Tax Bites

Tax Bites are regular, short communications containing a snapshot of various common tax issues of interest to professional advisers. Here are some of our previous Tax Bites. Should you wish to subscribe to receive Tax Bites via e-mail, please click on the "Subscribe to Tax Bites" button to the right.

Members’ Voluntary Liquidations – Time period for loans to shareholders to be repaid

26th May 2015

In the course of a Members’ Voluntary Liquidation of a private company a liquidator may realise assets and have surplus cash. Shareholders can be impatient and may not want to wait fo... read more

NSW stamp duty - Corporate reconstruction exemption and tax-minimisation schemes

28th April 2015

The NSW stamp duty legislation provides for a corporate reconstruction exemption for the purpose of changing the structure of a corporate group, or changing the holding of assets within a corpora... read more

GST-free supply of a going concern re sale of business with commercial property

17th March 2015

You might think that a taxpayer selling their business (including the necessary commercial property the business is run from) to a prospective purchaser should be a GST-free supply of a going con... read more

Genuine redundancy payments – Constructive dismissal

17th February 2015

Sometimes employees resign from their positions when their employer tries to move them into a new role, and a dispute arises as to whether the employee’s position was made redundant (typica... read more
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About Tax Bites

Tax Bites are general in nature and are not a substitute for specific advice. They are the opinion of Tax Advisory Specialists, and the ATO or the Courts may take a different view. They are not updated for changes in the law or the interpretation of the law since publication.

 

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Latest Tax Bite

ATO’s Private Groups Justified Trust program

Tax Advisory Specialists recently attended a workshop with Deputy Commissioner Tim Dyce and Assistance Commissioner Gregory Dick on the ATO’s Private Groups Justified Trust program.
 
In broad terms, Justified Trust is an approach by the ATO to build and maintain community confidence that taxpayers are paying the right amount of tax.
 
The Justified Trust program is aimed towards large private groups, market leaders and groups of specific interest.  However, the principles of Justified Trust are also applied to medium sized and emerging private groups (including where net wealth is as little as $5 million).
 
So the ATO’s approach to Justified Trust will most likely apply in some way or another to your larger clients.
 
For justified trust to be established across a private group, the following four elements need to be met:
  1. Effective tax governance demonstrated;
  2. Risks flagged to market are not present or appropriately mitigated;
  3. Tax outcomes from new and significant transactions are explained; and
  4. Differences in accounting and tax results are explained.
Effective tax governance is a critical element.  It comprises the following principles:
  1. Accountable management & oversight;
  2. Recognise tax risks;
  3. Seek advice;
  4. Integrity in reporting;
  5. Professional and productive working relationship;
  6. Timely lodgement and payments; and
  7. Ethical and responsive behaviour.
It is worth thinking about how your private group clients would rate against the above criteria.
 
And if you need to seek specialist tax advice, remember we are here to help.

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