Last week myself, Jodie, Chrissy, Rebbeca and Lynlea made the trek up the Bruce Highway to one of the most beautiful parts of the world Noosa as delegates of the Noosa Tax Retreat hosted by the Taxation Institute of Australia.
Whilst I am sure there are plenty of other interesting things to do in Noosa we listened to some of the brightest minds in tax provide their insights and expertise in the areas of superannuation, estate planning, structuring and business succession.
Some of the key take aways from this year’s conference were as follows:
- A continuing trend in the use of companies (as opposed to trusts) for both business and investment structures. With a reduction in the small business company tax rate to 25% (30% for investment companies) and the simplicity of changing ownership through shareholding means companies in most circumstances are the preferred trading structure.
- The movement of wealth between generations if not managed properly can create significant cost and angst for families. The competing interests of managing costs such as tax and stamp duty whilst maintaining family equity mean succession plans need to be well thought out and carefully reviewed.
- Superannuation continues to be in the headlines for the wrong reasons. The new tax on the earnings of member balances in excess of $3 million is viewed by many as a major shift in tax policy. Unrealised gains held on investment account will be subject to tax. Governments continuing to tinker with the superannuation system are undermining confidence in the system which was designed to produce better retirement outcomes for all.
- The ATO’s initial review into the Top 500 private client groups resulted in significant audit adjustments. The review found private family groups had significant deficiencies with their tax compliance in the following areas: related party transactions, shareholder loans, family trust distributions and international transactions.
- The ATO has signalled its intent to continue its audit activity in the private client space and focus on businesses with annual turnover greater than $10 million and groups controlling net wealth between $5 million and $50 million. Where appropriate review and tighten up your procedures and documentation relating to your tax affairs and back that up with sound advice.
Despite the heavy technical program we did have time for some cocktails by the pool and a nice dinner at one of the local restaurants.