The ATO seems to be always looking over the shoulder of property developers to make sure they are complying with their tax obligations.

The considerations facing the ATO are many and varied, but can include topics such as whether an agreement to develop and sell land is a “mere realisation” or a disposal either in the course of a business or as part of a profit making undertaking or plan.

A “mere realisation” is a sale on capital account to which the capital gains tax (CGT) rules will generally apply. Landholders will usually seek this treatment if they can access CGT concessions (for example, applying the appropriate CGT discount or the small business CGT concessions) or the property is a pre-CGT asset.

If a child is under the age of 18, and they earn income on their savings account, remember that the ATO considers that the person who “owns” the interest depends on who uses the funds of that account (no matter what type of account it is or the name of the account holder).

Inheriting a home or a legal interest in one could be the largest windfall gain that many Australians ever experience. From a tax law perspective, when someone dies a capital gain or loss does not apply when a property passes:

• to the deceased person’s beneficiary
• to the deceased person’s executor or other legal personal representative (LPR), or
• from the deceased’s LPR to a beneficiary.

The ATO is reminding rental property owners that each year it sees some fairly common mistakes being made with tax claims, and the outcomes that result, in regard to investment properties. It has therefore released a list of the top 10 stumbles, and how best to avoid them.

For small business owners who are disposing of assets that have risen in value during the time they have owned and used them in their business, accessing one or more of the available small business capital gains tax (CGT) concessions can greatly reduce any consequent tax liability. Indeed, many small business owners find they can reduce possible CGT liabilities to zero. For example, you can reduce the capital gain on an active asset by 50%, and in addition claim the general 50% CGT discount (which is available after owning any CGT asset for 12 months or more). However one critical condition

Most people’s “to-do” list when they are planning a trip overseas will likely include items such as travel insurance, phone chargers or taking photos of their passport — but probably the last thing on anyone’s minds will be their likely tax situation before, during or after that trip-of-a-lifetime. However a few simple considerations, taken in the context of your personal circumstances, may end up making quite a difference to your final fiscal outcome. Generally you will remain an Australian resident for tax purposes if you're overseas temporarily and you don't set up a permanent home in another country. There’s usually

The small business income tax offset (also known as the unincorporated small business tax discount) can reduce the tax a sole trader business pays by up to $1,000 each year. The offset is worked out on the proportion of tax payable on business income. To be eligible, a taxpayer must be carrying on a small business as a sole trader, or have a share of net small business income from a partnership or trust, and have an aggregated turnover of less than $5 million. The rate of the offset is 8% up to the end of the 2019-20 income year, but will

A new ruling has been released by the ATO on the deductibility or otherwise of “penalty interest”. The term penalty interest refers to an amount payable by a borrower under a loan agreement when the lender agrees to an early repayment of a loan. The amount payable is commonly calculated by reference to the number of months of interest payments that would have been received but for the early payment. The ATO ruling stresses that the deductibility or otherwise of penalty interest needs to be determined based on case-by-case circumstances. Another consideration the ATO also emphasises is that different provisions