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Beware the double trap for dividend washing under tax laws

Publication date: 06 Jul 17 | Source: CCH TAX WEEK

Issue: Issue 25, 23 Jun 2017

Pages: pp. 1-3


The recent Administrative Appeals Tribunal decision in Lynton atf David Lynton Superannuation Fund v FC of T 017 ATC ¶10-457, has confirmed that dividend washing will be caught both by ITAA 97 s207-157 and ITAA 36 s177EA, depending on whether or not the transactions took place before 1 July 2013.

Since July 2013, there has been specific legislation to prevent dividend washing, but what about previous arrangements? Anyone engaged in dividend washing arrangements before the introduction of ITAA 97 s207-157 and did not amend their income tax returns before 28 May 2014 should discuss with their tax advisers how to engage with the ATO in order to mitigate penalties and interest.

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Author profiles

Christine PALMER
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John Middleton CTA
John is a Special Counsel at Clayton Utz Brisbane and specialises in revenue and commercial law. He has provided legal advice in respect of the structuring, restructuring, purchase and sale of businesses and entities of all types. He has particular experience in CGT planning for the sale of businesses, and also practises in stamp duty, GST and general tax. He is listed in Doyle’s and Best Lawyers in respect of tax matters. - Current at 18 May 2018
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