The Aussie Govt is at it too… New tax rules

the latest info out there for 23AG (current tax rule for overseas derived income) specialist accountants is that it worded that it will only occur after industry consultation, so I cant see it happening in July

So has anyone had a chat with there accountants over this issue? Found a way around it?

I had a chat with mine and he basically said I was paying tax. There best thing to do is start investing. Reckons he can get me down to paying 30% tax.

Anyone or know of anyone in the ROV or Oil industry decided its just not worth working oversea’s anymore?
For many of us it was " not paying aussie tax " that just kept us a bit better than those working in Oz. Now that we have to pay tax, is it really worth working overseas?

Hotstab

Also under discussion here: HERE

Hi Guys,

Just following on from Luckyjim37 reply; http://www.rovworld.com/phpnuke/modules.php?name=Forums&file=viewtopic&t=3321&postdays=0&postorder=asc&start=60

Before I go running to the accountant/solicitor, any sharing of firsthand experience would be gratefully appreciated. Thanks.

Have many of you Aussie residents working & paying tax in Oz managed to set up any type of company or trust to minimize taxes paid from ROV offshore work?

Is there any hassle with having your salaries / day rate from the local companies paid directly into this type of arrangement, or does the agreement/contract with the employer need to have your personal name particulars on it rather than your company’s?

If I were paid as a company, would I have to ‘pre-pay’ the tax each year?

Also, could someone please recommend a reputable Aussie tax accountant with experience with offshore workers to set up any legal type tax minimization program if that’s possible / practical and dependant on the above questions?

Thanks,
Red

of interest is not the target, but how the ATO have interpreted the resident for tax purposes rule. in general the advice hogan originally got was probably correct, but it will now all depend on what assets/connections hogan had in australia when he received the income.

similiar in some respects to how others here have described the UK taxmans endeavours.

http://www.theaustralian.com.au/news/nation/hogan-hit-for-millions-as-ato-demands-its-take/story-e6frg6nf-1225905117507

Hogan hit for millions as ATO demands its take

EXCLUSIVE: Susannah Moran From: The Australian August 14, 2010 12:00AM Increase Text Size Decrease Text Size Print Email Share Add to Digg Add to del.icio.us Add to Facebook Add to Kwoff Add to Myspace Add to Newsvine What are these? ACTOR Paul Hogan has been hit with a multi-million-dollar tax bill.

The Australian Taxation Office has accused the entertainer of evading tax on $37.6 million of undeclared income.

The tax office has also told Hogan it considers him an Australian for tax purposes, despite the Crocodile Dundee star living and paying taxes in the US for a number of years.

The tax bill is the first punitive action taken against Hogan by the tax office, which along with the Australian Crime Commission has been pursuing the actor as part of a tax probe into the use of offshore accounts connected to the Wickenby investigation.

The size of the bill is not known. But if Hogan is assessed at the highest marginal rate of 40 per cent, the tax office is likely to have demanded a base payment of $15m, as well as interest charges from the date the tax was due, and additional penalties that could be as high as 75 per cent of the base bill.

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According to documents obtained by The Weekend Australian, the tax office has told Hogan it is considering him an Australian resident for tax purposes for the years 1987 to 2005. During eight of those years — from 1995 to 2002 — Hogan paid tax in the US, where he now permanently resides. From 2002 to 2005, Hogan lived in Australia.

Three payments are singled out as income that should have been declared to the tax office. The first is a $9.1m payment in July 2002, made at a time when Hogan had stopped being an Australian for tax purposes but had yet to take up US residency.

The tax office says Hogan did not pay tax in either country on this income. The reason for the payment is disputed, with some accounts saying it was for the film rights to the never-made Crocodile Dundee 4 and others for the rights to use Hogan’s likeness for commercial reasons.

The second payment was a dividend of $14.3m paid to Hogan in the same month. The third payment — also likely to have been from film royalties — was a $14.1m dividend paid to Hogan in June 2005, after he had again left Australia.

Tax advice given to Hogan by accounting firm Ernst &Young told the actor he would not have to declare the dividend if it was paid after he had left the country. But the tax office has told Hogan it considers him an Australian resident for the month and is demanding tax be paid.

Hogan’s artistic collaborator John Cornell and the pair’s financial adviser Tony Stewart have been accused in the Federal Court of lodging tax returns that contain "false and misleading statements". The ACC alleges the statements were made to avoid their tax obligations and to "evade paying income tax in Australia."

No tax-related charges have been laid against Hogan, Cornell or Mr Stewart, and all have denied any wrongdoing in relation to their tax affairs.

A lawyer for the Australian Crime Commission has previously told the court it is close to finalising its investigation, which is separate to the tax office’s actions. The ACC will then decide whether to recommend criminal charges against Hogan, Cornell and Mr Stewart.