SEARCH RESULTS

Search

Filter

Type







Category










Year












12 Nov 2018 | Riposte | Real Estate | Private Wealth

Extension of significant global entity definition and impact for large private groups

On 20 July 2018, Treasury released Exposure Draft legislation to extend the definition of a significant global entity (SGE). As a result, the extended definition of an SGE may include members of large private groups headed by unlisted companies, trusts (including discretionary trusts), partnerships or other investment vehicles. This will have wide ranging implications for affected large private groups which were previously outside the scope of some anti-avoidance provisions, increased administrative penalties and the requirement to lodge general purpose financial statements. The change is proposed to apply for income years starting on or after 1 July 2018.

07 Nov 2018 | Riposte | Real Estate | Financial Services | Energy & Resources

Unreal transfer pricing does not solve very real debt-equity issues

The ATO has released draft determination TD 2018/D6 on the relationship of the debt-equity and transfer pricing rules in relation to related party loans. The draft makes unreal assumptions about transfer pricing and avoids serious analysis of the debt-equity rules, with results that unfortunately are becoming common in ATO guidance – assertion without justification.

23 Oct 2018 | Riposte | Real Estate | Private Wealth

Victorian Land Tax: Guidelines for the Absentee Owner Surcharge Exemption

The Victorian Treasurer has published further guidelines on the circumstances in which an impacted landowner may be granted an exemption from the Absentee Owner Surcharge (AOS) for the 2019 land tax year onwards.

22 Oct 2018 | Riposte | Real Estate | Private Wealth

Denying deductions for vacant land – Exposure Draft

The Government has released Exposure Draft legislation, as previously announced in the 2018-2019 Budget, to deny certain deductions associated with holding vacant land incurred from 1 July 2019. These integrity measures, which are effectively targeted at private trusts, SMSFs and individuals, can apply to deny deductions where the land is not being used to carry on a business for the purpose of producing assessable income.

17 Oct 2018 | Riposte | Real Estate | Private Wealth

Circular trust resolutions – family trusts to be taxed at 47%

Following on from the Government’s announcement in the 2018-19 Budget, an Exposure Draft entitled Treasury Laws Amendment (Measures for a Later Sitting) Bill 2018 has been released which proposes to impose trustee beneficiary non-disclosure tax (currently, 47%) on the untaxed part of a circular trust distribution to which the trustee of a family trust becomes presently entitled.

15 Oct 2018 | Riposte | Real Estate | Financial Services | Energy & Resources

Source rule in treaty means what it says

The Full Federal Court has confirmed in a short but emphatic judgment that the sourcing rule in Australia’s tax treaties means what it says. It rejected the argument that tax treaties are exclusively relieving and cannot lead (indirectly) to higher tax burdens.

25 Sep 2018 | Riposte | Real Estate

Stapled structures: integrity measures

On 20 September 2018, the Government introduced a Bill into Parliament to give effect to various integrity measures aimed at foreign investors. This is another instalment in the review that was initially aimed primarily at stapled groups. In this Riposte, we focus predominantly on the changes from the exposure draft which will primarily impact real estate groups.

11 Sep 2018 | Riposte | Real Estate | Private Wealth

NSW land tax: property developer liable for land tax under property development agreement

The Civil and Administrative Tribunal of New South Wales decision in Australia Avenue Developments Pty Ltd as trustee for the SOP Site 3 Partner Trust v Chief Commissioner of State Revenue [2018] NSWCATAD 144 demonstrates the importance of considering land tax implications when structuring property development arrangements.

28 Aug 2018 | Riposte | Real Estate

New Zealand anti-hybrid rules

New Zealand's anti-hybrid rules are already in force. For some Australian groups with New Zealand operations, action may be required now to address the impact of the rules.

