Notice of Rulings 21 February 2024
The Commissioner of Taxation, Chris Jordan, gives notice by notifiable instrument under subsection 358-5(4) of Schedule 1 to the Taxation Administration Act 1953 of the following public rulings, copies of which can be obtained from ato.gov.au/law
NOTICE OF RULINGS |
Ruling number | Subject | Brief description |
TR 2024/2 | Income tax: when does a corporate limited partnership ‘credit’ an amount to a partner in that partnership? | This Ruling sets out the Commissioner’s view on when a corporate limited partnership ‘credits’ an amount to one of its partners within the meaning of section 94M of the Income Tax Assessment Act 1936. The Ruling applies to years of income commencing both before and after the date of issue. |
TR 2024/3 | Income tax: deductibility of self-education expenses incurred by an individual | This Ruling sets out the principles on the deductibility of self-education expenses under section 8-1 of the Income Tax Assessment Act 1997. The Ruling applies to arrangements both before and after its date of issue. |
CR 2024/9 | InvoCare Limited – employee share scheme – shares disposed of under a scheme of arrangment | This Ruling sets out the income tax consequences for employees of InvoCare Limited who participated in the Employee Share Purchase Plan to acquire ordinary shares in InvoCare Limited which were disposed of for cash consideration pursuant to a scheme of arrangement on 24 November 2023. The Ruling applies from 1 July 2023 to 30 June 2024. |
CR 2024/10 | InvoCare Limited – scheme of arrangement and special dividend | This Ruling sets out the income tax consequences of the special dividend paid and the scheme of arrangement under which Etermal Aus BidCo Pty Ltd acquired all the issued capital of InvoCare Limited which was not already held by funds managed or advised by TPG Capital Asia. The Ruling applies from 1 July 2023 to 30 June 2024. |
CR 2024/11 | Incitec Pivot Limited – reduction of share capital | This Ruling sets out the income tax consequences for holders of ordinary shares in Incitec Pivot Limited who received a reduction of share capital of $0.1557 per share paid on 8 February 2024. The Ruling applies from 1 July 2023 to 30 June 2024. |
CR 2024/12 | A2B Australia Limited – special dividend | This Ruling sets out the income tax consequences for holders of ordinary shares in A2B Australia Limited who received a special dividend of $0.60 per share paid by A2B Australia Limited on 30 January 2024. The Ruling applies from 1 July 2023 to 30 June 2024. |
PR 2024/1 | FTC Automator platform – use by clients of KPMG and Geotab Australia to calculate fuel tax credits | This Ruling sets out the fuel tax credit consequences for fuel tax credit clients of KPMG and Geotab Australia Pty Ltd or its affiliates in Australia that specifically use the FTC Automator platform. The Ruling applies to taxable fuel acquired on or after 1 July 2023 by the class of entities specified in the Ruling that enter into the scheme for the fuel tax credit results from the FTC Automator from 1 July 2023 until 31 December 2024. |
NOTICE OF ADDENDUM |
Ruling number | Subject | Brief description |
TR 2005/13 | Income tax: tax-deductible gifts – what is a gift | This Addendum amends Taxation Ruling TR 2005/13 to remove the reference to Subdivision 30-D of the Income Tax Assessment Act 1997 as this subdivision was repealed by the Tax Laws Amendment (2011 Measures No. 9) Act 2012. The Addendum applies from 21 March 2012. |
Overview
The Commissioner of Taxation, Chris Jordan, has issued a notifiable instrument under the Taxation Administration Act 1953, providing notice of several public rulings and an addendum that offer clarification on various income tax matters. These rulings and the addendum aim to assist taxpayers in understanding their obligations and entitlements under the tax law. For example, TR 2024/2 explains when a corporate limited partnership credits an amount to a partner, while TR 2024/3 outlines the deductibility of self-education expenses. Specific rulings also address the tax implications of particular corporate actions, such as the reduction of share capital or special dividends for companies like Incitec Pivot Limited and A2B Australia Limited. The addendum to TR 2005/13 updates the ruling to reflect changes in the law since its original publication. These notices ensure that taxpayers have access to the most current interpretations of the tax law as it applies to their circumstances.
Scope and Application
The Notice of Rulings issued by the Commissioner of Taxation on 21 February 2024 under the Taxation Administration Act 1953 provides clarity and guidance on various income tax issues affecting both corporate entities and individual taxpayers. These rulings, which can be accessed via the ATO website, cover a range of scenarios including the timing of credits by corporate limited partnerships to their partners, the deductibility of self-education expenses, and specific tax consequences arising from certain corporate actions such as share reductions, schemes of arrangement, and special dividends. These rulings apply to financial years starting both before and after the date of the rulings, with some rulings applying to a specific period between 1 July 2023 and 30 June 2024. Additionally, there is a ruling addressing the use of the FTC Automator platform for calculating fuel tax credits, applicable to fuel acquired on or after 1 July 2023 until 31 December 2024 for specified entities. The geographic reach of these rulings is national, applying across Australia, and they do not specify any exclusions, exemptions, or thresholds beyond the scope of the specific transactions and entities they address.
Key Provisions
The Commissioner of Taxation, Chris Jordan, has issued a notifiable instrument providing public rulings and an addendum under the Taxation Administration Act 1953, detailing specific tax matters that taxpayers and businesses can rely upon. The rulings and addendum cover various income tax issues, including when a corporate limited partnership credits an amount to a partner (TR 2024/2), the deductibility of self-education expenses (TR 2024/3), and specific tax consequences for certain companies and their shareholders (CR 2024/9 to CR 2024/12, and PR 2024/1). An addendum has also been provided to amend TR 2005/13 regarding tax-deductible gifts by removing a reference to a repealed subdivision (TR 2005/13 Addendum).
These rulings and the addendum impose obligations on taxpayers and businesses to ensure compliance with the specified income tax rules. For instance, taxpayers must correctly apply the principles set out in TR 2024/2 when determining when a corporate limited partnership credits an amount to a partner. Similarly, individuals and businesses must adhere to the deductibility criteria for self-education expenses as outlined in TR 2024/3. Companies and their shareholders must also comply with the specific tax consequences detailed in the various company-specific rulings (CR 2024/9 to CR 2024/12) and the fuel tax credit ruling (PR 2024/1). The addendum to TR 2005/13 requires taxpayers to update their understanding of what constitutes a tax-deductible gift by removing the reference to the repealed subdivision.
Breaches of these rulings and the addendum can result in various consequences, including the disallowance of deductions or credits, additional assessments, and penalties. For example, if a taxpayer fails to correctly apply the principles in TR 2024/2, the Commissioner may disallow any credits claimed that do not meet the criteria, potentially leading to additional tax assessments. Similarly, failure to adhere to the deductibility criteria in TR 2024/3 could result in the disallowance of deductions for self-education expenses. Companies and their shareholders must also ensure compliance with the specific tax consequences outlined in the company-specific rulings (CR 2024/9 to CR 2024/12) and the fuel tax credit ruling (PR 2024/1), with breaches potentially leading to additional tax liabilities or penalties. The maximum penalties for non-compliance with these rulings and the addendum can vary, but generally include fines and interest on any additional tax owed.