12 Nov 2019 | Tax Brief | Corporate and Mergers & Acquisitions | International | Financial Services | Private Wealth | Private Equity
BEPS 2.0 - Pillar Two moves forward
The OECD has released its consultation document for BEPS Pillar Two on GloBE (the global anti-base erosion tax) as promised when releasing the Unified Secretariat Proposal on Pillar One last month.
07 Nov 2019 | External Publications | Financial Services | Corporate and Mergers & Acquisitions | Private Equity | Private Wealth
Sharpcan highlights problems
The High Court recently handed down its judgment in the Sharpcan litigation (FCT v Sharpcan Pty Ltd  HCA 36, reported at 2019 WTB 44 , a case that raises a well-trodden capital-or-revenue issue, but also touches on the untested ‘black-hole’ rules. The case highlights again the glaring omission of a regime for depreciating wasting intangible assets, and the difficult problems taxpayers can face trying to remedy that defect in our law.
06 Nov 2019 | Riposte | Corporate and Mergers & Acquisitions | Private Wealth | Financial Services | Real Estate | Private Equity
ATO Challenges Trust Cloning, Again
The ATO has recently issued a Taxpayer Alert aimed at countering a newly-emerging form of ‘trust cloning.’
23 Oct 2019 | Riposte | Corporate and Mergers & Acquisitions | Private Wealth
High Court Rules on the Treatment of Statutory Licences
The High Court has handed down its judgment in the Sharpcan litigation, a case that raises a well-trodden capital-or-revenue issue, but also touches on the untested ‘black-hole’ rules. The case highlights again the glaring omission of a regime for depreciating wasting intangible assets, and the difficult problems taxpayers can face trying to remedy that defect in our law.
21 Oct 2019 | Riposte | Transfer Pricing | Energy & Resources | Corporate and Mergers & Acquisitions | Private Wealth
Transfer pricing & offshore drilling – PCG 2019/D5
The ATO has been concerned with the Australian tax implications of non-residents operating or undertaking drilling operations in Australian waters. The ATO flagged a number of its concerns in Tax Alert TA 2016/4.
11 Oct 2019 | Riposte | Corporate and Mergers & Acquisitions | Financial Services | Private Wealth | Private Equity
Thin Capitalisation - Arm’s length Debt Test – PCG 2019/D3
The ATO has now provide the following guidance on the application of the Arm’s Length Debt Test (ALDT) in the thin capitalisation rules.
17 Sep 2019 | Riposte | Transfer Pricing | Financial Services | Private Equity | Private Wealth | Corporate and Mergers & Acquisitions
Glencore Transfer Pricing Decision
The recent Glencore decision suggests some limits on the ATO’s ability to reconstruct related party transactions in transfer pricing disputes.
13 Sep 2019 | Riposte | Private Equity | Private Wealth | Corporate and Mergers & Acquisitions | Financial Services
International Tax Trust Morass – Again!
After almost 3 years consulting in relation to tax issues for non-resident beneficiaries in relation to trust level capital gains by an Australian resident trust, the ATO has continued the recent trend of making bad legislation even worse in two recent draft tax determinations.
30 Aug 2019 | Riposte | Private Wealth | Corporate and Mergers & Acquisitions | Energy & Resources | Financial Services
New corporate residence rules?
The High Court’s decision in Bywater and the ATO’s approach to the impact of the decision has significantly increased the focus on corporate tax residency. The Treasurer has now asked the Board of Taxation to review Australia’s corporate tax residency rules and report by the end of the year.
24 Jul 2019 | Riposte | International | Real Estate | Projects & Infrastructure | Private Equity | Private Wealth
Investment in the US by superannuation funds and through LPs
The US 2017 tax reform included less noticed changes including one relating to foreign partners in LPs investing in the US. An important change in relation to investment by foreign pension funds in US real estate has also been developing over recent years. This Riposte briefly outlines recent important developments on these matters and the problems that can arise when they come together.
02 Jul 2019 | Riposte | Private Wealth | Real Estate
Land tax changes following 2019-2020 State Budgets
In recent weeks, the Queensland and Victorian Governments handed down their 2019-2020 State Budgets. Each Budget contained land tax changes which are mainly targeted at foreign land owners.
