Budget Revenue Measures

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Budget Revenue Measures 2008-09 Part 1 Lisa
Baker
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Budget Revenue Measures

• The information provided in this presentation is
  based upon the Revenue Law Reform (Budget
  Initiatives) Bill 2008, which was introduced in
  the Legislative Assembly on 7 May 2008 as part of
  the 2008-09 Budget
• The intention of this presentation is to provide
  an overview of the measures included in the Bill,
  rather than be a platform for policy debate

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Overview

• Revenue Law Reform (Budget Initiatives) Bill
• Conveyance stamp duty rates reduction
• Other stamp duty changes
• Home incentive scheme changes
• Consequential amendments resulting from the
  introduction of the Taxation Administration Act

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Conveyance on Stamp Duty

• Conveyance stamp duty rates reduction
• From 6 May 2008
• New minimum rate 1.5 (from 2.1)
• New maximum rate 4.95 (from 5.4)
• Maximum rate will apply at 525 000 (previously
  500 000)
• Stamp duty first home owner concession on first
  385 000 of a propertys value

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Other Stamp Duty Changes

• Nominal 20 deed duty removed, other than where
  the deed relates to a trust
• Remains for deeds that constitute, vary, deal
  with interests or entitlements or extinguishes a
  trust

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Other Stamp Duty Changes

• Exploration licences and exploration retention
  licences will be land for purpose of stamp duty
• Direct conveyances and land holder acquisitions
• Transitional provisions
• Concession will be provided when conveyed
  pursuant to a farm-in agreement

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Other Stamp Duty Changes

• Farm-in agreement
• What is a farm-in agreement?
• Dutiable value of an interest in an exploration
  licence acquired pursuant to a farm-in agreement
• Transitional provisions

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Other Stamp Duty Changes

• Ensure stamp duty is required to be paid on the
  transfer of a mining tenement before it is
  entered in a mining register

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Home Incentive Scheme Changes

• Interest rate applied to a first home owner grant
  debt aligned with the interest rate provided in
  the Taxation Administration Act
• Time in which to commence a prosecution under the
  First Home Owner Grant Act increased to 5 years

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Home Incentive Scheme Changes

• Misleading information provision under the First
  Home Owner Grant Act redrafted to ensure that it
  is an offence where misleading information is
  provided
• Defence aligned with that in the Taxation
  Administration Act

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Consequential Amendments

• Clarify joint and several liability of group
  members
• Reinstate that the stamp duty exemption on the
  conveyance of property from a trustee of a
  non-discretionary trust to a beneficiary is only
  available where no valuable consideration is given

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Consequential Amendments

• Clarify when the TRO can provide revenue-related
  information
• Allow the Commissioner to excuse a conveyee from
  the residence requirements provided there are
  special reasons to do so
• Only applies where are two or more conveyees and
  at least one conveyee will fulfil the requirements

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Consequential Amendments

• Minor consequential amendments to update obsolete
  references as a result of the introduction of the
  new Taxation Administration Act

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Summary

• Stamp duty rates reduction
• Exploration licences land
• Abolition of nominal deed duty (except for
  trusts)
• Home ownership incentive schemes alignments
• Consequential amendments

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More information

• For more information see
• RC-GEN-008 2008-09 Budget Amendments
• or www.revenue.nt.gov.au

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www.nt.gov.au
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Budget Revenue Measures 2008-09 Part 2 Kevin
Phang
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Payroll Tax Measures

• The information in this presentation is based
  upon the Pay-roll Tax Amendment (Harmonisation)
  Bill 2008
• The presentation outlines measures in the Bill
• It is not a platform for policy debate

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Overview

• Pay-roll Tax Amendment (Harmonisation) Bill
• Rate reduction
• Harmonisation measures
• Effective 1 July 2008

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Rate Reduction

• Payroll tax rate reduction
• Rate currently 6.2
• Rate to reduce to 5.9
• From 1 July 2008

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National Project Eight Areas

• Lodgement and payment dates
• Motor vehicle allowances
• Accommodation allowances
• Fringe benefits
• Superannuation
• Work performed in another country
• Employee share schemes
• Grouping

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Motor Vehicle Allowances

• Exemption based on ATO rate
• 2008-09 rate is 70 cents per business km
• Amounts above exempt component remain taxable

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Accommodation Allowances

• Exemption based on ATO rate
• 2008/09 rate about 200 per day
• Amounts above exempt component remain taxable

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Living Away From Home Allowances

• Currently taxed on the full value
• From 1 July 2008, taxed as a fringe benefit
• Concessional FBT value

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Work Performed in Another Country

• Wages paid in NT for services performed in
  another country gt6 months fully exempt
• Includes first 6 months
• Previously tax on the first 6 months wages

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Employee Share Acquisition Schemes

• New rules for taxing shares and options
• Shares/options liable on the relevant day
• when share/option granted to employee or
• when share/option vests with the employee
  (employer can choose the day)

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Employee Share Acquisition Schemes

• Refund available where tax paid on grant of
  share/option and the grant is rescinded
• New nexus rules
• NT registered/incorporated company or
• Services performed wholly in the NT
• Grant of a unit in a unit trust scheme to be
  taxed as a fringe benefit

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Grouping

• Parent and subsidiary corporations
• Inter-use of employees
• Controlling interests (more than 50)
• Directors
• Shareholdings
• Partnership entitlements
• Entitlement of beneficiaries

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Grouping

• Definition of business aligned
• Common test for grouping by inter-use of
  employees
• Common test for determining controlling interests
• directors
• shareholdings
• partnership entitlements
• entitlement of beneficiaries
• Tracing of interests in corporations

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Grouping

• Excluding a person from a group
• discretion broadened
• inter-use of employees
• common directors, shareholdings
• partner or beneficiary entitlements
• Exception for related corporations remains

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Grouping Tracing Provisions

• Entity grouped with a corporation in which the
  entity has a controlling interest
• Entity person or associated persons
• Direct interest based on voting power
• Indirect interest
• Aggregate interest

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Grouping Tracing Provisions

• Entity person or set of associated persons
• Associated persons includes
• direct family members
• corporations which family has a majority
  shareholding
• related corporations

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Grouping Tracing Provisions

• Direct interest where an entity can exercise
  voting power of shares
• Indirect interest where an entity is linked to
  Corp B by the entitys direct interest in Corp A
• Corp A has a direct or indirect interest in Corp B

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Grouping Tracing Provisions

• Entity has 80 in Corp A
• Corp A has 70 in Corp B
• Entity has a direct interest in Corp A
• Corp A has a direct interest in Corp B
• Entity has an indirect interest in Corp B
• Value of indirect interest 80 x 70 56

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Grouping Tracing Provisions

• Aggregate interest exists where an entity has
• A direct and indirect interest in a Corp or
• Two or more indirect interests in a Corp
• Aggregate interest is the sum of the entitys
  direct and indirect interests in the Corp

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Grouping Tracing Provisions

• Entity has 25 in Corp A
• Entity has 40 in Corp B
• Corp A has 50 in Corp B
• Entity has indirect interest in Corp B
• 25 x 50 12.5
• Entitys aggregate interest in Corp B 12.5
  40 52.5

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Termination Payments

• Commonwealth amended its superannuation
  legislation
• Now known as employment termination payments

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Summary

• Rate reduction
• Harmonisation
• Allowances
• Work performed in another country
• Employee share schemes
• Grouping including tracing
• ETPs

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More information

• For more information see
• RC-PRT-001 2008-09 Payroll Tax Changes
• or www.revenue.nt.gov.au

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www.nt.gov.au