Friday, 28 September 2012

Effective trust deeds and trustee resolutions [Video]

In our latest video Peter Slegers CTA provides his expert view on trust streaming.



Recorded for the Trust Issues for SMEs DVD, Peter’s session at the 27th National Convention "Effective trust deeds and trustee resolutions" considered:

  • the concept of "specific entitlement"
  • the Treasury discussion paper
  • drafting effective trust distribution resolutions
  • trust deed provisions required for defining income, effective streaming and expenses allocation
  • interface of Small Business CGT concessions with streaming measures.

The Trust Issues for SMEs DVD includes three sessions filmed at the 27th National Convention in March 2012, as well as the speaker papers and presentations.

Thursday, 27 September 2012

Social media for tax professionals: getting involved on Twitter (Part 2)

The more you join the conversation on Twitter, the more you will grow your following and build your public profile. Post updates about what's happening in your industry, in your office or at a conference you're attending, or link to an interesting article you've read recently.

If someone says something interesting that you'd like to reply to, put an @ symbol before their username and type your reply.

If you'd like to share with your followers what someone else has said, you can "retweet" it by putting "RT" at the start of your message, followed by the @ symbol and the person's username, and then their message. You may need to edit the message to ensure that it still fits within 140 characters.

Who's on Twitter?
Using hashtags

To keep track of lots of people talking about a "trending" topic, many users will make use of hashtags. For example, at events held by The Tax Institute, Institute staff, speakers and attendees will often add the tag #nextgentax at the end of tweets to keep track of the conversation about the event. Anyone can use this hashtag to join the discussion and other tags can be found using the Twitter search engine.

Want to know more?

Twitter has put together a resource for businesses looking to use the network that can be found at business.twitter.com.

New to social media?

Connect with The Tax Institute and join the conversation.

Like us on Facebook
Follow us on Twitter
Join us on LinkedIn


Coming soon: Getting started with LinkedIn.

Wednesday, 26 September 2012

Lewis Carroll and the trust rewrite saga

The Walrus and the Carpenter
Walked on a mile or so,
And then they rested on a rock
Conveniently low:
And all the little Oysters stood
And waited in a row.

"The time has come," the Walrus said,
"To talk of many things:
Of shoes — and ships — and sealing-wax —
Of cabbages — and kings —
And why the sea is boiling hot —
And whether pigs have wings."

"But wait a bit," the Oysters cried,
"Before we have our chat;
For some of us are out of breath,
And all of us are fat!"
"No hurry!" said the Carpenter.
They thanked him much for that.

Lewis Carroll, Through the looking-glass

The Lewis Carroll narrative bespeaks the trust re-write saga. The oysters are us, standing, waiting in a row, a little tired by our efforts so far but highly expectant of the rewards of simplification (but suspecting that they will be made a meal of — refer to the last verse of The walrus and the carpenter). The walrus is Treasury. I'll leave it to your imagination who takes on the role of the carpenter. It is funny how fantasy so often matches reality. As Alice later observed:

"I like the Walrus best," said Alice, "because you
see he was a little sorry for the poor oysters."

"He ate more than the Carpenter, though," said
Tweedledee. "You see he held his handkerchief
in front, so that the Carpenter couldn't count how
many he took: contrariwise."

"That was mean!" Alice said indignantly. "Then I
like the Carpenter best — if he didn't eat so many
as the Walrus."

"But he ate as many as he could get," said
Tweedledum.

This was a puzzler. After a pause, Alice began,
"Well! They were both very unpleasant
characters —"

I do not mean for a moment that Treasury is an unpleasant character or houses unpleasant characters but, rather, that the alternatives put forward in the trust re-write are certainly unpleasant. No simplification here so far. A policy paper is to be issued in September but I would not hold out too much hope of true simplification.

The time has come to talk of an alternative small business structure as the simple approach we all hope for. What should such an entity look like and how should it function?

Ideally, it would exhibit a combination of the present merits of a discretionary trust and company. Let's call it a "discretionary company".

