“A renewed focus by the ATO has resulted in significant tax liabilities for bona fide arrangements involving no mischief, often arising from historical administrative errors or inadvertent oversights,” the submission read.
“Such outcomes are unfair and should not be treated as akin to fraud and evasion, particularly given that considerable time has elapsed since many elections were made.”
The NTAA added that the unlimited review period for family trust distribution tax liabilities was “particularly punitive,” especially in cases where no mischief was involved.
The industry body also urged Mulino to consider expanding transitional relief for Payday Super to the 2025–26 income year, noting that some businesses would seek to get ahead of the changes and begin adjusting their payroll practices in advance.
“Where an employer paid SG contributions for the June 2025 quarter in July 2025 and brings forward payment of SG contributions for the June 2026 quarter from July 2026 to June 2026, affected employees may exceed their CC cap due to decisions beyond their control,” the submission read.
Currently, transitional rules apply only to the 2026–27 income year, the NTAA said.
The industry association also urged the government to recommit to reforming Division 7A rules, noting that practitioners currently face significant uncertainties regarding the rules' operation.
“The prolonged delay in progressing Division 7A reform, together with the implications of the Bendel appeal, has...
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