Notice of Rulings 16 June 2021

Overview

The Taxation Administration Act 1953, enacted by the Parliament of Australia, addresses the need for clear and accessible tax rulings to ensure taxpayers understand their obligations and rights. The act empowers the Commissioner of Taxation to issue public rulings that provide detailed explanations of complex tax issues. These rulings are published to enhance transparency and assist taxpayers in complying with the law. The notifiable instrument F2021N00119, issued on 16 June 2021, notifies the public of specific rulings and addenda concerning fringe benefits tax for car parking and the taxation consequences of investing in particular schemes. The policy objective is to provide clarity and certainty in tax matters, thereby facilitating compliance and reducing disputes.

Scope and Application

The Notifiable Instrument F2021N00119 issued on 16 June 2021 by the Commissioner of Taxation, Chris Jordan, under subsection 358-5(4) of Schedule 1 to the Taxation Administration Act 1953, encompasses two public rulings that pertain to fringe benefits tax and income tax. These rulings provide clarity on specific tax obligations and consequences for various entities and individuals. The rulings apply to taxpayers, investors, and entities involved in the specified schemes and transactions, covering the provision of car parking benefits under the fringe benefits tax legislation and the taxation consequences of investing in the Aberdeen Standard Authorised Contractual Scheme I and the C2 Gateway Deferred Purchase Agreement. The rulings are effective from the dates specified in each ruling and extend to any relevant transactions occurring before or after these dates. The geographic reach of these rulings is national, applying across all jurisdictions within Australia. The instrument does not explicitly state any exclusions, exemptions, or thresholds; however, the applicability of the rulings is contingent on the specific circumstances of the transactions and entities involved. The rulings may be further extended or restricted through subordinate instruments, which could provide additional guidance or modifications to the original rulings.

Key Provisions

The main sections of the Notice of Rulings issued by the Commissioner of Taxation, Chris Jordan, under the Taxation Administration Act 1953, include the formal announcements of Taxation Rulings (TR) and Public Rulings (PR) (subsection 358-5(4)). Specifically, TR 2021/2 deals with fringe benefits tax concerning car parking benefits, clarifying the circumstances under which providing car parking constitutes a car parking benefit for fringe benefits tax purposes, including the interpretation of ‘commercial car parking station’ (section 57(1)(b)). PR 2021/6 outlines the tax consequences for investors in units of the Aberdeen Standard Authorised Contractual Scheme I, which was offered under a prospectus dated 23 October 2020, effective from that date until 30 June 2023. Additionally, PR 2020/2 has been amended to reflect updates to the taxation consequences of investing in the C2 Gateway Deferred Purchase Agreement, with the addendum applying both before and after its issuance date. The obligations imposed by these rulings are primarily informative and directive. They require taxpayers and investors to understand and apply the tax consequences and definitions as set out in the rulings. For instance, employers must correctly identify when providing car parking to employees constitutes a taxable benefit under TR 2021/2. Similarly, investors in the Aberdeen Standard Authorised Contractual Scheme I must be aware of the specific tax treatments as detailed in PR 2021/6. The amendments to PR 2020/2 necessitate that investors in the C2 Gateway Deferred Purchase Agreement adjust their tax strategies accordingly. Breaching the obligations imposed by these rulings can result in serious consequences. The Taxation Administration Act 1953 provides for both civil and criminal penalties for non-compliance. Civil penalties may include fines and interest on unpaid taxes, while criminal penalties may involve imprisonment or substantial fines, depending on the severity and intent of the breach. The maximum penalties are not explicitly stated in the notice but are governed by the general provisions of the Act, which can impose significant financial and legal repercussions for non-compliance with tax rulings and determinations.