| Brought to you in association with Thomson Reuters | Your weekly tax update | 5 November, 2009 |
|
New regulatory framework for tax practitioners All the necessary legislation to give effect to the new regime for tax practitioners has now been passed by parliament and the necessary regulations are expected to be finalised shortly to enable the regime to start from 1 January 2010. The new Tax Practitioners Board has also now released the following fact sheets:
The board has also released specific factsheets
for tax agents and BAS agents. More certainty for business in national payroll tax reforms The New South Wales Treasurer, Mr Eric Roozendaal, has announced that businesses will be given greater certainty under new national payroll tax reforms introduced into the state parliament on 30 October. Similar legislation is expected to be introduced by the other states and territories under a national agreement on harmonised payroll tax legislation. The new rules came into effect on 1 July and will be
backdated. CPA Australia welcomes these reforms and also the recent co-operation between the states and territories to ensure uniform administration by the various state revenue offices of the proposed new harmonised legislative framework going forward. Upcoming consultations and meetings
Member enquiries or issues for these meetings
should be sent to tax@cpaaustralia.com.au
Lodge early to avoid refund delays, says ATO ATO Second Commissioner, Mr David Butler, has advised that large businesses may be affected by the ATOs plans to implement its new income tax system in late January 2010. He said the ATOs computer systems will be unavailable from Friday 22 January until Wednesday 27 January 2010 while it implements the new system. There will also be some processing delays (possibly continuing during February 2010) in the weeks following the implementation as the new system gradually returns to full processing levels, Mr Butler said. The ATO recommends that if a business is expecting a tax refund, it lodge its income tax return as early as possible to reduce the likelihood of any delays. The ATO suggests that businesses due to lodge on 15 January 2010 should lodge no later than 7 December. Any queries should be directed to (02) 9685 8735 between the hours of 8.00 am to 4.30 pm AEST or email LB&IClientServices@ato.gov.au ATO focus on carried forward losses The ATO has advised that it has recently sent letters to selected practitioners who have business clients with an annual turnover of $2 million to $10 million. The letters include information about how carried forward loss provisions operate and highlight areas of concern. The ATO said it will be reinforcing the need to ensure businesses satisfy the continuity of ownership or same business tests. Further, the ATO said it may phone practitioners as a follow up to these letters. ATO IDs: seven new; one withdrawn The ATO has released the following IDs:
The ATO has withdrawn ATO ID 2008/105 (excise: meaning of tobacco). ATO website updates From the ATO website:
Foreign exchange rates — October 2009 The ATO has released the average foreign exchange rates for October 2009. Rates for selected countries include: Europe — 0.6249; Hong Kong — 7.1278; Japan— 84.0541; NZ — 1.2490; UK - 0.5728; USA — 0.9243.
Tax Bill (No 5) passes House of Representatives The Tax Laws Amendment (2009 Measures No 5) Bill 2009 has passed the House of Representatives without amendment and now moves to the Senate. The Bill contains amendments concerning: GST and representatives of incapacitated entities; IWT exemption for Commonwealth issued debt; PAYG and TOFA interaction; use of Victorian bushfire appeal donations; tax exemption for remote children payment and Continence Aids Payment Scheme.
The following rulings were released by the ATO on 4 November:
PSI rules apply where company non-resident — and no DTA relief In Russell v FCT, the Federal Court held that the PSI rules in Div 87 of the ITAA 1997 applied to attribute personal services income derived by a company resident in New Zealand to an Australian resident taxpayer who controlled the company. Moreover, the court held that the Australia-New Zealand DTA did not apply to eliminate the 'double taxation' that arose from the income being taxed both to the New Zealand company in New Zealand and to the taxpayer under the PSI rules in Australia. Appeals update The High Court has granted both the taxpayers and the ATO special leave to appeal from the decision of the Full Federal Court in Bamford v FCT [2009] FCAFC 66. The Full Federal Court held that a capital gain made by a trust but distributed as trust income should be treated as income for tax purposes. The court also confirmed that it is correct to apply the 'proportionate view' where the net income of a trust for tax purposes exceeds its accounting income. The High Court has refused the taxpayer special leave to appeal from the decision of the Full Federal Court in St George Bank Limited v FCT [2009] FCAFC 62. The Full Federal Court decision, which now stands, dismissed the taxpayer's appeals and held that interest payments made by the bank were all outgoings of a capital nature within s 8-1(2)(a) of the ITAA 1997 and therefore not deductible. Westpac appeals New Zealand tax decision Westpac has announced that it has appealed the decision of the New Zealand High Court relating to structured finance transactions undertaken by Westpac in New Zealand. The decision found in favour of the New Zealand Commissioner of Inland Revenue on four representative transactions. Westpac said it understands the appeal is likely to be held no earlier than the last quarter of 2010.
NSW: State Revenue Legislation Further Amendment Bill (No 2) introduced The State Revenue Legislation Further Amendment Bill (No 2) 2009 (NSW) has been introduced into the NSW Legislative Assembly. The Bill proposes various amendments to the Duties Act 1997 (NSW) relating to landholder duty. The amendments will be taken to have commenced on 1 December. The Bill also proposes to amend the Payroll Tax Act 2007 (NSW). The amendments implement an agreement between the states and the territories to adopt complementary nexus provisions in relation to the imposition of payroll tax where an employee who works in more than one jurisdiction in a month, such as in the airline industry. The amendments will be taken to have commenced on 1 July.
