Division 7A

Sladen Snippet - Bendel and SMSFs – Part 4–Bendel and UPEs owing to SMSFs

Sladen Snippet - Bendel and SMSFs – Part 4–Bendel and UPEs owing to SMSFs

As noted in part 1 of our articles on the application of the Bendel decision to the Superannuation Industry (Supervision) Act 1993 (SIS Act), in our view, it is likely that the Courts will apply the Bendel decision to the SIS Act, such that the expanded definition of loan in the SIS Act will apply to arrangements that involve the advancement of principal with an obligation to repay and that it will not apply to a mere creditor and debtor arrangement.

Sladen Snippet - Bendel and SMSFs – Part 3 –Bendel and the in-house asset rules

Sladen Snippet - Bendel and SMSFs – Part 3 –Bendel and the in-house asset rules

As noted in part 1 of our articles on the application of the Bendel decision to the Superannuation Industry (Supervision) Act 1993 (SIS Act), in our view, it is likely that the Courts will apply the Bendel decision to the SIS Act, such that the expanded definition of loan in the SIS Act will apply to arrangements that involve the advancement of principal with an obligation to repay and that it will not apply to a mere creditor and debtor arrangement (like a UPE).

In this part 3 of the series we examine how this may play out in the in-house asset rules contained in Part 8 of the SIS Act.

Sladen Snippet - Bendel and SMSFs – Part 2 –Bendel and section 65 of the SIS Act

Sladen Snippet - Bendel and SMSFs – Part 2 –Bendel and section 65 of the SIS Act

As noted in part 1 of our articles on the application of the Bendel decision to the Superannuation Industry (Supervision) Act 1993 (SIS Act), in our view, it is likely that the Courts will apply the Bendel decision to the SIS Act, such that the expanded definition of loan in the SIS Act will apply to arrangements that involve the advancement of principal with an obligation to repay and that it will not apply to a mere creditor and debtor arrangement (like a UPE).

Sladen Snippet - Bendel and SMSFs – Part 1 – can Bendel be applied to the SIS Act?

Sladen Snippet - Bendel and SMSFs – Part 1 – can Bendel be applied to the SIS Act?

As discussed here, the recent decision of the Full Federal Court (Court) in FCT v Bendel [2025] FCAFC 15 (Bendel) has been a significant one in the private tax world.

Sladen Snippet - Bendel: special leave and updated DIS - ATO fires a warning shot

Sladen Snippet - Bendel: special leave and updated DIS - ATO fires a warning shot

On 19 February 2025, the Full Federal Court handed down its decision in FCT v Bendel [2025] FCAFC 15. On 18 March 2025, the ATO applied for special leave and, on 19 March 2025, the ATO updated its interim decision statement (DIS) on the case.

We review the updated DIS below.

#Division 7A, #UPE, #Unpaid present entitlements, #Tax, #Trusts, #TD2022/11, #Bendel, #109D #Special leave #Decision Impact Statement

Bendel – UPEs as loans – are the curtains closed?

Bendel – UPEs as loans – are the curtains closed?

On 19 February 2025, the Full Federal Court, in FCT v Bendel [2025] FCAFC 15 (Bendel), held that an unpaid present entitlement (UPE) with a corporate beneficiary is not a loan under subsection 109D(3) of Division 7A of the Income Tax Assessment Act 1936 (ITAA 1936).

Division 7A – new ATO guidance – section 109U, it’s not all about Bendel

Division 7A – new ATO guidance – section 109U, it’s not all about Bendel

The Australian Taxation Office (ATO) recently issued two key updates that could affect private groups using guarantee-backed financial arrangements.

UPEs as loans - end of an era?

UPEs as loans - end of an era?

If 16 December 2009 was the beginning of the Australian Taxation Office (ATO) treating an unpaid present entitlement (UPE) with a corporate beneficiary as a loan for purposes of Division 7A, could 28 September 2023 be the end of that era?

Sladen snippet – LRBA and Div 7A interest rates to significantly increase in 2023/24

Sladen snippet – LRBA and Div 7A interest rates to significantly increase in 2023/24

The recent interest rate rises will result in significant increases in the LRBA safe harbour interest rates, and the Division 7A interest rate, for the 2023/24 year.  The interest rates will be:

  • LRBA real estate safe harbour interest rate – 8.85% (was 5.35%)

  • LRBA listed share safe harbour interest rate – 10.85% (was 7.35%)

  • Division 7A interest rate – 8.27% (was 4.77%)

TD 2022/11: ATO finalises views, relief for some taxpayers but a sting for others

TD 2022/11: ATO finalises views, relief for some taxpayers but a sting for others

We wrote about Draft Taxation Determination TD 2022/D1 (Draft TD) on Division 7A and unpaid present entitlements (UPEs) here. On 12 July 2022, the Australian Taxation Office (ATO) finalised the Draft TD as Taxation Determination TD 2022/11 (Final TD).

PCG 2017/13: sub-trust arrangements – welcome (continued) relief from the ATO

PCG 2017/13: sub-trust arrangements – welcome (continued) relief from the ATO

Draft Taxation Determination TD 2022/D1 sets out the Australian Taxation Office’s (ATO) views on when an unpaid present entitlement (UPE) with a corporate beneficiary is a loan for the purposes of Division 7A of the Income Tax Assessment Act 1936. We wrote about TD 2022/D1 here.

Draft Taxation Determination TD 2022/D1: much ado about nothing or a seismic shift?

Draft Taxation Determination TD 2022/D1: much ado about nothing or a seismic shift?

After our semi-serious opening statement on the Australian Taxation Office’s (ATO) recently released guidance on section 100A and unpaid present entitlements, this is one of a series of deep-dive articles on that guidance. These articles look at each of the ATO guidance products separately and then we discuss what the overall impact may be.

Sladen Snippet: Division 7A and COVID-19: ATO announces streamlined process to kick the can down the road

Sladen Snippet: Division 7A and COVID-19: ATO announces streamlined process to kick the can down the road

On 26 June 2020, the Australian Taxation Office (ATO) announced a streamlined process for COVID-19 affected borrowers to make applications under section 109RD to extend the time to make minimum yearly repayments (normally required to be made by 30 June 2020) under Division 7A.

ATO announces extension for Division 7A compliance

ATO announces extension for Division 7A compliance

As part of its response to COVID-19, on 13 May 2020 the Australian Taxation Office announced that it has extended the time for lodgment of 2019 tax returns for certain companies and trusts and made changes to its administration of Division 7A of the Income Tax Assessment Act 1936.

Labor’s Tax Policies and What They Mean for Discretionary Trusts

Labor’s Tax Policies and What They Mean for Discretionary Trusts

Discretionary trusts are prevalent in the small to medium enterprise (SME) market due to their income tax effectiveness, distribution flexibility, and asset protection features. However, this may be about to change. The Australian Labor Party (ALP) has proposed a number of amendments to existing tax laws should they win the election on 18 May 2019.