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Taxation in Australia

Taxation in Australia 201204

Written by practitioners for practitioners Taxation in Australia® is continually ranked as Australia's leading tax journal. With a readership exceeding 35,000, it is published 11 times per year and available exclusively to Institute Members in hard copy and online format, and now as an App on the Apple iPad. This comprehensive publication features articles with a strong, practical approach to the latest tax issues and professional development. It is affectionately known as the Blue Journal.

To find out more about downloading the journal to your iPad visit our dedicated web page: taxinstitute.com.au/ipad

Articles from the current issue:

  • Applying complex legislation - The dilemma facing administrators Add to cart

    01 May 2012

    On 1 January 2002, the provisions of the Social Security and Veterans’ Entitlements Legislation Amendment (Private Trusts and Private Companies — Integrity of Means Testing) Act 2000 came into effect. The large lead time was given to allow Centrelink sufficient time to put the necessary processes in place to administer what was recognised as complex legislation. The new legislation is primarily directed to individuals using trusts to hide their assets. It includes a control test to determine who is the ultimate or actual controller of trust assets, and a source test to determine whether assets transferred to a trust will continue to be used for the transferor’s benefit. There are safeguarding provisions built into the legislation.

    This article presents an analysis of the dilemma faced by Centrelink when applying the complex means test provisions to wealthy individuals hiding assets and income in private trusts and companies. A detailed case study is provided.

  • Effective trust deeds and trust resolutions Add to cart

    01 May 2012

    Drafting effective trust resolutions to take account of the interface between taxation law and trust law has never been a straightforward exercise. That said, the situation has become increasingly more challenging in recent years following significant judicial decisions and the Commissioner's release of numerous practice statements, decision impact statements and other pronouncements. Treasury has now sought to intervene by developing the new trust streaming measures, and further large-scale legislative reform is now proposed. In this climate of significant uncertainty, the task remains to provide practical solutions to clients to these complex issues.

    This article is intended to provide some useful and practical observations on the drafting of effective trust deeds and trust resolutions. A number of case studies are provided to illustrate the key principles. The new trust streaming measures have been addressed in some detail, given their significance for the 2012, 2013 and possibly later income years.

  • Chinese tax that benefits innovative Australian companies Add to cart

    01 May 2012

    The Chinese government's success is built on a succession of five-year plans. The current 12th Five Year Plan targets many sectors as priorities, including, especially, the agriculture, healthcare and green technology sectors. These policies present Australian companies with opportunities to make profits in the People’s Republic of China, because many Australian businesses have a high degree of expertise that their Chinese counterparts often lack. However, regardless of sector, all Australian companies looking to expand operations in mainland China will benefit from generous tax concessions linked to R&D conducted partly or wholly there.

    Further, Chinese tax concessions apply to a broad range of businesses and sectors, including multinationals operating market research projects, established small and medium-sized enterprises, start-ups, venture capitalists, and private equity firms. Australian companies can maximise their tax planning in China by implementing long-reaching tax plans and structures with a high degree of certainty over these five-year periods.

  • Changing the face of regulatory projects in Australia Add to cart

    01 May 2012

    Governments are carrying a greatly increased load to develop more complex regulation, combined with greater pressure for improved productivity. Organisations are likewise facing a very significant challenge in an increasingly regulated and cost-conscious world: how to achieve a quality business and regulatory outcome more efficiently without diverting focus away from the business. A groundswell for substantive regulatory change has developed.

    The establishment in December 2011 of the Strategic Review of Treasury is a significant initiative, and has the potential to be a crucial building block for improvements in productivity and innovation in regulatory reform. This article makes some suggestions as to what needs to change and how this can be achieved.

    The article discusses the benefits of change, the drivers for change, the problems generated by regulatory projects, how to create ownership of regulatory change, and the proper approach to achieving change.

  • Tax tips: The income of a trust Add to cart

    01 May 2012

    The Commissioner’s recent draft ruling on the meaning of “income of the trust estate” in Div 6 ITAA36 will need to be taken into account by practitioners when advising on 30 June discretionary trust distributions.

  • Part IVA : Fantastic voyage Add to cart

    01 May 2012

    When approaching matters involving the general anti-avoidance provisions of Pt IVA of the Income Tax Assessment Act 1936, one of the key statutory questions that must be answered is whether the taxpayer has obtained a tax benefit in connection with a scheme. This involves a determination as to whether the supposed benefit would or might reasonably be expected to have accrued if the scheme had not been entered into. Over the past four years, the requirement of the “tax benefit” has received extensive judicial clarification. In examining circumstances of what “would” or “might” happen, the courts have had to delve into the realm of the hypothetical and rely on a prediction as to the outcome of certain events.

    This article examines how the courts have carried out their function of resolving this key statutory question, and the continuing uncertainty in outcomes that has resulted.

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