Accounting standards update (IFRS) (claim up to 1.5 CPD hours) Update your knowledge of new accounting standards / interpretations issued during the half year period, and the standards effective for the first time at 31 December. Program information - Webinar Managing and forecasting cash flow (claim up to 16 CPD hours upon completion) Take your organisation's financial independence to the next level and learn to identify improvements you can implement today. Program information – CD-ROM/0nline More training and events For information on other CPA CPD activities being held
throughout Australia please visit the training and
events section on our website and use the search facility. To register
click onto the activity you wish to attend and follow the prompts.
Sound education in taxation CD The Federal Treasurer’s 2009 - 10 Australian Federal Budget speech announced changes to Australia's research and development tax concessions, most importantly, the announcement concerned a new research and development tax credit regime to replace the existing research and development tax concessions with effect from 1 July 2010. This is examined in the research and development reforms session in the October edition of Sound education in taxation CD. Other topics highlight managing Division 7A exposures: new issues and latest tax cases and rulings. Reserve a copy from CPA Library.
'High court to hear CGT case' (High Court grants special leave to appeal in the Bamford case) AFR [p 7], Wed 4.11.2009 'Time to turn back to shares' (Investment opportunities for DIY super funds) AFR [p 33], Wed 4.11.2009 'Deficits linger in gradual recovery' (Govt forecasts 1.5 per cent growth this year, but a better than expected tax revenue forecast) AFR [p 1], Tue 3.11.2009 'Tax take grows but still short' (Report that Commonwealth revenue will face a $170 billion shortfall over the next four years) AFR [p 9], Tue 3.11.2009 'Tax change to cost $65m' (Report that changes to the Government's employee share scheme measures will cost $65 million over four years) AFR [p 10], Tue 3.11.2009 'Regulator right on the money' (AUSTRAC to step up its compliance activities) AFR [p 12], Tue 3.11.2009 'Taxing times for a high-tech endeavour' (Report that the Henry tax review has serious implications for the Tax Office's revamp of its computer systems) AFR [p 31], Tue 3.11.2009 'Getting CGT relief depends on asset list' (The scope of the CGT small business concessions) AFR [p 49], Tue 3.11.2009 'ATO targets debt collection' (Report that the Tax Office is renewing its focus on debt collection) AFR [p 50], Tue 3.11.2009 'Super pledge goes missing' (Concern at delays in the start of the superannuation clearing house) AFR [p 60], Tue 3.11.2009 'Options tax "would stifle innovation"' (Claim that the Government's employee share scheme changes have effectively killed off option schemes) AFR [p 3], Mon 2.11.2009 'Plugging gap in tax knowledge' (UNSW is launching new master's degrees for tax administrators, lawyers, economists and accountants) AFR [p 28], Mon 2.11.2009 'VIC government backflip on tax review' (Report that the Victorian Government will review the insurance fire levy) AFR [p 8], 31 Oct-1 Nov 2009 'Super bandits steal your savings' (Claim that super funds have become a lucrative target for organised fraud) AFR [p 19], 31 Oct-1 Nov 2009 'And the government may have a go too' (Report that the Cooper and Henry reviews have superannuation in their sights) AFR [p 21], 31 Oct-1 Nov 2009 'Work longer, rebuild your super' (Ways to boost retirement savings) AFR [p 37], 31 Oct-1 Nov 2009 'Proper research needs to come before property' (More DIY super funds are investigating buying property) AFR [p 40], 31 Oct-1 Nov 2009 'Complexity looms as a prime target' (Report that Ken Henry says reducing complexity of the tax system is the most important priority) AFR [p 7], Fri 30.10.2009 'GST relief for public subsidies' (Federal Court finds Victorian Department of Transport was entitled to input tax credits for GST paid by disabled people via a govt subsidy) AFR [p 13], Fri 30.10.2009 'Don't miss tax deadline' (The 31 October tax lodgment deadline is here) AFR [p 13], Fri 30.10.2009 'ATO overhaul overdue and over budget' (ANAO report on the Tax Office's change program released) AFR [p 54], Fri 30.10.2009 'Brogden's super solution' (AFR interview with new IFSA CEO John Brogden, who wants super guarantee increased to 12 per cent) AFR [p 57], Fri 30.10.2009 'Westpac appeals NZ tax avoidance court decision' (A bank has appealed against a NZ High Court decision re structured finance transactions) AUSTRALIAN [p 41], Wed 4.11.2009 'Equities emphasis savages super' (Report that Australian super funds were the third worst performing group of pension funds in the world 2008) AUSTRALIAN [p 24], Mon 2.11.2009 'Hogan adviser charged' (Report that a financial adviser has been charged with criminal offences in relation to a Wickenby tax probe) AUSTRALIAN [p 1], Fri 30.10.2009 'Budget deficit doesn't allow latitude for tax experiments' (Opinion on whether there is a need for radical tax reform) AUSTRALIAN [p 32], Fri 30.10.2009 'Big trouble in small business' (Claim that small businesses are worried that research and development tax incentives will be restricted under new proposals) AUSTRALIAN [Entrepreneur, p 5], Fri 30.10.2009
CPA Australia seeks your input on issues it should take up on the members' behalf. If you would like to contact us please email us at tax@cpaaustralia.com.au.
 CPA Tax News is brought to you in association with Thomson Reuters 2009 CPA Australia Ltd ABN 64 008 392 452 2009 Thomson Reuters (Professional) Australia Limited ABN 058 914 668 Material in 'CPA Australia Tax News' marked with an asterisk is the copyright of CPA Australia Ltd. Members of CPA Australia may reproduce CPA Australia copyright material from 'CPA Australia Tax News' without permission provided the material is acknowledged as the copyright of CPA Australia Ltd. All other material in 'CPA Australia Tax News' is the
copyright of Thomson Reuters (Professional) Australia
Limited. |
