Tax Month – September 2019

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

– September 2019 Developments –

This is a collection of developments in Australian tax law and practice that occurred in September 2019
which aims to be relevant to tax practitioners.[i]

Compiled By

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

Table of Contents

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Tax Articles

• ‘Residency – Individuals (and trusts)’ – a valuable Paper delivered to the LIV Tax Discussion Group (September 2019)
• Low cost Sovereign Wealth Fund style of investing would eradicate the gross fee burden born the enormous AUD 2+ trillion Australian Superannuation system (read index trading within chosen asset allocations)
• This has nothing to do with tax either – but Cannon-Brookes’ $25b plan to power Singapore with 15,000 ha of solar cells in outback Australia, was interesting
• ATO froze the assets of Chinese billionaire Huang Xiangmo – ATO caught out by cancellation of his visa
• Billionaire Huang Xiangmo told ATO he had no assets overseas – but 71% of the disputed tax liability turns on the market value cost base of Chinese real estate when he became an Australian resident
• After APRA fails against IOOF – academics call for super fund ‘reserves’ to be better regulated and better scrutinised

Legislation

Acts etc.

• Director ID numbers – Labor moves amendments to the Government’s ‘Combating Illegal Phoenixing Bill’ replicating it’s lapsed legislation on DINs
• Limit to taxation concessions applicable to testamentary trusts – only income from deceased estate – draft legislation

Announcements

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Cases

High Court

• —

Full Federal Court

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Federal Court

• Deputy Commissioner of Taxation v Huang – Freezing orders made over Australian assets of notorious Chinese billionaire’s and his wife’s Australian assets – supporting assessments of $140m
• Chinese Billionaire’s assets frozen – ATO says he hid $170m of income and Hong Kong wouldn’t help enforce foreign tax liabilities

Administrative Appeals Tribunal (AAT)

Other Courts & Tribunals

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Appeals

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Rulings

Decision Impact statements

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Rulings

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Determinations

• TD 2019/D9 – the ‘natural love and affection’ exclusion from Commercial Debt forgiveness – Commissioner proposes to change his position on forgiving companies

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

Tax Alerts

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Other ATO news or statements

• 7.98% GIC and 3.98 SIC% for October to December 2019 Quarter – very low ‘base rate’

GST 

Legislation & Announcements (GST)

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Cases (GST)

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Rulings, Etc. (GST)

• —

Superannuation

Legislation etc. (Super)

• —

Cases (Super)

• APRA v Kelaher & Ors – Court finds against APRA, rules that APRA did not prove that IOOF breached the SIS Act and did not disqualify the relevant officers (some of whom had retired from IOOF by then)
• IOOF, the ‘pub test’ and members’ money – an article about APRA’s failed action against various IOOF entities and officers
• APRA’s failed case against IOOF entities and officers – Where are we now after 873 paragraphs of Justice Jagot’s reasons? – 2 articles, 2 views

Rulings etc. (Super)

• Low cost Sovereign Wealth Fund style of investing would eradicate the gross fee burden born the enormous AUD 2+ trillion Australian Superannuation system (read index trading within chosen asset allocations)
• PCG 2019/7 – Large APRA regulated Super Funds have until 30 June 2020 to get their systems into order to be able to reporting of ‘pension tax bonus’ amounts

State Taxes

Legislation & Announcements (State)

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Cases (State)

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Rulings & Other (State)

• The impact of foreign acquirer land tax and duty surcharges – it started in Victoria and has spread across most state and territory jurisdictions with similar but different tests and ambit

Other Developments

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

• —

Base Erosion & Profit Shifting & OECD

• —

Board of Taxation

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Inspector General and other external supervisors

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Miscellaneous

• Treasury Paper on ‘progressive tax rates’ in Australia – just how much difference is there in the tax paid by the top ‘decile’ over the last 22 years?

Tax Practitioners Board

• Taxation Guru Pty Ltd and Gambhir Watts v Tax Practitioners Board – no ‘stay’ of decision terminating their tax agent registration (for claiming deductions for unsupportable ‘work-related expenses’)
• Gao v Tax Practitioners Board – No stay of tax agent registration terminations (535 over claimed deductions, over claimed interest, under declared GST and consistently late self-returns)

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[i]           Sources – abbreviations: ‘KPMG’: KPMG Daily Tax News; ‘LCA’: Law Council of Australia; ‘LTN’: Latest Tax News (Thomson Reuters); ‘Sievers’: Chris Sievers’ GST post (www. http://chrissievers.com); ‘TBA’: Tax Bar Association Newsletter; ‘TaxVine’: The Tax Institute’s ‘TaxVine’.