Riposte - New Zealand Anti-Hybrid Rules - 28 August 2018 (110 kb)

21 Aug 2018 | Riposte | Real Estate | Financial Services | Employment & Superannuation

Trust the PDS

The Full Federal Court decision in Aussiegolfa Pty Ltd (Trustee) v Commissioner of Taxation [2018] FCAFC 122 highlights the importance of statements in offer documents to the interpretation of underlying legal documents - here a trust deed - and the borderline as to when distinct trusts will be created through the use of separate classes of units.

30 Jul 2018 | Tax Brief | Real Estate | Projects & Infrastructure

Stapled Structure Integrity Measures – Revised Exposure Draft

On 26 July 2018, the Government released revised draft legislation to give effect to various announced integrity measures aimed primarily at stapled groups. In this Tax Brief we focus on the changes from the original draft.

Tax Brief 30 July 2018 - Stapled Structure Integrity Measures – Revised Exposure Draft (222 kb)

25 Jul 2018 | Riposte | Real Estate | Employment & Superannuation

Payroll tax on service contracts – integrated workers

Recent NSW cases have shown that the concept of an “employment agency agreement” under which payments are subject to payroll tax is different to its ordinarily understood meaning.

24 Jul 2018 | Riposte | Real Estate | International

Hybrid mismatches: integrity rule and real estate investments in Australia

A bill has been introduced into Parliament (expected to be passed during the August Parliamentary sitting) to enact the Government’s announced hybrid mismatch rules. The rules will apply for income years starting on or after 1 January 2019, and apply regardless of whether an entity is a Significant Global Entity.

02 Jul 2018 | Riposte | Real Estate | GST

Happy New (Financial) Year! Welcome to GST Withholding...

The GST Withholding regime commenced on 1 July 2018, so purchasers exchanging from now on will be required to withhold an amount for GST when they acquire most new residential premises and potential residential land. Due to the transitional provisions, GST withholding will not apply where the contract was entered into prior to this date and the first payment (other than any consideration paid as a deposit) is provided before 1 July 2020.

29 Jun 2018 | Riposte | Real Estate | Projects & Infrastructure

Treasury consultation on integrity measures to access transitional relief from stapled structures changes

Treasury released a proposal paper seeking feedback on proposed integrity rules which must be satisfied to access the 7 and 15 year transitional relief from the proposed tax changes to the MIT withholding regime announced in the 17 May 2018 “Stapled Structures” Exposure Draft.

20 Jun 2018 | Riposte | Real Estate

Queensland Budget 2018-19: Increases to land tax rates

From 1 July 2018, Queensland land tax payers will be required to pay an additional 0.5% of land tax on the portion of aggregated landholdings above a total taxable value of $10 million.

19 Jun 2018 | Riposte | Real Estate

Exposure Draft released containing technical amendments to the AMIT regime

The Government has released an Exposure Draft containing a number of technical amendments to the AMIT regime. While a number of significant issues with the existing legislation have been brought to the attention of Treasury, only a handful have been addressed in this draft legislation leaving significant issues facing a number of taxpayers.

21 May 2018 | Tax Brief | Real Estate

Stapled structures: integrity measures

The Government has released draft legislation containing the proposed integrity measures for stapled groups. This follows the Government announcement in relation to the proposed integrity measures as addressed in our Tax Brief of 28 March 2018. This Tax Brief focuses on the impact of the measures on the real estate sector. A separate Riposte addresses the impact on the infrastructure sector. Generally, the measures should not affect stapled groups that do not have material cross-staple dealings.

Tax Brief: Stapled Structures - Impact of proposed integrity measures on real estate groups 21 May 2018 (212 kb)

28 Mar 2018 | Tax Brief | Real Estate

Stapled structures: integrity measures

Following on from the Australian Taxation Office’s concerns in TA 2017/1, the Government has proposed sweeping changes to the tax laws that will impact on a range of stapled and non-stapled structures. The measures will: (i) apply a 30% withholding tax rate to most income derived from cross-stapled arrangements; (ii) treat ownership of agricultural land as a trading business, even if used for rental purposes; (iii) expand the thin capitalisation rules to require gearing to be calculated on a look-through basis for interests of 10% or more; and (iv) limit the exemptions currently enjoyed by foreign sovereign entities and pension funds. This Tax Brief focuses on the impact of the measures on the real estate sector. A separate Riposte addresses the impact on the infrastructure sector. Generally, the measures should not affect stapled groups that do not have material cross-staple dealings.

