Tax Month – September 2014

M o r g a n’ s   T a x   M o n t h

– September 2014 Developments –

This is a collection of developments in Australian tax law and practice that occurred in September 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

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ACTS, BILLS AND ANNOUNCEMENTS
Acts & Bills

*Tax and Superannuation Laws Amendment (2014 Measures No 5) Bill 2014 introduced – reduce various offsets and update DGRs [1]

*Mining tax repeal and abolition of small business tax breaks – start dates proclaimed [2]

*Tax and Superannuation Laws Amendment (2014 Measures No 4) Bill 2014 passed; awaits Assent – thin cap; foreign resident CGT; foreign dividends [3]

*New Australia-Swiss DTA – Bill passes all stages [4]

Omnibus Repeal (Autumn 2014) Bill 2014 awaits Royal Assent – repeals legislation across 10 portfolios, including Treasury [5]

*CGT exemption to trustees for compensation and insurance: Draft legislation released [6]

Medicare levy surcharge and rebate – income thresholds to be frozen – Bill introduced [7]

Announcements

Parliamentary committee recommends tax changes re Northern Australia [8]

Tax reform needed to maintain living standards: Treasury Secretary [9]

The future of tax: BCA paper released [10]

*OECD/G20 BEPS project – 1^st set of deliverables released [11]

*G20 Finance Ministers agree to modernise global tax rules and close gaps [12]

*Complaints about tax disputes: Ombudsman appeared at Parliamentary inquiry [13]

CASES AND APPEALS

High Court

Full Federal Court

*Task Technology Pty Ltd v FCT – software licence use payments held to be royalties [14]

Federal Court

Federal Circuit Court

Administrative Appeals Tribunal (AAT)

*Re Coshott and FCT – Settlement payment for damages subject to CGT – and no cost base for legal costs (because there was no evidence) [15]

*Re GHP 104 160 689 Pty Ltd and FCT – R&D tax concession claims mostly allowed [16]

Re Moore and FCT – Over-claimed GST credits: penalty for “recklessness” affirmed [17]

*Re Riley and FCT – Compensation payment for domestic assistance assessable as ordinary income [18]

*Re Hicks & Associates Pty Ltd, Hicks and FCT – Assessments treating $800,000 in purported loans as income upheld [19]

*Re KNNW and FCT – Bulk of tax debt released on hardship grounds but application for release of the balance denied [20]

Other Courts & Tribunals

*Soong v Director of Public Prosecutions (Cth) – Conviction upheld for failure to provide security for tax liabilities [21]

*Windoval Pty Limited (Trustee) v Donnelly (Trustee in Bankruptcy) – Bankruptcy trustee claws back gift to family trust intended to defeat tax liability [22]

Appeals

*MBI Properties Pty Ltd v FCT – Transcript Released by High Court [23]

*Re Coshott and FCT – Taxpayer appeals decision that CGT applied to settlement proceeds to an action for breach of contract and negligence [24]

COMMISSIONER’S PUBLICATIONS & NEWS
Decision Impact statements

Chemical Trustee Limited v DCT Judgment to DCT for unpaid tax debt: ATO view on Chemical Trustee Ltd [25]

Rulings

Determinations

*TD 2014/D15 – PSI Entity’s receipts when not providing services is still PSI [26]

*TD 2014/D16 – a right for an employee to acquire an interest in shares subject to shareholder, is not an “indeterminate right” for ESS purposes [27]

Class Rulings & Product Rulings

Class Rulings, Product Ruling, Addendum to Product Ruling released [28]

ATO Interpretive Decisions (ATOIDs)

Tax Alerts

Other ATO news or statements

*Professional firm profits and assessing Pt IVA risk: ATO draft guidelines [29]

*ATO working with oversea regulators re global tax evasion: speech [30]

*Implications of OECD BEPS Actions Items from ATO perspective: speech [31]

*Australia’s laws are robust re aggressive international tax planning: Treasurer [33]

*GIC and SIC rates for Oct-Dec 2014 quarter [34]

*ATO launches voice authentication for telephone calls [35]

