Residency and Australians working overseas: can be an expensive lesson in tax law

Copyright © 2015 LexisNexis. This article is made available per the publisher's Content Sharing policy.Residence is important in determining the Australian income tax liability for individuals that are residents (all income sources) and foreign residents (Australian income sources) of ordinary and statutory income.1 In recent times the Australian Taxation Office (ATO) appears to be taking a tough stance on the residence of Australian citizens who travel overseas to work for a period of time, especially where that work is undertaken in countries with low income tax rates. This is evident in a number of cases that have recently been decided by the Administrative Appeals Tribunal (AAT) on the issue of residence. These cases highlight significant scrutiny by the ATO and the need for such workers to obtain good tax advice, and provide sufficient documentary evidence for the ATO or the AAT as this may be needed to establish the relevant facts

Allowable deductions, cost base of CGT assets and the GAAR: a minefield for taxpayers and their advisers

Copyright © 2014 LexisNexis. This article is made available per the publisher's Content Sharing policy.Taxpayers and their advisers have, for decades, struggled to reconcile outgoings that can be considered as allowable deductions under s 8-1 of the Income Tax Assessment Act 1997 (Cth) (ITAA 97), with those outgoings which may be included in the cost base of a Capital Gains Tax (CGT) asset.1 In this article we briefly examine Hart’s case2 and the subsequent Taxation Determination TD 2005/33 issued by the Australian Tax Office (ATO). This Tax Determination sets out the Commissioner’s view regarding the inclusion (or non-inclusion) of non-capital costs of ownership of a CGT asset in its cost base where such outgoings had been previously denied deductibility under the general deduction provisions3 of the ITAA 97 by virtue of the general anti-avoidance rule (GAAR) under Pt IVA of the Income Tax Assessment Act 1936 (Cth) (ITAA 36)

A framework for corporate insolvency taxation: the crossroads of the theoretical perspectives in taxation law and insolvency law

The first aim of this thesis is to develop a theoretical framework that can be used to analyse the effectiveness of Australian laws and administrative practices that sit at the crossroads of tax law and insolvency law, and to propose options for law reform and administrative reform where significant disharmony between these areas of law is identified. The second aim of this thesis is to apply the theoretical framework to assess the effectiveness of the Australian Federal Commissioner of Taxation (Commissioner) as a creditor in a corporate insolvency, and to propose law reform. In particular, this thesis applies the theoretical framework to answer the following questions: 1. Should the Commissioner have priority in a corporate insolvency? 2. Is there harmony at the intersection of tax law and insolvency law with respect to the Commissioner’s debt collection practices in the context of tax administration? 3. Is there harmony at the intersection of tax law and insolvency law with respect to the Commissioner’s powers to issue: a. notices under section 260-5 of Schedule 1 to the Taxation Administration Act 1953 (Cth) (TAA 1953)? b. director penalty notices under Division 269 to Schedule 1 of the TAA 1953 (DPNs)? c. statutory demand notices under section 459E of the Corporations Act 2001 (Cth) (Corporations Act)? The significance of this thesis is to develop an appropriate theoretical framework as a new tool to assess the effectiveness of a law, the interrelationship of laws and administrative practices with respect to both tax law and insolvency law, and to propose law reform. The theoretical framework is applied in relation to one area that sits at the intersection of tax and insolvency law, being the role of the Commissioner as a creditor in a corporate insolvency with respect to the Commissioner’s debt collection powers under the tax law and the Commissioner’s debt collection practices in the context of tax administration. Whilst the theoretical framework is applied in relation to this one particular area, it is intended that the framework has far broader application and can be used in relation to analysing the effectiveness of any law that sits at the intersection of tax law and insolvency law.Thesis (Ph.D.) -- University of Adelaide, Law School, 2016

Are changes to negative gearing in Australian imminent?

Negative gearing on levered investments is one of Australia’s most prevalent tax shelters and has been the focal point of an ongoing and heated debate.1 While negative gearing is most commonly used in property,2 there is no limit on deductions from investments across a range of asset classes, such as bonds,3 managed funds, agriculture, real property or shares.4 This article will consider negative gearing concessions for investment in residential property, the arguments in favour of the abolition of negative gearing centered at the heart of the negative gearing debate, possible reform options and barriers to achieving reform

Residency and Australians working overseas : can be an expensive lesson in tax Law

Residence is important in determining the Australian income tax liability for individuals that are residents (all income sources) and foreign residents (Australian income sources) of ordinary and statutory income.1 In recent times the Australian Taxation Office (ATO) appears to be taking a tough stance on the residence of Australian citizens who travel overseas to work for a period of time, especially where that work is undertaken in countries with low income tax rates. This is evident in a number of cases that have recently been decided by the Administrative Appeals Tribunal (AAT) on the issue of residence. These cases highlight significant scrutiny by the ATO and the need for such workers to obtain good tax advice, and provide sufficient documentary evidence for the ATO or the AAT as this may be needed to establish the relevant facts

Australian Tax 2019

The book is an introductory level text offering a straightforward explanation of Australia’s tax laws by using the unique tax pyramid method. This modern step-by-step process simplifies and explains Australia’s complex tax laws, providing a framework for students to put their knowledge into practice

Self-education expenses: some thoughts for taxpayers and their advisers

With the advent of another tax year, the nature and form of self-education expenses come to mind. The income tax return for individuals makes a perceived distinction between forms of education for tax purposes but it may not be that clear for taxpayers and their advisers. Item D4 of the individual tax return allows for taxpayers to make a claim for work related self education expenses that relate to formal qualifications from a school, college or university. The individual tax return implies that there is a distmction between formal self-education and informal self-education. However when one looks at the relevant Australian Tax Office (ATO) material, this distinction could easily be over-looked

Australian Tax 2015

The experienced author team provides a cohesive framework for students to carry their tax knowledge into practice. Australian Tax is designed for international and domestic business students. Newly developed online student resources facilitate student engagement. Learning is supported by almost 1,000 examples and questions, from the most simple to the most complex. These are found in both the text and the web quiz, together with solutions to selected questions

Wine options of Australian tax reform

Australia’s indirect tax policies for wine, the Wine Equalisation Tax (WET) and the WET rebate are very different to the policies of ‘old world’ wine countries and emerging competitors, and industry leaders have identified these tax policies as stymieing the industry. In light of these concerns and the current tax reform enquiry this paper critiques Australia’s wine taxes and evaluates reform options. This paper supports the repeal of the WET. The WET (as well as the wine excise alternative) raise small amounts of tax revenue but damage economic efficiency, fail to target externalities (the wine abusers), appear inequitable and are too complex, particularly for the thousands of small wine producers. Without a WET, it follows that the WET rebate also needs to be repealed, as it is costly, inefficient and inequitable. Assistance would be needed to help those affected by the transition away from a WET

Australian Tax 2018

Australian Tax 2018 by Paul Kenny, Michael Blissenden, Sylvia Villios and contributing authors Gordon Mackenzie and Lidia Xynas is an introductory level text offering a straightforward explanation of Australia’s tax laws by using the unique tax pyramid method. This modern step-by-step process helps to simplify and explain Australia’s complex tax laws and provides a framework for students to carry their knowledge into practice. Australian Tax 2018 is designed for both international and domestic business students. It includes online student support, facilitating student engagement. Learning is supported by substantial questions and examples, from the most simple to the most complex. These are found in both the text and online working materials, together with solutions to selected questions