[3898] Early stage innovation company – expense tests
Purpose
This Determination sets out the Commissioner's view on the expenses taken into account in determining whether a company meets the early stage limb of the early stage innovation company tests.
Outcome
Taxation Determination TD 2023/6 Income tax: tax incentives for early stage investors: what is an 'expense' that is 'incurred’ for the early stage test? published on 22 November 2023.
[3905] Construction of capital assets
Purpose
This Ruling sets out the Commissioner’s view on the appropriate treatment of labour costs related to the construction or creation of capital assets.
Outcome
Taxation Ruling TR 2023/2 Income tax: application of paragraph 8-1(2)(a) of the Income Tax Assessment Act 1997 to labour costs related to the construction or creation of capital assets published on 7 June 2023.
[3932] Taxing US and UK resident financial institutions under US and UK taxation conventions
Purpose
This Addendum clarifies certain aspects of the second limb of the definition of 'financial institution', which is used in Australia's double-tax conventions with the US and the UK.
Outcome
The Addendum to Tax Ruling TR 2005/5A2 Income tax: ascertaining the right to tax United States (US) and United Kingdom (UK) resident financial institutions under the US and the UK Taxation Conventions in respect of interest income arising in Australia published on 17 May 2023.
[3949] Collection and recovery of disputed debts
Purpose
This Practice Statement is a rewrite of PS LA 2011/4 Collection and recovery of disputed debts and further clarifies the Commissioner's approach to debt collection and recovery.
Outcome
The updated PS LA 2011/4 Collection and recovery of disputed debts published on 9 November 2023.
[3964] Appointment of capital – CGT events E5 or E7
Purpose
This Determination was proposed to set out the Commissioner’s view on the CGT consequences of appointing an amount of capital to a beneficiary and the subsequent distribution of Australian currency to the beneficiary in satisfaction of the capital interest.
Outcome
This item was removed from the Advice under development program. It was assessed as having insufficient priority to warrant progressing as a public advice product at this time.
[3965] Australian currency denominated asset – CGT events E5 to E7
Purpose
The Determination was proposed to set out the Commissioner's view on whether assets with a face value in Australian currency (including Australian currency itself) can be CGT assets for CGT events E5 to E7.
Outcome
This item was removed from the Advice under development program. It was assessed as having insufficient priority to warrant progressing as a public advice product at this time.
[3966] Unit trust – CGT events E5 to E8
Purpose
The Determination was proposed to set out the Commissioner’s view on what is a ‘unit trust’ for CGT events E5 to E8 and its implications for other CGT events.
Outcome
This item was removed from the Advice under development program. It was assessed as having insufficient priority to warrant progressing as a public advice product at this time.
[3971] Self-managed super funds – rectification directions
Purpose
This Practice Statement provides guidance to ATO staff on the relevant matters to be considered when deciding whether to give a trustee or a director of a body corporate that is a trustee of a self-managed super fund a written rectification direction under section 159 of the Superannuation Industry (Supervision) Act 1993.
Outcome
Law Administration Practice Statement PS LA 2023/1 Self-managed superannuation funds – rectification directions for contraventions of the Superannuation Industry (Supervision) Act 1993 published on 30 March 2023.
[3972] Self-managed super funds – education directions
Purpose
This Practice Statement proposed to provide guidance to ATO staff on the relevant matters to be considered when deciding whether to give a trustee or a director of a body corporate that is a trustee of a self-managed super fund a written education direction under section 160 of the Superannuation Industry (Supervision) Act 1993.
Outcome
Publication of this product has been delayed by the current lack of approved education courses. We are not proceeding with this product at this time and will recommence working on this issue when we have confirmation an approved education course is available.
[3975] Super benefits in breach of rules
Purpose
Both a practice statement and taxation determination were proposed to:
- provide guidance on the Commissioner's discretion as set out in subsection 304-10(4) of the Income Tax Assessment Act 1997, which may be applied where superannuation benefits are received in breach of legislative requirements, and
- set out the Commissioner’s view on the income tax treatment of a superannuation benefit received by an individual otherwise than in accordance with the payment standards prescribed under subsection 31(1) of the Superannuation Industry (Supervision) Act 1993, where the Commissioner exercises the discretion contained in subsection 304-10(4) of the Income Tax Assessment Act 1997.
