New thin capitalisation rules revised, but not yet finalised
After first being released as exposure draft legislation in March 2023, the new thin capitalisation interest limitation rules have undergone several round of updates but are still not law.
ATO stands by its views on UPEs and Division 7A following AAT loss
The ATO has issued an interim decision impact statement following the AAT’s decision in Bendel v FCT, currently on appeal to the Federal Court.
Updates on significant Victorian property tax changes
The draft legislation introducing significant Victorian property tax changes was amended within the last week to introduce further changes. Read about these here.
What do the new US Beneficial Ownership Reporting rules mean for Australian business owners ?
In response to an increased global focus on corporate transparency and exchange of information, effective 1 January of 2024 US businesses are now required to provide beneficial ownership information (BOI) to the US treasury department, via the Financial Crimes Enforcement Network (FinCEN).
The ATO is increasing its debt recovery activity – is your business ready?
In recent months, the Australian Taxation Office (ATO) has significantly intensified its efforts in debt recovery. Consequently, an increasing number of small businesses owners are now being issued Directors Penalty Notices (DPNs) and are forced to contemplate the possibility of seeking insolvency guidance.
NSW Labor government announces significant duty and land tax changes in its first budget in 12 years
In this article, we explain the key duty and land tax changes proposed in the NSW budget which are set out in the Treasury and Revenue Legislation Amendment Bill (‘the Bill’) and discuss what taxpayers can do to prepare for the changes.
Are you travelling for work, or commuting between home and the office?
FBT principles comes back into focus for a number of organisations with mobile employees travelling on Fly-in-Fly-Out (FIFO) arrangements. Business related travel expenses remain a topic of focus for the ATO. Whilst the John Holland case[1] and recently released Tax Ruling 2021/1 made significant progress in providing guidelines on when the “otherwise deductible” rule can apply for business-related travel expenses, the recent judgement in the Bechtel case[2] demonstrates that the devil is really in the detail.
Legislation containing new thin capitalisation rules to have major impacts on financing arrangements
Legislation has been introduced into Parliament that significantly rewrites Australia’s thin capitalisation rules with effect from 1 July 2023, with no grandfathering or transitional relief.
Our Advocacy work: Thin capitalisation legislation
In June 2023, legislation containing new thin capitalisation rules from 1 July 2023 was introduced into Parliament. Broadly, thin capitalisation applies to entities part of multinational groups that incur debt deductions (e.g. interest) of more than $2 million for an income year (on a group basis).
New thin capitalisation legislation introduced into Parliament
Last month, legislation was introduced to Parliament that significantly rewrites Australia’s thin capitalisation rules with effect from 1 July 2023, with no grandfathering or transitional rules. The new regime will replace the current asset-based test with an earnings based test that limits net debt deductions to 30% of tax EBITDA.