The Australian Taxation Office (ATO) has issued Taxation Determination TD 2021/2 that contains the ATO view that companies which carry on a business will be unable to benefit from the small business capital gains tax (CGT) concessions if the relevant asset is mainly used to derive rent (TD 2021/2 was issued as Draft TD 2019/D4 that we discussed here).

Advising clients on business structuring requires the consideration, and assessment, of the factors that should be considered when a client is about to commence the operation of a business.

State and territory revenue offices continue to make announcements in response to the COVID-19 crisis. Relevant to many taxpayers will be the numerous land tax changes. The changes include rebates, waivers and deferrals for eligible taxpayers.

The Federal Court in FCT v Eichmann [2019] FCA 2155 (Eichmann) held that land used for storage was not an active asset for purposes of the small business capital gains tax (CGT) concessions in Division 152 of the Income Tax Assessment Act 1997 (ITAA 1997).

On 8 February 2018, the Government released for public consultation exposure draft legislation to implement the announcement in the 2017 Budget regarding integrity improvements to the small business capital gains tax (CGT) concessions.

The Federal Government has released draft versions of legislation and regulations to strengthen consumer protection laws.  The changes would give effect to proposals contained in the 2017 Australian Consumer Law (ACL) Review Final Report agreed to by Commonwealth, State and Territory Consumer Affairs Ministers last year.  The public has until the end of February to submit views on the draft changes. 

The Tax Laws Amendment Bill (Small Business Restructure Roll–Over) Bill 2016 (Cth) (the Bill) was introduced to Parliament on 4 February 2016. 

The Bill amends the Income Tax Assessment Act 1997 (ITAA 97) to allow small businesses to defer the recognition of gains and losses arising from the transfer of active business assets as part of a genuine restructure of their ongoing business that occurs on or after 1 July 2016.

The Bill extends capital gains tax roll-over relief to transfers to and from a range of different entity types, including transfers of assets from a company to a sole trader, partnership or trust. The small business roll-over (the Roll-Over) is in addition to current roll-over relief available for individual sole traders, partnerships and trusts that convert to a company structure (Division 122 and Subdivision 124-N ITAA 97). 

The Federal Treasury has released the Exposure Draft for the Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill 2015: Small business restructure rollovers to amend the Income Tax Assessment Act 1997 to allow small businesses to defer gains and losses arising from the transfer of capital gains tax assets, depreciating assets, trading stock and revenue assets between entities as part of a restructure.

The proposed amendments attempt to provide greater flexibility for small businesses to change the legal structure through which they operate without triggering adverse taxation consequences.