Distributing Income and Benefits: Managing Your Client's Tax Pain Points – a recorded lunchtime online conference

Duration: Approximately 2.5 Hours

Hear from the experts at this online conference. You can watch it on your computer or on your portable electronic device from anywhere.

The conference will be based on our highly successful video webinar technology: there'll be a chairperson and presentations.

One registration can be shared by colleagues within the same firm utilising the same login.

THE PROGRAM

Session 1: It Might Not be Assessable Income Now, But What About Later On?

There are various types of income an entity can receive which may be excluded from being categorised as assessable income. However, this isn’t necessarily the end of the story. What about when these amounts ultimately find their to unitholders or shareholders? This session explores some of these amounts which may or may not have tax implications at the end of the line, including:

• The tax treatment of the CGT 15-year exemption amount and the 50% active asset reduction amount, when paid from a:

• company (ongoing)
• company (in liquidation)
• unit trust

• How to treat the CGT retirement exemption amount not required to be paid into a superannuation fund, from a:

• company (ongoing)
• company (in liquidation)
• unit trust

• Income that has been subject to family trust distribution tax subsequently paid out to shareholders/unitholders
• Income from the cash flow boost
• CGT events applying to distributions from:

• managed investment trusts
• attribution managed investment trusts

• Examples of other non assessable amounts derived in a company or trust paid out to shareholders/unitholders
• Practical examples calculating CGT events C2, E4 and G1

Session 2: The Flow Through Effect and Base Rate Entities

As is commonly known, base rate entities are eligible for a lower company tax rate than what can apply for other corporate entities. However, is the tax rate affected by funds flowing in and out of a company? This session explores the issue, including:

• What is the definition of a base rate entity?
• What type of income is base rate entity passive income?
• How are capital gains accounted for in the base rate entity passive income calculation?
• How trust and partnership income is defined
• Can franked dividends streamed from a trust to a company be classified as non-portfolio dividends?
• How to calculate the correct company tax rate for:

• bucket companies
• holding companies

• The effects on imputation credits
• Practical examples from LCR 2019/5

Session 3: Division 7A: The ATO are Digging Deeper

It is well known that Division 7A can apply to distributions or benefits provided by a company to a shareholder or associate, or a company that has an unpaid present entitlement from a trust. What is not as well known is that the reaches of the deemed dividend rules can extend to situations where those distributions or benefits flow through interposed entities. This session delves into how these type of situations can play out, including:

• Are the deemed dividend rules via an interposed entity self triggering or audit initiated and what are the reporting obligations? (section 109T)
• What is the “reasonable person” test?
• What are the exclusions?
• When will loan repayments to a company not be taken into account as reducing the original loan? (section 109R)
• What is the ATO policy on triggering section 109T? (TD 2011/16 TD 2018/13)
• How does the “intercompany payments and loans not treated as dividends” rule under section 109K interact with section 109T?
• What situations may an application for the Commissioner’s discretion to disregard a deemed dividend be plausible?
• Practical examples