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Showing posts from August, 2018

GST & cross border supplies – Leveling the playing field?

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The last two years have seen the biggest changes to the application of GST to cross border supplies since the GST commenced on 1 July 2000.

These changes have involved a myriad of amendments to various sections of the A New Tax System (Goods and Services Tax) Act 1999 (the GST Act) – changing both the basic rules and special rules – but have essentially been in line with one of two main themes:
Extending GST liability to cross border supplies of goods and services to Australian, nonbusiness consumers – B2C: where there is net GST revenue; orLimiting the application of GST on supplies to non-resident businesses or from non-resident businesses to Australian business consumers – B2B: where there is (usually) no net GST revenue.  At the recent NSW 11th Annual Tax Forum, Andrew Howe, CTA, and Rebecca Lawrence (both of Greenwoods & Herbert Smith Freehills) presented the session 'GST & cross border supplies – Leveling the playing field?'
The paper they presented is excerpte…

Stocktake on recent superannuation changes

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In this article from the August issue of Taxation in Australia, excerpted here, Daniel Butler, CTA, argues that the rules related to superannuation should encourage long-term savings rather than being a mechanism for governments to extract further tax revenue to balance their annual expenditure needs.

Daniel is one of Australia’s leading SMSF lawyers, and presents the session ‘Superannuation and Estate Planning’ at the upcoming 6th Annual Victorian Tax Forum in Melbourne.

In this article, Daniel points out that we have recently experienced substantial superannuation changes during the period of 1 July 2017 to 30 June 2018, and as such, a brief “stocktake” of the changes introduced by the current Coalition Government is provided. He points out that a number of these policies were adverse to many members.

Prime Minister Malcolm Turnbull has said that the next federal election is to be held in 2019. As Labor may be elected, a brief “stocktake” of the key Labor Government proposals that w…

The Multilateral Instrument: What you need to know

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The MLI is the new acronym on the block.

Developed as part of the OECD/G20 Base Erosion and Profit Shifting (BEPS) project, the Multilateral Instrument is a novel approach to updating many of the 3,000 or so existing double tax treaties, on a fast-track basis,

The MLI is expected to start reshaping international tax from 2019, and Australia is likely to be amongst the first wave of countries whose treaties will be affected.

At The Tax Institute's upcoming International Masterclass, David Watkins, CTA, and Isabelle Mac Innes present the session ‘Hello MLI!!’, where they will provide an overview of the issues, and look at the MLI from an Australian perspective.

David is the partner in charge of the Deloitte Australia Tax Insights & Policy group, and Isabelle is a Director at Deloitte Sydney specialising in inbound and outbound international tax issues, especially in relation to double tax treaties.

We speak to them about the impact of the MLI and what to expect from their …

SMSFs & property development - tips, traps and pitfalls

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Despite differing signals on the direction of the WA and national property markets, property remains a popular investment for SMSF trustees.

The rules in this space are complex, and most of the major banks no longer service the sector, with those that do offering somewhat unpalatable and restrictive lending terms.

At September’s Property Day in Perth, Tracey Scotchbrook, CTA, joins some of WA’s leading experts in property and tax to look at critical issues facing advisers and their clients. 
Tracey presents the session ‘SMSFs & property development - tips, traps and pitfalls’, and she tells us about some of them here.

“The desire to undertake a property development in a SMSF is often driven the attraction to the concessional tax environment, but this should not be the only consideration” she said.

“There is still some misunderstanding on whether a SMSF can run a property development. It is often linked to discussions around whether a SMSF can run a business. A SMSF can technic…

Tax as a business partner – aligning tax planning with a company’s strategy

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Many businesses view their tax team as simply a cost centre or compliance function.
The truth is, tax can and should be a critical component in achieving a company’s strategy and can be a true business partner.

There are however, obvious challenges with tax planning in an environment where there is sustained public interest and focus from regulators on the tax contribution of the corporate sector.

