Legal news
The draft legislation of the Government’s proposed new tax system for managed investment trusts proposes that super funds (and other exempt entities that are entitled to a refund of excess imputation credits) be excluded from the 20% tracing rule for the public trading trust rules.
The Workplace Relations Management Plan (WRMP) requirements under the Building Code 2013 (Code) have been amended to include a requirement that principal contractors have a fitness for work policy to manage alcohol and other drugs in the workplace.
Amongst other things, the policy must include:
The Federal Court has handed down another civil penalty decision for breaches by self managed superannuation fund (SMSF) trustees of the Superannuation Industry (Supervision) Act 1993 (SIS Act).
In the case of the Deputy Commissioner of Taxation (Superannuation) v Ryan [2015] FCA 1037 the Federal Court fined the two trustees of an SMSF $20,000 each for breaching the sole purpose test, the prohibition against providing members with financial assistance, the in-house asset rules and the requirement to make investments on an arm’s length basis. This was as a result of the SMSF lending to the members over $200,000. Most of these loans were never paid back to the SMSF ultimately leaving the SMSF with about $6,000 in assets. In addition, the members were disqualified as trustees.
The income tax look-through treatment for limited recourse borrowing arrangements (LRBAs) is now law with the Tax and Superannuation Laws Amendment (2015 Measures No 2) Act 2015 receiving royal assent on 16 September 2015. This means that, effective from 1 July 2007, a super fund under a LRBA will generally be treated as the owner of an asset bought under the arrangement for income tax purposes (including for capital gains tax purposes). This includes that the bare trust under an LRBA does not need a tax file number and does not need to lodge a tax return.
The Australian Taxation Office (ATO) has published guidance on penalties that could apply for deficient valuations. Valuations for income tax purposes of assets such as real property, shares in companies and units in unit trusts, are relevant in a number of contexts, including the capital gains tax provisions, the maximum net asset value test, the market value substitution rule, the GST Margin Scheme, and for assets held in self-managed superannuation funds.
The ATO warns that taxpayers who undertake their own property valuations or use valuations from unqualified people may be liable to pay administrative penalties where the valuations later prove to be deficient.
Powerful business figure, Janet Dore, has been appointed as chair of the Lantern Legal Group, parent company of Sladen Legal.
Janet, who last month ended a seven-year tenure as chief executive of the Transport Accident Commission (TAC), will bring high-level organisational experience to the firm. In her role at TAC she was responsible for the successful implementation of a six-year strategy to achieve a $600m reduction in liabilities.
On 20 August 2015, Sladen Legal’s Phil Broderick delivered a presentation on Transferring Real Estate In and Out of SMSFs, as part of The Tax Institute’s National Superannuation Conference.
Phil’s presentation considered a number of issues in relation to the holding of real estate in SMSFs and the transfer of real estate in and out of SMSFs.
On 1 September 2015, Sladen Legal’s Phil Broderick delivered a presentation on Seamlessly Integrating Superannuation into Effective Estate Planning, as part the Legalwise seminar topic of Estate Planning: Maximising Asset Protection.
The Productivity Commission will shortly commence a 12 month wholesale review of Australia’s intellectual property regime. The Government has recognised that with a rapidly changing global economy and new technologies, there is a need to ensure that there is an appropriate balance between intellectual property protection and competition. The review was recommended in the extensive Harper Report on Competition Policy, which noted that excessive intellectual property protection can ‘not only discourage adoption of new technologies but also stifle innovation’.
From 1 September 2015, the witnessing requirements for an enduring power of attorney have been significantly tightened.
The signing of an enduring power of attorney by the principal (the person giving the power) must be witnessed by two people. One of these witnesses must be either a person who is authorised to witness affidavits (such as lawyers, judges, members of the police force ranked sergeant or above, parliamentarians or justices of the peace) or a medical practitioner. Previously, it was only a requirement that one of the witnesses needed to be authorised to witness statutory declarations.
The very public dispute between mining magnate Gina Rinehart and her children over access to family wealth held in a Family Trust came to a head this year, when the NSW Supreme Court appointed one of Gina’s 4 children (Bianca) as the new trustee of the Family Trust in place of Gina.
The Family Trust, in effect, owned a 24% shareholding in Hancock Prospecting Pty Ltd (HPPL) and HHPL owned all the shares in the company which has an interest in an iron ore mine at Hope Downs. Bianca and her brother, John, had issued court proceedings against their mother to remove her as trustee so they could access their share of the Trust’s assets.
In the case of Stellard Pty Ltd & Anor v North Queensland Fuel Pty Ltd [2015], the Queensland Supreme Court recently held that negotiations via a chain of emails resulted in a binding contract, despite the email communication stating that the terms of agreement were subject to a signed contract. The judgment serves as a warning to those involved in the negotiation of a contract via email correspondence.
The recent case of Hockey v Fairfax Media Publications Pty Ltd provides an interesting example of the application of Australia’s defamation laws to social media publications and matters of public interest.
Treasurer, Joe Hockey brought a defamation claim against three newspaper publishers in regards to articles published on 5 May 2014 in the Sydney Morning Herald, The Age, The Canberra Times and online platforms controlled by those newspapers. The articles detailed the operations of a club, the North Sydney Forum and its connection to the Liberal Party. The articles said that through the North Sydney Forum, Mr Hockey was providing "privileged access" to a select group in return for donations to the Liberal Party without full disclosure to the election funding authorities. The words "Treasurer for Sale" or "Treasurer Hockey for Sale" were prominent in the articles. Although critical of the fundraising activities, the articles included some balancing comments and stated that the fundraising activities were legal.
