ADMINISTRATIVE APPEALS TRIBUNAL FOR INCORRECT TAX RETURN PENALTIES
In this case, our client is an accountant in practice. His client received a 25% penalty for an incorrectly completed income tax return. We assisted the accountant by appealing to the Administrative Appeals Tribunal. We attended a telephone hearing and subsequently made further submissions. The outcome of the case was full remission of the penalty payable to zero.
EXTENDING THE VESTING DATE FOR A DISCRETIONARY TRUST
Our client is looking at succession planning and wishes to transfer the business over time to their son. The question of vesting date arose and we have been tasked to research whether an extension of the vesting date will have capital gains tax and/or stamp duty complications.
PRIVATE BINDING RULING APPLICATIONS FOR COMMUNITY SERVICE ORGANISATIONS
We have lodged a private binding ruling application with the Tax Office for treatment of a Not-For-Profit organisation which has been adopting the mutuality principle of taxation for 20 years. The ruling seeks the Commissioner to reconsider his treatment of the application of the Community Service Organisation income tax exemption.
PRIVATE BINDING RULING APPLICATIONS FOR CHARITIES
An organisation which has been treated as a taxable entity subject to the mutuality principle may be eligible for income tax exempt status as a charity and we have lodged private binding ruling application with the ATO.
RESONABLY ARGUABLE POSITION FOR CONFERENCE ORGANISERS
An overseas conference organiser is concerned about apportionment of expenses between related attendees. The concerns relate to the potential for non-deductibility of spouse related travel and the potential non-deductibility as a result of the entertainment disallowance provisions. We have been tasked to prepare a reasonably arguable position paper and then, if suitable, lodge a product or class ruling.
SOLE MEMBER OF A COMPANY LIMITED BY GUARANTEE
We brought to the attention of our clients, a 2007 Tax case that raised the prospect of a sole member company limited by guarantee not being considered an “association” for the purposes of the Tax Act. This jeopardised our client’s eligibility for income tax exempt status. We briefed a Barrister to provide advice on this matter.
APPLICATION TO BE CONSIDERED A NON RESIDENT FOR TAX PURPOSES
We successfully proved a tax payer and his wife to be non residents receiving written approval of non residence status from the ATO.
SIMPLIFIED TAX SYSTEM
The simplified tax system ceased some years ago and we were surprised to see it continuing when we reviewed a client’s income tax return. We were able to advise of how best to manage and correct the error.
CAPITAL PROFITS RESERVE
This was an unusual case where a company showed un-appropriated profits, however upon further enquiry we were able to show that a substantial portion was related to the sale of a pre-capital gains tax asset. This created a significant tax advantage as our client has been able to transfer the gain to a capital profits reserve which is not taxed upon a correctly conducted voluntary liquidation by a liquidator.
GOODS AND SERVICES APPLICATION
We are in the process of working with the Tax Office on behalf of a client regarding a GST matter. We are seeking the Tax Office to endorse a novel approach to GST compliance.
Our client undertakes an international business selling technology on the internet. Due to the price, volume and data available to determine export sale applicability we are working with the Tax Office to adopt an innovative approach to compliance. The law currently does not cater for these types of transactions from a GST perspective.
STATUTORY TRUST RULING
We have lodged a Private Binding Ruling (“PBR”) Application challenging the current Tax Office views on whether the appointment of a Statutory Trust, for the purposes of selling a Capital Gains Tax (“CGT”) asset, triggers a CGT event. We consider the current Tax Office view as incorrect and are challenging the Tax Office to overturn a previous ATOID and PBR on this issue. Watch this space.
GOODS AND SERVICES TAX RULING
We have lodged a PBR with the Tax Office seeking approval for the sale of land as a GST-free supply due to the application of the farmland provisions. This provision provides that where land is used for “farming business” it will be GST-free. Watch this space.
GENERAL INTEREST CHARGE (“GIC”)
We have been successful in having the Tax Office remit GIC of $123,192. The original GIC imposed was $137,010; this dated from the year 2000. The grounds for our remission request were based on subsection 8AAG(5) of the Taxation Administration Act 1953 and the consideration of serious health issues impacting our client from the year 2003. The remaining GIC was not remitted due to being unable to document the health issues extending back to the year 2000.
