ATO documents 

TR 2017/D5: Income tax: employee remuneration trusts.

Please refer to our Riposte here for more details on the 3 documents released by the ATO on 8 June 2017 in relation to trusts used in conjunction with employee remuneration and employee share schemes (i.e. TR 2017/D5, TD 2017/D2 and draft Practical Compliance Guideline PCG 2017/D9).

Draft Taxation Determinations

TD 2017/D1: Income tax: is a person who is not a beneficiary of the trust capable of having a distribution made to them for the purposes of section 272-60 of Schedule 2F to the Income Tax Assessment Act 1936 ?

TD 2017/D2: Income tax: when will a dividend equivalent payment, made by a trustee under an employee share scheme that delivers ESS interests taxed by Subdivision 83A-B or 83A-C of the Income Tax Assessment Act 1997 be assessable as remuneration under section 6-5?.

Goods and Services Tax Ruling 

GSTR 2017/1: Goods and services tax: making cross-border supplies to Australian consumers.

Practical Compliance Guideline

PCG 2017/10: Application of paragraphs 215-10(1)(c) and 215-10(1)(d) of the Income Tax Assessment Act 1997

LCG 2017/D4: GST on supplies made through electronic distribution platforms

LCG 2017/D5: When is a redeliverer responsible for GST on a supply of low value imported goods?

PCG 2017/D9: Dividend equivalent payments made by a trustee under an employee share scheme.

Notices of Withdrawal - Draft Taxation Ruling

TR 2014/D1: Income tax: employee remuneration trust arrangements.

Withdrawn Interpretative Decisions

ATO ID 2003/195: Capital gains tax: cost base of SingTel Shares - compulsory acquisition of Optus shares

ATO ID 2007/226: Deductions and expenses: premium included as part of the purchase price - capital or revenue expense

ATO ID 2012/12: Trust Losses: whether the writing off of a trade debt by a trustee constitutes a distribution to the debtor

BEPS

Australia signed the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS on 7 June 2017. Once ratified, the new convention will modify existing bilateral tax treaties to allow countries to implement tax treaty measures developed in the course of the OECD/G20 BEPS Project. Treasury has provided a summary of Australia’s provisional positions on the various articles of the Convention here.

Tax cases

News Australia Holdings Pty Ltd v Commissioner of Taxation [2017] FCA 645 (8 June 2017): The Federal Court has held that an amount of interest that was due but had not been paid to a Cayman Islands company, a CFC of the taxpayer, by the end of the income year ended 30 June 2010, was derived by that company on an accruals basis and therefore was to be included in the income attributed to the taxpayer under the CFC provisions in relation to that income year.

Progress of legislation

As at 9.6.17

Bill

Treasury Laws Amendment (Foreign Resident Capital Gains Withholding Payments) 2017

Description

Modifies the foreign resident CGT withholding regime - increases the withholding rate from 10% to 12.5% and reduces the withholding threshold from $2 million to $750,000.

Status

Introduced into House of Reps 1.6.17.

Bill

Treasury Laws Amendment (GST Integrity) 2017

Description

Reverse charge for business to business transactions involving precious metals; withdraws input tax credits for second hand valuable metal trades.

Status

Introduced into House of Reps 1.6.17.

Bill

Major Bank Levy Bill 2017

Description

Introduces a levy on ADIs with total liabilities of greater than $100 billion.

Status

Introduced into House of Reps 30.5.17.

Bill

Treasury Laws Amendment (Major Bank Levy) Bill 2017

Description

Various amendments to specify certain administrative features relating to the major bank levy.

Status

Introduced into House of Reps 30.5.17.

Bill

Treasury Laws Amendment (2017 Measures No. 2) Bill 2017

Description

Various superannuation amendments, including in relation to the transfer balance cap, concessional and non-concessional contributions, limited recourse borrowing arrangements, transition to retirement income streams and CGT relief for superannuation funds.

Status

Introduced into House of Reps 25.5.17.

Bill

Treasury Laws Amendment (Accelerated Depreciation For Small Business Entities) Bill 2017

Description

Extends by 12 months to 30 June 2018 the period during which small business entities can access expanded accelerated depreciation rules.

Status

Passed House of Reps 31.5.17.

Bill

Treasury Laws Amendment (Medicare Levy and Medicare Levy Surcharge) Bill 2017

Description

Increases the Medicare levy and Medicare levy surcharge low-income threshold.

Status

Introduced into House of Reps 24.5.17.

Bill

Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017

Description

Extends the reduction of the corporate tax rate to 25 per cent by 2026/27 to businesses with turnover of more than $50 million.

Status

Introduced into House of Reps 11.5.17.

Bill

Treasury Laws Amendment (2017 Enterprise Incentives No. 1) Bill 2017

Description

Similar business test; Effective life assessment on intellectual property

Status

Introduced into House of Reps 30.3.17.

Bill

Treasury Laws Amendment (GST Low Value Goods) Bill 2017

Description

GST imposed on low cost imported goods

Status

Introduced into House of Reps 16.2.17.

Bill

Superannuation (Objective) Bill 2016

Description

Superannuation reform package

Status

Introduced into Senate 23.11.16. Awaiting passage by Senate.

Bill

Treasury Laws Amendment (Enterprise Tax Plan) Bill 2016

Description

Immediately reduces the tax rate for businesses with turnover of up to $10 million. Reduces the corporate tax rate for all businesses with an aggregated turnover of less than $50m to 25 per cent by 2026/27. Increases the unincorporated tax discount for small business.

Status

Received Royal Assent on 19.5.17 as Act No. 41 of 2017.