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Sladen Snippet – Fed Court overturns special circumstances finding of AAT

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Sladen Snippet – Fed Court overturns special circumstances finding of AAT

The Federal Court has overturned one of the few AAT cases that found special circumstances exist for an excess contribution assessment. In FCT v Dowling there were two relevant contributions. First, a non-concessional contribution of $156,142 made by the taxpayer’s husband in the 2009 year for the purposes of increasing his age pension entitlement. This contribution was made as a result of free advice from Centrelink and a public offer super fund. The contribution triggered the bring forward rule for the taxpayer. Second, a $200,000 non-concessional contribution in the 2011 year under a recontribution strategy which caused the taxpayer to exceed her non-concessional cap under the bring forward rule.

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Sladen Snippet - ATO Decision Impact Statement on the control of a trust

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Sladen Snippet - ATO Decision Impact Statement on the control of a trust

On 19 March 2014, the ATO issued its decision impact statement (DIS) on the AAT decision in Gutteridge & Anor v FC of T 2013 ATC.

In that case, a trust made capital gains from the sale of business assets and the taxpayers, Mr and Mrs Gutteridge, sought to apply the small business capital gains tax concessions when taxed on the capital gain. The Commissioner, in applying the $6 million maximum net asset value ("MNAV") test held that the trust was controlled by the taxpayers’ daughter who was the sole director and shareholder of the corporate trustee, and included the values of the assets held by a company also controlled by her on the basis that it was “connected with” the trust. As a consequence, the trust failed to satisfy the MNAV.

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Sladen Snippet – SMSF penalty/direction/education regime to apply from 1 July 2014

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Sladen Snippet – SMSF penalty/direction/education regime to apply from 1 July 2014

The SMSF administrative penalties, rectification directions and education directions regime is now law (via the Tax and Superannuation Laws Amendment (2014 Measures No. 1) Act 2014). From 1 July 2014, the ATO will have the power to: - issue scaled penalties to SMSF trustees for breaches of the SIS Act (in addition to the power to make a SMSF non-compliant); - order SMSF trustees/directors to attend education courses if they have breached the SIS Act; and - order SMSF trustees to rectify breaches of the SIS Act. The Bill also introduces penalties to deter and penalise persons who promote illegal early release schemes from regulated superannuation funds.

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Sladen Snippet – Separation of SMSF assets - ATOID 2014/7

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Sladen Snippet – Separation of SMSF assets - ATOID 2014/7

As we previously identified (see http://tinyurl.com/mgl5z7b) the operating standard compelling SMSF trustees to hold their assets separately is a limited obligation due to the wording of the standard in regulation 4.09A of the SIS Regs. The obligation only prevents mixing of the trustee’s personal assets or those held by a standard employer sponsor (or associate of the employer sponsor).

Stronger Super and SMSFs – SuperStream update

Stronger Super and SMSFs – SuperStream update

In our previous articles on Stronger Super and SMSFs, we outlined how the SuperStream measures would affect SMSFs and that some of those obligations would commence from 1 July 2014. Subsequently, the Australian Taxation Office (ATO) has released further information, including a letter to SMSF trustees, outlining the SuperStream compliance obligations for SMSF trustees.

Comprehensive credit reforms

Comprehensive credit reforms

As part of the reforms to the Privacy Act 1988 Update on the Australian Privacy Principle Guidelines and Changes to the Privacy Act - Ensuring the fine print is not forgotten, credit reporting in Australia will be regulated by a new Part IIIA of the Privacy Act. This will be accompanied by a new Credit Reporting Code which will replace the existing Credit Reporting Code of Conduct.

This new regime comes into effect on 12 March 2014 with the aim to simplify, clarify and update the current credit reporting provisions.  The new regime will affect most industries.

5 tips from an IP lawyer to protect your start-up business

5 tips from an IP lawyer to protect your start-up business

‘Entrepreneur’ is no longer a dirty word. Once considered a term self-claimed by unemployed middle aged men, entrepreneurism has hit the limelight. With increased accessibility to cost effective business models, passionate individuals can now pursue their start-up ventures. It seems there are bigger things to come, with Richard Branson dubbing 2014 as the Year of the Entrepreneur.

But one thing hasn’t (and won’t) change. Start-ups are cash-strapped and often look to cut corners. Some legal corners, however, can be costly or devastating to the development of a start-up. Here are our top 5 lessons you don’t want to learn the hard way.

Stronger Super and SMSFs – ISSUE 4

Stronger Super and SMSFs – ISSUE 4

The former Government’s first effort at alleviating the harsh operation of the excess concessional contributions (ECCs) regime was firstly introduced with effect from 1 July 2011 (and operated for the 2011/12 and 2012/13 years). Those rules operated so that on the first occurrence of an individual having ECCs, provided such ECCs were $10,000 or less, the individual had a one off choice of having up to 85% of their ECCs refunded where that amount refunded was subject to marginal tax rates (subject to satisfying certain criteria). Given the restrictive nature of this measure, it was roundly criticised as being inadequate.

