Funny Stuff Income Tax

Adam, Eve and Family Trust Elections

In ATOID 2014/3 the Commissioner states that the individual specified in the Family Trust Election must be alive at the time the trustee of the trust makes the election. He comes to this conclusion after finding the term “individual” is not defined and takes a very loose analysis of the various dictionary definitions. So why […]

Income Tax Planning Stuff

Injecting income into loss trusts – everyone should be doing it

There is this fear of having losses in discretionary trusts – specifically how do you get them out… The answer is easy. You just inject income into the trust. But what about the income injection test I hear you scream… First what is the income injection test? It is a test that states that if […]

Income Tax Legislation

Net Medical Expense Offset Gone… kind of

The Government has released some draft legislation and explanatory materials to phase-out the net medical expenses tax offset ( I love the way they call it a phase out when the vast majority of people lost all eligibility on 1 July 2013. SO this is their idea of a phase out… First, “From the 2013-14 […]

Income Tax Rulings

Another problem with marriage breakdowns

When a family court order as a part of a marriage breakdown requires assets held in a family company to be transferred there is no CGT payable due to the 126A rollover. BUT if the receiving spouse is a shareholder the Commissioner says it is a dividend and taxed under section 44 of the ITAA36. […]

Funny Stuff Income Tax Legislation

One year of carry back losses…

If you are completing a company tax return for the year ended 30 June 2013, you may have made your first ever claim for the refundable tax offset that the carry back loss rules created. Enjoy claiming this offset while you can, as the 2012/13 year will be the last year it is available. This […]

Income Tax Tax Policy

Another ridiculous tax policy… supported by every side

When there is change in government you hope they can dump all the stupid ideas of the previous government. But with the new government still needing to find savings stupid ideas seem not so stupid. In the May 2013 Budget the Labor (one day they might learn how to spell their party’s name) stead they […]

Income Tax Planning Stuff

Moving from cash to accruals

Since the Henderson Case it has been clear that there is only one appropriate way to return income for a year – either cash or accruals. TR 98/1 covers which one is correct for each year. But what happens to your debtors when in year one you were correctly on cash and in year two […]

Income Tax Part IVA Planning Stuff Rulings

Part IVA and partnerships of discretionary trusts

The most annoying habit of the Commissioner is to let everyone do something for years and then to finally try to close it down. Take the Commissioner’s announcement on 16 December 2009 that an unpaid present entitlement from a trust to a corporate beneficiary is a loan to which Division 7A applies. So 12 years […]

Income Tax Part IVA Planning Stuff

Part IVA applies to small businesses

I don’t get that so many small business advisors think Part IVA can not apply to their clients. Yes it does not happen often but if it does your business is on the line. And here is where it is most likely to apply… You just read my post below and want to inject income […]

Article Income Tax

Solar panels and tax – How many people have this wrong???

0010IP_Blue_Journal_Aug (Mansell) By the way, after writing this article I found that I had been placed on the world’s largest “climate denial” database. Now I new thought a tax article could make me politically incorrect?