Question:
Statutory tax advice privilege
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 Rule of Law Institute of Australia has called for the Accountant’s Concession to be replaced with a form of tax advice privilege between the accountant and client to be made into law.
The Accountant’s Concession provides guidelines to Tax Officers to protect confidentiality of certain tax advice correspondence between accountants and their clients. This concession has been criticised because Tax Office can ignore it (e.g. this was significant issue in the Paul Hogan matters).
The current concession is contained in the Tax Office Access and Information Gathering Manual and it originated in 1989.
In contrast, legal professional privilege applies to written and oral communications between a lawyer and their client in circumstances of actual or potential court action. The Institute argues that:
+ Tax advice privilege should be put in place for written and oral communications on interpretation of tax law;
+ The new privilege should be provided in the Tax Act (rather than Tax Office policy documents);
+ The new privilege should cover confidential communications and documents that are made for the dominate purpose of the provision of tax advice to the client (note the dominate test rather than a sole purpose test);
+ The new privilege could only be claimed for advice from a registered tax agent;
+ The new privilege would not extend to source documents, a communication furthering a fraud or offence or other act rendering someone liable for a civil penalty;
+ The onus would be on the taxpayer to establish the new privilege;
+ Claims for the new privilege would be certified by a legal practitioner if requested by the Tax Office; and
+ The Tax Office should develop guidelines for making claims and resolution of disputes about privilege.
Sounds like a great idea!
WTB 1273
