What were they thinking

Ideas that require the policy intent be clarified and identifying uncertainty in the application of the law.

What were they thinking

Submitted by (@michaelc)

Adjusted income calculations - double counting of losses

Some odd outcomes can arise when working through adjusted income calculations for certain tax and other purposes. The problem seems to mainly arise when someone has a net investment loss for the year as well as an overall tax loss for the year. For example, for some purposes a taxpayer will need to calculate their 'income for surcharge purposes' (eg, to determine whether Division 293 applies, applying the private health ...more »

Voting

1 vote
1 up votes
0 down votes

What were they thinking

Submitted by (@michaelc)

ESS start up options held by associates

Amendments were made to the employee share scheme rules in 2015 to introduce concessions for small start up companies. If certain conditions are met, the discount provided in relation to shares / options is not included in the assessable income of the employee. Section 115-30 has been amended to ensure that for the purpose of the CGT discount, when options are issued under the start up rules the ownership period is not ...more »

Voting

1 vote
1 up votes
0 down votes

What were they thinking

Submitted by (@michael.flynn)

Absolute entitlement

If a beneficiary is absolutely entitled to a trust asset, they, rather than the trustee, are required to return any capital gain, or claim any capital loss from a CGT event that happens to the asset. A common example that illustrates the significance of this concept is that of a nominee who holds shares on behalf of a principal. If the principal directs the nominee to sell the shares, the principal returns the capital ...more »

Voting

2 votes
2 up votes
0 down votes

What were they thinking

Submitted by (@reynah)

Foreign resident capital gains withholding payments

Given the broad application of this regime (eg. deeming all vendors of real property to be foreign residents unless they produce a clearance certificate from the ATO) and its red tape implications for day to day transactions, there is an urgent need for the ATO to issue class variations for situations where there is no tax payable including: • transactions attracting roll-over relief; • transactions required to give ...more »

Voting

7 votes
7 up votes
0 down votes