The discretionary company would be able to distribute to any person or entity within a family group in much the same way as a discretionary trust. It would be taxed on retained earnings. In an ideal world, the rate would be the corporate rate (30% and "going down"); however, the reality is likely to be a rate somewhere between 30% and the maximum marginal rate (46.5%). (Reality is informed by the fact that surplus income is, in practice, taxed at the corporate rate now and which is effectively increased by the tax paid on Div 7A structured loan interest).

Concessionally taxed income of the discretionary company could flow to shareholders and there would be no profits first rule. This would all take place within the confines of a family group.

Unfortunately, Div 7A would still have some, but modest, operation because of the rate differential. However, it could be vastly simplified.

Is this desirable and, moreover, is it achievable?

The answer lies in further consultation and analysis. A fulsome discussion is a necessary precursor to the simple solution we all seek. And, hopefully, there is no need for avian pigs to assist.

Ken Schurgott
Ken
Schurgott
Ken Schurgott is President of the National Council at The Tax Institute.

The Tax Institute is 
Australia's leading professional association in tax. Its 13,000 members include tax agents, accountants and lawyers as well as tax practitioners in corporations, government and academia.

Monday, 24 September 2012

The ATO's trustee compliance project

Last week I attended the third NTLG meeting of 2012 along with our President Ken Schurgott CTA and our Vice-President Steve Westaway CTA. As always, the agenda was varied and focussed on continuing our high-level engagement with the ATO on a range of systems and technical matters.

An area of significant focus was the ATO's trustee compliance project. This project followed a sustained education campaign by the ATO and the professional bodies (including The Tax Institute) and sought to review trustee compliance with the requirement to create present entitlement to trust income by 30 June.

The ATO reported positive results from the review: the overwhelming majority of trustees reviewed had complied with the requirements of the current Division 6. We will of course continue to support our members via our ongoing education activities in this space, in recognition of the delay in the application date of the revised taxation of trusts regime until 1 July 2014.

Also discussed at the meeting was the ATO's staffing capability in the context of the public service-wide efficiency dividend. We also had an opportunity to farewell Second Commissioner Jennie Granger as she heads off to the UK to commence her new role with the HMRC.

We of course wish Jennie the very best in this new role and thank her for her contributions to and engagement with The Tax Institute over the years.

Robert Jeremenko
Robert
Jeremenko
Robert Jeremenko CTA is Senior Tax Counsel of The Tax Institute.

The Tax Institute is Australia’s leading professional association in tax. Its 13,000 members include tax agents, accountants and lawyers as well as tax practitioners in corporations, government and academia.

Friday, 21 September 2012

2013: Save the date

What’s on in September

What's On is free with your copy of this month’s journal is our guide to what’s on at the Institute in September. Designed to keep you up to date with what’s happening at The Tax Institute, it will ensure that you don’t miss any key events, enrolment dates or product offers.

Save the date

Planning for 2013 is already well underway. The 2013 Financial Services Taxation Conference will take place from 13 to 15 February at the Hyatt Regency Sanctuary Cove on the Gold Coast. Delegates can look forward to presentations from Australia’s leading tax practitioners covering the latest issues in the financial services taxation area. Watch out for the program release in mid-October.

The 28th National Convention will move to the Perth Convention and Exhibition Centre in 2013 and will take place from 13 to 15 March. The event promises an outstanding line-up of speakers and an excellent opportunity to network with colleagues and peers and explore the beautiful city of Perth. You can register your interest for both events by emailing us.

Social media

Don’t forget that you can now connect with The Tax Institute on social media. Have a Twitter profile? Follow @TaxInstituteOz and keep up to date with what’s happening at the Institute in between issues of the journal.

Not on Twitter? This month, our social media series is focusing on how you can get tweeting for your business.

Education

Due to popular demand, an extra study period for the Certificate in Applied Tax is now available for candidates through distance study only. The session will commence on 6 November 2012, with early bird enrolments closing on 9 October 2012.

