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taxInsight - 2015/04 – March

2015/04 – March from taxInsight

Superannuation funds – Instalment Warrants and Limited Recourse Borrowing Arrangements (LRBAs)

Draft legislation, in respect of the matter which was originally announced by the previous Government in March 2010, has been released.  This will clarify the “look through tax treatment” which applies to superannuation investments which have been acquired using a limited recourse borrowing arrangement. Instalment Warrants and LRBAs are arrangements for assets (usually shares or property) which have been acquired using borrowings, where the security held by the lender is limited to that particular asset. The assets are usually held on trust until the borrowing is fully repaid.  However, for tax purposes, there is a “look through” treatment that treats […]

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Relax – The Commissioner will look after you!

The Second Commissioner of Taxation, Mr Andrew Mills, recently announced that a working group consisting of Tax Office, Treasury and professional officers had completed their consultations with a view to providing the Taxation Commissioner with “statutory remedial power”.  The proposal is to enable the Commissioner to vary the law (in favour of the taxpayer) where: The law produces outcomes which are inconsistent with the ascertainable policy intent of the law, and Where compliance costs for taxpayers are unnecessary or disproportionate. This is indeed an interesting and unusual project which, if legislated, would enable one man – the Commissioner of Taxation […]

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Recovering superannuation entitlements from Phoenix companies

The Tax Office has issued a media release advising that it has used new powers available to it to recover $8 million of employee super entitlements from operators of labour hire companies in South Australia and Victoria. Phoenix behaviour involves using of companies and liquidating them to avoid paying liabilities, then setting up fresh companies to carry on the business. The Tax Office now has new powers, called Superannuation Guarantee Estimates (SGE) which enables it to issue director penalty notices to make directors personally liable before their companies are liquidated and responsibilities avoided. To do this, the Tax Office can […]

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