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Showing posts from June, 2018

The Post-BEPS world – lessons learned

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2013 seems like a lifetime ago. In this pre-Trump, pre-Brexit world, then UK Prime Minister David Cameron’s made his famous “Wake up and smell the coffee” speech at Davos, putting tax avoidance by multinationals firmly in the spotlight.

Since then, the taxation implications of cross-border transactions and the complexity associated with operating within a multinational group have evolved at a breakneck pace. 
Australia has been at the forefront of the developing base erosion and profit shifting (BEPS) debate ever since, with multiple new pieces of tax legislation being introduced each year.
As the new legislation begins to take effect and tax returns start being lodged on the new basis, now is an opportune time to reflect.
At the 51st Western Australia State Convention in August, Matthew Popham, CTA, KPMG will did just that in his session, ‘The Post-BEPS world – lessons learned’. Matthew tells us about some of the issues in this post.
Matthew said “The various BEPS initiatives that h…

Doing something overseas – Have you understood the practical Australian taxation consequences correctly?

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The tax strategies and structures adopted by multinational organisations are currently under enormous (and very public) scrutiny from global tax authorities and the media.

In Australia alone, hardly a week goes by without a newspaper article commenting on the tax profile of a corporate entity or the “big end of town” as a concept.
Consistent with the Organisation for Economic Cooperation and Development’s (OECD) Base Erosion and Profit Shifting (BEPS) project initiative, the Australian Government has introduced a number of new legislative measures designed to reflect BEPS and the concerns raised around international tax avoidance for large multinationals.
At the 51st Western Australia State Convention in August, Mathew Chamberlain, CTA, (EY) will take a closer look at the issues in his session ‘Doing something overseas – Have you understood the practical Australian taxation consequences correctly?’
Here we speak to Mathew and preview the paper to be presented in Perth.
As Mathew’s pa…

Non-resident tax issues - the 2018 SA Private Business Day

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The operating environment for private companies is increasingly competitive and complex, and for those looking to expand their operations overseas, particularly fraught.
One of many important considerations is how the Australian taxation system will apply to income generated via an off-shore investment vehicle, such as a non-resident trust entity. What’s more, complying with the rules around transfer pricing can be onerous, despite efforts by the ATO to simplify record keeping.
At July’s SA Private Business Day in Adelaide, Talia Begley, ATI, looks at some of the issues in her session ‘Non-resident tax’. She tells us about some of the challenges facing businesses and their advisers in this post. 
“Expanding a business beyond Australian shores is complex. Transfer trust rules and transfer pricing are both highly technical aspects of the taxation law matrix – either subject could easily fill an entire day!As such, I will really be aiming to boil them down to some key practical takeaways…

Repair or improvement – Does Theseus have the answer?

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Written by Bob Deutsch, CTA

Following on from last week's post I thought I might tackle the problematic area of deductions in respect of repairs to investment properties.

In this context, it is critical to distinguish between:
ongoing repairs, which are deductible; initial repairs, which are not deductible; and improvements, which are not deductible.  If the amount in question falls into the category of initial repairs or improvements, the amount in question is not deductible, but, it would be considered as expenditure that may qualify for depreciation purposes, capital works purposes, or as part of the cost base for CGT purposes.

An amount of expenditure would constitute initial repairs if the asset was in disrepair at the time of its acquisition, and before letting out the property the owner carried out the repairs.

The way to get around this problem, might be to have the repairs done by the vendor before transfer, and an appropriate adjustment made to the purchase price whic…

Could your career fade away without a life-long partner?

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No, not a partner you can clink wine glasses and possibly walk down the aisle with. Rather, a professional partner that can provide the support you need to excel in your career.

Picture the following:

You’ve studied hard at school. You achieved your goals in university. You have been hired as the bright shining star and are enjoying your chosen career, feeling comfortable that things are heading in the right direction, with all the benefits a stable and fulfilling job provides.

Apart from deciding where your annual holidays will be spent, you don’t have a worry in the world… then you start noticing a few things.

Looking around, you can see a few unnerving aspects you weren’t aware of as you commenced your climb up the career ladder.

This isn’t quite what I expected?

To start with, there’s an ever-growing procession of ‘bon voyage’ cards to sign for now ex-colleagues and the staff kitchen is being frequented by unfamiliar faces.

You’re also noticing there’s less time to go out and …

Nine career tips to stand out from the crowd

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Why do we work so hard to fit in, when we were born to stand out?  Here are nine powerful ways to make a lasting impression and stand out in a crowded field of professionals.
1. Master the art of networking 
You cannot do your job alone. Building networks within the organisation, your client base, other firms and other service areas will allow you to tap into the expertise of your network to get the job done (well).

2. Have great mentors 
Ensure that you are always working in an environment where you have great mentors, and foster and develop that relationship. It also helps to be a sponge! Learn and absorb as much as you can from those around you.

