Australian Taxation Office

On 11 July 2018, the ATO published draft Tax Ruling TR 2018/D2 – Fringe benefits tax: benefits provided to religious practitioners.

The public is invited to provide feedback to TR 2018/D2 until 24 August 2018.

On the same date TR 2018/D2 was published, the ATO’s previous Tax Ruling on this topic – TR 92/17 – which was published in 1992 was withdrawn.

Since 1992, there have been numerous changes to both the law and to the nature of contemporary religious practice – the most significant of which is the establishment of the Australian Charities and Not-for-profits Commission (ACNC) in 2012.

The establishment of the ACNC means that determining whether an entity is a religious institution is now as simple as checking whether it has been registered as a charity with an “advancing religion” sub-type.

TR 2018/D2 contains a number of examples of contemporary real life scenarios to help understand whether benefits provided to religious practitioners are in respect of their pastoral duties or for directly related religious activities and therefore exempt from fringe benefits tax.

Although TR 2018/D2 is still in draft Ruling, the ATO has advised that it may be relied upon to the extent that if a person underpays tax as a result of them relying upon the
Ruling, they will still have to pay the correct amount of tax once known but will not have to pay any interest or penalties that would otherwise be applicable.

Please don’t hesitate to contact us if you would like to discuss the draft Ruling or its application to you or if you would like any help submitting feedback to the draft Ruling.

The ATO has released the Draft Special Conditions Ruling TR 2014/D5 – Income Tax: special conditions for various entities whose ordinary and statutory income is exempt

 

 

 

 

 

In August the ATO released draft ruling TR 2014/D5 regarding the proposed application of special conditions inserted by the Tax Laws Amendment (2013 Measures No. 2) Act 2013.
The special conditions require that:
  • An entity must comply with all the substantive requirements in its governing rules (Governing Rules Condition); and
  • An entity must apply its income and assets solely for the purpose for which the entity is established (Income and Assets Condition).

What organisations or entities does the ruling apply to?

The ruling applies to a number of income tax exempt entities (but not all) which are listed at Section 50 of the Income Tax Assessment Act 1997 (ITAA).

Continue Reading ATO releases Draft Special Conditions TR2014/D5