Study period 3 is your last chance in 2012 to enrol staff in this highly regarded course, the equivalent of the CA Program Tax Module and CPA Program Tax Segment. Get the edge on the competition in 2013 by securing a place for your staff. Visit our website for more information or to enrol.

2012-13 tax rates table

Last month, you would have received your free copy of the 2012-13 tax rates table. A handy desktop guide giving you quick access to the most commonly used tax rates, Medicare levy, tax offsets, superannuation, ETPs, FBT, CPI indexes and more, you can order extra copies for your staff online.

Tax Knowledge eXchange

Congratulations to the latest winner in our Tax Knowledge eXchange 10th Anniversary celebrations. Cameron Colvin of Vincents Chartered Accountants in Brisbane has won a free subscription to Australia’s leading tax knowledge-base.

For your chance to win one of the four remaining free subscriptions, visit our website and register for your free trial.

New titles from The Tax Institute

Estate & Business Succession Planning 2012-13 is coming off the presses as I write. We’re also about to begin taking pre-orders for the 2012-13 edition of the Division 7A Handbook, so keep an eye on your inbox for more information and, as always, you’ll find more information on our website.

Noel Rowland
Noel
Rowland
Noel Rowland is Chief Executive Officer of The Tax Institute.

The Tax Institute is Australia’s leading professional association in tax. Its 13,000 members include tax agents, accountants and lawyers as well as tax practitioners in corporations, government and academia.

Thursday, 20 September 2012

Social media for tax professionals: getting started with Twitter (Part 1)

This article discusses how to build your professional profile and enhance your network with the micro-blogging site, Twitter.

What is Twitter?

Twitter is a social media network designed for micro-blogging and calls itself the place to "find out what’s happening, right now, with the people and organisations you care about". It allows you to send short messages, or "tweets", telling the world in 140 characters or less what you’re thinking, doing or reading. Other users can follow you, and you can follow them.

Unlike a more traditional blog where you can passively consume the site's content without interacting, using Twitter requires you to build a network of users and businesses relevant to you, and get involved.

Why get involved?

Since the site's inception in 2006, the Twitter community has grown rapidly and generates over a billion tweets every three days. It has become a broadcast service for breaking news and is a means for those with a high profile, such as politicians and celebrities, to directly keep in touch with the public.

According to Twitter's "about" pages, the site "connects businesses to customers in real time — and businesses use Twitter to quickly share information with people interested in their products and services, gather real-time market intelligence and feedback, and build relationships with customers, partners and influencers".

You can use Twitter not only to increase traffic to your website, but also to build your professional profile and enhance your connections and reputation within your industry.

If you’re not on Twitter, you're missing out on the conversation.

How to get started

Visit twitter.com and sign up for an account. Choose a user name that people will recognise and allows them to easily find and follow you. Update your biography — a short, snappy few lines will help other users decide whether to follow you. Once you've activated you’re account, you can send your first tweet and start building your network.

New to social media?

Connect with The Tax Institute and join the conversation.

Like us on Facebook
Follow us on Twitter
Join us on LinkedIn


Coming soon: Getting started with Twitter (Part 2).

Wednesday, 19 September 2012

Pirates, cavaliers and lobsters at the WA State Convention

I had the great pleasure of attending the Western Australian state convention (and presenting a paper) this month. The program was excellent, the venue superb (Bunker Bay in the far south), and the gala-costumed dinner a lot of fun. Pirates, cavaliers, lobsters and penguins abounded.




During the convention, a very well deserved award was made to Martin Keating for his wonderful support of The Tax Institute over a very long time. Martin is unique in many ways, but I want in particular to focus on him as a role model for our Australian Taxation Office members.

Highly engaged, seriously involved, providing respected and intelligent explanations of the ATO's position and, at the same time, showing due regard for the opinions of other members of our profession. Martin retires from the ATO in a month or so and we wish him all the very best.

