Notice of Rulings

Overview

The Commissioner of Taxation issued rulings CR 2015/7, CR 2015/8, and CR 2015/9 to provide clarity on specific income tax issues affecting certain entities and arrangements. CR 2015/7 addresses the assessability of income and expenses for clubs and societies coordinated by the University of Sydney Union, applicable from 1 July 2012 to 8 December 2019. CR 2015/8 pertains to the tax treatment of ordinary shareholders of Crowe Horwath Australasia Ltd who participated in a scheme of arrangement and received a special dividend, without being subject to the taxation of financial arrangement rules, applicable from 1 July 2014 to 30 June 2015. Lastly, CR 2015/9 deals with the fringe benefits tax implications of health and fitness equipment services provided by EFM Corporate Pty Ltd to employees, applicable from 1 April 2014 to 31 March 2021. These rulings aim to provide taxpayers with certainty and guidance on the Commissioner’s position regarding these specific tax matters.

Scope and Application

The Commissioner of Taxation has issued several rulings clarifying the tax treatment of specific transactions and entities. For instance, Ruling CR 2015/7 outlines the assessability of income and expenses for clubs and societies coordinated by the University of Sydney Union. This ruling applies to all clubs and societies established under this program, and its provisions are effective from 1 July 2012 to 8 December 2019. Another ruling, CR 2015/8, addresses the tax consequences for ordinary shareholders of Crowe Horwath Australasia Ltd who participated in a Scheme of Arrangement and received a Special Dividend, excluding those subject to the taxation of financial arrangement rules. This ruling applies to events occurring between 1 July 2014 and 30 June 2015. Furthermore, Ruling CR 2015/9 clarifies the fringe benefits tax implications for employers who provide health and fitness equipment services supplied by EFM Corporate Pty Ltd to their employees. This ruling is applicable from 1 April 2014 to 31 March 2021. The rulings aim to provide clear guidance to the relevant entities and taxpayers regarding their tax obligations under these specific circumstances.

Key Provisions

The main operative sections of these rulings provide the Commissioner’s position on specific tax matters relating to the assessability of income and expenses incurred by clubs and societies coordinated by the University of Sydney Union (section CR 2015/7), the taxation treatment of gains and losses on shares in Crowe Horwath Australasia Ltd under a scheme of arrangement (section CR 2015/8), and the fringe benefits tax treatment of health and fitness equipment services provided by EFM Corporate Pty Ltd (section CR 2015/9). Each ruling outlines the specific circumstances under which the Commissioner will apply certain tax provisions, providing clarity to the entities and individuals affected. Section CR 2015/7 sets out the Commissioner’s position on the assessability of income and expenses for clubs and societies established under the University of Sydney Union’s program. These rulings apply to entities that meet the specified criteria, ensuring they understand their tax obligations. Section CR 2015/8 addresses the tax treatment for ordinary shareholders of Crowe Horwath Australasia Ltd who participated in a specific scheme of arrangement and received a special dividend. This ruling applies to those who held their shares on capital account and were not subject to the taxation of financial arrangement rules. Finally, Section CR 2015/9 concerns the fringe benefits tax treatment of employers providing health and fitness equipment services through EFM Corporate Pty Ltd, applying to arrangements made between certain dates. These rulings impose obligations on the parties they govern by clearly outlining the tax treatment of specific income and expenses, participation in schemes of arrangement, and the provision of health and fitness equipment services. The rulings require entities and individuals to adhere to the Commissioner’s position as stated, ensuring compliance with tax laws. Failure to comply with the provisions outlined in these rulings may lead to incorrect tax assessments, which could result in penalties or additional tax liabilities. The consequences for non-compliance with these rulings can include the imposition of penalties and interest on any additional tax found to be payable. While the specific penalties are not detailed within the rulings, general tax law provides for penalties such as general interest charges and the Commissioner may pursue legal action in cases of serious non-compliance. The maximum penalties can vary depending on the nature and extent of the non-compliance, but can include fines and, in severe cases, criminal charges. It is crucial for affected parties to adhere to the rulings to avoid these potential civil and criminal consequences.