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48th Victorian State Convention

Published on 08 Oct 2009 | Took place at Novotel Forest Resort, Creswick , VIC

This year's convention had the theme 'Out of the Rough' to reflect the current economic conditions.

The conference detailed strategies and tactics which can be adopted in turbulent economic times, not in a negative sense but in a positive way, to assist your businesses and your clients.

Presenters included members of the Judiciary, senior Australian Taxation Office personnel, senior taxation representatives of leading Australian publicly-listed companies, experienced advisers from legal and accounting firms and in-house tax personnel.

Get a 20% discount when you buy all the items from this event.

Individual sessions

Current issues in self managed superannuation

Author(s):  Heather GRAY

Self managed superannuation is not getting any simpler, and the rules for the acquisition and holding of investments offer ample scope for error and confusion. This paper covers:

  • loss realisation and maintaining losses - strategies and risks
  • purchase of assets using instalment warrant loans, terms contracts and un-geared property trusts
  • acquiring business real property and other assets from related parties
  • investments in unrelated companies and trusts
  • asset protection and superannuation strategies.
Materials from this session:

Capital allowances-Opportunities now arising

Author(s):  Andrew WOOLLARD

An understanding of recent developments and proposed changes to the capital allowance deductions and investment "tax breaks" is critical. Advisers need to understand the rules to properly advise their clients. This paper considers:

  • key issues in claiming capital allowance deductions
  • section 40-880 and claiming blackhole expenditures
  • investment allowance issues.
Materials from this session:

Tax consolidation-Continual evolution

Author(s):  Richard BUCHANAN

The consolidation rules continue to evolve and present new challenges. This paper covers the evolution of tax consolidation over the past 12 months, including an analysis of:

  • the nature, timing and purpose of the amendments to the tax consolidation legislation
  • the practical consequences of those retrospective changes
  • how the tax consolidation provisions have responded to key legislative and/or interpretive changes in other areas of the Tax Act.
Materials from this session:

Managing trust losses

Author(s):  Meagan O'CONNOR,  Rob JEREMIAH

Although unchanged for many years now, the Trust Loss rules are a cause of confusion and continue to be ignored or are just misunderstood, usually with catastrophic consequences for all involved.

This paper covers:

  • introduction to schedule 2F ITAA 1936 rules and operation
  • family trust elections planning issues
  • exceptions to the trust loss regime
  • passing the income injection test.
Materials from this session:

Tax risk management in a changing world

Author(s):  Tony FULTON

This paper covers:

  • developments in corporate tax risk management practices
  • getting the balance right between managing risk and generating value
  • stakeholder engagement on tax risk in the current environment.
Materials from this session:

Division 7A the 'sleeping giant'

Author(s):  David STAVROPOULOS

The recent changes to Division 7A giving the Commissioner discretionary powers is good news, yet present perplexing and difficult issues in practice. This paper considers the following:

  • the present UPE/Loan controversy
  • what the specific rules are relating to trusts
  • why is debt forgiveness a ‘sleeping giant'?
  • what is the Commissioner's discretion and how does it apply in practice
  • other problem areas and traps.
Materials from this session:

Tax accounting - a changing landscape: what it means for you

Author(s):  Ronen VEXLER,  David ROMANS,  Michelle Thomas,  David Morrin

The operation of a substantial amount of tax law now hinges on the preparation of an entity's financial statements being prepared in accordance with generally accepted International accounting standards, but the standards continually transform. This paper provides:

  • an overview of the proposed changes to the accounting standard on accounting for taxes, IAS12
  • practical implications of the key changes contained in the exposure draft
  • key issues raised in submissions on the exposure draft and the likely outcomes for corporates.
Materials from this session:

International tax strategies/structuring for SMEs

Author(s):  James Newnham

The rules for structuring inbound and outbound investment for SMEs continue to change. This paper deals with the key international tax issues encountered by SMEs including:

  • how to determine the right structure both here and there including:
    • entry financing issues
    • repatriation issues and your global tax rate
    • branch vs company
    • branch profit exemption
    • foreign tax offsets - Division 770
  • the impact of a bear market
  • exit issues and Division 768-G.
Materials from this session:

