5 minute tax updates: 17-21 February

High Court disallows appeal in FITO case
Broadband tax gets Senate approval, but wireless not ruled “off-limits”
Warn your clients: New “8% bonus” scam
The end of AUSkey and Manage ABN Connections is nigh
Reporting and paying of inactive low-balance accounts
Online services for agents feedback
An SMSF investment strategy is a legal requirement
Approval to defer GST on imported goods
Appeal in Travelex GST case dismissed
FBT guide for employers available to download
Buy-back or redemption of certain hybrid securities

High Court disallows appeal in FITO case
An application for special leave to appeal a Full Federal Court decision has been blocked by the High Court. Regarding Burton v Commissioner of Taxation [2019] FCAFC 141, the FFC concluded the taxpayer was not entitled to a full foreign income tax offset due to half of a capital gain being included in assessable income. That decision would mean that Australian taxpayers, to whom the 50% CGT discount applies, are only entitled to a foreign income tax offset in respect of half of the US tax paid in respect of a gain.

Broadband tax gets Senate approval, but wireless not ruled “off-limits”
The government’s proposed Regional Broadband Scheme, which imposes a tax on non-NBN operated fixed line services, looks set to begin on 1 July 2020 after the Senate committee examining the bill recommended it pass through Parliament. The committee’s report, handed down last Friday, recommended that some additional transparency measures be introduced, but not put in a way that would hamper passage of the bill. Importantly however, the committee left the door open on the tax expanding to mobile services in the future.

Warn your clients: New “8% bonus” scam
The ATO is warning the community about a new SMS scam that promises an 8% bonus on 2020 tax returns to victims of recent natural disasters. This particular scam includes a link to a fake myGov website that has the look of the genuine thing.

The end of AUSkey and Manage ABN Connections is nigh
The ATO is again reminding practitioners that time is running out to move to myGovID and RAM. After Friday 27 March 2020, there’ll be no alternative but the new systems. To make the move (and here’s all you need to know), the principal authority of the business needs to kick start the process. This is either the eligible individual associate listed on an ABN in the Australian Business Register (ABR) such as a trustee, director or partner, or the primary person (where no individual associate is listed in the ABR) such as a director or public officer of a corporate trustee.

Reporting and paying of inactive low-balance accounts
This new legislation, the Treasury Law Amendment (Protecting Your Superannuation Package) Bill 2019, gives the ATO authority to consolidate certain ATO-held inactive low-balance accounts (ILBAs) on behalf of individuals. The individual no longer needs to direct the ATO to do so. Super funds have to identify ILBAs on the two unclaimed money days each year (that is, 30 June and 31 December).

Online services for agents feedback
How you can provide feedback to the ATO about Online services for agents. Also find out what the ATO does with any feedback it receives, and its planned upcoming changes. The ATO has already made some updates, but also has changes in progress and some on hold while these are being reviewed.

An SMSF investment strategy is a legal requirement for trustees/members
Your SMSF client’s investment strategy sets out their fund’s investment objectives and how they plan to achieve them. It is their plan for making, holding and realising assets consistent with their objectives and retirement goals. The ATO has provided a thorough guide to making an investment strategy, which you can share with clients.

Approval to defer GST on imported goods
This ATO webpage and accompanying form (NAT 75136) explains how to apply for the deferred GST scheme on imported goods electronically.

Appeal in Travelex GST case dismissed
The case of Commissioner of Taxation v Travelex Limited [2020] FCAFC 10 was one where the company had repeatedly lodged its BAS on the basis that currency exchange services provided to persons who had passed through to the departure side of customs barriers at Australian ports of exit were taxable supplies under the GST Act. But the High Court determined that these are indeed GST-free. Interest was also involved.

FBT guide for employers available to download
The ATO has made available an updated Fringe benefits tax – a guide for employers PDF. On its legal database you can view the HTML version or download the PDF version here (3.5MB).

Buy-back or redemption of certain hybrid securities
The ATO has released a discussion paper about a potential practical compliance approach for determining the market value of certain hybrid securities when bought back or redeemed (as relevant) from an investor holding their hybrid securities on capital account. Feedback is most welcome on matters including but not limited to the points listed here.

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