Tax Brief - Stapled groups integrity measures 28 March 2018 (261 kb)

21 Mar 2018 | Riposte | Real Estate

Who is an Associate in a Stapled Group?

The ATO has argued that entities in a stapled group can be associates, mainly on the basis that the trust side of the stapled group is “sufficiently influenced” by the company side. This has tax consequences including raising the risk of s974-80 applying to cross staple loans. However, the recent AAT case of MWYS casts some doubt over the ATO’s position. Although the case deals with dual listed companies, the principles outlined in the case would suggest that the trust side of a stapled group is not an associate of the company side.

07 Mar 2018 | Riposte | Real Estate

South Australian Retirement Villages Act causes amendment to TR 2002/14

A good result for retirement village operators with villages in South Australia as the ATO provides clarity, and the right outcome for operators, following the recent changes to the State RV Act.

14 Feb 2018 | Riposte | Real Estate

The Review of Tax Treatment of Bare Trusts and Similar Arrangements

The Board of Taxation has today released a report into its review of the tax arrangements applying to bare trusts and similar arrangements. The Board has considered whether, and how, to legislate the current industry practice of looking through such trusts for income tax purposes. The treatment of bare trusts has been considered in reviews into the tax system by Governments in the past and although similar recommendations had been made, no changes to the Tax Law have followed. Let’s hope that this time the Government makes the recommended changes and aligns the Tax Law with industry practice.

14 Feb 2018 | Riposte | Real Estate

Affordable residential housing MIT measures

On 8 February 2018 the Government introduced the Treasury Laws Amendment (Reducing Pressure on Housing Affordability Measures No. 2) Bill 2018 into the House of Representatives. The Bill will enact the announcement in the May 2017 Budget about managed investment trusts investing in affordable residential housing. Individuals will also be eligible for an increased CGT discount where they invest in affordable residential housing. The Bill does not include the announced prohibition on holding residential property in a MIT. We understand however that this is not because the Government has changed its mind but rather because it is still considering its policy. It is expected that the Government will announce its position regarding MITs investing in residential property at a later time.

22 Jan 2018 | Riposte | Real Estate | International

Changes to Victorian Absentee Owner Surcharge for Trusts

The Absentee Owner Surcharge (AOS) exemption has been extended to trusts and changes have been implemented for the calculation of AOS for trusts that are part of a chain of trusts.

09 Jan 2018 | Riposte | Real Estate

Corporate CIV Regime takes shape

The government has released draft legislation for the tax aspects of the new regime for corporate collective investment vehicles.

21 Dec 2017 | Riposte | Real Estate

New fees on vacant residential property

The Government has introduced new vacancy fees on foreign owners of residential property vacant for more than six months of a year. A similar Victorian vacancy tax is also being imposed on owners of residential property situated in inner and middle suburban Melbourne.

09 Nov 2017 | Riposte | Real Estate | GST

Purchaser withholding on new homes

Draft legislation to combat phoenixing on new homes has been released, putting the onus on purchasers to withhold and pay to the ATO 1/11th of the price of their new home.

02 Nov 2017 | Riposte | Real Estate | Employment & Superannuation

Payroll tax on service contracts – integral vs incidental functions

The recent decision in JP Property Services Pty Limited v Commissioner of State Revenue [2017] NSWSC 1391 said contracts for service to perform integral functions in a client’s business invoke the employment agency payroll tax rules, but not contracts for incidental functions.