At the 2018 Queensland Tax Forum, Justine Neep (Senex Energy) and Sarah Price (PanAust) look at the opportunities for in-house tax teams to partner with the business in the session ‘Tax as a business partner – aligning tax planning with a company’s strategy’.

Justine tells us about some of the issues to be covered in this post.

“Tax risk management is already a key area of focus for advisers, be it a specialist focus or because it is inherent in all advice and compliance support activities we provide. What many people don’t understand fully are the drivers and therefore some of the cons…

Anti-Hybrids: The Current State of Play

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The Bill to enact the Government’s announced anti-hybrid measures was introduced into Parliament in May 2018. The Bill contains a number of measures intended to counter the consequences of transactions involving hybrid financial instruments and hybrid entities.

This proposed response, to the OECD’s BEPS Action Item 2, amounts to more than 90 pages of draft anti-hybrid legislation. These proposed rules are complex and broad in their application, and will result in changes to the Australian tax treatment of many instruments and arrangements.

At Victoria’s 6th Annual Tax Forum, Ryan Leslie, ATI, and Andrew Hirst, CTA, (both Greenwoods & Herbert Smith Freehills) present the session ‘Anti-Hybrids: The Current State of Play’, where they will consider some practical examples of how the rules will affect a range of instruments and structures.

Ryan tells us about some of the potential issues coming for advisers in this post.

“Andrew and I will be speaking on the anti-hybrid rules that…

SMSFs – working with clients to avoid common mistakes

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One year on from the introduction of the latest superannuation reforms, advisers are still coming to grips with a range of issues that can have a lasting impact on individuals’ retirement planning. Together with the continued growth of the sector, this has led to the increase in demand for tax and superannuation advice from those with superannuation clients in the profession. 
The SMSF $700 billion sector represents almost a third of the total superannuation system, but the poor performance of SMSFs have some in the industry calling for reform, including suggestions for a minimum threshold for setting them up.
Whatever the future holds, they remain a popular small business investment vehicle, and advisers need to be aware of the opportunities to help clients’ growth, and the risks that are present. At the 2018 SA Super Day, Shirley Schaefer (BDO) presents the session ‘SMSF hot topics plus tips and traps’. She previews her session here.
Shirley said, “The complexity of SMSFs and the s…

What happened in tax in July

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Written by TaxCounsel Pty Ltd
The following points highlight important federal tax developments that occurred during July 2018.
Each month, these developments are considered in more detail in the Taxing Issues column of Taxation in Australia, the Institute's member journal.
R&D tax incentive

Draft legislation (and explanatory material) to give effect to the 2018-19 Budget proposal in relation to the research and development tax incentive has been released.
Stapled structures
The government has released a paper for public consultation in relation to the reform of the tax treatment of stapled structures and similar arrangements.
Company residence
The Commissioner has issued a final ruling which sets out his view on how the central management and control test of company residency in s 6(1) ITAA36 operates following the decision of the High Court in the Bywater Investments Ltd case (TR2018/5).
Part IVA
A draft practical compliance guideline sets out the ATO’s compliance approach with res…

July's tax developments - in depth

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This article is taken from the August issue of Taxation in Australia, the journal for members of The Tax Institute.


Government initiatives

1. Better targeting the research and development tax incentive

In a 29 June 2018 joint media release, the Treasurer and the Minister for Jobs and Innovation announced the release of draft legislation (and explanatory material) to give effect to the 2018-19 Budget proposal in relation to the research and development tax incentive (R&DTI).

In the Budget, it was announced that the R&DTI would be reformed to better target the program and improve its integrity and fiscal affordability in response to the recommendations of the 2016 Review of the R&D tax incentive. The changes are to apply for income years starting on or after 1 July 2018.

The Treasurer said that the government is committed to backing R&D investment and the economic opportunities and jobs it generates. At the same time, it needed to be made sure that the investment of taxpay…