Outcome
Draft TD 2021/D6 Income tax: tax treatment of a superannuation benefit when the Commissioner exercises the discretion in subsection 304-10(4) of the Income Tax Assessment Act 1997 and draft PS LA 2021/D3 Superannuation – Commissioner's discretion where members receive benefits in breach of legislative requirements published on 15 December 2021.
This issue was however removed from the Advice under development program in May 2023. We need to further consider comments received and technical issues identified after draft TD 2021/D6 was published, and this work is on hold due to other higher priority work. This topic will be reinstated to the Program when work recommences.
[3984] Non-arm's length expenditure
Purpose
The final update to Tax Ruling TR 2010/1 will explain the interaction between the non-arm's length income provisions and the rules concerning superannuation contributions.
Outcome
This issue was removed from the Advice under development program in May 2023. Treasury issued a consultation paper Non-arm's length expense rules for superannuation fundsExternal Link, which closed for comment on 21 February 2023. Work is not progressing on this issue until the outcomes from this consultation are known. This issue will be reinstated to the Program once we recommence work on it.
[4005] Expenses associated with vacant land
Purpose
This Ruling provides the Commissioner's view in relation to the application of section 26-102 of the Income Tax Assessment Act 1997.
Outcome
Taxation Ruling TR 2023/3 Income tax: expenses associated with holding vacant land published on 27 September 2023.
[4018] Luxury car tax – principal purpose
Purpose
This Determination sets out the Commissioner’s view on how to determine whether a car is a commercial vehicle that is not designed for the principal purpose of carrying passengers. It also addresses specific issues regarding vehicle modifications purporting to alter the principal purpose of a luxury car.
Outcome
Luxury Car Tax Determination LCTD 2023/1 Luxury car tax: how to determine the principal purpose of a vehicle published on 23 August 2023.
[4023] Excise refund scheme – meaning of 'legally and economically independent'
Purpose
This Ruling sets out the Commissioner's view of the meaning of ‘legally and economically independent’ for the purposes of the excise refund scheme for alcohol manufacturers under item 21 of subclause 1(1) of Schedule 1 to Excise Regulation 2015 and the excise remission scheme for alcohol manufacturers under item 10 of subclause 2(1) of Schedule 1 to Excise Regulation 2015.
Outcome
Excise Ruling ER 2023/1 Excise: the meaning of 'legally and economically independent' published on 24 May 2023.
[4028] Use of an individual's image
Purpose
This Determination sets out the Commissioner’s view on how section 6-5 of the Income Tax Assessment Act 1997 applies to arrangements where an individual with fame establishes a connected entity and enters into an agreement with that entity granting it non-exclusive use of their name, image, likeness, identity, reputation and signature.
Outcome
Taxation Determination TD 2023/4 Income tax: use of an individual’s fame by related entities published 28 June 2023.
[4029] Residency tests for individuals
Purpose
This Ruling consolidates and replaces the Commissioner’s view on residency for individuals in Taxation Ruling IT 2650 Income tax: residency – permanent place of abode outside Australia, Taxation Ruling IT 2681W Income tax: residency status of business migrants and Taxation Ruling TR 98/17W Income tax: residency status of individuals entering Australia. The views reflected are updated to take into account developments in case law and provide further examples of global work practices.
Outcome
Taxation Ruling TR 2023/1 Income tax: residency tests for individuals published on 7 June 2023.
[4036] Beneficiary's share of the net income of a trust estate – present entitlement
Purpose
This Addendum amends TD 2012/22 to take account of the decision in Lewski v Commissioner of Taxation [2017] FCAFC 145.
Outcome
The Addendum to Taxation Determination TD 2012/22 Income tax: for the purposes of paragraph 97(1)(a) of the Income Tax Assessment Act 1936 is a beneficiary's share of the net income of a trust estate worked out by reference to the proportion of the income of the trust estate to which the beneficiary is presently entitled? published on 31 May 2023.
[4038] Car parking fringe benefits
Purpose
This Decision impact statement outlines the ATO's response to the Full Federal Court's decision in Commissioner of Taxation v Virgin Australia Regional Airlines Pty Ltd [2021] FCAFC 209 concerning the interpretation of ‘primary place of employment’ in subsection 136(1) of the Fringe Benefits Tax Assessment Act 1986 when read with the extended meaning of ‘business premises’ in subsection 136(2) of that Act.