He has said he will give up tax entirely, but I don’t believe him and look forward to seeing him at the National Convention in Perth next March.

Ken Schurgott
Ken
Schurgott
Ken Schurgott is President of the National Council at The Tax Institute.

The Tax Institute is 
Australia’s leading professional association in tax. Its 13,000 members include tax agents, accountants and lawyers as well as tax practitioners in corporations, government and academia.

Monday, 17 September 2012

Delivering sound tax law design

At the Tax Institute's Queensland Corporate Tax Retreat recently, we were very pleased to have the Assistant Treasurer, the Hon David Bradbury MP, provide a keynote address to attendees.

The Minister's speech focussed on the role of transparent and informed consultation in delivering sound tax law design, and he commenced by acknowledging "the significant contribution of The Tax Institute to tax consultations over the years".

Notably, the Minister recognised Tax Institute concerns and agreed to host bi-annual meetings with key stakeholders to discuss the prioritisation of unenacted tax measures – that is, those that have been announced but have not yet become law. He will also set up a Revenue Group Law Design Practice within Treasury to manage priorities.

In releasing related Board of Taxation reports, the Government has further committed to improve the tax consultation process by:

  • annually reviewing and making public the stock of unlegislated announcements
  • improving project management skills within Treasury
  • developing an explicit ethical framework to further underpin the integrity of tax consultations.

The Tax Institute congratulated the Government on this announcement.

The Tax Institute's strong advocacy for greater stakeholder involvement in prioritising tax law measures has resulted in these Government commitments. We welcome the Government's acknowledgment of the long-held concerns of Tax Institute members and commitment to action that should inject much needed certainty into our tax system.

Robert Jeremenko
Robert
Jeremenko
Robert Jeremenko CTA is Senior Tax Counsel of The Tax Institute.

The Tax Institute is Australia’s leading professional association in tax. Its 13,000 members include tax agents, accountants and lawyers as well as tax practitioners in corporations, government and academia.

Friday, 14 September 2012

Unpaid present entitlements – current practical implications [Video]

In our latest video Ian Snook CTA talks about what unpaid present entitlements are, and why we have them.



Recorded for the Trust Issues for SMEs DVD, Ian’s session at the 27th National Convention "Unpaid present entitlements – current practical implications" provided practical guidance to tax practitioners on:

  • pros and cons of each option available and when on option may be preferable to another
  • how to perform the necessary calculations, what documentation is required and when payments are to be made
  • recent ATO pronouncements
  • structuring "out of" trusts.

The Trust Issues for SMEs DVD includes three sessions filmed at the 27th National Convention in March 2012, as well as the speaker papers and presentations.

Thursday, 13 September 2012

Media release: Government commitment to improving tax law design process welcomed

The Tax Institute welcomed improvements to the tax law design process announced by the Government today.

"The Government's commitment to streamline the tax law design process will assist in clearing some of the current back-log and help to future-proof the system to prevent further delays," said The Tax Institute's Senior Tax Counsel, Robert Jeremenko.

"A well designed tax law design system must adequately address the needs of tax professionals, business and the ATO."

"The Tax Institute's strong advocacy for greater stakeholder involvement in the tax law measures prioritisation process has resulted in today's Government commitments," Mr Jeremenko said.

"These commitments include greater stakeholder consultation on tax law reform priorities via regular meetings, and the formation of a Revenue Group Law Design Practice within Treasury to prioritise and project-manage the implementation of tax measures."

"We welcome the Government’s acknowledgment of the long-held concerns of Tax Institute members and commitment to action that should inject much needed certainty and simplicity into our tax system," Mr Jeremenko said.

"We look forward to engaging in consultation to prioritise and resolve the list of outstanding tax law measures and implementing the Board of Taxation’s recommendations."

The Tax Institute is Australia’s leading professional association in tax. Its 13,000 members include tax agents, accountants and lawyers as well as tax practitioners in corporations, government and academia.

Please visit our website for media enquiries.

