The 2017 great debate

written by Stephanie Caredes CTA *

On 16 August 2017, The Tax Institute held the 2017 great debate on the Australian tax system. This was a joint initiative of The Tax Institute and the Australian Tax Research Foundation.

The thought leader behind the debate was Senior Tax Counsel, Robert Deutsch. He selected key issues in our tax system and gathered tax professionals who are experts in their field to debate the merits of the following:
whether the current list of CGT events should be removed and replaced with a more coherent, conceptually based systemwhat the new rules could look like if all work-related deductions were abolished and provision was made for a one-off $1,000 annual deductionwhat a simplified set of residency rules could look like for individuals and companies if the current rules were removedwhat new rules could replace the CGT discount and negative gearingchanging the imputation system for a different modelwhether the tax advantages for stapled securities should be end…

Do your unconscious gender biases get in the way of decision-making?

Gender equality in the tax profession has received a lot of attention lately. And rightly so. The percentage of women practising in tax increases each year, and more women aspire to be emerging thought leaders.

However, whilst many men and women advocate for women in the profession, why are there still so few women in leadership positions? The answer might lie in the fact that we all practise something called the unconscious gender bias.

Unconscious gender biases are the unwitting, implicit associations of men and women that we harbour in our subconscious minds that affect our everyday actions and decision-making. For example, when ‘Partner at a big firm’ is mentioned, do you picture a male or female leader? Your answer depends on your unconscious gender bias and becomes problematic when it negatively affects your ability to be inclusive and supportive of female leaders in the workplace.

“Current measures aimed at addressing gender bias in the tax and transfer system are arguably not…

2016 duces share their experience of learning with The Tax Institute

Here at The Tax Institute, we’ve always been confident about the quality and value of our education programs. For additional feedback, we spoke with two of our highest-performing students from study period 3, 2016.

Kelly Venhuizen
Kelly Venhuizen is a Manager with the family and business advisory firm Chapman Eastway in Sydney. She was Dux in our CTA2B Advanced subject.

We asked Kelly about her career to date.

“I have spent most of my career on the south coast,” she said. “However, I moved to Sydney three years ago to further my career and education. During my time in Sydney, I worked at a ‘big four’ accounting firm, but I recently accepted a position at a boutique firm.”

“My focus has been on business services and providing relevant and practical advice to clients is at the forefront of my values.”

Kelly told us she enrolled in CTA2B Advanced because “an adviser’s education is never complete.”

“I have the attitude that we should always be extending and refining our knowledge to prov…

Transitioning a company for wind-down or exit – 2017 WA Tax Intensive

Preparing a company for the exit of the current owners or a winding-down presents a unique set of challenges.

Transferring the company or its business assets to new ownership often means that financial relationships need to be unwound or cleared at either or both the company and shareholder level.
From forgiving debts and dealing with shareholder loan accounts to decisions on liquidation versus capital reduction or share buy backs, there are also complexities with ss 45A, 45B, and 177EA. In addition, advisers need to ensure they've considered the debt equity rules, pre and post CGT shareholdings and how any value will be extracted using the small business CGT concessions.
Chris Wookey CTA is a Principal in the tax consulting division of Deloitte Private in Melbourne. At the 2017 WA Tax Intensive in November this year he will present ‘Transitioning a company for wind-down or exit’, a two-part session covering the key tax issues arising when a company is wound down or when certain shar…

Difficult structures made easy (or at least slightly less difficult) – 2017 WA Tax Intensive

Advisers working with clients who are planning for the future usually begin with the end in mind, and with a focus on the 'planned end' such as a trade sale or family transfer.

Planning for the unplanned needs to be front of mind, incorporating a degree of flexibility and allowing for restructuring down the line as events arise or circumstances change.
“Clients may want or need to restructure for a range of reasons”, says Linda Tapiolas CTA, a Partner with Cooper Grace Ward Lawyers’ commercial team.

“There is also a range of different roll-overs and CGT concessions which may be available to them when they choose to do so, each of which has a number of potential particular traps associated with them.”
Linda will present the session, ‘Dealing with Difficult Structures’, at the upcoming WA Tax Intensive.

We spoke to her about her presentation.
Looking at how advisers can work with a difficult structure, and the care that needs to be taken during the lifetime of a structure, with the en…

Realising the potential of women in the tax profession – Women in Tax National Congress

The influence of women is growing across the traditionally male-dominated professions of tax, accounting and law. Yet we still see too few women in leadership positions.
The inaugural Women in Tax National Congress will address this issue. Focused on the unique challenges facing professional women, this new event will feature high-profile presenters from the business world, media, academia and government.
Julie Abdalla FTI, from the National Congress organising committee, said: “It’s important to give a voice to women who are underrepresented in the tax profession. Everyone in the profession, regardless of gender, will benefit if we can realise the potential of female talent that exists in the profession.”
The congress will showcase some of Australia’s most influential leaders, who will offer insights and share their experiences of building a career in a male-dominated profession.
The day begins with a keynote address from one of Australia’s most high-profile female leaders, Emeritus Prof…

Taxing earnings – the great distortion

written by Robert Deutsch CTA *

Is it just me or are there others out there who find the debate about lowering the corporate tax rate to 27.5% (ultimately to 25%) somewhat perverse in view of the fact that the top marginal tax rate is sitting at almost 50%?

Let’s look at the tax effect on the last $200,000 of taxable income of each of three fictitious taxpayers:

News Today Pty Ltd – the owner of an outer-Melbourne newsagencyBob Build – a respected architectAmy Land – a real estate investor.
News Today derives taxable income of $200,000. Assuming it is accepted that it carries on a business (1) and its turnover is less than $10m, it qualifies for the reduced corporate tax rate of 27.5%. This would give rise to tax of $55,000.

Bob Build earns $380,000 in 2016-17 in taxable income and will consequently pay tax on the top $200,000 of $94,000 (inclusive of the Medicare levy).

Amy Land purchased real estate in Sydney’s inner west for $1m in May 2014 and sells it in August 2016 for $1.2m. Tax …