Outcome
The comments period for this Decision impact statement – Commissioner of Taxation v Virgin Australia Regional Airlines Pty Ltd has closed and no updates will be made. Work on updating impacted advice and guidance outlined in the decision impact statement has now finalised.
Purpose
Following the decision by the Full Federal Court in Commissioner of Taxation v Virgin Australia Regional Airlines Pty Ltd [2021] FCAFC 209, Taxation Ruling TR 2021/2 has been amended to confirm the Commissioner’s views on the meaning of ‘primary place of employment’ for the purposes of the car parking benefit provisions in the Fringe Benefits Tax Assessment Act 1986.
Outcome
The Addendum to Taxation Ruling TR 2021/2 Fringe benefits tax: car parking benefits published on 22 February 2023.
Purpose
Chapter 16 – Car parking fringe benefits has been updated to provide practical guidance on the application of the car parking fringe benefits tax law, including the meanings of 'commercial parking station' and 'primary place of employment', to complement Taxation Ruling TR 2021/2.
Outcome
The update to Chapter 16 – Car parking fringe benefits Fringe benefits tax – a guide for employers was published on 8 November 2023.
[4039] Commissioner’s discretion to determine that an entity does not control another entity
Purpose
This Determination sets out the Commissioner's view on the meaning of ‘control’ for the purpose of exercising the discretion under subsection 328-125(6) of the Income Tax Assessment Act 1997.
Outcome
Taxation Determination TD 2023/5 Income tax: aggregated turnover and connected entities – Commissioner’s discretion that an entity does not ‘control’ another entity published on 6 September 2023.
[4042] Ordinary meaning of the term 'employee'
Purpose
The Ruling explains the Commissioner's approach in applying the High Court decisions in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1 and ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2 to the definition of ‘employee’ for the purposes of section 12–35 of Schedule 1 to the Taxation Administration Act 1953. It also aids in understanding the ordinary meaning of an ‘employee’ for the purposes of subsection 12(1) of the Superannuation Guarantee (Administration) Act 1992.
This Ruling should be read in conjunction with Practical Compliance Guideline PCG 2023/2 Classifying workers as employees or independent contractors – ATO compliance approach, which provides guidance on the ATO's compliance approach on classifying workers as employees or contractors.
Outcome
Taxation Ruling TR 2023/4 Income tax: pay as you go withholding – who is an employee? published on 6 December 2023.
Practical Compliance Guideline PCG 2023/2 Classifying workers as employees or independent contractors – ATO compliance approach published on 6 December 2023.
[4047] GST treatment of financial supplies
Purpose
This Addendum updated the Ruling to reflect changes in the GST law (for instance, changes to the GST legislation applicable to cross-border supplies and in relation to digital currency) and contains changes to modernise parts of the Ruling.
Outcome
The Addendum to Goods and Services Tax Ruling GSTR 2002/2 Goods and services tax: GST treatment of financial supplies and related supplies and acquisitions published on 22 March 2023.
[4048] GST and retirement villages
Purpose
The proposed draft Guideline was intended to reduce complexity and the costs of compliance for a subset of retirement villages that make minimal taxable supplies.
Outcome
The Guideline will not be progressed. A holistic review of issues impacting retirement villages is being undertaken by the ATO. As part of this review, the ATO is considering opportunities to provide guidance that is comprehensive and fit for purpose across a broader spectrum of retirement village operating models.
[4052] Working from home deductions
Purpose
The Guideline outlines a practical compliance approach, referred to as the revised fixed-rate method, applicable from 1 July 2022, which taxpayers can use to calculate their deduction for certain working from home expenses.
Outcome
Practical Compliance Guideline PCG 2023/1 Claiming a deduction for additional running expenses incurred while working from home – ATO compliance approach published on 16 February 2023.
[4058] GST margin scheme to the sale of multiple interests in land
Purpose
This Decision impact statement provides the ATO’s response to the Full Federal Court decision on Commissioner of Taxation v Landcom [2022] FCAFC 204 as well as the preceding first instance decision, which concerned the application of the GST margin scheme to the sale of multiple interests in land in a single transaction and the scope for judicial review of rulings relating to notional GST issues.
