Greenwoods and Freehills Weekly Tax Highlights 13.05.2005 - 20.05.2005

Debate is due to resume on several tax bills when the House of Representatives resumes on 23.5.05. The schedule of debate is as follows:

Tuesday 24.5.05: Tax Laws Amendment (Personal Income Tax Reduction) Bill 2005, Superannuation Bill 2005, Superannuation (Consequential Amendments) Bill 2005

Wednesday 25.5.05: Tax Laws Amendment (2005 Measures No 3) Bill 2005

Thursday 26.05.05:  Tax Laws Amendment (2005 Measures No 2) Bill 2005

For a copy of the Rulings please click on the links provided:

Released 18.05.05

Taxation Determination TD 2005/16: Income tax: does paragraph 251L(1)(b) of the Income Tax Assessment Act 1936 prevent persons other than registered tax agents from giving advice about a taxation law for a fee?
 http://law.ato.gov.au/atolaw/view.htm?docid=TXD/TD200516/NAT/ATO/00001

Taxation Determination TD 2005/17: Income tax: consolidation: life insurance: do sections 705-75 and 705-80 of the Income Tax Assessment Act 1997 apply to a policy liability that has been valued under section 713-520 for the purposes of working out step 2 of the allocable cost amount, for a joining entity that is a life insurance company?
http://law.ato.gov.au/atolaw/view.htm?docid=TXD/TD200517/NAT/ATO/00001

Taxation Determination TD 2005/18: Fringe benefits tax: for the purposes of section 39A of the Fringe Benefits Tax Assessment Act 1986 what is the car parking threshold for the fringe benefits tax year commencing on 1 April 2005?
http://law.ato.gov.au/atolaw/view.htm?docid=TXD/TD200518/NAT/ATO/00001

Taxation Determination TD 2005/19: Income tax: consolidation: does the phrase 'could be recognised in the joining entity's statement of financial position' in subsection 705-90(2) of Income Tax Assessment Act 1997 refer to the application of accounting policies consistent with the established accounting framework in preparing an entity's notional statement of financial position as at the joining time? http://law.ato.gov.au/atolaw/view.htm?docid=TXD/TD200519/NAT/ATO/00001

Class Ruling CR 2005/33: Income tax: capital gains tax: variation of share rights: Singleton Equity Housing Limited http://law.ato.gov.au/atolaw/view.htm?docid=CLR/CR200533/NAT/ATO/00001

Class Ruling CR 2005/34: Income tax: Approved Early Retirement Scheme - Department of Justice - Corrections Victoria http://law.ato.gov.au/atolaw/view.htm?docid=CLR/CR200534/NAT/ATO/00001

Class Ruling CR 2005/35: Income tax: Approved Early Retirement Scheme - The South Australian Forestry Corporation (ForestrySA) http://law.ato.gov.au/atolaw/view.htm?docid=CLR/CR200535/NAT/ATO/00001

Class Ruling CR 2005/36: Income tax: Agere Systems Inc. 2001 Employee Stock Purchase Plan
http://law.ato.gov.au/atolaw/view.htm?docid=CLR/CR200536/NAT/ATO/00001

Class Ruling CR 2005/37: Income tax: trust restructure and transfer of assets - Estate of the Late George Adams/Tattersall's Limited  http://law.ato.gov.au/atolaw/view.htm?docid=CLR/CR200537/NAT/ATO/00001 

Product Ruling PR 2005/77: Income tax: Film Investment - 'Armoured X' 
http://law.ato.gov.au/atolaw/view.htm?docid=PRR/PR200577/NAT/ATO/00001

Notice of Withdrawal TR 1999/3: Income tax: the value for depreciation purposes for a subsequent purchase of a car subject to the section 42-80 luxury car limit
http://law.ato.gov.au/atolaw/view.htm?docid=TXR/TR19993W/NAT/ATO/00001

Queensland Holding and Trading Co Ltd & Anor V FCT [2004] FCS 418: The Commissioner of Taxation has appealed the decision by Conti, J in the Federal Court to the Full Bench of the Federal Court after two corporate taxpayers were allowed to obtain a statement of reason s for a decision not to remit shortfall penalty tax.

Platypus Leasing Inc v Commissioner of Taxation (No 3) [2005] NSWSC 388 (17 May 2005)

The Supreme court of NSW has found that certain companies seeking declatory relief from the Commissioner of Taxation would have to use the normal process as set down by the Taxation Administration Act 1953. The companies involved sought to have the commissioner issue declarations relieving them of liability to GST and entitlement to input credits. The issue concerned several cross-border transactions involving leased Virgin Blue aircraft.

For a copy of the case please click on the link:

http://www.austlii.edu.au/au/cases/nsw/supreme_ct/2005/388.rtf

Released 17.05.2005

A number of draft regulations have been released setting out the conditions for an interdependent relationship. The Government has expanded the definition of dependant for the purposes of the payment and taxation of superannuation death benefits. An interpendency relationship consists of two people who reside together, one or each of the individuals supports the other financially, and one or each of the individuals  provides domestic and personal care. The definition of interdependency realtionship also extends to individuals in a close personal relationship who are unable to meet all of the above criteria by reason of disability.

For a copy of the regulations please click on the link:

http://www.treasury.gov.au/contentitem.asp?NavId=002&ContentID=978

The New Zealand budget has been handed down and contains a number of taxation measures. Personal income tax thresholds will be indexed for inflation every three years with this measure coming into operation in the 2008 income tax year. Any shortfall will be made up by the introduction of a carbon tax from 2007.

Other Measures designed to increase the efficiency of the New Zealand economy include: The introduction of provisions which will no longer require NZ based collective investment vehicles to be taxed as entities; a temporary tax exemption of five years for foreign income for foreigners or formerly non-resident New Zealanders working in New Zealand; new tax deductions for Research and Development, and increased depreciation rates for short life assets.

To access the New Zealand Budget Papers please click on the link:

http://www.treasury.govt.nz/budget2005/default.asp

Released 20.05.05

Interpretative Decision ATO ID 2005/141: Choice of superannuation fund - members of defined benefit funds http://law.ato.gov.au/atolaw/view.htm?docid=AID/AID2005141/00001