Collection of a Consolidated Group’s Tax Liabilities

Collection of a Consolidated Group’s Tax Liabilities

On 7 November 2013 the ATO released a Practice Statement (Practice Statement Law Administration 2013/5 (PS LA 2013/5)) which details the Commissioner’s policy (previously included in Chapter 35 of the ATO’s Receivables Policy) in relation to:

  1. the collection of group liabilities from the Head Company, member entities and entities that have exited a Consolidated Group;
  2. Tax Sharing Agreements (TSAs); and
  3. the requirements for a member entity to make a “clear exit” from the Group.

 

Update on the Australian Privacy Principle Guidelines

Update on the Australian Privacy Principle Guidelines

The Office of the Australian Information Commissioner (Commissioner) is in the process of developing Australian Privacy Principle Guidelines (Guidelines) to accompany the new Australian Privacy Principles (APPs) due to commence on 12 March 2014.  

The Pitfalls of Self-Filing a Trade Mark

The Pitfalls of Self-Filing a Trade Mark

We increasingly come across individuals or businesses that are self-filing trade marks and managing their own portfolios. Their reasoning – why pay a lawyer to do it, when I can do it cheaper? Well, here are a few reasons that might make you reconsider self-filing a trade mark

ASIC warns real estate industry about recommending property investment through SMSFs

ASIC warns real estate industry about recommending property investment through SMSFs

The Australian Securities and Investments Commission (ASIC) has released a warning to the real estate industry regarding recommending self-managed superannuation funds (SMSFs) as an investment vehicle to acquire real property.

Workplace Bullying - 3 Simple Ways to Prepare for the New Regime

Workplace Bullying - 3 Simple Ways to Prepare for the New Regime

With only 4 solid working weeks remaining, 2014 is already upon us. These coming weeks will be swallowed up by end of year functions and completing those jobs that were due back in July. While we admit we are adding another inconvenient issue to the plate, this alert is essential reading for all employers.

Stronger Super and SMSFS – Part 3

Stronger Super and SMSFS – Part 3

Collectables, market value reporting, separation of assets, investment strategies and 30% tax on contributions

In our first two articles on stronger super and SMSFs we set out a time line of the various stronger super and other Government changes that have affected self managed superannuation funds (SMSFs) in the last few years. In this article we look at some of those changes that commenced in the 2011/12 and 2012/13 years in more detail.

New Commissioner of taxation – New emphasis on Alternative Dispute Resolution

New Commissioner of taxation – New emphasis on Alternative Dispute Resolution

In his address at the Tax Institute’s 28th Annual Convention in Perth on 14 March this year, the newly appointed Commissioner of Taxation, Chris Jordan (Commissioner) prioritised the increasing use of dispute resolution processes to resolve taxpayer disputes in a timely manner.

Changes to the Privacy Act - Ensuring the fine print is not forgotten

Changes to the Privacy Act - Ensuring the fine print is not forgotten

Most businesses will have standard form policies and procedures relating to privacy.  While these policies can be found on business websites and on documents handed out to customers and clients, they are too often left on the shelf collecting dust.  Invariably, business owners tick the regulatory box with the implementation of a privacy policy, and then continue to focus on the most important part of their business - doing business.

 

Directors’ liability for unpaid superannuation

Directors’ liability for unpaid superannuation

The director penalty regime has been in place since 1993 and most directors have at least a “working knowledge” of how the provisions operate and when they could become personally liable for the pay as you go (PAYG) withholding tax liabilities of their company. However, from 30 June 2012, the director penalty regime has been significantly expanded to include the superannuation guarantee obligations of the company, as well as restricting the application of some of the statutory defences.

 

Australia's First PPSA Decision

Australia's First PPSA Decision

On 27 June 2013 the first major Personal Property Securities Act 2009 (Cth) (PPSA) judgment was handed down in Australia in the New South Wales Supreme Court. The decision in the case of Maiden Civil (P&E) Pty Ltd; Richard Albarran and Blair Alexander Pleash as receivers and managers of Maiden Civil (P&E) Pty Ltd & Ors v Queensland Excavation Services Pty Ltd & Ors [2013] NSWSC 852 provides guidance on the operation of the PPSA and how to resolve priority disputes. 

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Employee share scheme update

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Employee share scheme update

Further to the Government’s release of Advancing Australia as a Digital Economy: Update to the National Economy Strategy on 12 June 2013 (refer to Employee share scheme announcement - 21 June 2013 for an overview), Treasury and the Department of Industry, Innovation, Climate Change, Science, Research and Tertiary Education issued the discussion paper Employee Share Schemes and Start-up Companies: Administrative and Taxation Arrangements.