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.

Small business CGT – Why discretionary trust distributions matter in the years before a sale

20th January 2015

The ultimate of the small business CGT concessions is the small business 15-year exemption – it provides a full CGT exemption and provides a mechanism to extract proceeds from sale structur... read more

Exception to the NSW stamp duty relief for change of trustee

18th November 2014

NSW stamp duty relief is typically available for transfers of dutiable property upon a change in the trustee of a discretionary trust or unit trust. Where the relief applies, a concessional... read more

NSW payroll tax and financial planners

21st October 2014

There seems to be a lot of NSW payroll tax activity of late.  One area of risk seems to be financial planning firms that engage financial planning commission agents (as common law contractor... read more

Pre-sale dividends can waste capital losses

23rd September 2014

A pre-sale dividend is assessable income and can also be included in the capital proceeds on the disposal of shares where, in broad terms, the payment of the dividend is part and parcel of the sh... 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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