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Articles
SMSFs warned on ‘ticking time bomb’ with outdated deeds
Taxation ruling on commercial website deductibility
68% of SMEs ‘significantly stressed,’ 85% rely on accountants
Statutory wills are underutilised in estate planning
Small business slips on lodgement deadlines
300,000 SMEs utilising $20K write-off, says ATO
‘A bad thing times 10’: ATO set for new SMSF blitz
Capital Gains and Renounceable Rights
Paperwork bungles lead to $38k in payments
Australian Dietary Guidelines and healthy eating chart (PDF)
Former director liable for company’s unpaid tax liabilities
Super for housing measures enter Senate
No Special Circumstances to allow Excess Super Contributions
Housing tax measures progress to Parliament
AirBnb – wrong tax outcome?
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ATO sending 'more letters than ever' on income tax errors
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Major Bank Levy Passed
NSW tops list as ATO reveals billions in lost super
Capital Gains and Renounceable Rights

In a small win, the taxation of renounceable rights offers (in some cases) will be concessionally treated following a recent Australian Taxation Office ruling.



       


 


The taxation of rights and premiums paid to retail shareholders has improved where those shares are held on capital account.


If the shareholder is an Australian resident then there is no assessable income on the timing of the grant of the entitlement and any retail premium received, can be treated us the realisation of a CGT asset.  Most years a large public company structure an equity deal to provide this opportunity to its shareholders – in 2016 it included Origin, in 2017 it included Boral, JB Hi-Fi, and Vows Communications.


The right to be issued shares is a CGT asset, which if no action is taken and the resultant is sale by the company and subsequent premium is paid to the shareholder, capital gain will result.  What is more significant is that the shareholder is considered to have required the rights when it acquired the original shares.  There is a discount capital gain (i.e. 50%) if the shares were held for twelve months or longer.


 


AcctWeb


 




14th-November-2017