3. Be committed to furthering your education 
Tax laws and their application change every day. If you want to be a high-calibre professional, you must be prepared to keep up with the evolving landscape. You must be continuously committed to developing yourself – whether that be with structured education to learn a skill or through seminars to…

Issues with life estates - the 2018 Death… and Taxes Symposium

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With an ageing population and increasing wealth held personally and via trusts and estates, the practical matters in the event of incapacity or death have increasing importance.

Despite many holding the view that life estates should only be used sparingly, creating life and remainder estates continues to be a popular option for many will makers.
But after death, family members often wish to terminate their life or remainder interests early, and there are a range of consequences that arise from such early terminations.
At July’s 2018 Death… and Taxes Symposium, Michael Flynn, QC, CTA (Life) presents the session ‘Issues with life estates’. We spoke to him about what to expect from his presentation. 
Michael told us “It is still common for will makers to leave their surviving spouse with a life interest in the family home and in other assets, which will pass to their children when the spouse dies.Very often this arrangement is unsuitable by the time the will maker dies, or later becomes…

Proposals for payroll tax reform - The 18th Annual States’ Taxation Conference

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In August 2017, Craig Bowie, CTA, (MinterEllison) took part in the panel session ‘Payroll Tax – Exploring the Issues’, at the Queensland Tax Forum.
In the session, Craig discussed a range of points from a paper he produced with Harry Lakis, CTA, (Barrister) and Damien Bourke (Bourke Legal). 

In July 2018, Craig will expand on some of the points presented in this paper in his session ‘Proposals for payroll tax reform’, at the 18th Annual States’ Taxation Conference in Melbourne
Craig’s session will consist of a discussion on matters that are suitable for harmonisation in the administration of payroll tax around Australia, providing a practical outline as to the impact of the issues raised, and suggested approaches to improve their administration.
This post excerpts the paper presented at the Queensland Tax Forum, which includes a short outline of the grouping provisions’ history, the purpose and scope of the grouping provisions, raises a number of discussion points, and concludes with some…

Rental property deductions – the do's and don'ts

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Some weeks ago, I canvassed issues relating to work-related deductions.

In the final weeks of the financial year, I will focus my attention on different aspects of deductions that can be claimed with a particular focus on contentious areas.

This month, I thought I would look at the question of deductions in the context of investment properties.
In Australia, there are over 2 million people who claim some $46 billion in rental property deductions in their tax returns, and this number appears to be growing. The lion's share of the available tax deductions is generally the interest portion of a mortgage connected with the property.

However, other costs can be claimed on an immediate basis provided that they have been incurred by the relevant taxpayer, and they have not been recouped from elsewhere, such as a payment from the tenant.

Items that can be claimed on this basis include:
Advertising for tenants Bank charges Body corporate fees and charges / or strata levies Cleaning cos…

Simplifying GST to extract more revenue!

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Written by Bob Deutsch, CTA

The talk of tax reform in recent times seems to have centred on nothing more than adjustments to corporate and personal tax rates. However, genuine reform entails much more than that and The Tax Institute advocates strongly for more genuine reform, particularly in the area of GST.

The political compromise that was done on the GST back in the late 1990s, whereby basic food, health, education, childcare, and water and sewerage services were all classified as GST-free is, quite frankly, as absurd as it is complex.

We seem to have decided at that point, largely for political reasons, that because somewhere between half a million and one million Australians would be disadvantaged by having GST imposed on these types of services and goods, we should exclude the whole of the community from this impost. This is an absurd knee-jerk reaction which favours the top and middle-income earners simply because we wish to preclude the imposition of this tax on lower-income …

How emerging leaders can make the most of their career in the tax profession.

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Today's leaders are confronted with challenges and opportunities that have never been more complex. However, it may take some commitment to develop into a high potential leader to handle the formidable challenges you’ll likely face.
We spoke with Antoinette Elias, CTA, Oceania Sector Leader for Wealth & Asset Management and Tax Partner in EY’s Financial Services Group, with over 33 years’ experience as a tax adviser, on her views to inspire and nurture the next level of top performers who want to grow as leaders.
Antoinette’s advice on how emerging tax leaders can make the most of their career in tax is to embrace every opportunity that is in their path, and, in particular, to find their passion for tax. “If you're not passionate about tax, it is actually very hard to succeed, so you need to find that passion. Take the opportunities that come your way, say yes to every experience you can possibly get. As you mature throughout your career, start to work out what area you wa…

How tax professionals can prepare for the storm ahead

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For those industry professionals toiling away with current, new and proposed tax laws, every now and again — when you raise your head from the never-ending updates — you may see signs of change… unsettling change. Yes, no doubt about it, with an avalanche of disruptors, digital start-ups, and the sharing economy radically changing the taxation landscape, there’s certainly a storm of confrontation ahead. And if you don’t batten down and prepare for change in the commercial weather, you’ll be washed aside just like other has-been businesses. 

In five years’ time, will anyone remember what a video store was?
Just like vanishing record shops and book stores as well as industries that are currently in the eye of their own storm — such as the taxi, transport and accommodation sectors — the commercial world as we know it, will only be survived by those that prepare themselves.
Whether they disappear or not, the average tax professional could do well to ponder when they too will be affected by …