This page displays a list of completed public advice and guidance issues for the 2020 year.
COVID-19 related guidance - temporary employees
Purpose
To provide advice on the GST obligations for temporary employees working in Australia due to COVID-19.
Outcome
After considering the limited number of queries received, we have determined that it is no longer necessary to prepare COVID-19 related guidance for this item.
Should you require tailored advice on this issue, please email AustraliaGST@ato.gov.au
[3712] Environmental protection activities
Purpose
This Ruling sets out the Commissioner's view on whether a taxpayer is able to deduct expenditure they incur in an income year for the sole or dominant purpose of carrying on environmental protection activities.
Outcome
Taxation Ruling TR 2020/2 Income tax: deductions for expenditure on environmental protection activities published on 15 July 2020.
[3734] Deductibility of legal expenses
Purpose
This Ruling was proposed to consolidate a number of ATO views, and to provide a principles-based approach to the determination of deductibility of legal expenses.
Following consultation, this proposed Ruling is no longer considered a priority and is not being progressed.
[3755] Withholding provisions relating to natural resource income
Purpose
This Ruling provides certainty on the application of section 6CA of the ITAA 1936 and section 12–325 of Schedule 1 to the Taxation Administration Act 1953 and their interactions with Australia’s tax treaties.
Outcome
Taxation Ruling TR 2020/5 Income tax: application of section 6CA of the Income Tax Assessment Act 1936 and Australia’s tax treaties and the payer’s withholding obligations published on 9 December 2020.
[3901] Related party financing – interest- free loans
Purpose
Schedule 3 of this Guideline outlines the factors under which the risk score assigned to outbound interest-free loans made between related parties may be modified for the purposes of Schedule 1 of the Guideline.
Outcome
Schedule 3 to Practical Compliance Guideline PCG 2017/4 Interest-free loans between related parties published on 10 December 2020.
[3908] Thin capitalisation – bifurcation of financial instruments
Purpose
This Determination provides the ATO view relating to the valuation of a taxpayer’s debt capital in accordance with accounting standards when applying the thin capitalisation rules contained within Division 820 of the Income Tax Assessment Act 1997.
Outcome
Taxation Determination TD 2020/2 Income tax: thin capitalisation – valuation of debt capital for the purposes of Division 820 published on 25 March 2020.
[3910] Thin capitalisation – arm’s length debt test
Purpose
This Ruling and Practical Compliance Guideline set out the ATO view on the application of the arm’s length debt test for the thin capitalisation regime in Division 820 of the Income Tax Assessment Act 1997.
Outcome
Taxation Ruling TR 2020/4 Income tax: thin capitalisation – the arm’s length debt test and Practical Compliance Guideline PCG 2020/7 ATO compliance approach to the arm’s length debt test were published on 12 August 2020.
[3925] Ancillary funds – exercising the discretion to reduce the minimum annual distribution rate
Purpose
This Practice statement was proposed to provide process guidance to staff when considering the exercise of the Commissioner’s discretion to reduce the minimum annual distribution rate under the amended Private Ancillary Fund Guidelines 2009 and the Public Ancillary Fund Guidelines 2011.
Outcome
After completing our review of this issue, this proposed Practice statement is no longer considered a priority and is not being progressed on the basis that:
- the ancillary fund guidelines list the matters that need to be considered by the Commissioner when determining whether to exercise this discretion
- we receive a very small number of applications that are managed through the NFP Centre to ensure consistent decision making
- as part of the NFP Centre’s work program for 2020–21, we will review our web guidance material and deliver staff and client presentations on the administration of this discretion as required.
[3926] Transfer pricing – cross border leasing
Purpose
This Guideline provides practical guidance on the application of the transfer pricing provisions to cross-border leasing of vessels into Australia, by setting out the ATO's compliance approach to transfer pricing issues relating to the use of mobile offshore drilling units, such as drill-ships, drilling rigs (including but not limited to submersibles, semi-submersibles and jack-up rigs), pipe-laying vessels and heavy-lift vessels.
Outcome
Practical Compliance Guideline PCG 2020/1 Transfer pricing issues related to projects involving the use in Australian waters of non-resident owned mobile offshore drilling units – ATO compliance approach published on 19 February 2020.
[3943] Deductibility of work-related expenses
Purpose
This Ruling provides advice on when an employee can deduct a work-related expense under section 8-1 of the Income Tax Assessment Act 1997.
