R&D tax incentive to apply to certain clinical trials
The Federal Government has announced that investment in clinical trials for therapeutic goods will be eligible for the Research and Development Tax Incentive (R&D Tax Incentive). This will result in “phase 0-III clinical trials” being eligible for the incentive. In addition, there will be a simplified registration process, making it easier and faster for businesses to invest in clinical trials. For further details of the draft determinations that will give effect to these proposed measures and for feedback purposes, see here.
ATO Decision Impact Statement: MJ and IT Holdings Pty Ltd
The ATO has released its Decision Impact Statement to the AAT’s decision in MJ and IT Holdings Pty Ltd v FCT [2021] AATA 3250. The case concerned whether recording an increase in a company loan liability in favour of the Director constituted a constructive payment under section 11-5 of Sch 1 to the TAA 1953 and whether the making of that record constituted a scheme under s 5(1)(g) of the Boosting Cash Flow for Employers (Coronavirus Economic Response Package) Act 2020. The AAT found that there was a constructive payment but that the making of that payment constituted a scheme. The ATO disagrees with the AAT’s reasoning on the constructive payment issue notwithstanding that the ultimate decision in the case was favourable to the Commissioner. The decision has not been appealed.
TSA and SISFA submission re TBAR for SMSFs.
Tax and Super Australia and The Self-managed Independent Superannuation Funds Association (SISFA) have provided a joint submission to the ATO on streamlining the transfer balance cap event-based reporting arrangements for SMSFs. We believe that reporting transfer balance events to the ATO is an important process. Our view is that transfer balance account reporting (TBAR) should remain on an annual basis, whilst still providing SMSFs with the option to report events as they occur rather than waiting for the due date. Moving to an annual reporting framework would reduce red tape and allow SMSFs to complete all their reporting at once – eg tax return, financial statements and TBAR. Despite our preference for annual reporting, if the current quarterly regime is retained, we believe that SMSFs should be given until 1 July 2023 to report events to the ATO to allow SMSFs sufficient time to adjust to the more frequent quarterly reporting regime.
Refunds of Visa Application Charges
The Federal Government has announced that, among other related measures, Working Holiday Maker visa holders who are currently offshore and come to Australia during the next 12 weeks will be eligible for a refund of their Visa Application Charge. Likewise, any Student visa holder who is currently offshore and comes to Australia over the next 8 weeks, will be eligible for a refund of their Visa Application Charge. The current Visa Application Charge for a student is $630 and for a Working Holiday Maker it is $495.
