Expertise Archives:
Queensland Budget revenue measures: changes to foreign surcharge rates, payroll tax and first home buyer duty concessions
On 11 June 2024, the Queensland Treasurer delivered the 2024-2025 Queensland Budget (the Budget), and introduced the Revenue and Other Legislation Amendment Bill 2024 (QLD) (the Bill) to the Queensland Legislative Assembly. The Bill will effect a number of revenue measures announced in the Budget, which we have summarised in this alert.
Widespread federal tax changes
As we approach the Federal Budget, the Australian Government has recently detailed several significant changes affecting Capital Gains Withholding, Foreign Investment Fees, State Property Taxes, and the Deductibility of Interest Charges. These changes may have far reaching, and possibly unintended, consequences. The first legislated change related to the International Tax Agreements Act 1953, which ensured …
Taking ‘stock’: legality of State mining royalties following Vanderstock
Late last year, by narrow majority, the High Court of Australia ruled in Vanderstock v State of Victoria [2023] HCA 30 (Vanderstock) that the Victorian Zero and Low Emission Vehicle Distance-Based Charge Act 2021 (Vic) (ZLEV Act) was unconstitutional and invalid, given the annual charge imposed by the Victorian Government was a ‘duty of excise’ …
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Victorian Commercial and Industrial Property Tax Update
On 20 March 2024, the Commercial and Industrial Property Tax Reform Bill 2024 (Vic) (Bill) was introduced to the Victorian Parliament. The Bill was passed by the Legislative Assembly without amendment on 2 May 2024, and is due to be debated in the Legislative Council on 14 May 2024. The Bill will establish an annual …
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Closing loopholes or creating more? Conflicting employment and tax tests for ‘employee’ vs ‘contractor’
In late 2023 the ATO finalised a taxation ruling and accompanying guideline, to align its guidance on who is an ‘employee’ for taxation purposes following two landmark decisions of the High Court from 2022. While the ATO has finally caught up with case law, in the next six months the Fair Work Act 2009 (Cth) …
Changes to Victorian vacant land tax and other Victorian State taxes
In December 2023, the Victorian Government passed the State Taxation Acts and Other Acts Amendment Act 2023 (Vic), introducing multiple State tax changes that will predominantly impact the real estate sector, as well as landowners leasing or licencing their land for the operation of high-value infrastructure (e.g. infrastructure for power generation). Key Changes The most …
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Significant tax changes in NSW – do you need to act now?
The Treasury and Revenue Legislation Amendment Bill 2023 (the Bill) passed both Houses of Parliament in NSW on 21 September 2023. Once assent is received, the Treasury and Revenue Legislation Amendment Act 2023 (Amendment Act) makes a number of significant changes to the Duties Act 1997 (NSW) (Duties Act). An update on the proposed changes …
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Managing tax risk when engaging talent
For many businesses, the temptation to classify workers as independent contractors presents an opportunity for reduced costs, increased flexibility and administrative simplicity. This often seems more attractive compared to the minimum entitlements and protections that might be mandated for employees by law. However, it is important to understand the differences between a person engaged …
BPFN
Foreign ownership of assets register – annual notification of water rights
Foreign ownership of water All foreign persons (including foreign owned companies and trusts) must notify the Australian Taxation Office (ATO) by 30 July each year if the foreign person acquired a registrable water interest during the previous financial year and continues to hold that interest at 30 June. A registrable water interest means any ‘registrable …
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Adria Askin
Section 100A Reimbursement Agreements: The ATO finalises its views…for now
The recent explosion of interest in the taxation of discretionary trust distributions would suggest that there has been a radical amendment of the Australian law. Nothing could be further from the truth. What has occurred, particularly over the last eighteen months, is the culmination of multi-year campaign by the Australian Tax Office (ATO) to re-purpose …
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Up close and Personnel: ATO updates its guidance on the definition of an ‘employee’ for businesses’ withholding obligations
Late last year, the Australian Taxation Office (ATO) released Draft Ruling TR 2022/D3 Income tax: pay as you go withholding – who is an employee (Draft Ruling) and Draft Practical Compliance Guideline PCG 2022/D5 (Draft PCG). The Draft Ruling provides updated guidance on businesses’ obligations in relation to Pay as You Go (PAYG) withholding and …
Proposed tax on super balances greater than $3 million
The Treasurer’s proposed change to taxation on superannuation balances over $3 million is currently very long on rhetoric and very short on detail. The little detail we have so far comes from a short Treasury fact sheet and a number of statements to the press and parliament, which seem to only add to the confusion. …
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Revenue NSW: Foreign Purchaser Surcharge Duty and Surcharge Land Tax not payable by citizens of New Zealand, Finland, Germany or South Africa
On 21 February 2023 Revenue NSW announced that effective immediately citizens of New Zealand, Finland, Germany, or South Africa are no longer liable to pay foreign purchaser surcharge duty or surcharge land tax on residential land in NSW, because of inconsistencies between Australia’s international tax treaties and the NSW surcharge provisions. It is yet to be …
Cedar Pacific
ATO wrapping up for Christmas
This month, the ATO finalised its draft ruling and guidelines on section 100A ITAA36 in TR 2022/4 and PCG 2022/2, and issued a draft ruling and guidelines on the classification of employees and contractors in TR 2022/D3 and PCG 2022/D5. In the weeks leading up to Christmas, the ATO participated in the season of giving …
Unfrankable dividends sourced from a capital raise
Last month the Federal Government published exposure draft legislation, to ultimately legislate that dividends sourced from a capital raise cannot be franked (see here). Critically, the exposure draft provides for the retrospective amendment of the legislation, such that any transaction dating back to 19 December 2016 will be caught, and the franking credit must be …
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Customs and excise: How much does your drink really cost?
