Flood levy passed

Personal services – Data Matching Program

The ATO will collect information on amounts paid to personal services entities by labour hire firms, placement agencies and computer consultancies – it is called the PSI Data Matching project.
The data requested will also include name and address details of the individual who is the main service provider to the entity.

The information collected will be electronically matched with ATO data holdings to identify non-compliance with lodgement and payment obligations.
Records relating to approximately 100,000 individuals and entities who have received contract payments from the listed entities (there are 39 in total, such as Accenture Australia Holdings Pty Ltd, Hays Specialist Recruitment and Drake Australia) will be matched.

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ATO withdraws 2009 cash sales benchmarks

 The ATO's cash sales benchmarks for the following 15 industries, released in November 2010 for the 2009 year, have been withdrawn from use: 

• Beauty services
• Fuel retailing
• Meat retailing and butchers
• Clothing retailing
• Garden supplies retailing
• Newsagents
• Coffee shops
• Grocery retailing and general stores
• Pubs, taverns and bars
• Florists
• Hairdressers
• Restaurants
• Fruit and vegetable retailing
• Hardware and building supplies retailing and
• Takeaway food services

 
A review of the data used to calculate the cash sales benchmarks has identified inconsistencies in the way in which cash-outs* paid by businesses to their customers were recorded.

Note(*): An example of a cash-out is when a customer requests additional cash when purchasing goods or services.

The ATO is refreshing the data used to calculate these benchmarks and will release updated cash sales benchmarks for 2010 later this year.

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Supply of land development not a going concern 

The following case involved the sale of a piece of land for which the taxpayer was trying to claim the going concern exemption from GST, despite having ceased development on it.
A sale of an "enterprise" (including a land development) can be GST-free if the requirements for the going concern exemption are met.
One of these requirements is that the taxpayer selling (or otherwise "supplying") the enterprise must carry it on right up until the date it is sold.

Facts
The taxpayer purchased land at Hope Island, Queensland, to develop as a retirement community.

However, a number of years later it was decided that the taxpayer would withdraw from the project, and it ceased all construction works, removed existing construction works and all services to the apartment and house sites.

Another purchaser was found which proposed to develop a residential development according to its own designs, plans and subdivisional approvals.

It had no need of or use for the taxpayer's architectural plans and drawings, but still wanted to retain some of the features of the taxpayer's original development, being the lakes, the marina and the canal.

Bulk earthworks were required to enable those features to be developed or completed and, in that sense, the taxpayer continued those works.

Decision
The court held that the seller was not, at the date of the contract, carrying on an enterprise, but had abandoned the project in favour of simply selling the land upon particular terms.

Other obligations to finish off bulk earthworks were simply an incident of that sale, so it was not a supply of a going concern, but was a taxable supply.

However, it would have been more likely to be a supply of a going concern if the taxpayer had assigned to the purchaser the drawings and plans together with the benefit of all contracts with end buyers off-the-plan, and had otherwise supplied all things necessary to continue the project enterprise and carried it on until settlement or the day of supply.

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Please Note: Many of the comments in this publication are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances.