End of the financial year is always a busy time for tax managers in financial services. But this year things are substantially harder with the disruption caused by COVID-19.
The FSC quickly recognised the problems that superannuation funds, managed funds and life insurers would face with tax due to COVID-19, and we wrote to the Australian Taxation Office (ATO) to request delays and waivers relating to many tax issues facing our members.
We were pleased that the ATO and Government accepted many of our requests, including deferral of top taxpayer reviews, delays to the requirements to implement the new version of the Annual Investment Income Report (AIIR), and permitting electronic processing of applications.
The ATO also indicated it would not be taking compliance action in relation to a recent court case about the utilisation of Foreign Income Tax Offsets (Burton v Commissioner), however, fund managers are facing significant uncertainty about how this court case will be applied – with some advisers, customers, and suppliers in the industry arguing or assuming the case should be implemented one way for fund managers, while others arguing the case should be implemented completely differently. The FSC continues to encourage the ATO to provide a view on this issue as soon as possible.
OPINION PIECE - by Michael Potter, Senior Policy Manager – Economics & Tax