Legal Updates

Talking Tax – Issue 74

Case law

Application of the CGT rollover for marriage breakdowns broadened by Federal Court

The Federal Court in the recent case of Sandini Pty Ltd v Commissioner of Taxation [2017] FCA 287 made a declaration that the Taxpayer was entitled to relief under the marriage and relationship breakdown CGT rollover under subdivision 126A of the Income Tax Assessment Act 1997 (ITAA 1997). This was despite the fact that the assets in question were transferred directly to the family trust of the Taxpayer’s spouse – a transfer that would not ordinarily come within the scope of the rollover.

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Short term hire arrangements: further relief ahead?

Changes appear imminent in the Personal Property Securities Act 2009 (Cth) (PPSA) arena, as on 1 March 2017 the Personal Property Securities Amendment (PPS Leases) Bill 2017 (PPS Leases Bill) was tabled in the Federal House of Representatives.

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Sexual misconduct: The use of chaperones to protect patients

On 11 April 2017, the Medical Board of Australia (MBA) and the Australian Health Practitioner Regulation Agency (AHPRA) released a report prepared by Professor Ron Paterson, being an independent review of the use of chaperones to protect patients in Australia. Professor Paterson concluded that the use of chaperones where sexual misconduct allegations are being investigated does not meet community expectations and does not always keep patients safe from predatory practitioners. Professor Paterson made a number of recommendations as a result of his review, including that chaperones no longer be used (except in exceptional circumstances) as an interim restriction whilst investigations are undertaken into allegations of sexual misconduct by practitioners and for the improvement of handling of sexual misconduct complaints. Both the MBA and AHPRA have accepted Professor Paterson’s recommendations.

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Grip tight and hold on: latest trends in the construction of amusement rides

Quantitative risk assessment techniques are changing the way in which amusement rides are designed, inspected and operated.  Modern rides are becoming dependent on computer-based technology with control systems allowing rides to perform increasingly complex functions at very high speeds.  Passenger safety can depend on the correct operation of control systems and their failure could compromise safety.

Such developments mean that quantitative risk assessments are increasingly being applied to amusement rides.1  A quantitative risk assessment involves calculating the magnitude of a potential loss and the probability that such loss will occur.  An acceptable risk is only understood or tolerated where the cost or difficulty of implementing an effective countermeasure exceeds the expectation of loss.

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Planning new experiences? What you need to know

How public attractions are used is changing.  There is a growing recognition of the increasing demand for a broader night time culture and entertainment offering, which in turn is leading to cities starting to re-evaluate their night time economies.  Sleepovers already allow guests to experience a night at the museum or the zoo and the success of such events is leading to a demand for better quality accommodation.  Some zoos are seeking to capitalise on this demand by offering permanent accommodation that allows guests to stay overnight in an immersive conservation experience.

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Ny afgørelse om trepartsforhold

SKAT har afgjort, at man kan anses for ansat i et firma, selv om man er ansat gennem et bureau

De fleste personer er meget sjældent i tvivl om, hvorvidt de er lønmodtagere eller selvstændig erhvervsdrivende. Ofte giver dette sig selv. Det forekommer imidlertid, at en del personer har en interesse i at være selvstændig erhvervsdrivende og ”forsøger” at få deres aktivitet løftet op til at være det. I disse situationer foretager man en konkret skatteretlig vurdering af, hvorvidt den aktivitet, den pågældende person udøver, er kendetegnet som selvstændig erhvervsdrivende.

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Sharing Cyber Threat Information

The Information Sharing and Analysis Organization-Standards Organization (ISAO-SO) was set up under the aegis of the Department of Homeland Security pursuant to a Presidential Executive Order intended to foster threat vector sharing among private entities and with the government. ISAOs are proliferating in many critical infrastructure fields, including health care, where cybersecurity and data privacy are particularly sensitive issues given HIPAA requirements and disproportionate industry human and systems vulnerabilities. Therefore, in advising their companies’ management, general counsel and others might benefit from reviewing the FAQ’s and answers contained in the draft document that can be accessed at the link below.

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Exactly what it seems

One of the most frequent areas of dispute between the tax authority and taxpayers relates to the conditions under which a taxable entity participating in a chain transaction can deduct the VAT passed on to it. The tax authority (NAV) was recently struck another blow in the tussle when the Supreme Court, in a precedent-setting ruling, took issue with the tax authority’s practice of regularly reclassifying the participants in chain transactions as agents. What’s more, the Curia’s ruling goes significantly further, and questions in general the tax authority’s right to reclassify the transactions of taxable entities on a whim.

NAV has very broad powers to classify a transaction for the purposes of taxation, based on its actual economic content. This reclassification does not affect the business or civil-law aspects of the relationship between the parties, but it can entail a serious additional tax and penalty payment obligation.

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South Carolina: Gas tax increase measure still in play despite disagreements

We recently addressed the increasing possibility that South Carolina would pass a gas tax increase this year, by way of House Bill 3516, formally known as the Infrastructure and Economic Development Reform Act (Act). House members approved it 97 to 18, and it moved to the Senate, where that chamber received it favorably. In mid-March, the measure proceeded to the Finance Committee, but a late March vote of 23 to 18 revealed less widespread support. In early April, the Senate’s debate on the bill was put on hold.
Despite support in the House, there have been suggestions that the Palmetto State may not see a gas tax increase any time soon. The Post and Courier blamed this on “[a] faction of rebellious Senate Republicans [who] killed an effort by members of their own party that would have made the highway gas tax bill a priority.” The dissenting senators took issue with the fact that the increase, which ultimately would have amounted to 12 cents, or 2 cents per year for each year between July 1, 2017, and July 1, 2022, was not offset by either tax cuts elsewhere, or reform of the highway department. The paper characterized the move as a “revolt.”
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New York: Budget approved with new millionaire’s tax, but without new online sales tax

In a press release touting the passage of New York state’s $153.1 billion budget for fiscal year 2018, Gov. Andrew Cuomo claimed that “we’ve embraced the politics of unity,” in spite of the divisiveness of these “trying times.” The press release highlights the following items:
  • $25.8 billion in education, “the most in history.” This includes free tuition at public colleges and universities for middle-class students;
  • $100 billion for infrastructure investment in projects at LaGuardia Airport, Penn Station, the Bruckner-Sheridan Interchange, and the Kosciusko Bridge, among others;
  • $10 million to the Liberty Defense Project to provide free legal assistance to immigrants, and to enforce anti-discrimination and hate-crimes laws through the newly established $1 million Hate Crimes Task Force; and
  • $2 billion over five years for the Clean Water Infrastructure Act.

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