Notice of Rulings, Notice of Addendum

Overview

The Commissioner of Taxation, Chris Jordan, issued Rulings and an Addendum in 2017, as part of the ongoing efforts to provide clarity on specific tax matters for taxpayers in Australia. This was in response to the need for clear guidance on complex tax issues related to fuel tax credits, fringe benefits tax, investment structures, and life insurance policies. The rulings were enacted by the Commissioner of Taxation, aiming to provide policy certainty and compliance guidance to taxpayers. The rulings and addendum offer definitive positions on the tax implications of certain transactions and records, ensuring that taxpayers are well-informed and can comply with their tax obligations effectively. These rulings help bridge the gap between legislative provisions and practical application, ensuring that taxpayers can navigate their tax liabilities with greater confidence and clarity.

Scope and Application

The Commissioner of Taxation has issued Rulings and an Addendum under the Commissioner of Taxation Act 1963, providing clarification on specific tax matters. Ruling CR 2017/64 pertains to clients of Navman Wireless Australia Pty Ltd who use the FTC Manager system for fuel tax credit purposes. This Ruling applies to those who are registered for goods and services tax and use FTC Manager-generated reports for claiming fuel tax credits, effective from 28 April 2017 to 30 June 2020. Ruling CR 2017/65 addresses employers using the EzyCarLog mobile application for maintaining car log books and odometer records for fringe benefits tax purposes. This Ruling applies from 1 July 2017 to 30 June 2022, and will continue to apply to entities within the specified class who entered into the scheme during the term of the Ruling. Ruling PR 2017/12 outlines the taxation consequences of investing in the UBS Structured Option and Loan Facility, applicable prospectively from 1 July 2017 to 30 June 2020, and continuing to apply to those entities for schemes entered into during the period of application. The Addendum to Product Ruling PR 2017/9 amends the initial ruling to incorporate updated Product Disclosure Statements and Policy Terms dated 19 August 2017, effective from 1 July 2017. These Rulings and the Addendum serve to provide certainty and guidance to taxpayers in relation to specific tax matters, and their application is primarily within the Commonwealth jurisdiction.

Key Provisions

The main operative sections of this notice are CR 2017/64, CR 2017/65, PR 2017/12 and the Addendum to PR 2017/9. CR 2017/64 provides guidance for clients of Navman Wireless Australia Pty Ltd who use the FTC Claim Reports information for fuel tax credit purposes. It specifies the Commissioner’s position on how these clients should record their fuel use for tax purposes. CR 2017/65 details the Commissioner’s position on employers who use the EZYCarLog mobile APP Logbook Solution for keeping car log book and odometer records. It sets out the requirements for employers to comply with fringe benefits tax obligations. PR 2017/12 outlines the taxation consequences of investing in the UBS Structured Option and Loan Facility, providing guidance on the tax treatment of such investments. The Addendum to PR 2017/9 updates the Product Ruling to incorporate new Product Disclosure Statement and Policy Terms for the OnePath Life – OneCare Policy. The obligations imposed by these rulings on the parties they govern are primarily focused on ensuring compliance with tax laws. For example, CR 2017/64 requires clients of Navman Wireless Australia Pty Ltd to accurately record their fuel use as specified, ensuring they meet their fuel tax credit obligations. CR 2017/65 mandates that employers using the EZYCarLog mobile APP must keep accurate car log book and odometer records to comply with fringe benefits tax. PR 2017/12 requires entities investing in the UBS Structured Option and Loan Facility to understand and apply the specified taxation consequences as outlined. The Addendum to PR 2017/9 updates the policy terms and disclosure statement, necessitating that entities using these products adhere to the new terms. Breach of these rulings can lead to various civil and criminal consequences. For CR 2017/64 and CR 2017/65, failure to comply with the specified record-keeping requirements could result in penalties for incorrect fuel tax credits and fringe benefits tax liabilities. The penalties for non-compliance can include fines and additional tax assessments. PR 2017/12, if not adhered to, may lead to incorrect tax assessments and potential audits by the Australian Taxation Office (ATO). Under the Income Tax Assessment Act 1997, penalties for incorrect statements and omissions can be severe, including fines and interest on unpaid taxes. The Addendum to PR 2017/9 ensures that entities must comply with the updated terms, and failure to do so could lead to disputes and potential legal action.