Newsletter
December 2010 Newsletter
Trust Entitlements and Loans - Tax Office Issues Guidance
The Tax Office has released its keenly awaited guidance on the tax treatment of trust entitlements and loans. The guidance, known as a practice statement, explains how the Tax Office will apply its ruling on when a private company with an unpaid present entitlement makes a loan to the trust estate which generated the entitlement. Click heading to read further.
read more
Tax Office Highlights Common PAYG Instalment Errors
The Tax Office has been calling selected business operators in the $2 million to $100 million annual turnover range to discuss instances where the pay-as-you-go (PAYG) instalment amount received for the quarter under review is significantly different to the PAYG instalment amount received in a previous quarter. Click heading to read further.read more
SMSFs and Private Companies Investing in Trusts: Tax Office Warning
The Tax Office has warned self-managed super funds (SMSFs) not to invest in trusts with the intention of making funds available for lending to members. The warning comes in a taxpayer alert which describes an arrangement where an SMSF invests money in an unrelated trust that then on-lends the funds to an SMSF member or relative. Click heading to read further.read more
Self-education Expenses for Youth Allowance Recipient Deductible
The High Court unanimously dismissed the Commissioner of Taxation’s appeal and held that a taxpayer was entitled to a deduction for expenses incurred in deriving income from receiving Youth Allowance. Click heading to read further.read more
Declaration of Trust over Land Sold - So No Personal Tax Liability
A taxpayer has been successful in obtaining a declaration from the Supreme Court of Western Australia that a valid trust had been created over a property he had originally bought in 1990 under his own name. Click heading to read further.
read more
Subsidy Paid for Loss-making Contracts Assessable as Income
In a recent case, the Administrative Appeals Tribunal ruled that a taxpayer in the waste disposal business was assessable on a “subsidy” paid to it by a competitor in connection with the taxpayer assuming unprofitable waste disposal contracts that it acquired from the competitor under an agreement. Click heading to read further.read more
Employing your Spouse Ensure There's an Employment Relationship
Two recent cases before the Administrative Appeals Tribunal dealt with the scenario of a husband employing his wife to assist with looking after rental properties. The question before the Tribunals was whether there was a “genuine employment relationship”. Click heading to read further.
read more
Increasing Adjustments in BASs as Debts Remain Unpaid
In another case, the Administrative Appeals Tribunal held that three taxpayers were required to reverse earlier claims for input tax credits in their later Business Activity Statements. Click heading to read further.read more