Tag Archives: income tax

Trust vesting – ATO Draft Ruling released amending the vesting date and consequences of vesting

The Commissioner has issued draft tax ruling TR 2017/D10 Income Tax: Trust Vesting – amending the vesting date and consequences of a trust vesting (Draft Ruling). Click here to read the full ruling. Partner, Andrew O’Bryan presented a webinar on this topic, a copy of which can be ordered here.

As anticipated, the Draft Ruling doesn’t make any major variation from the current views on the extension of vesting dates, but it is good to have some detail around trust vesting from the Commissioner and in particular a question that we continue to emphasise – what do the terms of the trust deed say?

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Talking Tax – Issue 100

100th Issue of Talking Tax in the 100th year of Hall & Wilcox

When we embarked on a quest to find out more about the history of Hall & Wilcox tax publications, we discovered that while this issue is formally the 100th issue of Talking Tax, it certainly is not the 100th issue of like publications.

Keith James tells us the team were industry pioneers in preparing a Corporate Tax update. It began as a monthly publication and had a significant impact on the variety of work we received and the people it touched.

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ILN Today Post

Report: Caution warranted despite robust income tax growth in the first quarter of 2017

Last week, we published an article that addressed South Dakota’s lawsuit over the state’s ability to tax internet sales made by vendors that lack a physical presence in the state. Whether states will finally be able to capture those otherwise lost tax revenues is now in the United States Supreme Court’s hands.

In addition to the dearth of sales tax revenues with which states are contending, our article also discussed the volatility of revenue streams that compounds already precarious fiscal situations. We pointed to an October 2014 Pew Charitable Trusts article, “Volatile Income Tax Revenue Stumps States,” which asserted that even though some states’ tax collections have recovered somewhat since the recession, and in fact are expected to rise, this growth “is anemic compared to years preceding the recession.”

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The new similar business test – a golden opportunity for businesses or a playground for lawyers

The Government has recently introduced draft legislation (Treasury Laws Amendment (2017 Enterprise Incentives No. 1) Bill 2017 (Bill)), which proposes to amend the Income Tax Assessment Act 1997 and Income Tax Assessment Act 1936 to create a new framework for determining whether a business can carry forward and use tax losses and bad debts that it incurred prior to a change of control or ownership of that business.

The proposed legislation introduces a new and more flexible ‘similar business test’ to supplement the existing ‘same business test’. Broadly, the similar business test gives companies (and certain trusts) more scope to innovate and expand their business without losing their tax losses.

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Talking Tax – Issue 77

Case law

The Tribunal to confirm an assessment when a taxpayer fails to appear

In Melbourne Home Insulation Pty Ltd v Commissioner of State Revenue (Review and Regulation) [2017] VCAT 654, the Victorian Civil and Administrative Tribunal (VCAT) confirmed the payroll tax reassessments for the relevant tax years issued by the Commissioner of State Revenue (Commissioner) to Melbourne Home Insulation Pty Ltd (Applicant) by reason of the Applicant’s non-appearance at the hearing.

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ILN Today Post

California: San Francisco seeks local income tax increase

For the last 50 years, California law has prohibited cities, counties, and governmental subdivisions from levying and collecting any income tax on any person, whether or not a California state resident. This puts a strain on these entities in times of fiscal uncertainty, which are upon us now, according to one state assembly member, Phil Ting, who represents San Francisco.

In a December 2016 press release, Ting pointed to a number of threats that jeopardize the state’s fiscal health. These include the uncertainty of the Affordable Care Act, the repeal of which could cost California over $20 billion in federal funds, and a trade war with China, which could cost California 730,000 jobs. In addition, budget shortfalls in jurisdictions that have adopted Sanctuary City policies, like San Francisco, may be exacerbated by a withdrawal of federal funding.

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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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Multistate Tax Update — February 4, 2016

Illinois: State of the state speech contains many proposals, none for tax changes

In Governor Bruce Rauner’s January 27, 2016, address, he acknowledged his government’s goal “to improve the quality of life for ALL the people of Illinois,” which means more economic opportunity, higher pay and a lower cost of living.
Lamenting the fact that jobs and people are leaving the state, the Governor conceded that despite the fact that Illinois is a “wonderful place,” it has:
  • Fewer jobs today than it did 15 years ago;
  • The average working family is making less now than they were eight years ago;
  • Is “virtually tied for the highest property taxes in America;” and
  • Has “far more layers of government and mountains of debt at every level.”
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