The ‘active asset test’ for the purpose of accessing the small business capital gains tax (CGT) concessions has effectively been narrowed, due to a Federal Court decision which held that land used to store business assets and materials was not an active asset. The decision sets a new ‘direct functional relevance’ test, which will create difficulty for business owners in accessing the concessions.
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A collection of case studies and articles highlighting the latest in legal news.
Legislative measures are currently before Parliament, which will operate to deny foreign residents the ability to access the capital gains tax (CGT) main residence exemption upon the disposal of their Australian dwelling.
Linfox Australia Pty Ltd v Commissioner of Taxation of the Commonwealth of Australia  FCAFC 131
The Full Court of the Federal Court recently handed down a decision in Linfox Australia Pty Ltd v Commissioner of Taxation of the Commonwealth of Australia  FCAFC 131 (Linfox Case) in relation to fuel tax credits claimed by Linfox pursuant to the provisions of the Fuel Tax Act 2006 (Cth) (FTA).
Businesses that provide road freight services have increased tax compliance obligations as they are now subject to the Government’s Taxable Payments Reporting System (TPRS).
The sale of a person’s main residence (ie their home) is generally exempt from capital gains tax. This exemption is ‘carried through’ to beneficiaries or executors of deceased estates who seek to dispose of the deceased’s main residence, where certain conditions are satisfied.
On 18 September 2019, the Treasury Laws Amendment (Recovering Unpaid Superannuation) Bill 2019 (the Bill) was introduced into Parliament. The Bill seeks to re-introduce a superannuation guarantee amnesty, following the previous amnesty legislation lapsing due to the Federal Election being called in April 2019.
Do you claim tax deductions on vacant land you own? An unwelcome surprise for property investors from 1 July 2019
In a Bill currently before Parliament, property investors will be denied deductions for holding and financing costs incurred in owning vacant land. Ordinarily, such costs would be deductible where the land is intended to be used for the purpose of producing assessable income.
Are you overpaying land tax based on out of date council valuations?
The 2019-2020 Victorian State Budget reported that land tax revenue in 2019-2020 is expected to increase to $3.7 billion. This is a significant increase from the $1.2 billion raised in 2009-2010.
Property developers who enter into agreements to develop Victorian land with an unencumbered value of over $1 million are at significant risk of incurring a duty liability, under new legislation that received Royal Assent on 18 June 2019.
In follow up to our recent article titled Independent Contractors or Employees, while it’s one thing to know the difference between employees and independent contractors, an important issue to consider is the consequences for getting the classification wrong.
New laws have been passed affecting the GST obligations of property developers. These laws take effect from 1 July 2018, but may affect contracts entered into prior to this date.
The development and operation of commercial accommodation raises complex regulatory, contractual, commercial and taxation issues.
The reconstitution of a general law partnership or a tax law partnership may have different income tax, capital gains tax (CGT) and goods and services tax (GST) consequences that should be addressed in preparing a Partnership Reconstitution Deed.
A general law partnership may be reconstituted without the tax consequences associated with reconstituting a tax law partnership, a joint venture or co-ownership.
Rigby Cooke Lawyers’ Tax & Wealth and Wills & Estates teams have been recognised by independent survey and review source Doyle’s Guide for their expertise in their respective practice areas.
Foreign purchaser additional duty and absentee owner surcharge land tax may apply to Australian discretionary trusts transacting in Victorian residential land where the discretionary trust has potential foreign beneficiaries.
A number of recent changes affecting foreign purchasers of property in Victoria have either come into, or are soon to come into effect. These changes are already impacting on the sale of property.
- From 1 July 2016, any purchaser who acquires an Australian property with value of $2 million or more from a foreign resident vendor will be required to withhold and pay 10% of the purchase price to the Australian Taxation Office (ATO).
In structuring 30 June transactions it is often desirable to sign a contract before 30 June, but defer payment of capital gains tax (CGT) or the CGT event until a subsequent income year; particularly where settlement is deferred to a subsequent income year so there are no sale proceeds for the vendor to pay the tax or it is desired to set-off losses in the subsequent income year.
Disclosure statistics released
- The ATO has announced that, at 30 June 2014, there had been 166 disclosures, 250 expressions of interest (where taxpayers have identified themselves and said they will be making a disclosure) and more than 600 general enquiries in relation to Project DO IT.