New task force, including ATO, to target outlaw motorcycle gangs [36]

GST DEVELOPMENTS
Legislation & Announcements (GST)

*GST on imported goods: no agreement on lowering id=”mce_marker”,000 threshold [37]

Cases (GST)

*Re The Trustee of Oenoviva (Australia & New Zealand) Plant and Equipment Trust and FCT – GST input tax credits: no standing to act on behalf of another entity [38]

Rulings, Determinations & Other things (GST)

*Re North Sydney Developments Pty Ltd v FCT – Sufficient notification of GST refund – ATO reaction [39]

*GSTR 2014/D4 – GST: meaning of “passed on” and “reimbursed” for the purposes of the new ‘anti-refund’ provision: s142-10 [40]

SUPERANNUATION DEVELOPMENTS
Legislation, Announcements etc. (Super)

*CGT exemption to trustees for compensation and insurance: Draft legislation released [41]

*Super fund mergers and the proportioning rule: Draft legislation released [42]

Cases (Super)

Rulings & Other things (Super)

*Super excess contributions tax: ATO view on Dowling case [43]

*ATO SMSF quarterly statistics for June 2014 released [44]

CARBON TAX & EMISSIONS REDUCTION FUND

MINERALS & PETROLEUM RENT RESOURCE RENT TAX

*Government tries again – new mining tax repeal Bill introduced [45]

*Mining tax repeal Bill – deal done with PUP in Senate and now awaits Assent [46]

Mining tax repeal and associated measures – start dates to be proclaimed: Government [47]

Mining tax repeal and abolition of small business tax breaks – start dates proclaimed [48]

Mining tax repeal – exemption from MRRT return lodgment: Legislative Instruments [49]

AUSTRALIAN CHARITIES & NOT-FOR-PROFITS (ACNC) SECTOR

*ACNC to revoke registration of 400 charities that appear not to be operating [50]

BOARD OF TAXATION

EXTERNAL SUPERVISORS – IGoT; OMBUDSMAN, JCPAA & ANAO.

TAX PRACTITIONERS BOARD & LEGISLATION

Re Su and Tax Practitioners Board – prohibition period upheld [51]

Re Burnett and Tax Practitioners Board – Tax agent registration renewal denied [52]

*‘Sufficient number’ and ‘fee or other reward’ for tax (financial) advisers: TPB drafts Information Sheets released [53]

*‘Tax (financial) adviser’ registration options: TPB updates [54]

STATE TAXES
Legislation & Announcements (State)

NSW: State Revenue Legislation Amendment (Electronic Transactions) Bill introduced [55]

Qld payroll tax: twice yearly lodgment for small businesses [56]

SA: Budget Bill awaits Assent [57]

Cases (State)

NSW land tax: Loomes v Chief Comr of State Revenue – discretion to “write off” unpaid land tax refused [58]

NSW land tax: Woods v Chief Comr of State Revenue – Principal Place of Residence (‘PPR’) exemption revoked, but Comr told to reconsider delay [59]

NSW payroll tax: Lombard Farms Pty Ltd v Chief Comr of State Revenue – discretion to de-group refused – taxpayer loses appeal [60]

NSW payroll tax: Boston Sales and Marketing Pty Ltd v Chief Comr of State Revenue – de-grouping determination refused [61]

SA: Emergency Services Levy remissions – retirement villages [62]

Vic land tax: Marrone & Anor v Comr of State Revenue – primary production exemption allowed [63]

Rulings & Other (State)

Qld payroll tax: exempt allowances for motor vehicles and accommodation – updated Public Ruling to harmonise with other States [64]

Vic stamp duty: first home buyer duty concession [65]

Vic payroll tax: SRO disclosure opportunity or ‘employers’ who’ve treated the contractor provisions as applying holders of Private Security Individual Operator Licences [66]

OTHER DEVELOPMENTS

FoFA amendments regulation: disallowance motion postponed [67]

Financial advice and SoAs: regs made following PUP deal [68]

FoFA Amendment Bill: Senate committee recommends passage [69]

THE END
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