Showing posts from February, 2018

International tax practice – is it about to become a whole lot more complicated?

written by Robert Deutsch CTA *

The practice of international tax has always been complex and challenging. In part, this has been the result of adjustments which must be made to conclusions reached as a result of the application of the domestic law because of the overlay of Australia's 44 Double Taxation Agreements (DTAs). Each DTA seeks to modify the operation of Australia's non-DTA law in various different ways.

Let's work with an example – an unfranked dividend paid by an Australian company to its Russian parent would, under Australian non-DTA law, be subject to a withholding tax rate of 30% (see Taxation Administration Regulations 1976 Reg 40(1) esp (c)). However, under the relevant Australia/Russia DTA that rate is limited to 5% if certain conditions are met, including that there is at least a 10% shareholding: Article 10(2)(a). Otherwise, under the DTA, the DTA rate will be 15%: Article 10(2)(b).

If that was not complicated enough, on 7 July 2017 Australia was one of…

A year for us to make a difference

written by Tracey Rens *

I am incredibly honoured to serve as president for 2018 and I extend my thanks to the National Council, the dedicated Institute team, and our members for your support.

This year, we continue to focus on providing our best education programs, events and information to support all tax professionals in their day-to-day activities, as well as our advocacy work in improving the tax system now and in the future.

The National Councillors for 2018 are:
Tim Neilson (vice president)David EarlStuart GlasgowPeter GodberLen HertzmanMarg MarshallTim Sandow;Jerome TseTodd Want. I joined the Institute in 1995 at the beginning of my tax career because it was “the thing to do”, and I was encouraged to volunteer and become a more active member by senior members and my mentors. My involvement in volunteering began with participating on the NSW Education Committee, which I ultimately chaired. I then served on the NSW State Council and eventually National Council.

The experience ope…

Super and the expiry of the CGT relief – 2018 WA Superannuation Intensive

Trustees of superannuation funds, including self-managed funds, who adjust their asset allocations to comply with the transfer balance cap and transition-to-retirement income stream reforms that commenced on 1 July 2017 can claim the temporary transitional capital gains tax (CGT) relief. For many, this relief expires 15 May 2018.
Guidance from the Australian Taxation Office indicates that applying the CGT relief resets the cost base of an asset to its market value (as determined under the Valuation guidelines for SMSFs on the date the relief applies) and allows you to defer a capital gain that arises when resetting the cost base for assets where you use the proportionate method.
This rapidly encroaching May deadline means that any advisers who haven’t yet considered the issues facing their clients should be doing so now. 

Here we speak with self-professed 'superannuation nerd' Jemma Sanderson CTA about the ‘CGT relief seminar’session she will present at the WA Superannuation Inte…

The tax professional of the future – 2018 Barossa Convention

At a time in which traditional knowledge boundaries are rapidly eroding, the tax profession faces more serious challenges than in any other historical period.
Recent years have seen significant developments that are already affecting how we engage with clients and deliver services to them. Clients' expectations have also shifted.
At the 2018 Barossa Convention, Grant Thornton's Steve Healey CTA (Life) will deliver the keynote address, which will examine in detail the impact of these changes and how professionals can seize the opportunities they bring.
The following quotes are excerpted from the paper that Steve will present – 'The future tax professional'.

“Traditionally, we, as advisers, have been custodians of a body of knowledge that has within it enormous complexity. Today, we are witnessing a fundamental shift in the way we interact with each other in our personal and professional lives, in how we solve problems and generate new ideas. In future, the work profess…

Super death benefits & strategy beyond 1 July 2017 – WA Superannuation Intensive

1 July 2017 saw the biggest changes to superannuation in almost a decade. While professionals have generally come to grips with what the new rules mean, they are still working through a number of practical aspects.
One area of particular complexity is superannuation and death benefits, touching as it does on diverse areas including income streams, transition to retirement pensions, estate planning and even insurance.
At the 2018 WA Superannuation Intensive in March, Colonial First State's Craig Day will present the session ‘Super death benefits and strategy beyond 1 July 2017’, looking at the recent reforms and exploring the direct and indirect implications of the changes.

We spoke with Craig about some of the issues facing advisers. 
“2017’s super reforms had a significant impact on estate planning as it relates to superannuation. The session I’ll be presenting in March provides an in-depth analysis of the changes and a summary of the potential strategies advisers should be con…

Tax agents and privacy – don't stick your head in the sand!

written by Robert Deutsch CTA *

A number of members of The Tax Institute have commented upon the Privacy Amendment (Notifiable Data Breaches) Act 2017 (‘the Act’) which commences to formally operate on 22 February 2018.

