ATO targeting private not-for-profits
As a part of its ever tightening compliance net, the ATO has recently announced it is targeting specific tax avoidance behaviour in the not-for-profits sector. The first is private foundations used to operate businesses or income producing activities on which no tax is paid. In some cases, a small portion of the income made may …
Upcoming FBT-related changes
Late last year, the ATO released a draft addendum to its car parking fringe benefits ruling. 2023 sees it resuming that work. Following consultation, it is planning to release the addendum sometime in February. It is also planning to release an update to Chapter 16 of its FBT – a guide for employers in April …
Sharing economy reporting regime commences soon
Compulsory reporting of information to the ATO for sharing economy platforms is now in place. The legislation to implement this recently passed both Houses of Parliament after lapsing due to the election. With the passing of the legislation, the ATO is expected to more easily monitor the compliance of participants through data-matching. This new reporting …
Non-deductible threshold removed for self education
The non-deductible threshold for work-related education expenses of $250 has now been removed with the recent passing of legislation. This deduction limit was an artifact from when the self-education deduction measure was first introduced and no longer served its original purpose. Now that it has been repealed individual taxpayers only need to consider the deductibility …
Tax rules for personal services income
The tax legislation contains special rules about personal services income (PSI). The PSI rules are aimed at ensuring individuals cannot reduce or defer their income tax by alienating or splitting their PSI through the use of interposed companies, partnerships or trusts. An interposed entity is called a personal services entity (PSE). The ATO recently released …
Transitional approach extended: foreign companies
Foreign-incorporated companies that may have their residency status questioned as a result of the High Court’s decision in the Bywater Investments case will now have more time to organise their governance arrangements. The ATO has recently issued an update to a Compliance Guideline which gives these companies until 30 June 2023 to make any necessary …
NSW first home buyers: choice of tax
In a bid to encourage home ownership in NSW, the state government has introduced the First Home Buyer Choice scheme which would allow eligible first home buyers a choice between paying an annual property tax or the traditional stamp duty. Eligible first home buyers of residential properties of up to $1.5m or vacant land of …
IGTO report on ATO handling of objections
The result of a recent review into the ATO’s handling of objections by taxpayers has been released by the Inspector-General of Taxation and Taxation Ombudsman (IGTO). While this initial review merely analysed ATO’s data in order to report the information publicly with no in-depth investigations, the issues identified will form the basis of Phase 2 …
FBT record-keeping: simplification of requirements
In order to reduce red-tape for businesses, the government has released draft legislation to allow employers to rely on existing corporate records, rather than employee declarations and other prescribed records to finalise their FBT returns. This will be achieved by giving the Commissioner the power to make legislative instruments to determine the kinds of adequate …