Greenwoods and Freehills Weekly Tax Highlights - Week Ended 7.11.08
ATO Documents
Released 5.11.08
Class Rulings
CR 2008/67: Income tax: share buy-back: Santos Limited
CR 2008/68: Income tax: capital gains tax: conversion of Swan Taxis Co-operative Limited to Swan Taxis Limited
CR 2008/69: Income tax: return of capital: MYOB Limited
CR 2008/70: Income tax: assessable income: Australian Federal Police deployed to the Solomon Islands
CR 2008/71: Income tax: assessable income: Australian Federal Police deployed to Timor-Leste
CR 2008/72: Income tax: Skilled Group Limited Executive Share Option Plan
Product Ruling
PR 2008/71: Income tax: tax consequences of investing in Next Financial Instalments - Series NF 330
Draft Superannuation Guarantee Ruling
SGR 2008/D2: Superannuation guarantee: meaning of the terms 'ordinary time earnings' and 'salary or wages'
Draft Self Managed Superannuation Fund Ruling
SMSFR 2008/D5: Self Managed Superannuation Funds: the meaning of 'asset', 'loan', 'investment in', 'lease' and 'lease arrangement' in the definition of an 'in-house asset' in the Superannuation Industry (Supervision) Act 1993
Notices of Withdrawal
Class Rulings
CR 2003/61: Income tax: Assessability of income: Australian Federal Police (AFP) and Australian Protective Service (APS) employees deployed to the Solomon Islands
CR 2006/89: Income tax: assessable income: Australian Federal Police deployed to Timor-Leste in accordance with the arrangement dated 26 May 2006
CR 2006/108: Income tax: assessable income: Australian Federal Police personnel on long term, non-diplomatic posting to East Timor (Timor-Leste) under the auspices of the Timor-Leste Police Development Program
CR 2006/109: Income tax: assessable income: Australian Federal Police personnel on long term, non-diplomatic posting to Solomon Islands under the auspices of the Regional Assistance Mission to the Solomon Islands
Product Ruling
PR 2008/13: Income tax: tax consequences of investing in Next Financial Instalments - Series NF 330
Released 7.10.08
New Interpretative Decisions
ATO ID 2008/144: GST and chocolate beverage drinking preparation
ATO ID 2008/145: Periodic compensation payments received by a non-resident individual and the Pension Article of the UK Convention
ATO ID 2008/146: Capital allowances: business related costs - capital expenditure incurred - non-contractual customer relationships
ATO ID 2008/147: Capital gains tax: vendor cancellation of contract - compensation payment - preserving ownership rights
Withdrawn Interpretative Decisions
ATO ID 2001/126: Taxation of compensation paid to non-residents
Abolishing the CGT trust cloning exception
Released 5.11.08
Treasury has released a discussion paper on the Goverment's proposal to remove the CGT trust cloning exception to CGT events E1 and E2. The purpose of the paper is to provide interested parties with an opportunity to comment on the policy design of the proposal. An exposure draft of the legislation will be released after consultation.
Appeals Update
Released 28.10.08
Virgin Holdings SA v FCT [2008] FCA 1503: The Commissioner has appealed to the Full Federal Court. The Federal Court found that, under the double taxation agreement between Australia and Switzerland, the Commissioner did not have a right to tax a capital gain made by a Swiss resident from sources in Australia.
3D Scaffolding Pty Ltd v FCT [2008] FCA 1477: The taxpayer has appealed to the Full Federal Court. The taxpayer had been denied deductions for payments allegedly made to a third party for hiring scaffolding equipment for use in the taxpayer's business.
Lawrence v FCT [2008] FCA 1497: The taxpayer has appealed to the Full Federal Court. The Federal Court upheld the inclusion of a distribution of profits by way of loans as assessable income of a taxpayer, but reduced the administrative penalty by 80% of the tax shortfall.
Tax Cases
XPMX and FCT, [2008] AATA 981, 5 November 2008: The trustees of the relevant self managed superannuation fund had failed to lodge regulatory returns and appoint an approved auditor. The Tribunal found that the Commissioner had incorrectly issued a notice of non-compliance to the self managed superannuation fund and that the notice was therefore invalid. The Tribunal found that the Commissioner had not issued the notice under the correct provisions of the Superannuation Industry (Supervision) Act. The Tribunal ordered that the trustees of the fund be allowed to roll the fund over into a nominated industry, retail or public offer complying superannuation fund in order to avoid further non-compliance issues.Australia-Japan DTA enters into force
Following the Exchange of Diplomatic Notes on 3.11.08, the Australia - Japan double taxation agreement (DTA) will enter into force on 3.12.08. The DTA comprehensively updates the existing treaty and has been implemented with a view to increasing investment and preventing tax evasion.Royal Assent
The following Bills received Royal Assent on 31.10.08:Tax Laws Amendment (Medicare Levy Surcharge Thresholds) Bill 2008 became Act No 110 of 2008. The Bill increases the thresholds for payment of the Medicare Levy Surcharge to $70,000 for individuals and to $140,000 for couples.
International Tax Agreements Amendment Bill (No 2) 2008 became Act No 111 of 2008. The Bill gives the force of law to a Protocol amending the double tax agreement between Australia and South Africa.
Progress of Legislation
As at 7.11.08
|
Bill |
Explanatory Memorandum |
Intro House |
Passed House |
Intro Senate |
Passed Senate |
Date of Royal assent / Act Number |
Description |
|
Tax Laws Amendment (Medicare Levy Surcharge Thresholds) Bill 2008 |
27.5.08 |
28.5.08 |
16.6.08 |
24.9.08 |
|
Medicare Levy Thresholds | |
|
29.3.08 |
5.6.08 |
16.6.08 |
1.9.08 |
20.9.08/91 |
Rights issues, GST Refunds | ||
|
26.6.08 |
17.9.08 |
1.9.08 |
3.9.08
|
3.10.08/97 |
Capital Gains Tax, Family Trust Changes | ||
|
International Tax Agreements Amendment Bill (No 1) Bill 2008 |
27.8.08 |
15.9.08 |
16.9.08 |
18.9.08
|
3.10.08/102 |
New Treaty with Japan | |
|
27.8.08 |
15.10.08 |
|
|
|
Removes Tax Deductibility of Political Donations, GST | ||
|
17.9.08 |
24.9.08 |
25.9.08 |
16.10.08
|
31.10.08/111 |
Introduces a Protocol with South Africa | ||
|
25.9.08 |
|
|
|
|
GST, Thin Cap, Division 6C, Definition of "Otherwise Deductible, Exemption of Interest Withholding, | ||
|
25.9.08 |
|
|
|
Tax Offsets for Education Expenses | |||
|
Temporary Residents' Superannuation Legislation Amendment Bill 2008, |
25.9.08 |
22.10.08 |
|
|
|
Payment of Superannuation on Behalf of Temporary Visa Holders | |
|
Superannuation (Departing Australia Superannuation Payments Tax) Amendment Bill 2008 |
25.9.08 |
22.10.08 |
|
|
|
Payment of Superannuation on Behalf of Temporary Visa Holders | |
|
Tax Laws Amendment (Medicare Levy Surcharge Thresholds) Bill (No 2) 2008 |
25.9.08 |
13.10.08 |
14.10.08 |
16.10.08
|
31.10.08/110 |