M o r g a n’ s   T a x   M o n t h

– October 2014 Developments –

This is a collection of developments in Australian tax law and practice that occurred in October 2014 and which aims at being of relevance to tax lawyers.*

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

Table of Contents





Acts & Bills

*Tax and Superannuation Laws Amendment (2014 Measures No 4) Bill receives Royal Assent [1]

*Tax and Superannuation Laws Amendment (2014 Measures No 6) Bill introduced [2]

*Korea-Australia Free Trade Bills passed [3]

*Major FOI amendments – Bill introduced [4]

*Miscellaneous tax and superannuation law amendments: exposure draft legislation released [5]

*Withdrawing excess non-concessional super contributions: draft legislation [6]

*Small mineral exploration companies – tax incentive for shareholders: draft legislation [7]

Govt to repeal unnecessary legislation – introduction of Omnibus Repeal Day (Spring 2014) Bill 2014 and Amending Acts 1970 to 1979 Bill 2014 [9]

Correcting technical errors, etc in Acts – Statute Law Revision Bill (No. 2) Bill introduced [10]

Treasury Legislation Amendment (Repeal Day) Bill 2014 introduced – ITAA36 provisions re-written into ITAA 1997, consolidate provisions into TAA1 [11]

*Revised Aust-Swiss DTA enters into force [12]

Medicare levy surcharge thresholds paused for 3 years in line with Federal Budget announcements: Bill passes House of Representatives [14]

New Indirect Tax Concession Scheme packages made for diplomats – Determination made [15]

*Fuel excise increase: tariff increases to be tabled as ‘proposals’ (like the ‘Alcopops’ measures by the former Government) [16]

FOI Amendment Bill passes Reps with amendments [17]

Japan-Australia Economic Partnership: Bills introduced [18]

Three Bills referred to Senate committees [19]



Senate committee to inquire into aggressive tax minimisation by Australian companies and Multinational Entities [20]

*Senate committee to examine Bitcoin and digital currencies, incl tax regulation [21]

Family business committee inquiry looks at tax issues: Government issues its response [22]

*Employee share scheme changes – tax on ESS options deferred to exercise for all companies; ‘start-up’ shares or options issued at a small discount not taxed until sale of shares [23]

*Agricultural Green Paper put out by Agriculture Minister recommends tax changes for farmers [24]

Tax Administrators from 38 Countries agree in Dublin on greater cooperation re BEPS and information exchange [25]

*OECD and G20 countries commit to automatic exchange of information [26]

*Non-final withholding tax on taxable Australian property transactions: consultation paper [27]




High Court

Full Federal Court

*FCT v Australian Building Systems Pty Ltd (in liq) – No duty on liquidators to retain funds to pay CGT until assessment issued [28]


Federal Court

*Ogden v FCT – Appeal dismissed: no question of law raised [29]

FCT v Desalination Technology Pty Limited – R&D offset: Relevant expenditure properly ‘incurred’ – Commissioner loses appeal [30]

McGrouther v FCT – Taxpayers’ s appealled on 14ZYA notices (giving the Commissioner 60 days to make an objection decision) but they cannot be withdrawn [31]


Federal Circuit Court

Administrative Appeals Tribunal (AAT)

*Re Scanlon and FCT – CGT: obligation to pay an ETP was not a liability incurred ‘just before’ the CGT event – failed the maximum net asset value test [32]

*Re Dewheath Pty Ltd and FCT – Remission of penalties refused: failure to lodge BASs and income tax returns [33]

*Re Cronan and FCT – Default assessments using industry benchmarks affirmed – no records kept sufficient to demonstrate taxable income [34]

*Re Kirkby and FCT – Proceeds from sale of mining tenements assessable income [35]


Other Courts & Tribunals

*Re Arthur Brady Family Trust; Re Trekmore Trading Trust – Vesting dates allowed to be varied to avoid potential tax costs [36]

Roche v DCT – Director’s penalty notices upheld [37]



*FCT v Resource Capital Fund III LP – High Court refuses leave to appeal [38]

High Court refuses special leave in 4 cases [39]

Re Thorpe and FCT – taxpayer appeals against AAT decision which only allowed him some deductions and imposed 50% penalties on the balance [40]




Decision Impact statements

*Darling case – ATO access to family court proceeding documents [41]

Income tax and GST assessments, and Div 7A issues: ATO view of case [42]





TD 2014/D17 – FBT: duties of employment in connection with public or non-profit hospital [43]


Class Rulings & Product Rulings

Class Rulings issued on 1 October 2014 [44]

Class Rulings issued on 8 October 2014 [45]

Class Rulings, Addendum and Withdrawal [46]

Class Rulings and Addenda released on 22.10.14 [47]

CR 2014/90 – off-market share buy-back by Telstra [48]



ATO Interpretive Decisions (ATOIDs)

*ATOID on ‘employee’ status of pizza delivery drivers for SGC purposes [49]


Tax Alerts

Other ATO news or statements

*Company loss carry-back repealed: ATO reminder to tax practitioners [50]

*ATO releases new Code of Settlement – with links to ‘model deeds’ of Settlement [51]

ATO asks tax professionals to join conversation about future of tax profession [52]

Project DO IT – the time to disclose is now, says ATO (19 December 2014 deadline) [53]




Legislation & Announcements (GST)

Cases (GST)

High Court refuses special leave in ATS Pacific Pty Ltd v FCT [54]

*GST: Re Guru 4U and FCT – company not carrying on an enterprise [55]


Rulings, Determinations & Other things (GST)

*GSTR 2014/1 – motor vehicle incentive payments following the AP Group Ltd decision [56]

GST – Addendum and Withdrawal of Class Rulings and GST Advice [57]

GSTD 2014/D4 – GST and supply of brokerage services for overseas purchases [58]



Legislation, Announcements etc. (Super)

*Withdrawing excess non-concessional super contributions: draft legislation [59]


Cases (Super)

*DCT (Superannuation) v Graham Family Superannuation Pty Limited – SMSF loans to members: Court approves $50,000 penalty for trustee directors [60]

*Re The Trustee for Rane Haulage Trust and FCT – Superannuation guarantee charge: nominal interest component affirmed [61]

Rulings & Other things (Super)












Annual reports released: IGT, SCT, Ombudsman, SCT and AAT [62]




‘Retroactive’ PI insurance cover required for tax and BAS agents from 1 July 2015: Tax Practitioners Board reminder [63]

Re Burnett – Tax Agent appeals to Federal Court against AAT decision to reject re-registration [64]

Re Frugtniet and Tax Practitioners Board – Tax agent registration termination upheld [65]

Tax Practitioners Board’s office is moving to the Sydney CBD [66]




Legislation & Announcements (State)

NSW: State Revenue Legislation Further Amendment Bill 2014 passed – Payroll Tax restriction to contractor provisions; Duties Act anti-avoidance; Land Tax grouping provisions [67]

NSW – State Revenue Legislation Amendment (Electronic Transactions) Bill 2014 – passed and awaits Royal Assent [68]

SA: Budget Bill receives Assent [69]


Cases (State)

NSW land tax: Bisvic Pty Ltd v Chief Comr of State Revenue (No 2) – primary production exemption refused [70]


Rulings & Other (State)

Qld: Insurance duty exemption for health insurance – admin arrangement made [71]

WA stamp duty: land transfer under property order; business asset transfer [72]

WA: land tax – withdrawal of memorial; FHOG – substantially renovated homes [73]




Amending FoFA regs stand: disallowance motion defeated in the Senate [74]

Government to establish public register of financial advisers [75]

Government releases its response to Senate inquiry into ASIC [76]






: 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

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