Greenwoods and Freehills Weekly Tax Highlights - Week Ended 15.8.08

ATO Documents

Released 13.8.08

Taxation Determination
TD 2008/23: Income tax: are the active assets of a partnership, in which a foreign company is a partner, active foreign business assets of the foreign company for the purposes of the capital gains tax participation exemption provisions contained in Subdivision 768-G of the Income Tax Assessment Act 1997?
TD 2008/24: Income tax: can section 23AJ of the Income Tax Assessment Act 1936 apply to a dividend when it is paid by a company (not being a Part X Australian resident) to an Australian resident company which receives it in its capacity as a partner in a partnership?
TD 2008/25: Income tax: can section 23AJ of the Income Tax Assessment Act 1936 apply to a dividend paid by a company (not being a Part X Australian resident) to the trustee of a trust, even where the trustee then pays an amount attributable to the dividend to an Australian resident company beneficiary?

Released 15.8.08

ATO ID 2008/113: Transfer from foreign superannuation fund to complying superannuation fund

Released 12.8.08

DIS VID 140 of 2008 Brady King Pty Ltd v Commissioner of Taxation: In light of the Full Federal Court's decision, the ATO has said that it will await the trial judge's final decision with regard to the margin for the supply of the units in the case and will not seek special leave to appeal to the High Court at this time. The Tax Office will continue to consider that acquisition of land occurs upon completion of the standard land contract. Various GST rulings will be amended to reflect the Court's reasoning.

DCT v James Hardie Australia Finance Pty Ltd (Deregistered) [2008] FCA 1181, 8 August 2008: The Federal Court has ordered that the taxpayer's business registration be reinstated in order to allow the ATO to issue an amended assessment. The assessment related to a cross border master repurchase arrangement. The ATO is of the opinion that the scheme was within the scope of Part IVA.

Watson v DCT [2008] FCA 1173, 8 August 2008: The Federal Court has found that partial disability benefits, paid to the taxpayer, did not constitute part of the assessable income of the taxpayer. In reaching this conclusion, the Court has affirmed the Commissioner's decision to only take into consideration business losses incurred by the taxpayer during the period of assessment. The Commissioner subsequently decided to defer those losses.