Greenwoods & Freehills Weekly Tax Highlights - Week Ended 11.12.09

ATO Documents

Released 8.12.09

Taxpayer Alert
TA 2009/18: Discretionary Option Arrangement

Released 9.12.09

Class Ruling
CR 2009/73: Income tax: proposed Final Capital Return: eircom Holdings Limited 

Released 11.12.09

New Interpretative Decisions
ATO ID 2009/147: Capital gains tax: CGT discount - application of Subdivision 152-E and Subdivision 124-B roll-over
ATO ID 2009/148: CGT: non-resident becomes resident - assets in respect of which choice was made to treat as having the necessary connection with Australia
ATO ID 2009/149: Consolidation: membership rules - foreign hybrid company
ATO ID 2009/150: PAYG withholding: meaning of managed investment trust
ATO ID 2009/151: Superannuation Product: one or two superannuation income streams
ATO ID 2009/152: Benchmark rate of return: Mandatorily Redeemable Preference Share (MRPS)
ATO ID 2009/153: Consolidation: entry Allocable Cost Amount - identifying the relevant asset for the purposes of section 705-56 of the ITAA 1997  

 Withdrawn Interpretative Decisions
ATO ID 2003/101: Capital gains tax: meaning of 'resident trust for CGT purposes'
ATO ID 2003/102: Capital gains tax: Extension of time to choose the small business roll-over 
ATO ID 2003/104: Capital gains tax: Choice and the small business 50% reduction.
ATO ID 2003/107: Capital gains tax: 'Claim' to participate in the distribution of assets in deceased estate
ATO ID 2003/129: Capital gains tax: CGT discount - application of Subdivision 152-E and Subdivision 124-B rollover
ATO ID 2003/132: CGT: non-resident becomes resident - assets in respect of which choice was made to treat as having the necessary connection with Australia
ATO ID 2003/133: CGT: non-resident becomes resident - assets that do not have the necessary connection with Australia
ATO ID 2003/147: Capital gains tax: small business roll-over - function of replacement asset
ATO ID 2003/949: Commercial debt forgiveness - whether creditor and debtor dealing at arm's length
ATO ID 2003/99: Capital gains tax: non-resident trust - disposal of asset without necessary connection to Australia
ATO ID 2005/96: Capital gains tax: assets having necessary connection with Australia: foreign resident company becoming Australian resident 

Draft Legislation: Managed Investment Trusts - Capital Account Treatment

Released 10.12.09

Treasury has released an Exposure Draft: Managed Investment Trusts - Capital Account Treatment and accompanying draft Explanatory Material. The Exposure Draft proposes changes be made to the way in which gains and losses on the disposal of certain investments by Australian Managed Investment Trusts (“MITs”) are taxed. The changes will allow an eligible MIT to irrevocably elect capital account treatment for gains and losses on disposal of certain investments with effect from the 2008-09 income year. The Exposure Draft expands the concept of a MIT for these purposes. It also confines elective capital account treatment to assets that are shares, units and certain real property. If an eligible MIT does not elect capital account treatment, then gains and losses on disposals of those assets will be on revenue account.

Discussion Paper: Post-Implementation Review into Certain Aspects of the Consolidation Regime

Released 9.12.09 

The Board of Taxation has released for comment a Discussion Paper: Post‑Implementation Review into Certain Aspects of the Consolidation Regime.  Aspects of the consolidation regime that will be subject to the review include:
- the operation of the single entity rule;
- the operation of the entry history rule in acquisition cases; and
- the interaction between the consolidation provisions and other parts of the income tax law.

Legislative Update