Greenwoods and Freehills Weekly Tax Highlights - Week Ended 9.5.08

ATO Documents

Released 7.5.08

Taxation Determination
TD 2008/12: 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 2008?
Class Ruling
CR 2008/34: Income tax: return of capital: Hansen Technologies Ltd 
Goods and Services Tax Ruling
GSTR 2008/2: Goods and services tax: development lease arrangements with government agencies
Draft Taxation Ruling
TR 2008/D4: Petroleum resource rent tax: application of Petroleum Resource Rent Tax Assessment Regulations 2005 to an integrated gas-to-liquid operation
Addenda
Product Rulings
PR 2008/21: Income tax: Barossa Vines Project 2007 - Applicant Group 2
PR 2008/22: Income tax: Barossa Vines Project 2007 - Applicant Group 2 (using finance from Barossa Vines Limited) 
Notices of Withdrawal
Taxation Determinations
TD 93/77: Income tax: is interest paid by an Australian resident to a non-resident government savings bank exempt from withholding tax under paragraph 128B(3)(a) of the Income Tax Assessment Act 1936?
TD 94/37: Income tax: how does the receipt of a share of the net income or loss from a partnership affect the calculation of the rebate for personal superannuation contributions under section 159SZ of the Income Tax Assessment Act 1936?
Taxpayer Alerts
TA 2008/8: Australian resident entities creating false deductions and/or concealing income through arrangements with promoters based in Vanuatu.

Released 9.5.08

Interpretative Decisions
ATO ID 2008/64: Fuel Sales Grants Scheme: eligibility
ATO ID 2008/65: Fuel Tax Credit: electricity generation - fuel purchased between 1 July 2008 and 30 June 2012
ATO ID 2008/66: Fuel Tax Credits: Fuel used in a generator to power a refrigerated container (Reefer)
ATO ID 2008/67: Fuel Tax Credits: Fuel used to power a refrigerated container (Reefer) - road user charge
ATO ID 2008/68: GST and supply of services performed on an island which is part of the Commonwealth of Australia
ATO ID 2008/69: GST and whether a resident company incorporated overseas is in Australia in relation to a supply of services
Withdrawn Interpretative Decisions
ATO ID 2001/16: Superannuation: Bona Fide Redundancy (Lump Sum on Completion of Fixed Term Contract) 
ATO ID 2001/19: Superannuation: Bona Fide Redundancy (Completed Employment Contract) 
ATO ID 2001/430: Division 7A - Loan not repaid at the end of the year 
ATO ID 2002/153: Superannuation, retirement & employment termination: Eligible termination payments (ETPs). Employee replaced. Not a bona fide redundancy payment. 
ATO ID 2002/1043: GST and supply by resident insurance broker to a non-resident underwriter
ATO ID 2002/1044: GST and brokerage fee from resident insured
ATO ID 2002/1045: GST and supply by resident insurance broker to a non-resident insurance broker
ATO ID 2003/681: Assessability of Australian sourced superannuation lump sum payment received by a resident of France
ATO ID 2004/31: GST and adjustments for cancellation of compulsory third party insurance
ATO ID 2004/33: GST and the treatment of compulsory third party insurance following a transfer of registration
ATO ID 2004/551: Assessability of lump sum payment paid from South African superannuation fund to an Australian resident

The following tax and superannuation related legislation has been proposed for introduction in the 2008 Winter sittings which commence on 13 May 2008:

Tax Laws Amendment (2008 Measures No 3) Bill 2008 - will amend various Tax Acts;
Tax Laws Amendment (2008 Measures No 4) Bill 2008 - will amend various Tax Acts, amending CGT for demutualisation of health insurers;
International Tax Agreements Amendment Bill 2008 - will implement the revised tax treaty with Japan;
Tax Laws Amendment (Election Commitments) Bill 2008 - will introduce certain 2007 election commitments;
Tax Laws Amendment (First Home Saver Accounts) Bill 2008 - will implement the 2007 election commitment concerning First Home Saver Accounts;
Family Assistance Legislation Amendment (Child Care Tax Rebate and Other Measures) Bill 2008 - will implement the Government's election commitments to increase the Child Care Tax Rebate (CCTR) from 30% to 50% and cover up to $7,500 of out-of-pocket costs per child; and to make quarterly payments of the Rebate;
Superannuation Legislation Amendment Bill 2008 - will establish a mechanism that would allow the unfunded productivity component of Commonwealth Superannuation Scheme and Public Sector Superannuation Scheme benefits to be funded;

Kap Motors

Released 6.5.08

Decision Impact Statement on the Federal Court decision in KAP Motors Pty Ltd v FCT [2008] FCA 159: The Federal Court held that 2 taxpayers who mistakenly remitted money to the Tax Office were entitled to refunds on those amounts as no supply had been made. In its Decision Impact statement the ATO accepted the Court's construction of the relevant section and has decided not to appeal. The ATO also added that the decision in KAP Motors is not restricted to holdback payments. The Tax Office said that if a taxpayer has overpaid GST in relation to a transaction where it is ultimately found that there was no supply at all, the taxpayer may seek to claim a refund for that overpayment.

However in a related announcement the Treasurer has stated that the Government will seek to amend the tax law to overcome an anomaly limiting the scope of the restriction on refunds to taxpayers if GST is overpaid. The Federal Court had held that the restriction on paying refunds does not apply if GST is paid on a transaction which is later determined not to be a supply for GST purposes. In these circumstances, the Treasurer said businesses can claim a refund of GST without first having to refund their customers. The Treasurer said the Government would act to ensure that customers would be refunded.

Progress of Legislation

As at 9.5.08