Thursday, 30 June 2016

Inherited client problems: new clients, old problems… The 49th Western Australia State Convention

Often when taking on new clients, tax practitioners get lumped with a large inheritance. A large inheritance of old problems, that is. New clients, old problems seems to be an everyday experience for tax practitioners. Same same but different, right?

“Often a previous adviser may have unintentionally or otherwise acted in a manner that leaves issues which need to be addressed and often require realignment,” says Ken Schurgott, CTA (Life) of Brown Wright Stein Lawyers.

That ‘realignment’ or adjustment can range from a relatively innocuous self-amendment to a full-blown disclosure to the ATO and a consideration of significant penalties. Ken will be passing on his considerable experience in ‘Solving Inherited Client Problems’ at The Tax Institute’s 49th Western Australian State Convention on 11-12 August 2016. Ken will provide practical insights and options to manage these situations. “I’ll also be discussing what an adviser’s obligation is when a client presents with these issues,” Ken comments.

First, seek to understand

Dealing with inherited client issues is always difficult. Ken notes, “Understanding time limits for amendment is crucial, both in an advantageous and disadvantageous way. The delicate issue of whether there has been fraud or evasion will sometimes need to be addressed.”

When discussing issues with a new client, they will often need to be convinced that there is a need for amendment and that will often turn on being able to explain how time limits work for a range of taxes. Ken believes it’s vital to fully understand section 170 of the Income Tax Assessment Act 1936 and other provisions which deal with time passing.

But there is more in the tangle of tax laws which deal with fixing up past problems, and difficult interpretive issues often arise. For example, how do you apply the principles emerging from the Metlife case when the unlimited CGT amendment period is in question? [1]

“Then there’s the worst issue of the lot: what is to be done when it is you, or your firm, that has provided the bad advice,” Ken warns.

A roadmap to manage these issues

During his session Ken will look at past Div 7A non-compliance defective restructures, inefficient structures, non-compliance with the personal services income rules and exposures arising from alienated personal exertion income, as well as historical aggressive tax strategies.

Tax and Commercial Law Director with Schurgott & Co Lawyers, Ken Schurgott CTA (Life) is also Special Counsel with Brown Wright Stein Lawyers, Sydney. He has extensive experience in all aspects of tax, as well as business structuring, business sales and acquisitions, asset protection, trust and estate law. Until recently he was a member of the Advisory Panel to the Board of Taxation.

Ken will also be running a workshop session at the Convention, ‘Exiting Business Structures’, which will illustrate some of the more difficult issues in selling to third parties, transferring control in a corporate joint venture, accessing cash without disproportionate tax liabilities, and using concessional tax treatments.

Hear the latest thinking on inherited client problems, exiting business structures, and a wide range of other topics at the 49th Western Australian State Convention taking place 11-12 August 2016 at the Novotel Vines Swan Valley Resort. Choose from 21 sessions over two days, across two streams – SME & Corporate, and includes up to 13 CPD hours. Find out more.

[1] Metlife Insurance Ltd v Commissioner of Taxation [2008] FCAFC 167.

Tuesday, 28 June 2016

The opportunities for a common charity definition: Australian Charities and Not-for-profits Commission

For the first time, the Australian Charities and Not-for-profits Commission (ACNC) have been invited to present at The Tax Institute’s States’ Taxation Conference, taking place in Darwin in July 2016.
David Locke, Assistant Commissioner, Charity Services at the Australian Charities and Not-for-Profits Commission spoke to us about why the time was right for the ACNC to speak directly to practitioners on charity related taxation issues.

David said ‘The ACNC works closely with the State and Territory Offices of State Revenue but have not previously engaged with The Tax Institute to a significant extent. My presentation, with Nicole Rowa, also of the ACNC, is an important next step in the ACNC’s relationship with the Offices of State Revenue. These relationships have helped us to understand the differences in the legislation and regulations that impact on the taxation concessions available to charities’.