23 Oct 2017 | Riposte | Real Estate | Projects & Infrastructure

Commissioner refreshes long term construction contract ruling

As part of Project Refresh the Commissioner has released Taxation Ruling TR 2017/D8 which is a rewrite of Taxation Ruling IT 2450 and related taxation determinations dealing with the income tax treatment of long term construction contracts.

15 Sep 2017 | Riposte | Real Estate

Government significantly limits residential REITs

The Government has released for public consultation the exposure draft legislation containing the measures to implement its affordable housing MIT proposal.. However, at the same time the Government will deny MIT status to trusts that invest in residential premises that do not constitute affordable housing.

13 Sep 2017 | Riposte | Real Estate | Employment & Superannuation | International

Housing Affordability Bills Introduced

As part of the 2017-18 Federal Budget, the Government announced several measures to assist with housing affordability. Bills to implement some of these measures were introduced on 7 September 2017.

27 Mar 2017 | Riposte | Real Estate | Projects & Infrastructure

Stapled structures consultation paper

The attack on stapled structures continues with the release of a consultation paper looking at stapled structures, the taxation of real property investments and the re-characterisation of trading income.

10 Mar 2017 | Riposte | Real Estate

A tax on vacant properties

The Victorian government is considering extending the land tax framework to impose a tax on vacant properties in some parts of Melbourne.

07 Mar 2017 | Riposte | Real Estate | Private Wealth

‘Improvements’ – pre- or post-CGT assets?

According to the ATO, any intangible capital improvements made to a pre-CGT asset may be treated as a separate CGT asset.

02 Feb 2017 | Riposte | Real Estate

Land Tax - foreign owners’ notification obligations

Foreign owners of land located in NSW and Victoria are obliged to notify the Commissioner of their foreign status.

31 Jan 2017 | Tax Brief | Real Estate

TA 2017/1: impact on property groups

Stapled property groups need to look closely at their cross staple arrangements or risk raising the ire of the ATO.

(200 kb)

30 Jan 2017 | Riposte | Real Estate

Inequitable taxation of 'disturbance payments'

The tax treatment of ‘disturbance payments’ in connection with the compulsory acquisition of land proposed in a recently issued ATO class ruling has the potential to disadvantage some taxpayers while delivering a windfall to others.

19 Jan 2017 | Riposte | GST | Real Estate

The meaning of 'GST' in property transactions

The McEwans case held that 'GST' can have different meanings in a contract. As a result of imprecise language, both parties to a sale of land subject to the margin scheme were left worse off.

12 Jan 2017 | Riposte | Real Estate

NSW land tax surcharge for foreign persons

Commencing from the 2017 land tax year, foreign persons will be liable to pay an additional land tax surcharge of 0.75% on residential land owned in NSW.

17 Nov 2016 | Riposte | Real Estate | GST

GST in property transactions: who bears the risk?

How important is it to get the details right in the particulars of a contract of sale? A recent case involving a GST clause in a real estate contract demonstrates how one word can be determinative of a tax liability.

07 Nov 2016 | Riposte | Real Estate

WHT rate cuts - but not for property sector

Two options for reducing withholding tax to 5% for certain CIV distributions are considered in a recent Treasury Discussion Paper. Unfortunately, neither option applies to income from investments in property.

31 Oct 2016 | Riposte | Real Estate

Draft ATO guidance on fixed trusts

Determining the important question of whether a trust is a ‘fixed trust’ has always been a tightrope walk between its strict definition and how the ATO might exercise its discretion. A new draft guideline considers how the ATO will use its discretion to treat a trust as a fixed trust in the context of the trust loss rules.

11 Oct 2016 | Riposte | Real Estate | Financial Services | Projects & Infrastructure

Related schemes & 974-80 ED at last

Exposure draft legislation intended to address the Board of Taxation’s recommendations concerning s.974-80 and the related schemes provisions in the debt/equity rules has finally been released. Do the proposals provide clarity to taxpayers who are not on all fours with the examples?

