Monthly Technical roundup - April 2018

News and legislation

Tuesday 24 April 2018

Welcome to the April technical roundup. An item of note is the release of draft legislation and regulations to support an industry funding model for the regulatory services provided by the Australian Securities and Investments Commission (ASIC). The proposed model includes a substantial increase in the registration fee for self managed superannuation fund (SMSF) auditors.

Legislative updates

The following legislative instruments were recently registered:

Superannuation member account reporting

  • Taxation Administration Member Account Attribute Service – the Reporting of Information relation to Superannuation Account Phases and Attributes 2018 sets out the way in which superannuation funds (other than SMSFs) are required to give information to the Australian Taxation Office (ATO) in relation to individuals’ superannuation accounts.
  • From 1 April 2018, funds will be required to report this information by a Member Account Attribute Service (MAAS) form. The MAAS will be required to be lodged no later than five business days after an account is opened or the account changes phases eg moves from accumulation to retirement phase.
  • To support the implementation of MAAS, transitional rules will apply from 1 April 2018 to 31 October 2018, with the first MAAS to be lodged no later than five business days from 31 October 2018.

Employment termination payments

  • Income Tax Employment Termination Payments (12 month rule) Determination 2018 extends the definition of employment termination payment to include certain payments that are received more than 12 months after the termination of an individual’s employment.
  • The extended definition will apply where the payment was delayed due to legal action regarding the individual’s entitlement to the payment or the amount of the payment. The legal action must have been commenced within 12 months of termination of employment.
  • This instrument commenced on 29 March 2018.

Regulator views

Tax treatment of cryptocurrency

  • The ATO commenced a consultation seeking feedback on compliance issues that may arise in relation to cryptocurrency (eg Bitcoin) transactions. Feedback was specifically requested in relation to:
    • Capital gains tax (CGT) record-keeping for cryptocurrency transactions in order to calculate and substantiate capital gains and losses arising from a CGT event
    • Practical compliance issues in exchanging one cryptocurrency for another cryptocurrency. The ATO considers this to be the disposal of one CGT asset and acquisition of another CGT asset, with transactions to be accounted for in Australian dollars for tax purposes.
  • Submissions were due by 20 April 2018.
  • The ATO has previously issued a number of Taxation Determinations (see TD 2014/25, TD 2014/26 and TD 2014/27) regarding the income tax treatment of Bitcoin.

Policy updates

Industry funding model for ASIC

  • Draft legislation has been released for consultation to increase the maximum fees ASIC can charge to recover the costs of providing regulatory services to specific entities (eg Australian Financial Services Licencees) and SMSF auditors.
  • The draft legislation also permits ASIC to charge fees in relation to an application to vary, revoke or cancel an SMSF auditor’s registration.
  • The consultation also includes draft regulations that:
    • prescribe the fees that ASIC can charge for specific regulatory services
    • establish a tiering regime to ensure fees are based on the complexity of the services provided
    • update the hourly rate that ASIC charges
    • provide that indexation will only apply to registry fees, not regulatory fees
  • In relation to SMSF auditors, the draft regulations set the fees for applying:
    • for registration as an approved SMSF auditor at $1,927 (an increase from its current rate of $107)
    • to revoke or vary an auditor registration at $1,028
    • to cancel an auditor registration at $899
  • Submissions are due by 1 May 2018.

Other news

Private health insurance rebate for 2018/19

  • The Department of Health has published details of the private health insurance rebate applicable from 1 April 2018 to 31 March 2019.
  • From 1 April 2018, the maximum rebate reduced to:
    • 25.415 per cent for those under age 65
    • 29.651 per cent for those aged 65 to 69
    • 33.887 per cent for those aged 70 or more

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