ATO maintains stance on Bendel case amid High Court appeal

Deputy Commissioner Louise Clarke has addressed recent developments concerning the Bendel case, emphasising the ATO's current position on unpaid present entitlements (UPEs) and their classification under Division 7A.

The Full Federal Court's decision in February 2025 contradicted the ATO's longstanding view, prompting the Commissioner to seek special leave to appeal to the High Court.

Until the High Court's decision, the ATO maintains its position as outlined in Taxation Determination TD 2022/11, which treats certain UPEs as loans under Division 7A.  Clarke advises taxpayers to review the ATO's Interim Decision Impact Statement and consult with their tax agents to understand the implications for their specific circumstances.

The ATO has indicated that it will not grant blanket deferrals for tax return lodgments related to this issue.  However, the Commissioner may exercise his discretion under section 109RB to disregard deemed dividends in cases of honest mistakes or inadvertent omissions, should the High Court rule in the ATO's favour.

For further information on this topic click the below link

Deputy Commissioner Louise Clarke discusses Bendel decision | Australian Taxation Office

Managing your business' day-to-day transactions: Essential tips for small business owners

The ATO offers practical advice to help small business owners streamline their operations and stay on top of their financial duties.  These include:

  1. staying organised with regular record-keeping;
  2. setting aside funds for tax obligations;
  3. preparing and lodge your BAS promptly; and
  4. seeking professional assistance when needed.

For further information on this topic click the below link

Manage your business' day-to-day transactions? | Australian Taxation Office

 

Get ready for 12% super from 1 July 2025

The superannuation guarantee rate increases from 11.5% to 12% from 1 July 2025.

Make sure your clients and their systems are ready, so that staff receive their correct rate of super and they aren't inadvertently underpaid.

For further information on this topic click the below link

Super guarantee | Australian Taxation Office

 

Sale of developed land: size doesn't matter

In the case of Morton v FCT [2025] FCA 336, the Federal Court held that a farming family on the outskirts of Melbourne who sold sub-divided lots of land can treat those sales as tax-free because they were sales of pre-CGT land.

This is a significant case because over 1,600 lots were developed and sold on capital account, rather than as profit-making undertaking, trading stock, etc.

For further information on this topic click the below link

Morton v Commissioner of Taxation [2025] FCA 336 (11 April 2025)