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11 Nov 2021 Advocacy Tracker

Key issues on the radar 

Our Tax Policy and Advocacy team is always working for our members. Our Advocacy Tracker sets out the key issues that we are advocating for on your behalf, including additional resources via the hyperlinks. Should members have any queries or wish to discuss matters with the Tax Policy and Advocacy team, please contact us at Tax Policy. 

Members can also track updated ATO advice under development and matters under consultation. 

Issue 

Tax Policy and Advocacy activity 

Stakeholder 

ONGOING ITEMS 

 

 

The performance and integrity of Australia's administrative review system 

On 20 October 2021, the Senate referred an inquiry into the performance and integrity of Australia’s administrative review system to the Legal and Constitutional Affairs References Committee. The committee is reviewing a range of matters including the selection process for AAT members, the importance of transparency and parliamentary accountability, and whether the Administrative Review Council should be re-established.   

Submissions for the inquiry are due on 24 November 2021, with the report being released by 31 March 2022. The Tax Institute is preparing a submission to highlight the importance of the Administrative Appeals Tribunal to tax disputes, and highlighting the key concerns for taxpayers who need to resolve their tax disputes in the Tribunal. 

Senate Standing Committees on Legal and Constitutional Affairs  

Draft Taxation Determinations TD 2021/D2, TD 2021/D3 and TD 2021/D4. 

The ATO has released three draft taxation determinations setting out the ATO’s views on the application of various concepts, such as the application of the ‘connected with’ tests, in Subdivision 328-C of the Income Tax Assessment Act 1997 to a broader range of entities including corporate limited partnerships, foreign hybrids and non-entity joint ventures. The relevant draft taxation determinations are: 

The Tax Institute is preparing a submission to try and ensure that the ATO is able to provide the most useful information to best assist taxpayers and advisers on these topics. 

ATO  

Legal Professional Privilege Protocol Consultation 

The ATO is preparing a Legal Professional Privilege (LPP) Protocol which attempts to assist taxpayers and advisers by recommending an approach to take when claiming LPP. The LPP Protocol also broadly describes how the ATO may challenge LPP claims, along with the information that may be requested under such a challenge. 

As part of this, The ATO is publicly consulting on a draft protocol that has been released. The Tax Institute will be participating in this consultation through the NTLG, and preparing a submission to highlight concerns and workable alternatives where feasible. 

ATO 

Working with vulnerable clients – focus group 

The ATO has commenced a targeted consultation with a focus group on working with vulnerable clients, to understand the ATO’s approaches to working with vulnerable clients to identify opportunities to improve the client experience. 

The consultation, which is expected to conclude in October 2021, will explore the definition of, and approach to, vulnerability. Recent events such as the 2019–20 bushfires and the COVID-19 pandemic have drawn focus to the ATO’s need for an empathetic approach to clients experiencing vulnerability. 

Vulnerability includes those who are affected by homelessness, drugs and/or alcohol abuse (either their own, or vicariously), gambling, domestic and family violence, sexual and financial abuse, and mental illness. It also includes those for whom English is a second language, those in remote communities and those who are technologically challenged and may not have reliable or ready access to digital resources. 

The ATO is consulting with organisations that support or interact with vulnerable clients, including government agencies, welfare groups, financial counsellors and The Tax Institute (represented by our Senior Advocate, Robyn Jacobson, CTA). 

ATO 

Non-arm’s length income of superannuation funds 

Following the recent release of LCR 2021/2, and PCG 2020/5 in 2020 on how the ATO will apply the non-arm’s length income (NALI) provisions to ‘non-arm’s length expenditure’ to complying superannuation entities, we continue to work with the other professional bodies to raise the practical implications of s 295-550 of the Income Tax Assessment Act 1997 with the government. 

ATO 

Treasury 

Digital activity statements 

Following a number of members raising the issue of the removal of paper activity statements with us, The Tax Institute escalated the matter to the ATO late last year. 

This has resulted in a series of regular meetings to discuss the impact of the ATO’s decision to remove paper quarterly PAYG and GST instalment notices and the design of an interim solution which involves the reinstatement of paper activity statements from the March 2021 quarter. 

We continue to work with the ATO in the design of a permanent solution. 

ATO 

 

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