‘The ACNC is presenting on the opportunities for a common charity definition. The definition of charity has an impact on a number of Commonwealth and state regulators, but we are obviously focussing on the taxation revenue impact on the states’, he said.

‘We will be asking delegates to think of the charity taxation environment as having two distinct stages; the Charity Determination stage and the Tax Assessment stage. We are proposing that the Charity Determination stage be undertaken by the ACNC and the Tax Assessment stage by the Commissioners of State Revenue. We hope that attendees will see the value to regulators, charities, the public and the beneficiaries of charities in the model that we are proposing’.

David mentioned ‘The new model that the ACNC is proposing for managing charity determinations will be a significant change and is a hot topic in itself. We are proposing a model that we believe will make life much easier for charities without compromising the Commissioners of State Revenue’s jurisdiction to determine which charities receive tax concessions. The model proposed means that once they are recognised as a charity by the ACNC, this status has universal application for all Office of State Revenue and other state and territory purposes. Under this model, the Professional delegates (as opposed to Government delegates) will still need to understand the particular state and territory charity Tax Assessment rules.’

Looking at the wider conference, David told us he was particularly keen on catching the panel discussion on ‘Tax Reform – the Federal/State Interplay’, with Robert Carling, Senior Fellow, Centre for Independent Studies, Rob Schwarz, SA Dept of Premier and Cabinet and The Tax Institute’s Stephanie Caredes, CTA. He told us ‘the session has direct relevance to the role of the ACNC. One of our statutory objects is to promote the reduction of unnecessary regulatory obligations on the Australian not-for-profit sector. This involves us having direct relationships with the not-for-profit regulators, which are mainly the states and territories’.

David is a qualified lawyer who has served as a board member and volunteer of a number of charities and not-for-profits. David was formerly the Executive Director of Charity Services at the Charity Commission of England and Wales. David has worked as an adviser to several international governments on the regulation of non-government organisations. A keen traveller, David mentions he’s looking forward to a break in the warm weather in Darwin, and enjoys spending time exploring the many beautiful destinations Australia has to offer. He also loves cinema and theatre of all types.

Find out more about David and Nicole’s session on our website, where you can explore the rest of the program.

The 16th Annual States' Taxation Conference takes place 27-29 July 2016, at the Darwin Convention Centre. Find out more.

Monday, 27 June 2016

‘The Nature of a State Tax Appeal’ - David Marks, QC, CTA at 2016's States’ Taxation Conference

The States’ Taxation Conference remains the only national conference covering all State and Territory taxes in one technical program. We spoke to David Marks, QC, CTA, a commercial silk, specialising in tax who will present the session ‘The Nature of a State Tax Appeal’ on day two of the conference, to be held in Darwin in July.

David tells us that his session will help practitioners ‘understand which way to go when setting up an appeal, and how different types of matters need to be set up for appeal differently’. His session will look at the differences in the nature of an appeal from a tribunal, to an appeal panel of the tribunal, from a tribunal, to a court and from a court, to a superior court.

David’s session will look at how the basis of appeal may be discerned from the legislation, the difference between the court substituting its own decision, and the court giving directions to the decision maker, as well as providing guidance to the likely participants in these sorts of appeals as to the different approach to evidence or issues that are relevant for these different contexts. 

He mentioned that by ‘front-ending consideration of where a matter might go, you can negotiate more effectively for your client’ and that his session is designed to give delegates ‘a new perspective on how to approach matters’.

Affiliated with The Tax Institute since 1991, David sees the States’ Taxation Conference as one of those events that is ‘required attendance for all in the profession’. Amongst the rest of the program, David is particularly looking forward to Nicholas Clifton, CTA, and Jacqueline Wood, CTA, both of Deloitte and Shaun Pearson of the Department of Treasury and Finance Territory Revenue Office presenting the Cases and Legislation Update.

