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23 Nov 11 2011 Measures No 9 Bill introduced

On 23 November 2011, Tax Laws Amendment (2011 Measures No 9) Bill 2011 was introduced into the House of Representatives.

The following is extracted from the Explanatory Memorandum:

SCHEDULE 1 to the Bill amends the Retirement Savings Accounts Act 1997 and the Superannuation Industry (Supervision) Act 1993 to enable certain superannuation fund members to electronically request the consolidation of their superannuation benefits through the ATO. These amendments commence from the day after Royal Assent.

Part 1 of SCHEDULE 2 to the Bill amends the ITAA 1997 to ensure entities in a restructure can use a share or interest sale facility to deal with foreign held interests without Australian tax residents automatically failing a key requirement of certain CGT roll-overs. This measure applies to CGT events happening after 7.30 pm (by legal time in the Australian Capital Territory) on 11 May 2010.

Part 2 of SCHEDULE 2 to the Bill excludes an entity from being a member of a demerger group if the entity is a corporation sole or a complying superannuation entity. The amendments in Part 2 apply to CGT events happening after 7.30 pm (by legal time in the Australian Capital Territory) on 11 May 2010.

Part 3 of SCHEDULE 2 to the Bill amends the ITAA 1997 to expand the existing CGT roll-over for the change of a body to an incorporated company. The expanded roll-over applies to entities that change incorporation to become a Corporations (Aboriginal and Torres Strait Islander) Act 2006 corporation. The expansions to the CGT roll-over for interests in a body that changes incorporation applies to CGT events happening after 7.30 pm (by legal time in the Australian Capital Territory) on 11 May 2010.

Part 3 of SCHEDULE 2 to the Bill also amends the ITAA 1997 to allow for tax neutral consequences for CGT, depreciating, revenue and trading stock assets of a body that is wound up and replaced by a new company incorporated under a different law, and these assets are transferred to the new company. It applies in relation to the cessation of existence of bodies corporate occurring after 7.30 pm (by legal time in the Australian Capital Territory) on 11 May 2010.

SCHEDULE 3 to the Bill amends the A New Tax System (Goods and Services Tax) Act 1999 to implement three of the seven recommendations agreed to by the Government arising out of Treasury’s Review of the GST financial supply provisions. The measures requiring legislative change and included in the Bill:

  • increase the first limb of the financial acquisitions threshold from $50,000 to $150,000;
  • exclude financial supplies consisting of a borrowing made through the provision of a deposit account by an Australian authorised deposit-taking institution from the current concession for borrowings; and
  • allow taxpayers who account on a cash basis to treat an acquisition made under a hire purchase agreement as though they do not account on a cash basis.

Date of effect: 1 July 2012.

SCHEDULE 4 to the Bill amends the A New Tax System (Goods and Services Tax) Act 1999 to ensure that sales or long-term leases of new residential premises by a registered entity are taxable supplies and that sales or long-term leases of residential premises (other than new residential premises) are input taxed supplies.

Date of effect: Except for item 2 (clarifying the definition of ‘new residential premises’) which applies on or after the day this Schedule commences, the provisions take effect from 27 January 2011 (the date of the Government’s announcement). This start date will reduce the risk to revenue that might otherwise arise from behavioural change. These amendments contain a transitional provision to ensure that developers who were ‘commercially committed’ to arrangements to develop premises before 27 January 2011 are not disadvantaged by the measure.

SCHEDULE 5 to the Bill amends the ITAA 1997 to update the list of deductible gift recipients (DGRs) by adding one entity as a DGR, and changing the name of another entity previously specifically listed.

SCHEDULE 6 to the Bill makes technical corrections and other minor and miscellaneous amendments to the taxation laws. These amendments are part of the Government’s commitment to the care and maintenance of the tax system. These amendments were all foreshadowed by release in draft form on the Treasury website on 11 October 2011. Date of effect: These amendments commence from Royal Assent unless otherwise stated.

 


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