Greenwoods and Freehills Weekly Tax Highlights 7.12.07-14.12.07

Print Version

ATO Documents

Released 12.12.07

Draft Fuel Tax Ruling
TR 2007/9: Income tax: circumstances when an item used to create a particular atmosphere or ambience for premises used in a cafe, restaurant, licensed club, hotel, motel or retail shopping business constitutes an item of plant
Class Rulings
CR 2007/115: Income tax: scrip for scrip roll-over: acquisition of E*TRADE Australia Limited by ANZ Online Holdings Pty Limited
CR 2007/116: Income tax: capital gains: restructure of International Catamarans (Tasmania) Unit Trust
Product Rulings
PR 2007/100: Income tax: Kiri Park Projects - pre 30 June 2008 Growers
Goods and Services Tax Determinations
GSTD 2007/2: Goods and services tax: what are the results for GST purposes of a charitable institution engaging with an associated endorsed charitable institution in an arrangement described in Taxpayer Alert TA 2007/1?
GSTD 2007/3: Goods and services tax: if a non-resident entity owns residential rental premises in Australia and an Australian accountant makes a supply to that entity consisting of advice about the premises and tax return preparation services, is that supply wholly or partly GST-free if made on or after 1 April 2005?
Draft Taxation Determinations
TD 2007/D21: Income tax: are amounts mistakenly paid as salary or wages to employees (or as income support payments or worker's compensation amounts to persons), to which they are not beneficially entitled, but are obliged to repay, 'ordinary income' under section 6-5 of the Income Tax Assessment Act 1997?
TD 2007/D22: Fringe benefits tax: where an employer recognises they mistakenly paid to their employee an amount that the employee is not legally entitled to, but is obliged to repay, and afterwards allows the employee time to repay the amount, is there a 'loan benefit' under subsection 16(1) of the Fringe Benefits Tax Assessment Act 1986?
TD 2007/D23: Fringe benefits tax: where an employer mistakenly pays to their employee an amount that the employee is not legally entitled to, but is obliged to repay, does the employer's subsequent waiver of that obligation constitute a 'debt waiver benefit' under section 14 of the Fringe Benefits Tax Assessment Act 1986?
Notices of Withdrawal
Product Ruling
PR 2006/52: Income tax: National Viticultural Fund of Australia Project No. 5 (October 2006 Growers)
PR 2006/85: Income tax: National Viticultural Fund of Australia Project No. 6 (October 2006 Growers)
PR 2006/86: Income tax: National Viticultural Fund of Australia Project No. 6 (May 2007 Growers)
Taxation Determination
TD 95/33: Income tax: when are 'Factor (f)' payments derived by pharmaceutical companies?
Withdrawn Interpretative Decisions
ATO ID 2006/143: Deduction limit for employer defined benefit superannuation contributions 

Released 14.12.07

New Interpretative Decisions
ATO ID 2007/220: Assessability of income derived by an Australian resident working in Australia as the holder of an office in an international organisation
ATO ID 2007/221: Wine Equalisation Tax: imported wine and gift containers - taxable value
ATO ID 2007/222: Interest received from 'tax-free stock'
ATO ID 2007/223: Exemption from withholding tax under Article 10 of the 2003 UK Convention 
ATO ID 2007/224: Excess contributions tax: non-concessional contributions - contribution to fund within 90 days of receiving a court ordered personal injury payment
Withdrawn Interpretative Decisions
ATO ID 2001/1: Eligible termination payment: Extension of Time to Roll Over
ATO ID 2001/374: Gifts - advantage of a material character
ATO ID 2001/403: Assessability of periodical compensation payments
ATO ID 2002/98: Legal expenses incurred for Family Court matters
ATO ID 2002/132: Superannuation, retirement and employment termination: Eligible termination payment (ETP) and ETP Rollovers 
ATO ID 2002/138: Superannuation, retirement & employment termination: Eligible termination payment (ETP) and ETP rollover 
ATO ID 2002/156: Superannuation, retirement & employment termination: Eligible termination payment (ETP) and ETP Rollover  
ATO ID 2002/158: Superannuation, retirement & employment termination: Eligible termination payment (ETP) paid to a bank account under instructions from the taxpayer. Subsequent transfer not an ETP roll-over. 
ATO ID 2002/458: Deductibility of a donation made in the taxpayer's name by another person 
ATO ID 2002/577: Deductibility of gift of property purchased more than 12 months prior to the gifting - value less than $5000
ATO ID 2003/92: Deductibility of gift of property to a charity

Star City Pty Ltd v FCT [2007] FCA 1701: The Commissioner has appealed to the Full Federal Court. The Federal Court had held that the taxpayer was entitled to a deduction for the prepayment of rent of $120m made to the NSW State Government.

Reliance Carpet Co Pty Ltd  v FCT (2007) [2007] FCAFC 99: The High Court has granted the Commissioner special leave to appeal. The Full Federal Court had unanimously found there was no GST liability in respect of a deposit that was forfeited pursuant to the terms of a standard land contract.

FCT v R & D Holdings Pty Ltd [2007] FCAFC 107: The High Court refused the taxpayer special leave to appeal. The Full Federal Court decision now stands. The case concerned a deduction for losses which were transferred to it by another, related company.

WR Carpenter Holdings Pty Ltd & Anor v FCT (2007) [2007] FCAFC 103: The High Court has granted the taxpayers special leave to appeal. The case concerened the Commissioner's making of determinations under s 136AD of the transfer pricing provisions.

Tax Cases

DCT v Meredith [2007] NSWCA 354, NSW Court of Appeal, 10 December 2007: In a majority decision, the NSW Court of Appeal has found that the Deputy Commissioner, by complying with the statutory provisions concerning delivery of a notice, had fulfilled all of the obligations to the taxpayer. The taxpayer had argued that the notice had not been received and the lower court had found in favour of the taxpayer. The taxpayer had withheld amounts of tax from the salary of  her employees but failed to remit those amounts to the Commissioner, rendering her liable for a penalty.