The tax rate tango

written by Robert Deutsch CTA *

The coming Federal Budget is likely to reveal some further tax initiatives that might assist the Coalition in its quest for re-election. One mooted change is a reduction in personal tax rates. I wonder if the Government might at the same time also consider some simplification around any new rates?

To that end, I put forward the following proposal:

What would all this achieve? Well, for a start, we would move from 5 to 4 brackets with more logical rounded bracket numbers and rates.

As the accompanying table shows, the crossover point would be $173,500. Tax would come down modestly for everyone on incomes up to $173,500 and go up slightly for everyone on incomes above that figure.

Of course, the Medicare levy would remain as an add-on.

I would suggest foreign residents should be taxed at 25% from dollar one rather than 35% (or as currently 32.5%). This reduction would at least make up for the recent disgraceful wholesale removal of the private residence e…

The Truth Behind Trusts - 2018's WA Trusts Half Day

Trusts, particularly discretionary trusts, have become a fundamental tool in structuring businesses and investments in Australia. Figures from the Australian Tax Office show there are now more than 800,000 trusts with assets totalling more than $3 trillion operating in Australia.

As a result, tax practitioners are increasingly faced with varied and complex issues with respect to the taxation of trusts. In practice, these issues require an application of tax law and trust law, as well as an understanding of ATO views and judicial interpretations.

At May’s Trusts Half Day in Perth, Modiesha Stephens, CTA and Lucy Ferreira (both HHG Legal Group) present the session ‘The Truth Behind Trusts’, a case study-focused session looking at some of the common practical issues relating to trusts. We spoke to Modiesha about some of the issues they’ll be covering.

“The Truth Behind Trusts focuses on some of the practical problems that arise when you deal with trusts, from lost trust deeds or unexpect…

Which area of tax should you specialise in?

A career in tax can open up rewarding opportunities. It’s a multifaceted profession, with areas you can choose to specialise in once you've completed your postgraduate tax education.

But how do you know which discipline is the right fit for your mindset and abilities?

Here are four areas you might consider focusing on in your tax training, along with the skills and experience you’ll need to succeed and the types of personalities that tend to excel in them.

Material mistakes, material consequences for taxpayers

written by Robert Deutsch CTA *

Much warranted attention has been given to the Four Corners program which aired on the ABC on Monday night last week, and the series of articles recently published in Fairfax media.

That story and the articles undoubtedly demonstrate that, when material mistakes happen, they can and often do have material consequences for taxpayers.

Large taxpayers have access to the Australian Taxation Office's independent review program to ensure risks of poor administration are minimised. The playing field, however, is not level for smaller taxpayers. When one takes into account the powers and resources the ATO has at its disposal to impose tax assessments and pursue taxpayers, smaller taxpayers can struggle to have their voices properly heard in relation to poor administration by the ATO.

As a result, The Tax Institute is calling for serious consideration to be given to the possibility of having ATO decisions being referred to an independent body for further exa…

Structuring outbound infrastructure investment – 2018 National Infrastructure Conference

Outbound investment has become an increasingly important pillar in Australia’s economic growth, and equally an increasing focus for investors large and small.
Growing protectionist mindsets taking hold internationally among some of our largest recipients of outbound investment, combined with a complex domestic regulatory setting, mean that what should be a fairly straightforward practice is becoming somewhat fraught.
At May’s National Infrastructure Conference, Edward Consett, ATI (EY) will present a session on ‘Outbound infrastructure investment – key issues in structuring outbound investments’.

We spoke with Edward about some of the issues facing investors and their advisers.
“Australia’s high infrastructure asset prices, strong dollar and the continued growth of domestic funds available for investment mean that Australian investors are being increasingly encouraged to seek infrastructure opportunities offshore," Edward said.

"In my session, I intend to help delegates ma…

Chris Bray on creating the tax business of the future

Chris Bray, Director of Bray Chan Chartered Accountants, participated in a panel discussion at The Tax Institute’s 2017 SME Symposium.

In this short video he speaks about creating the tax business of the future, and some of the topics covered in the panel session. The panel session 'Evolution or revolution' also featured Grant Thornton's Steve Healey, CTA-Life, and Michael Cox of PwC.

The panel looked at what's involved in creating the tax business of the future, the effects the future will have on changing both the client and people experience, and asked what does embracing change and making a difference look like?

On creating the tax business of the future, Chris says businesses need to “firstly understand what clients want. Secondly is consciously adapting the skill set within our businesses to be able to provide those solutions. Thirdly is having the technology to deliver those solutions. Fourthly I think most importantly, specifically in a small business like ours…

Prof Bob Deutsch CTA on developing the Snapshot Series

Many advisers will tread the well-worn path towards specialisation in their careers. However, even as specialists, many also find themselves acting as a ‘jack of all trades’ on occasion, when they find the area they’re advising on touches on areas of tax that they don’t deal with on a regular basis.

The Snapshot Series, launched in March 2018, was developed with this in mind and provides at-a-glance coverage of key tax facts, figures and formulas across 15 tax topics, giving advisers the ability to stay across the fundamentals of areas they may not deal with daily.

Here we speak with the author of the series, The Tax Institute’s own Professor Robert (Bob) Deutsch CTA, about the development of this new member benefit.

“The idea for this series has been floating around in my head for about 10 years," Bob said, "but there was never an appropriate forum to move it forward until now. The impetus arose from my own experience when trying to conquer a new topic in tax – I could nev…