Division 7A: key risks, common issues, advantages and disadvantages

2020 Business Structures Online Tax Symposium-part 3

Having the right business structure can be the difference between being successful and losing it all.

The 2020 Business Structures Online Tax Symposium webinar series has been specifically devised for tax professionals that design structures to help their clients fulfil their tax obligations while protecting their assets and complying with other legislative requirements.

The series consists of 8 sessions over 2 months, guiding delegates through all the important issues in this space. The next session, Div 7A - everything old is new again, is presented by Leo Gouzenfiter and Alexis Kokkinos, ATI. Ahead of their session, we caught up with Leo and Alexis to discuss what delegates could expect to explore.

Although Division 7A has been around for over 22 years, views on its operation are still evolving. Current focus areas include the treatment of UPEs, loan assignments, capitalisation of unit trusts and the application of the interposed entity rules.

These focus areas may give rise to key risks and issues for common transactions. This webinar aims to cover a number of technical issues arising with respect to commonly applied provisions in Division 7A.

“In particular, we will be looking at interpretive issues associated with assignments and their interaction with the meaning of a loan, repayments and their interaction with the interposed entity provisions, the payment rules and how they work with subscriptions of equity, sub-trusts and the operation of Subdivision EA,” Leo explained.

This session will provide practical insights into both the advantages and disadvantages of Division 7A for common transactions, and also consider the management of Division 7A obligations in the context of COVID-19.

“While these provisions have been examined numerous times, this presentation will highlight new and emerging views with respect to how these provisions are being looked at by the ATO,” Alexis said.

“The session will cover a number of new Div 7A key risks and also how such risks can possibly be identified and managed.”

“The ATO has issued limited guidance on a number of key operative provisions in Division 7A and the operation of Division 7A to common transactions.  As such, these issues can often be overlooked or not considered,” continued Leo.

Leo and Alexis will be presenting Div 7A – everything old is new again on 26 June 2020. If Division 7A is important for your professional practice, register today to secure your spot!

The 2020 Business Structures Online Tax Symposium webinar series: getting involved

In response to COVID-19 social distancing measures, The Tax Institute has brought it’s professional development events online. Leo and Alexis are looking forward to being involved with this adapted style of learning. Like many of our members, webinars are a new experience for them.

They are also looking forward to engaging with the 2020 Business Structures Online Tax Symposium as a whole. In particular, hearing from David W Marks QC, CTA in his session The broke trustee (3 July 2020) as well as Daniel Smedley, CTA and Magdalena Njokos in their session Succession planning and trusts (17 July 2020).

The Business Structures Tax Symposium spans 8 informational, expert-led sessions and that your practice will value as much as your clients. Read the full program to see what sessions may suit your professional interests, and register today.

About the presenters

Leo Gouzenfiter

Leo Gouzenfiter is a Senior Manager in the National Tax team at Pitcher Partners. He focuses on a broad range of income tax issues that affect private clients and family groups in the SME market and regularly consults with the ATO and Treasury in his role. Leo commenced his career in the tax profession as a graduate in the ATO and left in 2017 to work in private practice. Having graduated with a Commerce/Law degree, Leo has completed his Master of Tax in 2016.

Outside of taxation and trusts, Leo can be found, “Spending time with my 5-month-old son, reading, playing local cricket in summer and cheering on Essendon in winter.”

Alexis Kokkinos, ATI

Alexis Kokkinos, ATI, is a Partner of the Tax Consulting group of Pitcher Partners and has over 25 years’ experience in advising private and corporate clients. Alexis was a member of the Board of Taxation review on Division 7A, is chair of the CPA’s Tax Centre of Excellence and is also a member of the ATO’s NTLG.

Outside of taxation and trusts, Alexis said, “Other than being a taxi driver for my children, I am a passionate student of Jiu jitsu.”



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