Tax in recessionary times

Author(s):  Mark POOLE

This paper covers:

  • capital injections
  • the issue of shares in companies with low or negative net worth
  • equity issues, consolidated groups and available fractions
  • exit of subsidiaries from wholly-owned group: unrealised loss companies
  • unrealised losses/realised gains - Taxation of Financial Arrangements
  • relief for ‘blackhole' expenditure: Section 40-880
  • bad debt deductions - especially debts arising from money lending.
Materials from this session:

Bamford v Federal Commissioner of Taxation

Author(s):  Terry MURPHY

This paper was also delivered at the event Trust Distributions - Where Are We At? in Melbourne on 13 November 2009.

This paper covers:

  • special leave applications
  • the trust deed
  • Division 6
  • the income of the trust estate
  • the Commissioner's interim position.
Materials from this session:

The new Tax Agents Services Regime - Setting up the procedures necessary to comply with your obligations

Author(s):  Sue WILLIAMSON

Note: This paper has been adapted by a paper written and presented by the author at the 2009 National Convention. 

All tax agents need to review their structures and procedures to ensure they are not in breach of any of the requirements of the new regime.

This paper focuses on what you need to do to ensure that the new regime will not adversely affect the ongoing operation of your practice including:

  • your obligations under the Code of Professional Conduct
  • adequate supervision and control of employees and contractors
  • what you need to do if you are outsourcing to related entities, Australian entities or offshore entities
  • updating engagement letters and ensuring instructions are adequate.
Materials from this session:

Structuring and financing investments into Asia

Author(s):  Dino FARRONATO

Structuring for investment and trading to take advantage of the Asian economic powerhouse
requires a comprehensive knowledge of optimal investment structures. This paper covers:

  • choosing the right investment structure to achieve lower effective tax rates
  • efficient financing techniques in the light of tax and regulatory regimes
  • practical issues around maintaining an efficient structure
  • exit strategies and the impact of the Vodafone case - India and beyond.
Materials from this session:

Trusts and distribution resolutions in the light of Bamford

Author(s):  Nabil (Bill) F. OROW

This paper was also delivered at the event Trust Distributions - Where Are We At? in Melbourne on 13 November 2009.

This paper covers practical issues and questions relating to trust distributions and approaches taken in drafting distribution minutes and resolutions in the light of the recent decision of the Full Federal Court in Bamford.

The paper:

  • examines the principles that govern the taxation of distributions
  • reviews the critical factors to consider when drafting valid distribution resolutions
  • provides an overview and critique of some sample distribution minutes and resolutions.
Materials from this session:

Transfer pricing - the practicalities of achieving an arm's length outcome

Author(s):  Keir CORNISH

Taxpayers and the revenue authorities are grappling with how to translate transfer pricing theory into a workable approach. This paper discusses:

  • the challenges of making adjustments to target a profit result
  • navigating the ATO and OECD views on business restructuring where not just pricing but decision making may be open to review
  • opportunities under the ATOs renewed APA program
  • dealing with current ATO compliance activities.
Materials from this session:

Promoter penalties

Author(s):  Stephanie MARTIN

The promoter penalty regime is designed to deter the promotion of tax exploitation schemes and provides for civil penalties, statutory injunctions to stop the promotion of a scheme and voluntary undertakings. This paper provides practical insights into:

  • promoter penalties and large corporates - it's not just product developers who may be exposed. The ATO draws from their experience to outline some examples where conduct may have contravened the promoter penalty laws
  • when should a corporate consider offering the Commissioner an enforceable voluntary undertaking and what should it contain?
  • how the ATO approaches promoter risk in its administration of the promoter penalty laws
  • an in-house corporate case study on establishing good governance in the process of product development.
Materials from this session:

Tax controversy strategies - preparing for ATO reviews, audits and tax disputes

Author(s):  Peter POULOS

Too often disputes with the Commissioner spiral out of control because of poor planning and no thought given to any preparatory steps a taxpayer could take to minimise costs and further exposure.

