Unpaid Trust Distributions: ATO's Rulings vs. Recent AAT Decision and What It Means for 2023
It has long been the ATO’s practice to treat a trust’s unpaid present entitlements (“UPE”) to a company as a loan for th...
There are varied viewpoints generated by this year’s Federal Budget, putting aside the potential political context and any discussion concerning the economic and social impact will be dependent on the status of the reviewer.
In simplistic terms, the highlights of the 2022 Budget are:
Not unexpectedly, the Budget did not contain any significant new business measures, other than the extension of the prior year’s patent box for agricultural innovations. What the Government has provided, says the Treasurer, is the delivery of the economic promises made over the last few years. That is, good economic management, manageable national debt having regard to Covid support measures provided and an economic environment that provides good employment opportunities and anticipated strong wage growth.
Suffice it to say, there was no appetite for any major tax reform in this year’s Budget however at some point of time in the near future there is a continuing and concerning need for Government’s tax policy to address the Government’s substantial reliance on revenue from personal tax vis a vis company tax, or GST. By way of illustration
Total government receipts were $548bn of which:
The ongoing reliance on revenue from personal tax has long been identified as a structural taxation problem. This reliance on personal tax, increases the tax burden on individuals and limits the Government’s capacity to embark on broader social issues. Arguably this also inappropriately results in fewer individuals carrying a greater burden to fund social and welfare policies of the Government. Having said that, the obvious solution would be to reconsider the rate and application of GST, however, all GST revenues are allocated to the State Government. If Australia’s response to Covid has illustrated anything that is the difficulty of the State Governments to adopt a coordinated approach to Federal issues.
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Brian Richards LLB B/Bus CTA FCA FCPA Ulton's Senior Taxation Specialist, Brian Richards shares his opinion on how the 2022 Federal Budget will shape the nation and impact you, your savings, your business and the community. |
If you have any questions or concerns about the proposals from the Federal budget announcements, please contact your Ulton Advisor to discuss.
Want to learn more about the other announcements from the 2022 budget? Click on the links below to go through to the specific summary or view the entire budget summary here.
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