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SMSF borrowing — ATO ID 2014/39 and ATO ID 2014/40 both confirm that nil interest borrowings from related parties can cause non-arm’s length income

SMSF borrowing — ATO ID 2014/39 and ATO ID 2014/40 both confirm that nil interest borrowings from related parties can cause non-arm’s length income

By on 15/12/2014 in ATO, Limited recourse borrowing arrangements, SMSF strategy, Taxation

Two ATO Interpretive Decisions (ie, ATO ID 2014/39 and ATO ID 2014/40 both published on 12 December 2014) address the question: Will ordinary or statutory income derived by an SMSF under a limited recourse borrowing arrangement (‘LRBA’) be non-arm’s length income (‘NALI’) of the fund pursuant to s 295-550 of the Income Tax Act Assessment [read more]

Can an adult child be a tax dependan

Can an adult child be a tax dependant — ATO ID 2014/22 says yes!

By on 05/12/2014 in ATO, SMSF strategy, Succession planning, Taxation

ATO Interpretive Decision 2014/22 addresses the question: ‘Can an adult child be a ‘death benefits dependant’ of his or her deceased parent for the purposes of section 302-195 of the Income Tax Assessment Act 1997 (Cth)?’ The adult child was considered to be a death benefits dependant for the purposes of this section. Tax definition [read more]

Excess contributions tax — the good news continues

Excess contributions tax — the good news continues

By on 17/10/2014 in Contributions, Federal Budget, Taxation

True to its word, on 10 October 2014 the Government introduced draft legislation, which proposes practical and long-awaited changes to the treatment of excess non-concessional contributions (‘NCCs’). This article outlines the tips and traps associated with the proposed changes. Details of the draft legislation The draft legislation takes the form of the Tax and Superannuation [read more]

Watch-out-for-early-release-of-super-schemes

Watch out for early release of super schemes – Vuong and FCT [2014] AATA 402

By on 07/07/2014 in ATO, Audit, SMSF compliance, Taxation

This Administrative Appeals Tribunal decision involved a member of a large fund becoming implicated in an early release of superannuation scheme. It is a very interesting insight into how some of these schemes are undertaken. Also, it has some very interesting tips for advisers especially tax agents of how deep they should investigate dubious or [read more]

segregated-bank-accounts-are-now-made-easy-so-why-have-unsegregated-assets

TD 2014/7 — segregated bank accounts are now made easy, so why have unsegregated assets? The simple answer!

By on 01/07/2014 in SMSF strategy, Taxation

The ATO released Taxation Determination 2014/7 (‘TD 2014/7’) on 9 April 2014 entitled ‘Income tax: in what circumstances is a bank account of a complying superannuation fund a segregated current pension asset under section 295-385 of the Income Tax Assessment Act 1997 (Cth) (‘ITAA’)?’. Broadly, TD 2014/7 adopts a much more practical approach to dealing [read more]

SMSFs-buying-overseas-property

SMSFs buying overseas property – tips & traps

By on 12/06/2014 in Investments, Limited recourse borrowing arrangements, SMSF compliance, SMSF deeds, SMSF strategy, Taxation

Introduction Overseas property investment may appear attractive to many; such as an investment in an apartment in Paris, a Balinese beachfront villa, or a ski chalet in Colorado. However, when an SMSF is the purchaser there are a number of compliance tips and traps to navigate. SMSF trustees can purchase property either by an outright [read more]