This paper provides strategies tax advisors can adopt when a taxpayer needs to prepare for a review or resolve a dispute with the Commissioner, so to ensure
that a taxpayer's tax exposure and costs are minimised.

Materials from this session:

Merger and acquisition outbound

Author(s):  John BRAZZALE This paper covers a demerger case study.

Materials from this session:

Professional practices - State of play

Author(s):  Mark NORTHEAST

Recent changes to bankruptcy law, superannuation, each profession's rules governing permitted
structures, tax agent registration requirements, and the ATO's approach to service trusts have
heightened the focus on appropriate structuring for professionals.

This paper addresses where matters stand from a professional's perspective.

Materials from this session:

Practical TOFA Considerations for corporates

Author(s):  Neil WARD

The TOFA legislation received Royal Assent six months ago and early electing taxpayers may in
some cases be already subject to the new rules. There is still time before the first TOFA elections need to be made.

This paper covers a number of practical issues that have become relevant in determining the potential impact of TOFA and is intended to help with your decisions on the various elections available. It includes a practical analysis supported by case studies covering:

  • a suggested approach to determining the preferable TOFA position
  • is tax hedging as beneficial as it appears and how is it achieved?
  • when would you consider the accounting based elections?
  • TOFA issues still under consultation.
Materials from this session:

Practical transfer pricing documentation for the SME market

Author(s):  Shannon SMIT

Think transfer pricing is only something the large multinationals have to consider? Think again. The SME market is on the ATOs radar screen as many SMEs expand globally. What does this mean, and how can you satisfy your transfer pricing obligations in a practical and efficient manner? This paper covers:

  • transfer pricing for SMEs: the simplified approach
  • characterisation: why is it important?
  • justification: how to substantiate an arm's length price
  • adapting to change: keeping documentation relevant to your business.
Materials from this session:

GST Today – Cases update, legislative update & rulings update

Author(s):  Geoff MANN,  Suzanne KNEEN,  Michelle SIU This paper gives an update on key recent developments (cases, rulings, legislation and proposals for reform) in GST and an overview of what corporates and SMEs need to know or do in the current economic environment.

Materials from this session:

Hybrid financial instruments: Classifying hybrid instruments under the Debt/Equity Rules and related issues

Author(s):  Cameron RIDER,  Martin FRY

This paper covers:

  • debt/equity in context
  • debt/equity outline
  • ENCO and options to convert to equity
  • equity credit features and ratings agency requirements
  • presentation in accounts
  • are returns deductible or frankable?
  • withholding tax implications
  • rollover relief on conversion.
Materials from this session:

Inbound investment emerging issues

Author(s):  Vik KHANNA

Inbound investment into Australia presents challenges that are not just confined to tax issues.

This presentation covers emerging issues relevant to inbound investment, including:

  • financing issues including thin capitalisation and debt deductions
  • tax treatment of inbound partnerships
  • cash pooling and netting arrangements
  • corporate reorganisations including supply chain restructures
  • disposal of businesses by non-residents.
Materials from this session:

Case-law developments in Section 8-1

Author(s):  Michael CLOUGH,  Ged O’SHAUGHNESSY

In the past year there have been some potentially landmark developments in the interpretation of section 8-1 of the Income Tax Assessment Act 1997 (C'th). This paper analyses the implications of recent decisions in Malouf, Day, Spriggs & Riddell, St George and others and answers:

  • whether there are any new principles emerging?
  • is there a new test to satisfy the positive limb?
  • has the capital exclusion been expanded?
  • how wide should the factual survey be to provide a context for the outgoing?
  • what are the trends and likely appeal outcomes?
Materials from this session:

Tax controversy strategies (preparing for ATO reviews, audits and disputes)

Author(s):  Peter POULOS

Too often disputes with the Commissioner spiral out of control because of poor planning and
no thought given to any preparatory steps a taxpayer could take to minimise costs and further

This paper considers strategies tax advisors can adopt when a taxpayer needs to prepare for a review or resolve a dispute with the Commissioner, so to ensure that a taxpayer's tax exposure and costs are minimised.

Materials from this session:

Demerger case study

Author(s):  John BRAZZALE This paper covers a demerger case study.

Materials from this session: