Tax Knowledge

September 7, 2018

Agency Relationship and GST on Disbursements – Legal Practices

It is common for legal practitioners to seek reimbursement for costs, in addition to the charge for services. However, the GST treatment of such reimbursements depends on the nature of the arrangement entered into, commercial terms of the transaction, and whether it was incurred as agent of the principal. Incorrect treatment of GST on reimbursements […]

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July 6, 2018

Tax treatment of long-term construction contracts

The Commissioner of Taxation recently released a taxation ruling, TR 2018/3, which provides guidance on reporting profits derived and losses incurred from long-term construction contracts. While the understandings are not vastly different to a previous release from 1987 (IT 2450), it is a healthy reminder that long-term construction contracts must be correctly accounted for to […]

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March 14, 2018

GST on the import of low value goods

GST does not currently apply when goods are imported into Australia if they have a customs value of $1,000 or less and the supplier is not registered or required to be registered for GST. Arguably this places Australian retailers / suppliers at a competitive disadvantage compared with foreign suppliers that are not required to be […]

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February 27, 2017

Uber drivers must register for GST

In Uber B.V. v FC of T, the Federal Court has held that services provided by an Uber driver constituted a supply of “taxi travel” for GST purposes. Accordingly, the driver was required to be registered for GST. Facts: The applicant applied for a declaration that one of its drivers did not supply “taxi travel” […]

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Deductibility of expenditure on a commercial website

The ATO has released a public taxation ruling covering the ATO’s views on the deductibility of expenditure incurred in acquiring, developing, maintaining or modifying a website for use in the carrying on of a business. Importantly, if the expenditure is incurred in maintaining a website, it would be considered ‘revenue’ in nature, and therefore generally […]

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Can a UPE be written off and claimed as a bad debt?

‘UPE’ (or ‘unpaid present entitlement’) arises where a trust makes a beneficiary entitled to an amount of the trust’s income (and therefore the beneficiary may have to pay tax on their share of the trust’s taxable income that year), but that amount has not been physically paid to the beneficiary. If the beneficiary never receives […]

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January 30, 2017

Leased properties were still ‘new residential premises’

The AAT has held that GST applied to the disposal of four properties that had been built, leased and then sold. GST does not ordinarily apply to sale of residential premises unless they are ‘new residential premises’. However, there is a special rule in the GST law that states that a newly constructed property will […]

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May 30, 2016

ATO focusing on repairs vs. improvements

The Australian Taxation Office is paying particular attention to claims that investment property owners make for repairs to rental properties. All clients should note repairs are deductible, improvements are not. Though improvements may add to the cost base. There are many examples of case law to assist in differentiating between repairs and improvements and the […]

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April 30, 2014

Tax Facts – Imputation

The imputation system provides a way for Australian and New Zealand corporate tax entities that pay Australian tax, to pass on to their members a credit for Australian income tax they have paid. This prevents the same income from being taxed twice – once when the income is earned by the entity, and again when the income […]

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