It is a common adage that most alcohol gets better with age. Unfortunately, the taxation of alcohol does not. In over a century, customs duty (on imports) and excise duty (on Australian manufacturers) have not fully matured, or perhaps more aptly, they have turned sour. Over 120 years since their introduction, customs and excise are …
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Queensland land tax reform shelved
The Queensland Government is reported to have shelved its proposed reform to the Land Tax Act 2010 (Qld), which would have seen Queensland land tax levied at a rate calculated with reference to a landholder’s Australia-wide landholdings. The decision not to proceed with the reforms, which would have required sharing of information by the Revenue …
Further blood drawn on section 100A and the meaning of ordinary family or commercial dealing
In September, Justice Thawley of the Federal Court handed down his decision in BBlood Enterprises Pty Ltd v Commissioner of Taxation [2022] FCA 1112, the most recent case tried in the ATO’s focus on section 100A ITAA36. Although the taxpayer was not successful on the facts in the case, amongst other elements of section 100A …
Beware the foreign asset in an Australian discretionary trust: The ATO’s final Determinations emphasise the need for review and legislative change.
The Commissioner has finalised his Taxation Determinations TD 2022/12 and 2022/13 regarding the taxation of capital gains made by foreign beneficiaries of Australian resident discretionary trusts on the sale of non-taxable Australian property. These determinations follow the current law as confirmed in Greensill and N&M Martin, and again reinforce the need for review of the …
New Queensland land tax rules: Queensland land tax rates to be based on Australia wide landholdings
Earlier this year, the Queensland Government announced that from 30 June 2023 Queensland land tax will be levied at a rate that is calculated with reference to a landholder’s Australia-wide landholdings. This new approach is different from the way land tax has been calculated in the past and is inconsistent with the land tax regimes …
Offshore wind on Australia’s horizon
The realisation of offshore wind projects in Australia is shifting closer, thanks to a more renewables-focused Commonwealth Government, increased cost competitiveness of renewable projects, and fluctuations in the fossil fuel markets. Australia moves to declare its first offshore renewable energy zone Most recently, the Minister for Climate Change and Energy, Chris Bowen MP, announced his …
Jodie Robinson
Melissa Simpson
2022-23 Queensland Budget
The Queensland Budget for 2022-23 was handed down on Tuesday, with a host of revenue reforms announced. Below, we provide a brief summary of the key reforms introduced by the Revenue Legislation Amendment Bill 2022 (Qld) (the Bill) and their impact on individuals and businesses across Queensland. Land tax Queensland’s method of calculating land tax will …
2022 EOFY trust distributions: handle with care
One of the perennial items on everyone’s end of financial year checklist is the proper execution of trust resolutions, ensuring that trustees are not taxed on trust income at the top marginal rate (45%). For family trusts in particular, these distributions often require additional consideration prior to the end of this financial year following some …
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NSW significantly expands scope of stamp duty regime
State Revenue and Fines Legislation Amendment (Miscellaneous) Act 2022 (NSW) In late May 2022, the NSW Government introduced significant changes to the duty regime. Importantly, the changes capture transactions and statements that are currently not caught, extend the operation of anti-avoidance provisions and introduce a refund for surcharge duty and land tax for Australian developers …
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