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Legislating ATO practice – The good and the bad for practitioners

Published on 01 Dec 13 by "TAXATION IN AUSTRALIA" JOURNAL ARTICLE

Among the backlog of announced tax measures which the federal government intends to review in the near future is measure 63, a proposal which relates to allowing a testamentary trust to distribute the assets of a deceased person without CGT implications. The intention in measure 63 was to formally legislate ATO practice and remove any uncertainty about the ATO approach being in accordance with the CGT legislation. The current ATO practice of allowing a testamentary trust to distribute an asset of a deceased person without a CGT taxing point is outlined in PS LA 2003/12.

This article examines the ATO practice and the legislative proposal. The author concludes that the approach embodied in PS LA 2003/12 is flawed and would have no basis in law. It appears that the ATO has substantially realised that its approach to the CGT treatment of a trustee of a testamentary trust is not in accordance with the law.

Author profile:

Michael Blissenden
Michael is Associate Professor of Law at the University of Western Sydney. Current at 01 February 2015 Click here to expand/collapse more articles by Michael BLISSENDEN.
 
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