December 1, 2011
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Andrew Lovett

Question:

Allegations of Tax Office incompetence, from within

Answer:

Recent changes are outlined below:

July 1, 2022

  • Loss carry back for eligible companies extended to cover 2023 income year.
  • Professional firm profits diverted to the professional's spouse or other associates to be reviewed under new Tax Office guidance.
  • Corporate collective investment vehicle legislative regime introduced.
  • Temporary full expensing of depreciating assets extended to include 2023 income year.
  • Depreciable assets of a company joining a tax consolidation group have tax costs setting rules modified for assets depreciated under temporary full expensing rules.

December 9, 2021

  • Reduced Pandemic leave disaster payment of $750 per week made available through to 30 June 2022.

August 5, 2021

  • COVID-19 Disaster Payments are non-assessable non-exempt income in 2021 income year and later. Payments phasing out as vaccination rates increase.

July 1, 2021

  • New Investment Engagement Service launched for businesses planning significant new investments in Australia.
  • Tax Office small business independent review service made permanent for businesses with turnover < $10m, for income tax, GST, exercise, luxury car tax, wine equalisation tax and fuel tax credits. Requested  before amended assessment issued.
  • Small business income tax offset for individuals increased to provide a reduction of 16% for a tax payable up to $1,000.
  • Self-managed superannuation funds can now have six members, increased from four members previously.

July 1, 2021

  • Some COVID -19 state and territory business grants received by small and medium enterprises are non-assessable, non-exempt income for 2021 and 2022 income years.
  • Certain state, territory and local government financial support for individuals and businesses suffering COVID-19 impacts made exempt where businesses have turnover less than $50 million and only in eligible programs.

March 31, 2021

  • JobKeeper payments scheme ended.

October 5, 2020

  • Boosting apprenticeship commencements subsidy (up to 50% of apprentice's wages) is assessable income.

June 4, 2020

  • Homebuilder grant for new home or substantial renovation construction is not subject to income tax.

April 1, 2020

  • COVID-19 cash flow boost payments are not subject to income tax

The Financial Review reports on allegations from a Tax Office whistle-blower that the Small and Medium Enterprise division lacks technical capability, industry specific knowledge and legal expertise and that aggressive tactics are being used by ATO officers in their compliance work.  The Inspector General of Taxation is carrying out an investigation into this division and has received a report from the whistle-blower as well as the media.


In an internal response to the media criticism which was sent by e-mail by acting Deputy Commissioner Greg Williams it was said …the Tax Office operates on a collective capability model where we do not expect every staff member to be an expert in all areas of income tax law...


It's a very interesting idea isn't it!  The Tax Office does not expect its own people to be experts but it does expect the ordinary business person, the ordinary taxpayer to comply with all aspects of income tax law on a self-assessment model (necessarily implying that they are an expert or that they retain the necessary expertise which is becoming increasingly expensive).  One rule for their own people and quite a different rule for the ordinary taxpayer.


A former Tax Office manager who resigned in 2008, has endorsed the incompetency claim from the whistle-blower and said of Tax Office bullying that … It appeared to me that in order to get promoted to more senior levels that was precisely what you had to be capable of.


The Australian Financial Review, 24 August 2011, p15

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One idea, could help you save tax – let’s get creative.

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