The Commissioner of Taxation, Chris Jordan, gives notice of the following Rulings, copies of which can be obtained from ato.gov.au/law.
NOTICE OF RULINGS |
Ruling number | Subject | Brief description |
CR 2019/62 | Placard Pty Ltd – early retirement scheme 2019 | The Ruling sets out tax consequences of an early retirement scheme implemented by Placard Pty Ltd. The Ruling applies from 9 October 2019 to 30 June 2020. |
CR 2019/63 | Ruralco Holdings Limited – Exempt Employee Share Plan shares disposed of under scheme of arrangement | The Ruling sets out the Commissioner’s opinion on the ending of the ‘minimum holding period’ requirement in subsection 83A‑45(4) of the Income Tax Assessment Act 1997 for shares acquired in the 2017 and 2018 income years under the Ruralco Holdings exempt employee share plan. The Ruling applies from 1 July 2019 to 30 June 2020. |
CR 2019/64 | Ruralco Holdings Limited – Scheme of Arrangement and payment of Special Dividend | The Ruling sets out the tax consequences of the special dividend paid and the scheme of arrangement under which Agrium Australia Pty Ltd acquired 100% of the shares in Ruralco Holdings Limited on 30 September 2019. The Ruling applies from 1 July 2019 to 30 June 2020. |
CR 2019/65 | Fleetcare Pty Ltd telematics product – use for FBT car logbook and odometer records | The Ruling sets out when Fleetcare Pty Ltd Vehicle Telematics Product can be used to reduce the operating costs in both a logbook and non-logbook year of tax for the purposes of calculating the fringe benefits tax taxable value of a car fringe benefit using the cost basis method. The Ruling applies from 1 April 2019 to 31 March 2024. |
CR 2019/66 | Entwined Signage Pty Ltd in-Vehicle Monitoring System – use for car logbook and odometer records | The Ruling sets out when the Entwined Signage Pty Ltd in-Vehicle Monitoring System can be used to reduce the operating costs in both a log book and non‑logbook year of tax for the purposes of calculating the fringe benefits tax taxable value of a car fringe benefit using the cost basis method. The Ruling applies from 1 April 2019 to 31 March 2023. |
NOTICE OF ADDENDUM |
Ruling number | Subject | Brief description |
CR 2017/64 | Fuel tax credits: clients of Navman Wireless Australia Pty Ltd who use the FTC Claim Reports information showing litres allocated according to travel generated by FTC Manager as a record for fuel tax credit purposes | The Addendum amends Class Ruling CR 2017/64 to update the description of the scheme. The Addendum applies on and from 1 October 2019. |
Overview
The Commissioner of Taxation, Chris Jordan, issued a series of rulings and an addendum to address specific tax issues arising from particular corporate schemes and arrangements. Enacted under the authority of the Australian Parliament, these rulings aim to clarify the tax consequences and obligations of businesses and their employees in relation to specific transactions. For instance, Ruling CR 2019/62 addresses the tax implications of an early retirement scheme by Placard Pty Ltd, while Ruling CR 2019/63 concerns the ending of the 'minimum holding period' requirement for shares acquired under the Ruralco Holdings exempt employee share plan. Each ruling is designed to provide certainty and compliance guidance to affected entities, ensuring that they meet their tax obligations under the Income Tax Assessment Act 1997. The rulings apply for specified periods, ranging from 9 October 2019 to 31 March 2024, ensuring that businesses can plan and act with confidence during these timeframes.
Scope and Application
The Commissioner of Taxation has issued several rulings that provide clarification on specific tax matters in relation to particular companies and schemes. Ruling CR 2019/62 applies to Placard Pty Ltd and outlines the tax consequences of an early retirement scheme implemented by the company, effective from 9 October 2019 to 30 June 2020. Ruling CR 2019/63 pertains to Ruralco Holdings Limited and the ending of the 'minimum holding period' requirement for shares acquired under the exempt employee share plan for the 2017 and 2018 income years, effective from 1 July 2019 to 30 June 2020. Ruling CR 2019/64 addresses the tax consequences of a special dividend paid and the scheme of arrangement under which Agrium Australia Pty Ltd acquired 100% of the shares in Ruralco Holdings Limited, effective from 1 July 2019 to 30 June 2020. Ruling CR 2019/65 concerns the use of Fleetcare Pty Ltd Vehicle Telematics Product for FBT car logbook and odometer records, effective from 1 April 2019 to 31 March 2024, while Ruling CR 2019/66 deals with the use of the Entwined Signage Pty Ltd in-Vehicle Monitoring System for the same purpose, effective from 1 April 2019 to 31 March 2023. An addendum to Ruling CR 2017/64 updates the description of the scheme for fuel tax credits for clients of Navman Wireless Australia Pty Ltd, effective from 1 October 2019. These rulings apply to the specific entities and schemes mentioned, with no broader application to other companies or industries unless explicitly stated.
Key Provisions
The Commissioner of Taxation has issued several rulings that provide clarity on specific tax scenarios for various entities. The ruling CR 2019/62 (paragraph 1) addresses Placard Pty Ltd’s early retirement scheme, detailing the tax implications of this scheme for the period between 9 October 2019 and 30 June 2020. Similarly, ruling CR 2019/63 (paragraph 2) pertains to the termination of the 'minimum holding period' requirement for shares acquired under Ruralco Holdings Limited’s exempt employee share plan for the income years 2017 and 2018. This ruling is effective from 1 July 2019 to 30 June 2020. Ruling CR 2019/64 (paragraph 3) explains the tax consequences of a special dividend paid and the scheme of arrangement under which Agrium Australia Pty Ltd acquired all shares in Ruralco Holdings Limited on 30 September 2019, effective from 1 July 2019 to 30 June 2020. Additionally, ruling CR 2019/65 (paragraph 4) clarifies when the Fleetcare Pty Ltd telematics product can be used to reduce operating costs for fringe benefits tax purposes, from 1 April 2019 to 31 March 2024. Lastly, ruling CR 2019/66 (paragraph 5) provides similar guidance for the Entwined Signage Pty Ltd in-vehicle monitoring system, applicable from 1 April 2019 to 31 March 2023.
These rulings impose specific obligations on the entities mentioned. Placard Pty Ltd must adhere to the tax consequences outlined in ruling CR 2019/62 for their early retirement scheme. Ruralco Holdings Limited must follow the guidelines set forth in rulings CR 2019/63 and CR 2019/64 for their exempt employee share plan and the scheme of arrangement with Agrium Australia Pty Ltd. Fleetcare Pty Ltd and Entwined Signage Pty Ltd must ensure their telematics and in-vehicle monitoring systems are used in accordance with the respective rulings CR 2019/65 and CR 2019/66 for fringe benefits tax purposes. Furthermore, Navman Wireless Australia Pty Ltd must update their scheme description as per the addendum to ruling CR 2017/64, effective from 1 October 2019.
Failure to comply with these rulings could result in various consequences. While the specific offences and penalties are not detailed in the rulings themselves, non-compliance generally may lead to penalties for incorrect tax assessments, which can include fines and interest on unpaid taxes. In severe cases, legal action might be taken against the entities involved. It is crucial for the entities to understand and adhere to the specific tax implications and requirements outlined in these rulings to avoid potential penalties and legal repercussions.