Wednesday, 12 September 2012

An important message for Australian tax professionals

Tax payers want to know that their practitioner has the right qualifications to manage their affairs. The Chartered Tax Adviser designation is the global mark of technical excellence and professional integrity and proves that you have the skills and expertise to stand out at the forefront of the industry.

Being offered in Australia now for the first time, the Chartered Tax Adviser designation is already recognised in the UK, Europe and Ireland. Attaining the designation means joining a network of thousands of Chartered Tax Advisers worldwide and allows you to take your career to the next level.

Can you answer ‘Yes’ to the following questions?

Do you want to receive specialist recognition for your skills and attract new clients? Have you completed an accounting, law or Masters of Tax degree, OR are you a CA or CPA, AND do you have 3 years’ tax experience?

If so, this is your opportunity to give your professional standing the competitive edge and become a Chartered Tax Adviser (CTA).

Fast track your application

From 1 October, additional qualifying criteria will apply. Join The Tax Institute and become a Chartered Tax Adviser by applying before 30 September 2012 to fast track your application.

Visit our website for more information or call our membership centre on 02 8223 0089 to determine whether you meet the requirements. If you do not currently qualify for CTA, we will be running dedicated CTA events around the country in November that will provide all of the information you need.

Noel Rowland
Noel
Rowland
Noel Rowland is Chief Executive Officer of The Tax Institute.

The Tax Institute is Australia’s leading professional association in tax. Its 13,000 members include tax agents, accountants and lawyers as well as tax practitioners in corporations, government and academia.

Monday, 10 September 2012

Improving the ATO’s performance

The Joint Committee of Public Accounts and Audit comprises Members of Parliament and Senators drawn from the Government, Opposition and cross-benches. This parliamentary committee exists to hold Commonwealth agencies to account for the lawfulness, efficiency and effectiveness with which they use public monies.

The Committee holds annual hearings with the Commissioner of Taxation and this year's is to be held in Canberra on Friday 14 September. The Tax Institute will also present evidence to the committee hearing as one of only a handful of professional bodies who have been invited to appear. Tax Counsel Stephanie Caredes CTA will join me in appearing before the committee.

We will discuss key issues of concern with regard to the ATO's performance, including suggestions for improvement, whilst acknowledging some areas that have indeed been improved. The questions from committee members will also allow us to discuss broader issues such as the future direction of tax administration in Australia.

If you are keen to watch, the Committee's proceedings will be broadcast live via the Parliament's website and the proceedings will be recorded in Hansard for reference after the event.

Robert Jeremenko
Robert
Jeremenko
Robert Jeremenko CTA is Senior Tax Counsel of The Tax Institute.

The Tax Institute is Australia’s leading professional association in tax. Its 13,000 members include tax agents, accountants and lawyers as well as tax practitioners in corporations, government and academia.

Monday, 3 September 2012

Developing the forward work program

In recent weeks the Inspector-General of Taxation started formally consulting on issues to include in his new Work Program for 2012-13 and beyond.

As members would be aware, the Inspector-General reviews systems and processes set up by the Tax Office to administer the tax and superannuation laws. His recommendations are (more often than not) accepted and acted upon by the Tax Office and therefore they serve as a positive addition to the tax system.

Issues that may form part of the work program include:

  • the ATO's Risk Engine
  • delayed income tax refunds
  • the ATO's administration of penalties
  • the ATO's use of client feedback questionnaires
  • the ATO's Test Case Litigation Program
  • use of data matching & third party information
  • ATO system upgrades.

We will soon be meeting with the Inspector-General to ensure that members concerns are fed into the development of the forward work program.

We are also drafting our written submission to the Inspector-General, so if there are any other issues that members would like raised please contact us at Tax Policy.

Robert Jeremenko
Robert
Jeremenko
Robert Jeremenko is Senior Tax Counsel of The Tax Institute.

The Tax Institute is Australia’s leading professional association in tax. Its 13,000 members include tax agents, accountants and lawyers as well as tax practitioners in corporations, government and academia.