Birchstone Brief for the week ended 4 November 2022

Last Chance to Register for Birchstone’s Advisers Day

The countdown is on… our inaugural Adviser’s day is this Friday and we’d love to see you there!

If you’re still on the fence about whether you should attend, then the answer lies in answering the following question:

Do you advise clients with family businesses?

If so, then the correct answer is yes… you simply must attend! All sessions are directly relevant to family businesses, especially the workshop in session six, which will show you how to navigate the restructure of a family business. The presentation will discuss not only the tax and duty implications, but also the client’s succession planning intentions.

We’ll break down the technical issues into bite-size pieces and then add practical considerations that will help you approach a restructure in future. Best of all, you’ll leave with a better understanding of when and why you would choose certain roll-overs and concessions (particularly when multiple may be available).

 

ATO Updates

Draft guideline on deductions for additional running expenses while WFH

The ATO has released PCG 2022/D4, which sets out the ATO’s proposed compliance approach to taxpayers claiming a deduction for additional running expenses incurred while working from home. It provides that from 1 July 2022, taxpayers can only claim such expenses if they use the:

  • ‘actual expenses’ method (that is, calculating and claiming actual expenses incurred as a result of working from home); or 
  • the revised fixed-rate method (as outlined at paragraphs 23 to 26 of the draft Guideline). 

Notably, the draft Guideline:

  • confirms that from 1 July 2022 taxpayers may no longer use the ‘shortcut method’ (outlined in PCG 2020/3) to claim deductions for such expenses; and
  • has been criticised by tax professionals due to the strict new requirements that must be satisfied to utilise the revised fixed-rate method, and furthermore the fact that it states a taxpayer will only be able to use the actual method (which requires the taxpayer to have retained appropriate documentary evidence) if they lodge an objection in relation to a claim for WFH expenses for any reason. 

Draft update to car parking benefits ruling

TR 2021/2DC1 sets out proposed amendments to TR 2021/2 to incorporate changes which address the concept of ‘primary place of employment’ relevant to car parking benefits in light of the decision in FCT v Virgin Australia Regional Airlines Pty Ltd [2021] FCAFC 209

Class ruling issued

The ATO has issued the following class ruling:

  • CR 2022/98 – Single Cell Mobile Consulting Pty Ltd – Portt Options Plan – Reducing the minimum holding period. 

Legislation

Exposure draft legislation: Requirements to maintain ABN registration

Treasury has released exposure draft legislation that proposes to make an entity’s ongoing ABN registration contingent on it meeting two additional obligations:

  • firstly, the obligation to comply with income tax return lodgement requirements; and
  • secondly, the obligation to update the accuracy of its details on the ABR annually. 

These measures, designed to strengthen the ABN system, were originally announced by the former government in the 2019-20 Federal Budget. 

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