17 Dec 2018 | Riposte | Private Wealth
Capital gain versus revenue gain, again
The recent decision in the Ransley case has shown the willingness of the ATO to target investors seeking to adopt CGT treatment on the sale of shares. The decision also upheld the 50% penalty applied by the ATO.
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.
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.
16 Oct 2018 | Tax Brief | Private Wealth
Taxing private trusts - a moving target
Our revenue authorities have been very active recently issuing judgments, making pronouncements and intensifying enforcement activity, all directed to the way the tax system operates in relation to income made from, and gains arising on transactions with, assets that are held on trust. This Tax Brief highlights the effects of some of the more important developments affecting private trusts.
Tax Brief - Taxing private trusts – a moving target (322 kb)
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  NSWCATAD 144 demonstrates the importance of considering land tax implications when structuring property development arrangements.
13 Aug 2018 | Riposte | Financial Services | Private Equity | Private Wealth
Tax Law Bites Trust Law on Franking Credits
The High Court of Australia has restored sanity in a long running saga in which a trustee purported to separate franking credits from the underlying dividends in allocations to beneficiaries. The Court held (as the parties now accepted) that this was not possible and that a contrary decision of the Supreme Court of Queensland in its trusts jurisdiction to which the Commissioner of Taxation was not party did not bind the Commissioner.
13 Aug 2018 | Riposte | Real Estate | Private Equity | Private Wealth
Tax Law Bites Trust Law on Franking Credits
The High Court of Australia has restored sanity in a long running saga in which a trustee purported to separate franking credits from the underlying dividends in allocations to beneficiaries. The court held (as the parties now accepted) that this was not possible and that a contrary decision of the Supreme Court of Queensland in its trusts jurisdiction to which the Commissioner of Taxation was not party did not bind the Commissioner.
12 Jul 2018 | Riposte | Private Wealth | Employment & Superannuation
Board of Taxation reviews residency test for individuals
The Board of Taxation has released a self-initiated report considering the existing individual income tax residency rules. In providing its recommendations, the Board of Taxation concludes that the existing residency rules are no longer appropriate and must be modernised.
15 Mar 2018 | Riposte | Employment & Superannuation | Private Wealth
Labor to deny SMSF franking credit refunds
Labor announced that, if elected, they would deny franking credit refunds for superannuation funds and individuals. Although targeted primarily at Self-Managed Superannuation Funds, some APRA-regulated funds that cater principally for pensioners and some non-working and low-income individuals will also be adversely affected.
26 Sep 2017 | Riposte | Private Wealth
Crackdown on Phoenixing: Director Identification Numbers
The Government has announced a package of reforms in a bid to crackdown on illegal phoenixing activities, which will require every company director to register for a unique Director Identification Number. The Government also intends to consult on other measures targeted towards phoenix operators.
20 Sep 2017 | Riposte | Private Wealth
Corporate tax rate cut - passive income exclusion
The Government has released exposure draft legislation to clarify that the corporate tax rate reduction will not be available for corporate tax entities with predominantly passive income. There are areas of the drafting that may require amendment.
15 Sep 2017 | Riposte | Private Wealth
Private Groups and Trusts under ATO scrutiny
The ‘Tax Avoidance Taskforce – Trusts’ is targeting privately owned and wealthy groups involved in higher risk trust arrangements. The ATO has released a list of situations which attract the Taskforce’s attention and may result in severe sanctions for targeted taxpayers.
04 Aug 2017 | Riposte | Private Wealth
Labor’s family trust distribution tax
In an audacious move to target income splitting, if elected, the ALP will introduce a minimum 30 per cent tax rate on all discretionary trust distributions made to adult beneficiaries.
17 Jul 2017 | Riposte | Private Wealth
A severe case of the penalties
The AAT has upheld the Commissioner’s decision to impose penalties of up to 95% of the tax shortfall. It is a timely reminder of the various powers that the Commissioner has to impose penalties on taxpayers.
06 Jul 2017 | Riposte | Private Wealth
ATO targets converted UPEs
The ATO has issued a warning that it is targeting arrangements where unpaid present entitlements of unit trusts within private groups are converted to equity. The unit trust may then make payments or loans to other members of the private group.
26 May 2017 | External Publications | Private Wealth
The expanding offshore client
"The Expanding Offshore Client – How Australian Tax Rules Are Taken With You and How to Manage Them" was authored by Director Cameron Blackwood and Senior Associate Chris Aboud and presented by Cameron at The Tax Institute Private Business Tax Retreat in May 2017.
