A recent Interpretative Decision (ATO ID 2013/54) considered the meaning of the phrase “covered by an appropriation” in the new s 9-17(3) of the GST Act.
When you are dealing with tripartite arrangements, you need to ensure that all supplies and acquisitions are clearly identified and that the consideration goes where it’s supposed to. This case proved a very costly lesson for PASC and potentially Mr Felson, with more than $250,000 in input tax credits at risk.
For in-house benefits provided on or after 22 October 2012, the Tax Laws Amendment (2012 Measures No 6) Act 2013 removes the concessional FBT treatment of these benefits if they are accessed by way of a salary sacrifice/packaging arrangement.
It is a no-brainer that salary packaging benefits that are fully exempt from FBT under an effective salary sacrifice arrangement will produce a tax saving advantage for employees. It is also clear that no real tax saving advantage ensue for employees where they salary package benefit that are fully taxable under prevailing FBT legislation.
Another case, this time in the Federal Court dealing with the complex issue of determining if you are dealing with a contractor or common law employee… all members should stay abreast of these decisions.
GST Q&A – using credit card statements for claiming ITCs