Question:
New Investment Manager Regime
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
Private equity investors will miss out in the Government’s newly announced Investment Manager Regime designed to attract substantial funds from offshore for management within Australia.
The announcement in December follows acceptance of most of the recommendations from the Board of Taxation and pressure from the funds management industry.
The funds will have an exemption for Australian tax on “passive assets” invested on a portfolio basis, but this exemption will exclude certain land rich investments and withholding tax on dividends and interest.
The fund will not be able to operate or control a trading business in Australia and only funds from the 51 countries that have information exchange agreements with Australia will be eligible. The foreign funds will be required to complete an Information Return and provide it to the Tax Office on an annual basis (to check that they are actually eligible for the exemptions).
The Board will further investigate applying the exemption to non-widely held funds (such as wealthy foreign individuals and private groups).
The changes are designed to increase inbound investment. The Australian Investment Industry has $1.8 trillion dollars of funds under management and $61 billion of that comes from offshore.
Bill Shorten Media Release No. 168, WTB 2012/54