This is an important Act which has significant potential implications for tax practitioners.

The Act, while mercifully brief (coming to a mere 22 pages), is accompanied by an explanatory memorandum which runs to 104 pages. The explanatory memorandum's length in part explains some of the complexities that arise in the context of this legislation.

Who does the notifiable data breaches scheme apply to? For our immediate purposes, the critical point to understand is that the notifiable data breaches scheme which is introduced by this legislation applies to Tax File Number (TFN) recipients in relation to their handling of TFN information.

A TFN recipient is any person who is in possession or control of a record that contains TFN information, and TFN information is infor…

An exciting year ahead

written by Vince Lendrum *

Following a comprehensive review of our activities last year, including consultation with members and key stakeholders, 2018 will be a year of action.

We look forward to rolling out member service initiatives that will include an ever-richer selection of events and a renewed focus on key emerging demographics, such as women in the tax profession and younger practitioners. This will set us on the path to deliver on our mission of shaping the tax profession of the future.

Key events  I look forward to meeting many more members at our 33rd National Convention in Cairns from 14 to 16 March. The convention organising committee has brought together a diverse range of high-profile, expert presenters from across the profession to deliver the quality technical sessions that have become a hallmark of this landmark event. It is very exciting to take the National Convention to North Queensland for the first time, and to deliver on the member request for a “destination l…

Superannuation – a new, simple 15/15/0 regime

written by Robert Deutsch CTA *

At its most fundamental, superannuation is all about money being set aside throughout one’s working life so as to provide an adequate level of funding for one’s retirement. For many Australians, the superannuation nest egg is usually the second largest asset they will ever hold — the largest being the family home.

One would have thought that the idea that a fund could be set aside for each and every Australian to provide for their retirement funding would not be a complicated process and would not lead to convoluted legislation. How wrong one can be!

A key objective of a tax system is simplicity and yet, in the context of superannuation, we are as far away from that objective as ever.

In my opinion, our political masters, both past and present, should hang their collective heads in shame at the appalling state in which we now find superannuation. For the average person, the concepts that underpin superannuation are complex, abstract and basically beyond…

Member profile - Sylvia Villios

Dr Sylvia Villios is a Senior Lecturer in the Law School at the University of Adelaide, where she researches and teaches in taxation law.

We asked Sylvia about her career and life.

Member’s name Sylvia Villios CTA

Company Law School, University of Adelaide

State South Australia

Member since 2005

What led you to a career in tax? While I was completing my studies in law, I did some work experience at PwC in the tax area, which I really enjoyed. A year later, I was admitted to practice and continued down that path, working in the tax law area for six years, before entering into academia.

What are your current areas of specialty? My areas of specialty are researching and teaching in taxation law. The thematic strand uniting my research agenda is a keen interest in law reform aimed at making Australia’s tax system more efficient, equitable and simple. This is explored through my research, which is focused on examining the operation of the Australian tax system, taxation policy, corporate …

Business solvency – salvaging what you can: WA 'Dealing with a Client in Financial Distress' day

Clients can find themselves in financial distress for a wide range of reasons. And that financial distress can translate to real anxiety.
Clients often ignore the warning signs, which can lead to a situation that's much more difficult to emerge from. It's at this stage that an adviser is most likely asked to assist.

That said, the hallmark of a trusted professional is the ability to provide prudent advice when clients need it the most.
At the Dealing with a Client in Financial Distress event in Perth, a number of high-profile tax and legal specialists will be joined by representatives of the ATO to look at the causes and effects of financial distress, and the options available for businesses and individuals facing financial difficulties.
Dudley Elliott CTA, from Trove Advisory Group, has told us a little about what to expect from his session: 'Business solvency – salvaging what you can - tax and accounting considerations'.
“Usually, the last things on the mind of a bu…

Cairns and the Convention – a focus on our program for accountants

2017 was a year of significant upheaval for tax and accounting professionals.
2018 will be no different, with new rules, new ATO initiatives, and the always-accelerating rate of technological change creating new opportunities (and new headaches) for most of us.
Against this backdrop, The Tax Institute's 2018 National Convention will feature a wide-ranging program that will cover the latest technical matters, with a strong focus on the international issues shaping Australian business and a close look at the ways the ATO has been – and will be – interacting with organisations.
Designed to be broad in nature, the program will feature the technical tax content that our National Convention has become synonymous with. It will also cover the latest developments that accountants, lawyers and other advisers to business need to know about.
Helping set the scene for the Convention – which will take place this year in Cairns – we ask how, in a period of near-constant change, you can ensure y…