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.
11 Nov 2016 | Riposte | Private Wealth
Private groups attracting ATO attention
In another attempt to help “get things right”, the ATO has released a list of behaviours, characteristics and tax issues of privately owned and wealthy groups that will attract the ATO’s attention.
25 Oct 2016 | Riposte | Private Wealth
Tax transparency – a looming issue for private groups?
Greater tax transparency is a looming issue for privately owned and wealthy groups with numerous measures already having been introduced and other measures under consideration by Government.
13 Sep 2016 | Riposte | Private Wealth
“Every year counts” for private groups
The ATO's key initiatives for private groups in 2016/2017 are outlined in the latest update on its Reinvention program: “Every year counts for Privately Owned and Wealthy Groups”.
03 Jun 2016 | Riposte | Private Wealth
Tax adviser or ATO informer? The Mandatory Disclosure proposal
As part of the 2016-17 Federal Budget, the Government announced that it will introduce Mandatory Disclosure Rules to require tax advisors (and in certain circumstances taxpayers) to report ‘aggressive tax arrangements’ to the ATO.
11 May 2016 | Riposte | Private Wealth
Panel session with Jeremy Hirschhorn, ATO
On 11 May 2016, Greenwoods and our associated law firm, Herbert Smith Freehills, hosted a panel session in Melbourne titled "Are you on the ATO's radar?", which included ATO Deputy Commissioner, Public Groups, Jeremy Hirschhorn. Our Riposte summarises the key points raised in the session.
06 May 2016 | Riposte | Private Wealth
Budget 2016 - Reflections for large private groups and HWIs
The 2016-17 Federal Budget confirms that the ATO will continue to be heavily focused on the tax affairs private groups (and their tax advisors), however, there will be some welcomed relief on Division 7A and a lower company tax rate (eventually).
27 Apr 2016 | Riposte | Private Wealth
Senate Committee reports (again)
The Senate Economics References Committee’s inquiry into Corporate Tax Avoidance released a second report: Gaming the System. Its sole recommendation is to extend the committee's term to September 2016 ‘to explore the implications arising from the Panama papers’.
05 Apr 2016 | Riposte | Private Wealth
Panel session with Jeremy Hirschhorn, ATO
On 4 April 2016, Greenwoods and our associated law firm, Herbert Smith Freehills, hosted a panel session titled "Are you on the ATO's radar?", which included ATO Deputy Commissioner, Public Groups, Jeremy Hirschhorn. Our Riposte summarises the key points raised in the session.
01 Mar 2016 | Riposte | Private Wealth
ATO reinvents, targets private groups
Privately owned groups are a key target of the ATO's “Reinvention program” and will need to determine what the ATO's new approach means for them.
06 Jan 2005 | Tax Briefs | Private Wealth
The Review of Self-Assessment - Overview
Treasury’s report to the Government on aspects of the self assessment system, and the Government’s response to the Report, accepting all of the recommendations was released in January 2005. This Tax Brief is the first of three focussing on the recommendations of the Report.
The Review of Self-Assessment - Overview (163 kb)
04 May 2004 | Tax Briefs | Private Wealth
Packer Wins Battle, Commissioner Wins War
This Tax Brief analyses the Full Federal Court’s decision in Asiamet (No.1) Resources Pty Limited v FCT. The Court upheld the decision at first instance on the Commissioner’s discretion to grant extensions of time for loss transfers under s.80G(6A)(b) of the Income Tax Assessment Act 1936.
Packer Wins Battle, Commissioner Wins War (255 kb)
10 Nov 2003 | Tax Briefs | Private Wealth
FCT v Zoffanies Pty Ltd
This Tax Brief considers the Federal Court decision in FCT v Zoffaines in which the a decision of the AAT that the provisions of Part IVA did not apply to the circumstances of
the case which involved an R&D syndicate was set aside and remitted to the AAT for re-hearing.
FCT v Zoffanies Pty Ltd (206 kb)
09 Sep 2003 | Tax Briefs | Private Wealth
This Tax Brief considers the decision of the Full Federal Court in Harts Case which upheld the decision decision to deny deductions for outgoings incurred in connection with the conduct of air-show activities by the taxpayer and ruled that the taxpayer was reckless in claiming those losses as deductions.
Harts Case (289 kb)