Date posted: 25/09/2019 5 min read

Have your say: open Australian consultation items

Have your say on upcoming consultations and learn about what we’ve been doing to help improve the tax profession and further the public interest.

In brief

  • The CA ANZ Tax Team would like to hear from members on its upcoming submissions
  • Members are encouraged to share their comments

We want your input

Agenda items are currently being sought for up-coming meetings of the ATO's:

  • Small Business Stewardship Group, and
  • Private Groups Stewardship Group.

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ATO says you must feel the love to escape commercial debt forgiveness rules. Do you agree?

Draft TD 20019/D9 does a u-turn on the ATO’s interpretation of s245-40(e) ITAA 1997 (previously expressed in Withdrawn ATO ID 2003/589 Commercial debt forgiveness - can a company forgive a debt for reasons of natural love and affection?). This provision excludes from the scope of the commercial debt forgiveness rules a debt forgiven for reasons of natural love and affection. 

The scenario that concerns us is where the shareholder \ directors (i.e. real people) of a company which has lent money to an individual resolve to later forgive the commercial debt. The small business sector and farming communities typically provide the most common examples of such arrangements.

The literal interpretation of s245-40(e) does not require that the creditor be a natural person, only that the reason for forgiveness be 'natural love and affection'. But TD 2019/D9 now says: “The notion of forgiveness is confined by the use of 'natural love and affection'. That term serves to identify the motivation for the forgiveness. The requisite connection between that motivation and the forgiveness can only be satisfied when the creditor feels the natural love and affection.” [Emphasis added]

Comments close:  Friday 25 October 2019.

ATO seeking feedback on Company Tax Return instructions

The ATO is currently seeking advice and feedback on improving the Company Tax Return (CTR) instructions. The intention is to review and revise the CTR instructions and make modifications to:

  • improve the online useability
  • remove duplicate information
  • streamline the guidance to assist in more timely preparation and completion of the CTR.

The Tax advocacy team wants to understand from members what works well and what doesn’t so we can provide feedback to the ATO. .