Weekly Tax Highlights

Highlights to 15 February 2019

ATO Documents

Taxation determination
TD 2019/1 Income tax: what constitutes ‘use’ (and potentially first use) of a mining, quarrying or prospecting right, that is a depreciating asset, for the purposes of subsection 40­-80(1) of the Income Tax Assessment Act 1997?

Class rulings
CR 2019/11 Income tax: Excelsior Capital Limited (formerly CMI Limited) – off‑market share buy‑back
CR 2019/12 Income tax: Phileo Australia Limited – selective capital reduction
CR 2019/13 Income tax: Invion Limited – return of capital by way of in specie distribution

Other news

Similar business test Bill awaiting Royal Assent
On 12 February theTreasury Laws Amendment (2017 Enterprise Incentives No. 1) Bill 2017 was passed by both Houses and now awaits Royal Assent. The Bill amends the Income Tax Assessment Act 1997 and the Income Tax Assessment Act 1936 to supplement the same business test with a more flexible similar business test.  The amendments apply to income years starting on or after 1 July 2015. The Bill was amended to remove Schedule 2 which means that taxpayers will not be allowed to choose to self-assess the effective life of certain intangible depreciating assets.

OECD releases public consultation document on tax challenges of digitalisation
On 13 February the OECD released a public consultation document which describes potential solutions to the tax challenges arising from the digitalisation of the economy for public input. Comments are due by 1 March 2019.

Progress of legislation

As at 15.02.19

Bill

Treasury Laws Amendment (Mutual Reforms) Bill 2019

Description  

Introduced by the Government into the Senate to reform the mutual sector including amendments to the Corporations Act and related tax amendments.

Status

Introduced into Senate 13.02.19.

Bill

Treasury Laws Amendment (Combating Illegal Phoenixing) Bill 2019

Description

Implements measures to prohibit creditor-defeating dispositions of company property, improve accountability of resigning directors, allow the Commissioner to collect estimates of anticipated GST liabilities and make company directors personally liable for GST and authorise the Commissioner to retain tax refunds in certain circumstances.

Status

Introduced into House of Reps 13.02.19.

Bill

Treasury Laws Amendment (Increasing the Instant Asset Write-Off for Small Business Entities) Bill 2019

Description

Increases the threshold below which amounts can be immediately deducted by small businesses and extends the time period during which small business entities can access expanded accelerated depreciation rules.

Status

Introduced into House of Reps 13.02.19.

Bill

Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax in Australia and Other Measures) Bill 2018

Description

Implements integrity measures in relation to stapled structures, thin capitalisation, withholding tax exemption for superannuation funds for foreign residents and the sovereign immunity tax exemption. The Bill was amended in the House of Reps in relation to premises used primarily for the provision of disability accommodation and student accommodation.

Status

Introduced into Senate 14.02.19.

Bill

Treasury Laws Amendment (Making Sure Multinationals Pay Their Fair Share of Tax in Australia and Other Measures) Bill 2018

Description

Broadens the SGE definition, amends the thin capitalisation asset valuation rules, better targets the R&D Tax Incentive, changes the GST Act in relation to online hotel bookings and removes the luxury car tax for re-imported cars refurbished overseas.

Status

Introduced into House of Reps 20.09.18. Report released.

Bill

Treasury Laws Amendment (2018 Measures No 5) Bill 2018

Description

Technical amendments to the AMIT regime; extending deductible gift recipient status to entities promoting Indigenous languages.

Status

Introduced into the Senate 18.10.18.

Bill

Treasury Laws Amendment (2018 Superannuation Measures No. 1) Bill 2018

Description

Increased penalties and a one off amnesty for employers not meeting their superannuation obligations.

Status

Introduced into Senate 25.06.18.

Bill

Treasury Laws Amendment (2018 Measures No. 4) Bill 2018

Description

Implements the Government’s Superannuation Guarantee (SG) integrity package, extends Single Touch Payroll, and changes Super Fund reporting requirements.

Status

Passed both House and awaits Royal Assent 12.02.19.

Bill

Treasury Laws Amendment (Reducing Pressure on Housing Affordability Measures No. 2) Bill 2018

Description

Implements new rules for foreign residents owning Australian housing, technical amendments to streamline the foreign investment framework and introduces tax incentives to boost investment in affordable housing.

Status

Introduced into Senate 19.03.18.

Bill

Treasury Laws Amendment (2018 Measures No. 2) Bill 2018

Description

Establishes the foundation for the Government's new Fintech framework. Makes a number of technical amendments to the Early Stage Venture Capital Limited Partnership, Venture Capital Limited Partnership and Tax Incentives for Early Stage Investor regimes.

Status

Introduced into Senate 26.06.18.

Bill

Medicare Levy Amendment (National Disability Insurance Scheme Funding) Bill 2017

Description

Fund the NDIS by amending the Medicare Levy Act 1986 to increase the Medicare levy rate from 2 to 2.5% of taxable income for the 2019-20 income year and later income years. Given the Government’s announcement that the increase to the Medicare Levy will be scrapped, this Bill may not proceed

Status

Introduced into Senate 13.11.17.

Bill

Treasury Laws Amendment (2017 Enterprise Incentives No. 1) Bill 2017

Description

Similar business test; Effective life assessment on intellectual property. The Government has announced that it will not be proceeding with the amendment to provide taxpayers with the choice to self-assess the effective life of certain intangible depreciating assets from 1 July 2016.

Status

Passed both Houses and awaits Royal Assent 12.02.19.

Bill

Superannuation (Objective) Bill 2016

Description

Superannuation reform package.

Status

Introduced into Senate 23.11.16.

 

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