Outcome
Taxation Ruling TR 2020/1 Income tax: employees: deductions for work expenses under section 8-1 of the Income Tax Assessment Act 1997 published on 1 April 2020.
[3944] Prevention of treaty abuse
Purpose
This Practice Statement provides guidance to assist our staff in applying a principal or main purposes test to deny a treaty benefit or to rule on the application of a principal purposes test in a private ruling, class ruling or product ruling.
Outcome
Law Administration Practice Statement PS LA 2020/2 Administering general anti-abuse rules, such as a principal or main purposes test, included in any of Australia's tax treaties published on 1 October 2020.
[3946] Offshore shipping service hubs
Purpose
The final Schedule proposed to set out practical administration approaches to assist taxpayers to comply with their transfer pricing obligations, and allow taxpayers to self-assess their transfer pricing risk for certain types of offshore shipping service hub arrangements.
Outcome
A draft update to Practical Compliance Guideline PCG 2017/1 ATO compliance approach to transfer pricing issues related to centralised operating models involving procurement, marketing, sales and distribution functions was withdrawn from 22 June 2020 and will not be finalised. Following comments received on the draft update, the ATO considers the Guideline is not the best product for communicating its guidance on offshore shipping service hubs.
[3952] Restructuring for demerger relief
Purpose
This Determination provides the Commissioner's view on how to establish the scope of a 'restructuring', which sets out the factual parameters for the application of the conditions in subsection 125-70(1) that must be satisfied to qualify as a demerger.
Outcome
Taxation Determination TD 2020/6 Income tax: what is a 'restructuring' for the purposes of subsection 125-70(1) of the Income Tax Assessment Act 1997? published on 22 July 2020.
[3955] GST – assignment of payment streams
Purpose
This Addendum clarifies when input tax credits are available to home loan lenders where securitisation arrangements exist.
Outcome
An Addendum to Goods and Services Tax Ruling GSTR 2004/4 Goods and services tax: assignment of payment streams including under a typical securitisation arrangement published on 25 September 2020.
[3956] GST – transaction accounts
Purpose
This Ruling provides the Commissioner’s views on how to apply paragraph 11-15(2)(a) of the A New Tax System (Goods and Services Tax) Act 1999 to acquisitions in relation to transaction accounts. It explains how the Commissioner’s existing views in Goods and Services Tax Ruling GSTR 2008/1 Goods and services tax: when do you acquire anything or import goods solely or partly for a creditable purpose? apply in this specific context.
Outcome
Goods and Services Tax Ruling GSTR 2020/1 Goods and services tax: determining the creditable purpose of acquisitions in relation to transaction accounts published on 25 September 2020.
[3970] Self-managed super funds – property development
Purpose
This Bulletin outlines the potential tax and regulatory consequences of arrangements self-managed super funds enter into to develop property.
Outcome
Self-managed Super Fund Regulator's Bulletin SMSFRB 2020/1 Self-managed superannuation funds and property development published on 13 March 2020.
[3974] Foreign income tax offset – inclusion of capital gains
Purpose
This Determination provides the Commissioner's view that capital gains are not captured when calculating the foreign income tax offset limit.
Outcome
Taxation Determination TD 2020/7 Income tax: can capital gains be included under subparagraph 770-75(4)(a)(ii) of the Income Tax Assessment Act 1997 when calculating the foreign income tax offset limit? published on 26 August 2020.
[3976] Self-managed super funds – administrative penalties
Purpose
This Practice statement provides guidelines on when an entity becomes liable to one or more administrative penalties and the Commissioner's remission considerations.
Outcome
Law Administration Practice Statement PS LA 2020/3 Self-managed superannuation funds – administrative penalties imposed under subsection 166(1) of the Superannuation Industry (Supervision) Act 1993 published on 15 October 2020.
[3981] Non-concessional MIT income
Purpose
This Ruling addresses Schedules 1 and 5 to the Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax in Australia and Other Measures) Act 2019. In particular, the Ruling covers the key aspects of non-concessional MIT income, with particular focus on MIT cross staple arrangement income.
Outcome
Law Companion Ruling LCR 2020/2 Non-concessional MIT income published on 18 November 2020.
[3983] Expansion of estimates regime to GST, LCT and WET
Purpose
This Practical Compliance Guideline provides guidance on the measure contained in Schedule 3 of the Treasury Laws Amendment (Combating Illegal Phoenixing) Act 2020, to bring GST, LCT and WET within the existing estimate regime.
