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2809, 2017

Estate Planning When Entering or Exiting Relationships – Are All Things Equal Between Married and De Facto Couples?

By |September 28th, 2017|

No matter what your view is on the marriage equality debate, understanding the rights of a married couple compared to a de facto (including same sex) couple is critical to enable a meaningful discussion with clients who are entering or exiting relationships about their plans on death and incapacity.


The difference between proving a marriage and a de facto relationship

At the very core, marriage is based on a couple’s mutual promise to one another and need only be proved by the production of one document (a marriage certificate) at most. It is immediate and undeniable.

A de facto relationship must be proved by evidence relating to living arrangements, sexual relationship, finances, ownership of property, etc. It often requires one or both partners to spend significant amounts of time, money and unnecessary stress to produce the necessary evidence.

Although most states allow de facto couples to register their domestic relationship a prescribed set of […]

2809, 2017

Just in the knick of time! Deciding whether to apply the super reform CGT relief

By |September 28th, 2017|

The transitional CGT relief in the superannuation reform allows an SMSF to reset the cost base of any assets reallocated or re-apportioned from retirement phase to accumulation phase to comply with the transfer balance cap or new transition to retirement pension arrangements.

The relief applies where the re-allocation or re-apportionment occurred between 9 November 2016 and just before 1 July 2017.

Ordinarily, if a pension is commuted from retirement phase to accumulation phase, the earnings on assets supporting the commuted balances will become taxable.

The relief operates to ensure that tax does not apply to unrealized capital gains that have accrued on assets that were used to support pensions up until that time. The rationale for this treatment is that such gains would have been exempt from tax if the SMSF had realized those assets prior to commutation.

The relief is provided by deeming the fund to have sold and reacquired the relevant asset […]

2609, 2017

Konnie Lontos Joins the Team

By |September 26th, 2017|

We are very pleased to welcome lawyer Konnie Lontos to Bernie O’Sullivan Lawyers. Konnie works predominantly in commercial matters including negotiating and drafting agreements and documenting commercial transactions including sales of businesses and commercial leases. With a Bachelor of Laws, a Bachelor of Business (Banking and Finance) and a Graduate Diploma in Legal Practice, Konnie provides exceptional practical legal advice to our clients. Attention to detail, a solid work ethic and strong working relationships enables Konnie to achieve positive results that meet clients’ expectations.

2609, 2017

Let’s Get Physical: Changes Affecting the Small Business Company Tax Rate

By |September 26th, 2017|

We are regularly told to be more active for our physical wellbeing.

Similar advice now applies to companies – they need to be less passive.

To qualify for the small business company tax rate of 27.5%, a company needs to be a “small business entity” – that is, the company needs to carry on a business and have an aggregated turnover of less than $10 million.

On 18 September 2017, the Federal Government released draft legislation to “clarify that passive investment companies cannot access the lower company tax rate for small businesses”.

Before the proposed change, there was some doubt as to whether a company that derived investment income (such as rent, dividends and interest), or that received distributions of income from discretionary trusts, was carrying on a business so that it qualified for this concessional rate.

The ATO website states:

    “It is not possible to definitively state whether a particular company is carrying on a […]

2609, 2017

Small Business CGT Concessions and Property Sales

By |September 26th, 2017|

One of the consequences of the housing boom in Melbourne is that properties that have been used for farming businesses for many years are being sold to developers. These sales often raise significant tax issues.

Some of the more interesting examples on which we have worked include:

  • A husband and wife acquired a property of about 95 acres in 2003. The owners of the property operated a market garden and raised livestock on the property. In 2009, the owners could no longer actively work in the business, but they continued to operate the market garden and raise livestock with help from family and friends. In 2013, the owners ceased to operate the market garden and leased that part of the property to a neighbour but continued to raise livestock on the balance of the property.

    The owners received an offer for the sale of the property. Under the offer, the purchaser would pay […]

2609, 2017

10 Tips to Limit Risk and Avoid Litigation

By |September 26th, 2017|

When people hear I am a litigation lawyer, their response is usually “well, we won’t need you!”.

We all know litigation can be expensive, unpredictable, time-consuming and distracting. However, litigation lawyers are best placed to provide the right advice to protect your business (or clients) from costly litigation. This advice is best obtained before a dispute arises.
Whilst completely avoiding potential litigation is unlikely, here are some quick tips you can easily implement within your business to reduce the risk:

1. Know your business partners/clients

Make sure you understand your business partners’ and clients’ intentions and properly gauge their ability to perform. If you’re entering into business with friends or family, do not romanticise the relationship – when things go bad, it’s often every man/woman for themselves!

If you don’t know your business partners/clients, then ask around. Make discreet enquiries in the business community about their reputation. Background checks (including financial and technical capabilities) can […]

906, 2017

Acquiring Interests in Property Worth More than $750,000? Get a Tax Clearance Certificate

By |June 9th, 2017|

Last year the Government introduced the Foreign Resident Capital Gains Tax Withholding measures.

These measures were framed so that from 1 July 2016, a person acquiring interests in:

  • Land, or
  • Interests in a company or trust that owns land,

valued at $2 million or more from a non-resident needed to pay tax equal to 10% of the value of the land or the interests in the company or trust to the ATO.

In the Budget on 9 May 2017, the Government changed the rules to reduce the threshold at which tax would need to be withheld from $2,000,000 to $750,000. The Government also increased the rate of withholding to 12.5%.

The Government announced that these changes will come into effect on 1 July 2017.

The Government has introduced the Treasury Laws Amendment (Foreign Resident Capital Gains Withholding Payments) Bill 2017 (Bill) to give effect to these changes. The Bill has been referred to a Senate committee that […]

906, 2017

Tick-Tock, Tick-Tock: The Transfer Balance Cap Countdown is On!

By |June 9th, 2017|

With 1 July 2017 fast approaching, many accountants and advisers are working feverishly to help clients needing to act before then to ensure they do not exceed the $1.6 million transfer balance cap. Requests are being made to the trustee of their self managed superannuation fund (SMSF) to commute some or all their pension phase superannuation income stream(s), and, either roll them over as an accumulation interest within the SMSF, or, withdraw them from the SMSF as a lump sum payment.

In theory, commuting amounts from pension phase is simple (i.e. pension balance(s) less $1.6 million equals the amount to be commuted). However, most SMSFs do not operate on real time reporting so a member will not know the amount of their pension balance(s) until well after 30 June 2017 – thereby making the task of determining the exact amount that needs to be commuted from pension phase under the new […]