Outcome
This Decision impact statement – Commissioner of Taxation v Landcom originally published on 15 March 2023 and updates were made following the closure of the comments period. Work continues on reviewing impacted advice and guidance outlined in the decision impact statement.
[4059] Crypto guidance
Purpose
This guidance provides greater certainty to the community and assists in improving tax compliance on a variety of issues relating to the use of crypto assets.
Outcome
We have refreshed and enhanced current website content relating to crypto assets as personal use assets to include information on recent developments. This was published on 9 November 2023.
[4061] Application of anti-avoidance provisions in section 100A and Part IVA
Purpose
This Decision impact statement explains the ATO’s view of the Full Federal Court decision on Commissioner of Taxation v Guardian AIT Pty Ltd ATF Australian Investment Trust [2023] FCAFC 3, which concerned the application of section 100A and Part IVA of the Income Tax Assessment Act 1936 to a series of transactions which reduced the tax paid by a non-resident on trust distributions, by first passing that income through a company.
Outcome
The Decision impact statement – Commissioner of Taxation v Guardian AIT Pty Ltd ATF Australian Investment Trust was published on 24 April 2023 and no further updates will be made.
[4062] Not-for-profit organisations seeking deductible gift recipient endorsement
Purpose
This Decision impact statement outlines the ATO’s response to the Federal Court decision on The Buddhist Society of Western Australia Inc v Commissioner of Taxation (No 2) [2021] FCA 1363, which concerns the Commissioner’s decision to revoke the endorsement of the Buddhist Society of Western Australia (Inc) (BSWA) as a deductible gift recipient.
Outcome
The Decision impact statement – The Buddhist Society of Western Australia Inc v Commissioner of Taxation (No 2) was published on 18 May 2023 and no further updates will be made. Work continues on reviewing impacted advice and guidance outlined in the decision impact statement.
[4084] Central management and control test of residency
Purpose
The ATO confirmed in the previous update to PCG 2018/9 that the transitional compliance approach which applied to certain foreign-incorporated companies would end on 30 June 2023. With this approach ending, the Guideline has been updated with a new Risk assessment framework as an Appendix to the Guideline.
Outcome
Practical Compliance Guideline PCG 2018/9 Central management and control test of residency: identifying where a company’s central management and control is located published on 1 November 2023.
[4085] Sale of residential property used for making rental supplies
Purpose
The Decision impact statement outlines the ATO's response to Domestic Property Developments Pty Ltd as trustees for the Dals Property Trust v Commissioner of Taxation [2022] AATA 4436 which concerns whether the sale of residential property was input taxed on the basis of having been used for the making of rental supplies for 5 years, and if so, whether GST had been passed on.
Outcome
The Decision impact statement – Domestic Property Developments Pty Ltd as trustee for the Dals Property Trust and Commissioner of Taxation published on 27 September 2023 and no further updates will be made. Work continues on reviewing impacted advice and guidance outlined in the decision impact statement.
[4097] Dominant purpose and principal effect tests
Purpose
This Decision impact statement outlines the ATO’s response to the Full Federal Court decision in Commissioner of Taxation v Complete Success Solutions Pty Ltd ATF Complete Success Solutions Trust [2023] FCAFC 19, which concerned the application of the dominant purpose test and the principal effect test under the general anti-avoidance provisions in Division 165 of the A New Tax System (Goods and Services Tax) Act 1999.
Outcome
The Decision impact statement – Commissioner of Taxation v Complete Success Solutions Pty Ltd ATF Complete Success Solutions Trust was published on 20 July 2023 and no further updates will be made. Work continues on reviewing impacted advice and guidance outlined in the decision impact statement.
[4099] Section 100A reimbursement agreements
Purpose
TR 2022/4 has been updated to reflect two recent Full Federal Court decisions, Commissioner of Taxation v Guardian AIT Pty Ltd ATF Australian Investment Trust [2023] FCAFC 3 and Blood Enterprises Pty Ltd v Commissioner of Taxation [2023] FCAFC 89.
A minor update has also been made to Practical Compliance Guideline PCG 2022/2 to further clarify some features of green zone arrangements.
Outcome
An addendum to Taxation Ruling TR 2022/4 Income tax: section 100A reimbursement agreements published on 27 September 2023.
An update to Practical Compliance Guideline PCG 2022/2 Section 100A reimbursement agreements – ATO compliance approach also published on 27 September 2023.