Outcome
Practical Compliance Guideline PCG 2020/2 Expansion of estimates regime to GST, LCT and WET published on 18 March 2020.
[3985] Sovereign immunity
Purpose
This Ruling addresses Schedules 3 and 4 to the Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax in Australia and Other Measures) Act 2019. The Ruling covers key aspects of the restriction to the superannuation fund for foreign residents withholding tax exemption and the codification and limitation of sovereign immunity.
Outcome
Law Companion Ruling LCR 2020/3 The superannuation fund for foreign residents withholding tax exemption and sovereign immunity published on 16 December 2020.
[3989] Super contributions - compliance approach to timing of income tax deductions
Purpose
This Guideline describes circumstances where the Commissioner will not apply compliance resources to determine which income year an employer is entitled to claim income tax deductions for super contributions made through the Small Business Superannuation Clearing House.
Outcome
Practical Compliance Guideline PCG 2020/6 Timing of income tax deductions for superannuation contributions made through the Small Business Superannuation Clearing House – ATO compliance approach published on 3 June 2020.
[3993] GST – apportionment of acquisitions in relation to transaction accounts
Purpose
This Schedule adds to the practical guidance in PCG 2019/8 by setting out the ATO’s proposed framework for how assessing the risk associated with apportionment methods used to determine the extent of creditable purpose of acquisitions to provide transaction accounts.
Outcome
Schedule 2 to PCG 2019/8 ATO compliance approach to GST apportionment of acquisitions that relate to certain financial supplies – transaction accounts published on 25 September 2020.
[3995] GST – application of GST-free provisions to supplies of transaction accounts
Purpose
This Determination sets out the Commissioner's proposed view on the extent to which the supply of a transaction account is GST-free under table items 3 or 4(a) in subsection 38-190(1) of the GST Act. The Determination complements other public advice and guidance products in relation to the creditable purpose of acquisitions to provide transaction accounts (see also item [3993]).
Outcome
Goods and Services Tax Determination GSTD 2020/1 Goods and services tax: when is the supply of a transaction account GST-free under table item 3 or table item 4(a) in subsection 38-190(1) of the A New Tax System (Goods and Services Tax) Act 1999? published on 25 September 2020.
[3996] Salary sacrifice and super guarantee
Purpose
This Guidance note addresses law changes introduced by the Treasury Laws Amendment (2019 Tax Integrity and Other Measures No. 1) Act 2019 which changed the way salary amounts sacrificed to superannuation are treated when calculating and paying superannuation guarantee from 1 January 2020.
Outcome
Super Guidance Note GN 2020/1 Salary sacrifice and super guarantee published on 26 March 2020.
[4001] Super guarantee – employment of jockeys
Purpose
These Decision impact statements provide the ATO’s view on the outcome of. Commissioner of Taxation v Scone Race Club Limited [2019] FCAFC 225 and Commissioner of Taxation v Racing Queensland Board [2019] FCAFC 224
Outcome
Decision impact statements on Commissioner of Taxation v Scone Race Club Limited and Commissioner of Taxation v Racing Queensland Board published on 7 August 2020.
[4004] Remission of additional superannuation guarantee charge
Purpose
This Practice Statement outlines the Commissioner's approach to Part 7 penalties after the conclusion of the super guarantee amnesty, which ended on 7 September 2020.
Outcome
Law Administration Practice Statement PS LA 2020/4 Remission of additional superannuation guarantee charge published on 19 November 2020.
[4008] Australian Government employees posted overseas – tax treatment of allowances and benefits
Purpose
This Determination sets out the tax consequences when an Australian Government Agency (Agency) provides employees employed under the Public Service Act 1999 certain payments or benefits in respect of their overseas posting.
Outcome
Taxation Determination TR 2020/8 Income tax and fringe benefits tax: treatment of allowances and benefits provided to Australian Government employees posted overseas published on 16 December 2020.
[4014] Resident of Australia – tiebreaker test
Purpose
This Decision impact statement provides the ATO’s view on the outcome of Commissioner of Taxation v Pike [2020] FCAFC 158 which concerns whether an individual was a 'resident' of Australia and the application of the 'tiebreaker' test in the double-tax agreement between Australia and Thailand.
Outcome
The Decision impact statement on Commissioner of Taxation v Pike [2020] FCAFC 158 published on 13 November 2020.
This page displays a list of completed public advice and guidance issues for the 2020 year.