 7 August 2020 Announcements
• JobKeeper – amending rules made to add 1 July 2020 as an alternate date by which an individual must be employed, to eligible
• JobKeeper – ATO updates its guides for the additional the employment reference date – 1 July 2020 now, as well as the old 1 March 2020

Tax Articles

• GE settled ATO audit for $273m in UK ‘tax fraud’ case – ‘triple dipped’ interest (UK and Aus work together)
• Age retirement rule is probably illegal – implications for professional service firms in light of action of Deloitte partner forced to retire at age 62

Legislation

Acts & Bills

• Old fashioned ordinary tax measures (remember those) – a stocktake of recently passed bills, unpassed bills, and no bills at all measures (lots)

Announcements & Drafts

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Cases

High Court

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Full Federal Court

• CofT v Addy – “Backpacker tax” applies to British national who was an Australian tax resident on a ‘working visa’
• CofT v Fortunatow – PSI rules: unrelated clients test not satisfied because there work was not a ‘direct’ result of the Linked In advertisements – ATO wins appeal
• Huang v DCT – Freezing order against taxpayer set aside for overseas assets – ‘no realistic possibility of enforcement’

Federal Court

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Administrative Appeals Tribunal (AAT)

Other Courts & Tribunals

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Appeals

• Hamilton v CofT – Taxpayer appeals AAT decision on salary exemption under international immunities legislation – High Court Jayasinghe case considered

Rulings

Decision Impact statements

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Rulings

• TR 2020/4 and PCG 2020/7 – Thin cap: arm’s length debt test; ATO interpretation and practical compliance approach

Determinations

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Law Companion Rulings

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Class Rulings & Product Rulings

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ATO Interpretative Decisions

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Practice Statements

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Practical Compliance Guides

• Draft Schedule 3 to PCG 2017/4 – ATO transfer pricing guidance on ‘interest-free loans between related parties’

Tax Alerts

• Tax Alert TA 2020/3 – Arrangements with interposed offshore beneficiaries, with interest deductions – that avoid Australian tax and interest withholding tax

Other ATO news or statements

• ATO update on ‘Residency and source of income’ in the age of COVID-19
• 19-year tax fraud probe ends in jail time for company stripping scheme promoter
• Foreign Resident CGT Withholding Tax – ATO updates website for ‘Purchaser Payment Notification’ (PPN) forms – generating a ‘reference number’ for ATO, vendor and purchaser purposes

GST 

Legislation & Announcements (GST)

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Cases (GST)

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Rulings, Etc. (GST)

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Superannuation

Legislation etc. (Super)

• SPR 2020/D2 – SMSF ‘in-house asset’ exemption for rental income deferrals during COVID-19 period – ATO issues Draft Determination

Cases (Super)

• Kander v CofT – employee failed to tick the right box for ‘salary sacrificed’ super contributions and was assessed on the salary she directed be paid as contributions
• Gilliland v ASIC – AAT reverses ASIC decision to disqualify SMSF auditor for breaches of the APES 110 ‘independence’ rule in auditing his family’s SMSF

Rulings etc. (Super)

• SG amnesty 7 Sept 2020 deadline – recognising the COVID chaos, the ATO has prepared ‘pathways’ for businesses seeking payment plans (but will that include extending self-audit time?)
• ‘Downsizer’ super contributions from part disposal of home to ‘DomaCom’ product – so $300k contribution to SMSF possible (ATO advice released for ASX)
• ASIC acts against SMSF auditors who no longer have practical experience
• ‘SMSF auditor number’ misuse – ATO discloses the result of its mailout measure (but only for the 2018 year)

State Taxes

Legislation & Announcements (State)

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Cases (State)

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Rulings & Other (State)

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Other Developments

Australian Charities & Not-for-Profits Commission (ACNC)

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Base Erosion & Profit Shifting & OECD

• Tax haven residents hold $5.7 billion of cash in Australia – Marshal Islands residents $5m average – next biggest $1m in BVI

Board of Taxation

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Inspector General and other external supervisors

• IGTO releases Edition 13 of IGoT News – COVID Support issues, full year’s data, update on ‘reviews’ and what to expect in Q1 Fy ’21

Miscellaneous

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Tax Practitioners Board

• Bell v TPB – TPB publicises its victory in the AAT (upholding their decision to deregister an agent, for want of compliance in his own affairs) but is the TPB independent enough to be doing this?
• Tax Practitioners Board releases corporate plan for 2020-21 (‘sneak peek’ into its independence on imposing sanctions)