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Budget Revenue Measures 2008-09 – Part 1 Lisa Baker.

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Presentation on theme: "Budget Revenue Measures 2008-09 – Part 1 Lisa Baker."— Presentation transcript:

1 Budget Revenue Measures – Part 1 Lisa Baker

2  The information provided in this presentation is based upon the Revenue Law Reform (Budget Initiatives) Bill 2008, which was introduced in the Legislative Assembly on 7 May 2008 as part of the Budget  The intention of this presentation is to provide an overview of the measures included in the Bill, rather than be a platform for policy debate Budget Revenue Measures

3  Revenue Law Reform (Budget Initiatives) Bill ­Conveyance stamp duty rates reduction ­Other stamp duty changes ­Home incentive scheme changes ­Consequential amendments resulting from the introduction of the Taxation Administration Act Overview

4  Conveyance stamp duty rates reduction ­From 6 May 2008 ­New minimum rate 1.5% (from 2.1%) ­New maximum rate 4.95% (from 5.4%) ­Maximum rate will apply at $ (previously $ ) ­Stamp duty first home owner concession on first $ of a property’s value Conveyance on Stamp Duty

5  Nominal $20 deed duty removed, other than where the deed relates to a trust ­Remains for deeds that constitute, vary, deal with interests or entitlements or extinguishes a trust Other Stamp Duty Changes

6  Exploration licences and exploration retention licences will be “land” for purpose of stamp duty ­Direct conveyances and land holder acquisitions ­Transitional provisions ­Concession will be provided when conveyed pursuant to a “farm-in agreement” Other Stamp Duty Changes

7  “Farm-in agreement” ­What is a farm-in agreement? ­Dutiable value of an interest in an exploration licence acquired pursuant to a farm-in agreement ­Transitional provisions Other Stamp Duty Changes

8  Ensure stamp duty is required to be paid on the transfer of a mining tenement before it is entered in a mining register Other Stamp Duty Changes

9  Interest rate applied to a first home owner grant debt aligned with the interest rate provided in the Taxation Administration Act  Time in which to commence a prosecution under the First Home Owner Grant Act increased to 5 years Home Incentive Scheme Changes

10  Misleading information provision under the First Home Owner Grant Act redrafted to ensure that it is an offence where misleading information is provided ­Defence aligned with that in the Taxation Administration Act Home Incentive Scheme Changes

11  Clarify joint and several liability of group members  Reinstate that the stamp duty exemption on the conveyance of property from a trustee of a non-discretionary trust to a beneficiary is only available where no valuable consideration is given Consequential Amendments

12  Clarify when the TRO can provide revenue-related information  Allow the Commissioner to excuse a conveyee from the residence requirements provided there are special reasons to do so ­Only applies where are two or more conveyees and at least one conveyee will fulfil the requirements Consequential Amendments

13  Minor consequential amendments to update obsolete references as a result of the introduction of the new Taxation Administration Act Consequential Amendments

14  Stamp duty rates reduction  Exploration licences ‘land’  Abolition of nominal deed duty (except for trusts)  Home ownership incentive schemes alignments  Consequential amendments Summary

15  For more information see: RC-GEN-008: Budget Amendments or More information

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17 Budget Revenue Measures – Part 2 Kevin Phang

18  The information in this presentation is based upon the Pay-roll Tax Amendment (Harmonisation) Bill 2008  The presentation outlines measures in the Bill  It is not a platform for policy debate Payroll Tax Measures

19  Pay-roll Tax Amendment (Harmonisation) Bill ­Rate reduction ­Harmonisation measures ­Effective 1 July 2008 Overview

20  Payroll tax rate reduction ­Rate currently 6.2% ­Rate to reduce to 5.9% ­From 1 July 2008 Rate Reduction

21  Lodgement and payment dates  Motor vehicle allowances  Accommodation allowances  Fringe benefits  Superannuation  Work performed in another country  Employee share schemes  Grouping National Project – Eight Areas

22  Exemption based on ATO rate  rate is 70 cents per business km  Amounts above exempt component remain taxable Motor Vehicle Allowances

23  Exemption based on ATO rate  2008/09 rate about $200 per day  Amounts above exempt component remain taxable Accommodation Allowances

24  Currently taxed on the full value  From 1 July 2008, taxed as a fringe benefit  Concessional FBT value Living Away From Home Allowances

25  Wages paid in NT for services performed in another country >6 months fully exempt  Includes first 6 months  Previously tax on the first 6 months wages Work Performed in Another Country

26  New rules for taxing shares and options  Shares/options liable on the relevant day ­when share/option granted to employee; or ­when share/option vests with the employee (employer can choose the day) Employee Share Acquisition Schemes

27  Refund available where tax paid on grant of share/option and the grant is rescinded  New nexus rules ­NT registered/incorporated company; or ­Services performed wholly in the NT  Grant of a unit in a unit trust scheme to be taxed as a fringe benefit Employee Share Acquisition Schemes

28  Parent and subsidiary corporations  Inter-use of employees  Controlling interests (more than 50%) ­Directors ­Shareholdings ­Partnership entitlements ­Entitlement of beneficiaries Grouping

29  Definition of “business” aligned  Common test for grouping by inter-use of employees  Common test for determining controlling interests ­directors ­shareholdings ­partnership entitlements ­entitlement of beneficiaries  Tracing of interests in corporations Grouping

30  Excluding a person from a group ­discretion broadened ­inter-use of employees ­common directors, shareholdings ­partner or beneficiary entitlements  Exception for related corporations remains Grouping

31  Entity grouped with a corporation in which the entity has a controlling interest  Entity = person or associated persons  Direct interest – based on voting power  Indirect interest  Aggregate interest Grouping – Tracing Provisions

32  Entity = person or set of associated persons  Associated persons includes ­direct family members ­corporations which family has a majority shareholding ­related corporations Grouping – Tracing Provisions

33  Direct interest – where an entity can exercise voting power of shares  Indirect interest – where an entity is linked to Corp B by the entity’s direct interest in Corp A  Corp A has a direct or indirect interest in Corp B Grouping – Tracing Provisions

34 Entity has 80% in Corp A Corp A has 70% in Corp B  Entity has a direct interest in Corp A  Corp A has a direct interest in Corp B  Entity has an indirect interest in Corp B  Value of indirect interest = 80% x 70% = 56% Grouping – Tracing Provisions

35  Aggregate interest exists where an entity has: ­A direct and indirect interest in a Corp; or ­Two or more indirect interests in a Corp  Aggregate interest is the sum of the entity’s direct and indirect interests in the Corp Grouping – Tracing Provisions

36 Entity has 25% in Corp A Entity has 40% in Corp B Corp A has 50% in Corp B  Entity has indirect interest in Corp B 25% x 50% = 12.5%  Entity’s aggregate interest in Corp B = 12.5% + 40% = 52.5% Grouping – Tracing Provisions

37  Commonwealth amended its superannuation legislation  Now known as ‘employment termination payments’ Termination Payments

38  Rate reduction  Harmonisation  Allowances  Work performed in another country  Employee share schemes  Grouping including tracing  ETPs Summary

39  For more information see: RC-PRT-001: Payroll Tax Changes or More information

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