04 May 2016 | Riposte | Real Estate

MIT bill passed

The Senate approved the Bill to enact the specific tax regime for managed investment trusts. The MIT Regime is a welcome introduction of rules that have taken may years to formulate.

24 Feb 2016 | Riposte | Real Estate

New reporting for share and unit transactions

Share and unit transactions of listed companies, listed and unlisted unit trusts and certain other trustees are subject to new reporting requirements that enhance the ATO's data matching capabilities.

03 Dec 2015 | Tax Brief | Real Estate

The new landscape for managed investment trusts

Rules governing the taxation of income derived through “attribution managed investment trusts” or AMITs have been introduced. This critical development in the tax landscape will affect trusts used in the property, infrastructure and investment management sectors.

New landscape for managed Investment trusts (312 kb)

10 Apr 2015 | Tax Brief | Real Estate

The New Attribution MIT Regime

The recently released exposure draft legislation proposes a new regime for taxing income derived through “attribution managed investment trusts”. This Tax Brief considers each of the key measures of the new regime and certain other measures in the ED as well as some changes we might expect in the ultimate legislation.

The New Attribution MIT Regime (412 kb)

09 Apr 2015 | Riposte | Real Estate

New Regime for MITs

Long-awaited exposure draft legislation addressing the managed investment trust taxation regime has finally been released. The ED contains a package of eight key measures which will apply only to certain MITs and which may prove a mixed bag for industry.

03 Dec 2014 | Riposte | Real Estate | GST

High Court rules on GST on property leases

The High Court delivered a welcome judgment for commercial property landlords as it concerns the GST treatment of leasing.

26 Nov 2014 | Riposte | Real Estate

Addendum to TR 2002/14

An addendum to TR 2002/14 reaffirms the ATO's changed position on capital growth payments reflected in its recent Decision Impact Statement.

13 Nov 2014 | Riposte | Real Estate

A win for retirement village operators

The ATO has finally accepted that capital growth payments made to retirement village residents are deductible. Taxpayers can now lodge amendments to claim them.

20 Sep 2014 | External Publications | Real Estate

974-80 and stapled entities

Casey Wakely co-authored and presented "974-80 and stapled entities" for The Tax Institute's (NSW Division) 9th Annual Property Intensive conference held in Sydney on 20 September 2011.

(506 kb)

19 Sep 2014 | Briefing Notes | Real Estate

FATCA for Property Groups

Daniel Sydes and Manuel Makas set out some of the key issues relevant to Australian property groups as it relates to FATCA.

FATCA for Property Groups (247 kb)

02 Nov 2012 | Tax Briefs | Real Estate

Some Progress on Trust Tax Reform

This Tax Brief analyses Treasury's two proposals in presented in Options Paper concerning the new regime to tax income passing through trusts. It also considers what the future might look like for those managed investment trusts (‘MITs’) which will not qualify for the new MIT attribution regime, and for the trusts into which MITs and non-MIT trusts will invest.

Some Progress on Trust Tax Reform (157 kb)

12 Aug 2013 | Tax Briefs | Real Estate

IMR and MIT: A going-away present?

This Tax Brief considers the status of certain promises by the Labor Party to make Australia an Asian funds management hub.

IMR and MIT: A going-away present? (49 kb)

23 Apr 2013 | Tax Briefs | Real Estate

Investment Manager Regime - Element 3

This Tax Brief examines the main provisions of an n Exposure Draft of the legislation needed to enact ‘Element 3’ of the Investment Manager Regime Exposure Draft, its principal effects and some of the issues that it will raise.

Investment Manager Regime - Element 3 (265 kb)

10 Nov 2010 | Tax Briefs | Real Estate

Further Developments in the Taxation of MITs

The Assistant Treasurer released a Discussion Paper on proposed changes to the taxation of managed investment trusts (MITs), which in many important places is vague and indecisive. This Tax Brief explains the new measures and how the Paper proposes they will operate.