When he’s not knee-deep in tax, David is keen on chess, art and music, and when he is, he appears in Court as a specialist advocate, giving tax advice informed by his appearance practice. He was called to the Bar in 2000, taking silk in 2015, before which he worked in tax with a large firm of solicitors for 10 years. David has appeared for and against the revenue, as well as in the equitable, administrative law and commercial jurisdictions of the State and Federal courts, and in Tribunals.

The 16th Annual States’ Taxation Conference takes place 27-29 July 2016 at the Darwin Convention Centre. View the full program on our website.

Thursday, 23 June 2016

49th Western Australia State Convention

Move over Masterchef, there’s a new and more pertinent Masterclass in town.

An exciting addition to an already stellar line-up at the 49th Western Australia State Convention is the M&A taxation masterclass-style session on day one. With more and more companies looking to consolidate to rationalise operations, the main elements of Australia’s M&A-focussed tax code will continue to cause concern for tax advisers and their clients. The appetite for knowledge in this space continues to grow alongside the level of M&A activity in Western Australia, despite whispers that the economy is set for a downturn.

Read on to discover what’s on the menu for M&A at the convention, along with the rest of the program, designed to suit every appetite.

The bread and butter of it all…

As 2 July draws closer, many practitioners – and members of the public – are asking themselves what Australia’s GST and superannuation system will look like post-Federal Election. As with all areas of tax, these ‘bread and butter’ taxes will continue to morph according to the political landscape. Jemma Sanderson, CTA (Cooper Partners) and Tony Ince, CTA (RSM Australia) will unpack the day-to-day issues facing SME practitioners, as well as highlight potential risks and action items required for clients on day two of the convention.

Other bread and butter issues that will be brought to the table include Division 7A, unpaid present entitlements (UPEs) and a cheeky insider’s perspective on how to effectively run an AAT case. The keynote address from Justice Pagone on the current trends in tax disputes and the update from Inspector-General of Taxation, Ali Noroozi, are also two not-to-be-missed sessions for every practitioner.

This year’s convention also captures tax issues with a uniquely Western Australian flavour. The Hon Dr Mike Nahan, MLA, WA State Treasurer will discuss the opportunities and challenges of tax reform from a purely Western Australian perspective whilst Nicki Suchenia, WA Commissioner of State Revenue will outline the new and upcoming changes at State Revenue that will affect practitioners.

Finally, don’t miss our workshop session, Exiting Business Structures, in which Ken Schurgott, CTA-Life (Brown Wright Stein Lawyers) gets to the meat of the issues in advising successful clients about selling to third parties, transferring control in a corporate joint venture, getting access to funds without disproportionate tax liabilities, using concessional tax treatments and more.

M&A taxation: roasting old chestnuts

The key pillars of Australia’s M&A tax consolidation system has been in place for over 10 years, yet issues such as scrip-for-scrip rollover, consolidation, demergers and transaction-related distributions still continue to challenge advisers. The question is, why?

Australia’s tax consolidation regime is undoubtedly extremely complex and incredibly complicated. But the answer may just lie in the resurgence of M&A tax-related transactions in Australia. M&A activity fell silent in the years after 2008 but is making a comeback. Last year alone saw a 15% increase in the level of M&A activity in Western Australia compared to the previous year, where, interestingly enough, the bulk of transactions fell within the middle market space.*

With buy-side and sell-side transactions in Western Australia alone on the rise, tax advisers who were once shielded from M&A activity will now likely face a barrage of new tax issues stemming from those transactions. Join Nick Heggart, CTA (Greenwoods & Herbert Smith Freehills) for an in-depth, masterclass-style session focused on the major M&A issues that continue to cause concern for tax advisers and their clients, which will also incorporate several case studies to tease out the issues.

An expanded menu for the big end of town...

2016 brings a new corporate stream for the larger end of town and corporate practitioners. Hot topics such as tax transparency, the life cycle of transactions from the ATO’s standpoint, stapled entities, transfer pricing and the raft of new changes associated with multinational and anti-avoidance legislation (MAAL) will be analysed and unpacked at this year’s convention.

