What happened in tax in August?

Written by TaxCounsel Pty Ltd
The following points highlight important federal tax developments that
occurred during August 2018.

Each month, these developments are considered in more detail in the
Taxing Issues column of  Taxation in Australia, the Institute's member journal.

Residence: individuals

initial report of a self-initiated review of the Board of Taxation on the
income tax residency rules for individuals has been released.
SMSFs: red-tape reduction

consultation paper has been released on the proposal to change the annual audit
cycle for some SMSFs to a three-yearly cycle.
Draft legislation
legislation has been released for the following initiatives:
  • the extension
    of the definition of a “significant global entity”
  • the
    removal of an exemption that allows offshore sellers not to count sales of hotel
    bookings in Australia towards their GST turnover threshold
  • two
    black economy measures; and
  • tightening
    the rules on stapled structures and implementing the MIT affordable housing

ABN reform

consultation paper seeking views on designing a modern ABN system has been released.
“In Australia” condition

Commissioner has issued a draft ruling on the meaning of the “in Australia” requirement
that applies in relation to certain exempt entities and gift deductible recipients.
Final determinations

determinations that have been issued by the Commissioner:
  •  consider
    the meaning of the expression “directly in connection with” in s 177DA ITAA36;
  •  set
    out what he considers the reasonable travel and overtime meal allowance expense
    amounts are for the substantiation exception for the 2018-19 income year.

CGT: trust split

draft determination which considers the CGT consequences of a trust split has been

FBT: exempt benefits

practical compliance guideline issued by the Commissioner deals with the
car-related FBT exemptions under which a fringe benefit is an exempt benefit
where the private use of eligible vehicles by current employees during an FBT year
is limited to work-related travel, and other private use that is “minor, infrequent
and irregular”.
Division 7A

final determination has been released on an aspect of the Div 7A interposed
entity provisions.  
the 2018-19 income year, the Div 7A benchmark interest rate (where a regular 30
June accounting period is involved) is

5.20% per annum.
Small business company tax rate

draft practical compliance guideline sets out the ATO’s compliance and administrative
approaches for corporate tax entities that have faced practical difficulties when
determining their corporate tax rate and corporate tax rate for imputation purposes
in the 2015-16, 2016-17 and 2017-18 income years.

Overpaid GST: calculation of

a sequel to the High Court’s 2010 decision in the
Travelex case,
a dispute about the time from which the Commissioner was liable to pay interest
on the taxpayer’s overpayments has been decided by the Federal Court.
Legal professional privilege

Federal Court has decided a number of claims of legal professional privilege in
respect of documents obtained by the Commissioner from the applicant’s premises
in the exercise of his 
statutory  access powers.

Written by practitioners for practitioners, Taxation in
is continually ranked as Australia's leading tax journal.

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