Birchstone Brief for the week ended 15 January 2021

ATO Updates

Superannuation Guarantee Determination amended: SG shortfall for salary sacrifice arrangements

The ATO has issued an Addendum to Superannuation Guarantee Determination SGD 2006/2, which amends the determination so that salary sacrifice contributions paid to certain employees do not reduce an employer’s charge percentage when working out a SG shortfall amount for quarters starting after 1 January 2020. The determination is also amended so that the salary sacrificed amounts are included in the ordinary time earnings base and the quarterly salary or wages base.

Practical Compliance Guideline released: Methodologies for determining market value for a buy-back or redemption of hybrid securities

The ATO has released PCG 2021/1 in relation to determining the market value of hybrid securities for CGT purposes when there is a buy-back or redemption by investors holding their securities on capital account.

Tax Determination issued: Value of goods taken from stock for private use

The ATO has issued TD 2021/1 which updates the amounts that the ATO will accept as estimates of the value of goods taken from trading stock for private use by taxpayers in the 2020-21 income year.

Law Companion Ruling issued: Hybrid mismatch targeted integrity rule

The ATO has issued LCR 2021/1 which sets out the Commissioner’s view of the hybrid mismatch targeted integrity rule contained within Subdivision 832-J of the Income Tax Assessment Act 1997 (Cth).

Cases

KPTT v FCT [2020] AATA 5309 – Taxpayer refused leave to amend grounds of objection

This case involved a taxpayer who was issued default assessments by the ATO. The taxpayer’s objections to the default assessments were disallowed, following which he applied to the AAT for review of the objection decisions. The AAT hearing was vacated twice by request of the taxpayer and, after the review had already commenced, the taxpayer sought leave to amend his grounds of objection. The AAT declined the taxpayer leave to amend his grounds of objection because of the ‘lengthy history of the matter’, which included the vacation of the hearing, non-compliance with case management directions, and the absence of a satisfactory explanation for the delay. 

Appeals

The Commissioner of Taxation has made a special leave application to the High Court of Australia from the decision in FCT v Glencore Investment Pty Ltd [2020] FCAFC 187 (Transfer pricing – summarised in the Birchstone Brief for the week ended 13 November).

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