Further Developments in the Taxation of MITs (85 kb)

05 Jul 2010 | Tax Briefs | Real Estate

New Definition of Managed Investment Trust

The definition of a “managed investment trust” was significantly amended in 2010. The definition is relevant for the application of the MIT withholding and elective CGT regimes. This Tax Brief examines the new definition and how it has changed the range of trusts that are eligible to access the MIT withholding tax and CGT election concessions.

New Definition of Managed Investment Trust (79 kb)

10 May 2010 | Tax Briefs | Real Estate

New Managed Investment Trust Regime

This Tax Brief examines the Board of Taxation Report into the taxation of Managed Investments Trusts released on 7 May 2010, the Government’s responses and the next steps on the path to implement these important proposals.

New Managed Investment Trust Regime (76 kb)

05 Mar 2010 | Tax Briefs | Real Estate

CGT Treatment for MITs - New Draft Legislation

The Tax Laws Amendment (2010 Measures No 1) Bill 2010 contains the proposed final form of the measures that permit eligible managed investment trusts to elect to apply the capital gains tax regime as the primary measure for taxing gains and losses on assets. This Tax Brief examines the changes from the Exposure Draft of these provisions.

CGT Treatment for MITs - New Draft Legislation (70 kb)

17 Dec 2009 | Tax Briefs | Real Estate

CGT Treatment for MITs - Draft Legislation

This Tax Brief considers the 2009 Exposure Draft legislation for the application of capital gains tax to managed investment trusts.

CGT Treatment for MITs - Draft Legislation (60 kb)

29 Jan 2009 | Tax Briefs | Financial Services | Real Estate

TOFA for the Property Sector

After much delay, the regime for taxing financial arrangements (‘TOFA’) now seems likely to be passed early this year. TOFA can affect both the investments made in the property sector and the financing of those investments, but just how – and how much – activity in the property sector will be affected is neither obvious nor straightforward. This Tax Brief examines some of the issues that the TOFA regime will present for the property industry.

TOFA for the Property Sector (60 kb)

04 Nov 2008 | Tax Briefs | Real Estate

Review of Managed Investment Trusts: Round 1

In this Tax Brief we consider the Division 6C changes contained in Tax Laws Amendment (2008 Measures No 5) Bill 2008, introducing the ‘2% safe harbour’ and the ‘25% safe harbour’. This bill follows the release of exposure draft legislation in July 2008.

Review of Managed Investment Trusts: Round 1 (75 kb)

24 Jul 2008 | Tax Briefs | Real Estate

Proposed Amendments for Managed Investment Funds

The Government has released draft proposed amendments to Division 6C. This Tax Brief examines the scope and operation of the draft amendments.

Proposed Amendments for Managed Investment Funds (54 kb)

22 May 2008 | Tax Briefs | Real Estate

Final Withholding for Managed Investment Trust Distributions

This Tax Brief discusses the 2008 Exposure Draft to change the regime for taxing distributions to foreign residents who invest in Managed Investment Trusts.

Final Withholding for Managed Investment Trust Distributions (53 kb)

06 Sep 2007 | Tax Briefs | Real Estate

Tax Changes for Australian Property Trusts and Stapled Entities

This Tax Brief provides an overview of certain aspects of the Tax Laws Amendment (2007 Measures No. 5) Bill 2007 which contains two sets of measures that affect stapled entities and trusts – one that helps stapled groups to restructure without triggering adverse tax outcomes, and a second designed to permit Australian trusts to expand offshore.

Tax Changes for Australian Property Trusts and Stapled Entities (90 kb)

23 Aug 2007 | Tax Briefs | Real Estate | Projects & Infrastructure

New Tax Measures for Property and Infrastructure Projects

This Tax Brief discusses a bill introduced into Parliament by the Government on 16 August 2007, that enacts the tax exempt lessee rulse in Division 250.

New Tax Measures for Property and Infrastructure Projects (134 kb)