Weekly Tax Highlights

Highlights to 23 November 2018

ATO documents

Draft Practical Compliance Guideline

PCG 2018/D8 Transfer pricing issues related to inbound distribution arrangements

Taxpayer Alert

TA 2018/2 Mischaracterisation of activities or payments in connection with intangible assets

Class Rulings

CR 2018/47 Fringe benefits tax:  employer clients of Smartgroup Corporation Ltd’s wholly‑owned subsidiaries who use the Smartgroup Logbook Solution for car logbook records and odometer records

CR 2018/48 Income tax: tax treatment of payments to members of the Australian Construction Industry Redundancy Trust

Tax cases

Ransley and Commissioner of Taxation (Taxation) [2018] AATA 4359

The AAT held that net profits derived by an individual taxpayer on the sale and exchange of shares were on revenue account and that the taxpayer was not eligible for scrip for scrip rollover relief on the exchange of shares. The taxpayer was held to have had a profit making purpose at the time of the share acquisitions on the basis the operation involved her husband obtaining exploration licences and establishing training mines in order to increase the value of the shares held by the taxpayer to enable the shares to be sold at a profit.

Other news

OECD releases results on preferential regimes including OBU regime

The OECD has released a progress report covering the assessment of 53 preferential tax regimes, in respect of Action 5 under the OECD/G20 Base Erosion and Profit Shifting (BEPS) Project. The report notes that Australia’s offshore banking unit (OBU) regime is in the process of being amended.

Regulations made to extend information exchange countries for lower MIT withholding tax

On 23 November 2018 the Taxation Administration Amendment (Updating the List of Exchange of Information Countries) Regulations 2018 were registered to add 54 further countries to the list of ‘information exchange countries’ from 1 January 2019 for the purposes of the MIT withholding rules in section 12-385 of Schedule 1 to the Taxation Administration Act 1953.

Progress of legislation


Parliament resumed on Monday, 26 November 2018. 

As at 23.11.18

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.

Status

Introduced into House of Reps 20.09.18.

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.

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

Introduced into Senate 25.06.18.

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.

Status

Introduced into Senate 22.6.17.

Bill

Superannuation (Objective) Bill 2016

Description

Superannuation reform package.

Status

Introduced into Senate 23.11.16.

 

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