Legal Updates

Taxation and Superannuation

Are you ready for new changes when buying and selling real property?

On 1 July 2016, the law concerning transactions of real property will change dramatically. Recent changes to the Taxation Administration Act 1953 will assist the Federal Government capture tax to be paid by foreign residents on taxable Australian property by requiring purchasers to withhold 10% of the purchase price. The transactions that are caught by…

View Update

Land Tax Ruling and Stamp Duty Reduction

Land Tax Ruling – Trusts Revenue Ruling LT004 released by the Commissioner of State Taxation on 25 February 2016 indicates the Commissioner will be tougher in his approach to applications to disaggregate land holdings in separate trusts.  The ruling is helpful in providing clarity on the Commissioner’s interpretation of the law. Paragraph 13(3)(b) of the…

View Update

Dividend Access Shares and CGT Concessions

A recent case in the Administrative Appeals Tribunal has heard whether a dividend access share (DAS) affects a taxpayer’s ability to access the CGT concessions on a sale of shares. This article first sets out what a DAS is and then analyses the recent case. Advisers and DAS shareholders would be pleased to know that…

View Update

Part IVA – Tax Avoidance Alert

A decision of the Administrative Appeals Tribunal made on 29 January 2015 illustrates the risks of relatively ordinary schemes to minimise tax coming unstuck under the Part IVA anti-avoidance provisions. Many Part IVA cases come from “big end of town” complex corporate transactions, often with an international element. However, in Track and Commissioner of Taxation…

View Update

Why Negative Gearing Won’t Be Abolished (But What Will Go Instead)

There have been a number of articles in the press claiming that the Murray Inquiry into the Financial System has advocated abolishing negative gearing. It does not say that. Negative gearing is mentioned only once in the final report (delivered 7 December 2014). Negative gearing is the ability to deduct the losses made on one asset…

View Update

Leased residential premises and GST

The High Court has ruled against the taxpayer in a case concerning the GST treatment of a sale of residential premises, subject to a lease, that is sold as a going concern. Factual background South Steyne Hotels Pty Ltd (“South Steyne”) owned a series of apartments in NSW. Those apartments were leased to an operator…

View Update

Improved taxation arrangements for employee share schemes

In our August legal update I wrote that the Federal Government was proposing to amend the existing taxation laws concerning employee share schemes – particularly with regard to start-up companies. By way of background, research indicates that companies in which employees have an ownership interest are more productive than those that do not.  Employee share…

View Update

Farmer battles fire, pests, drought and tax

The AAT has considered whether a Doctor, who also owns an olive plantation that has been plagued by problems, is able to offset his farm losses against his other income. Dr Bentivoglio has operated an olive growing and olive oil production business for 15 years. He has 8000 trees across 125 acres, up to 13…

View Update

Unpaid Present Entitlements and Bad Debt Deductions

The AAT has denied a taxpayer a deduction for writing off an irrecoverable debt from his family trust. Under s 25-35 of the ITAA 97 a taxpayer is able to deduct a debt that is written off as irrecoverable if the debt has previously been included in assessable income. The typical application of this section…

View Update