Respected speakers have been invited to dissect these topics with delegates, including Jeremy Hirschhorn, CTA (Deputy Commissioner, ATO) who will discuss focus areas and priorities for the large market, highlighting how companies can manage and benefit from greater tax transparency.

This year, the convention will also host a new Q&A session, encouraging open dialogue between delegates and speakers on the activities of the Board of Taxation and the Administrative Appeals Tribual (AAT). Stephen Frost, FTI (AAT Deputy President) and member of the Board of Taxation, Craig Yaxley, CTA (KPMG) will facilitate this interactive session.

A special panel session, ‘The Life Cycle of a Transaction in the Era of Constructive Engagement’ sees Geofrey Fooks (Wesfarmers), Jeremy Hirschhorn, CTA, (ATO), Andrew Orme, ATO and Dr Niv Tadmore, CTA (Clayton Utz) focus on practical insights from the life cycle of a transaction in the public groups and international (PGI) market using a case study as a practical reference point.

Join us

With the Federal Budget and Federal Election done and dusted by the time of this convention, tax advisers will be left with a new tax landscape and grappling with the issues that heightened M&A activity will bring, as well as continue to tackle the complexities of superannuation and GST.

The 49th Western Australian Convention takes place 11-12 August 2016 at the Novotel Vines Swan Valley Resort. Choose from 21 sessions over two days, across two streams – SME & Corporate. Includes up to 13 CPD hours. Find out more

*Pitcher Partners ‘Western Australian M&A: A year of consolidation, rationalisation and new beginnings’ (March 2016)

Wednesday, 15 June 2016

Australian Taxation Office Round Table - Free Video

Senior Australian Taxation Office representatives Andrew Mills, CTA (Life) and Kristen Fish, CTA, were invited to communicate directly with tax professionals in a discussion-based format at The Tax Institute's 2016 National Convention, held in Melbourne in March.

A series of questions and answers covering an array of current technical issues of importance to tax professionals were asked of Andrew and Kristen, with Gordon Cooper, AM, CTA (Life) of Cooper & Co. and Cameron Rider, FTI of PwC joining the round table.

The video recording of this one hour session is available to view free by clicking the image below.

This video is one of nine in our 2016 National Convention Video Package. This specially priced bundle also features:
  • SMSF Real Property Investments - Presented by Speaker: Stuart Forsyth, CTA, McPherson Super Consulting
  • CGT Small Business Concessions - Selected Practical Issues - Presented by Rob Warnock, CTA, Bernie O’Sullivan Lawyers
  • CGT Rollover – An SME’s Perspective - Presented by Stuart Glasgow, CTA, Mutual Trust
  • Succession Planning to Avoid Disputes Between Trustees and Beneficiaries - Presented by Sam McCullough, ATI, Worrall Lawyers
  • Self-funding a Private Group Business or Investment, Including Div 7A and Trust Considerations - Presented by Greg Nielsen, CTA, Pitcher Partners
  • SMSF Participation in Private Business - Presented by Matthew Andruchowycz, CTA, DMAW Lawyers 
  • Digital and Technological Disruptors to Your Business – How to Prepare for and Manage Them - Peter Williams, Deloitte
  • Tax Issues for Digital Business - Joanne Dunne, CTA, Minter Ellison
Find out more about the bundle, and watch a free five minute preview of each, on our website.

Tax issues in a global economy - 2016's Queensland Tax Forum

Economies at a state level in Queensland, nationally and globally are in transition. Practitioners have seen huge shifts in the way their clients do business, and many are asking themselves ‘how do I get ahead of the game?’

Over two days at the 2016 Queensland Tax Forum close to 40 expert speakers will attempt to answer that question, looking at the latest issues affecting both SMEs and corporates.

Here we take a look at two sessions covering some common and not-so-common issues that can arise when clients are operating globally. We spoke to two members of the Forum's Organising Committee, Katherine Patel of HLB Mann Judd and Letitia Weatherhead, ATI, of DKM Group about what to expect from the sessions from Greg Travers, CTA, William Buck on ‘Business Tax Considerations in a Global Economy’ as well as Hayley Lock of KPMG and Melissa Rowbottom of Hatch, who outline what to expect in ‘Expatriates and International Assignees – A Tax Guide For An Employer’s First Time’.
Business Tax Considerations in a Global Economy

With growing numbers of SMEs seeking to expand their operations and customer base globally, advisers to SMEs need an awareness of the key issues in structuring, profit repatriation and other compliance matters.

Greg Travers, CTA, William Buck brings his experience in advising on international expansion to bear on the key areas to be addressed when advising our clients on their now cross-border business. Letitia said ‘With a slowing Australian economy, many SMEs are being forced to expand their customer base or operations offshore. Proper structuring, the operation of double tax agreements and profit repatriation back to Australia are some of the issues that they come up against regularly, and will be covered in Greg's session. They’re important in managing the effective tax rate at the Australian owner / shareholder level and ensuring that other unfavourable outcomes are avoided’.

Letitia told us ‘Greg's session will look at an area where most SME advisers won't have a lot of experience, in an area rarely covered by professional development seminars. The aim of the session is not to make the attendee an expert but to give them a greater awareness of all of the things that they need to cover off on. Checklists and a handy ready reckoner table will also be provided which will make great reference materials for SME advisers’.

Greg’s session also looks at the regulatory and compliance issues to be considered when you have a permanent establishment; how double tax agreements work with respect to withholding taxes, foreign tax credit entitlement, franking credits and GST/VAT; ensuring your structure can facilitate cross-border operations; as well as when transfer pricing provisions apply.

Looking at the wider Forum, Letitia told us ‘Over the two days the Forum will cover all of the key taxation and compliance issues which SMEs and family businesses will face when expanding overseas’. She felt ‘SME advisers who are experienced and have or are likely to have in the future clients looking to start up business in another country will benefit from attending. They should gain a high level understanding of all of the issues which need to be addressed by clients looking to expand their operations offshore

Expatriates and International Assignees – A Tax Guide for an Employer’s First Time

In their session, KPMG's Hayley Lock and Melissa Rowbottom of Hatch look at the key tax issues for employers and employees in ensuring SME clients are aware of their obligations in the jurisdiction/s they'll be operating in.

Hayley and Melissa will look at the complexities in ensuring employees are paying the correct individual income tax in the correct jurisdiction; FBT and expatriate employment packages; employer superannuation obligations and bilateral social security agreements as well as reciprocal health care agreements and private health insurance requirements.

Asked about why the issues covered in their session are important, Katherine said ‘While the considerations for doing business in Brisbane with exposure to cross-border considerations are becoming more relevant in SME tax, many practitioners have not had to deal with the issues and whilst they may not be complex, they need to know the key considerations and how to work through them’.

Katherine felt that ‘SME practitioners, partners and managers would benefit most from this session. A lot of key, relevant topics that are an issue in tax for our clients and firms need some practical advice and application’.

2016’s Forum opens with a keynote address from Treasury's Roger Brake, Acting Deputy Secretary of the Revenue Group, who will consider the importance of strategic tax reform and policy development in this time of economic transition.

Following this address, two streams will dive into the latest tax issues: one stream for those advising in the SME market and the other focused on advisers and in-house tax managers and teams in the corporate market. We are also pleased to welcome Kate Carnell, the newly appointed Small Business and Family Enterprise Ombudsman who will address the SME delegates on the scope and powers of the new role.

The 2016 Queensland Tax Forum takes place 18-19 August at the Brisbane Marriott Hotel. Choose from 28 sessions over two days and a range of flexible ticket options with up to 13.5 CPD hours on offer. Find out more.