The latest issues of PRISM – the quarterly tax newsletter, which is part of Reanda’s effort to stay in touch with our clients by sharing updates and insights on the recent taxation changes and current hot topics.
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Single Touch Payroll for All Businesses in Australia
Single Touch Payroll (STP) is reporting tax and superannuation information to the Australian Taxation Office (ATO), for all Australian businesses that employ staff. It commenced for all larger businesses from 1 July 2018. For smaller businesses with less than 20 employees, it starts from 1 July 2019. However, the closely held businesses have a further defer start from 1 July 2020.
Each business using a Software solution, will need to send employees' tax and super information to the ATO every time it processes its payroll and pays its employees.
Furthermore, non-compliant payroll payments are not tax deductible for the business.
Adoption of rules against tax avoidance practices
Following the publication of the EU Anti-Tax Avoidance Directive (ATAD I) on 12 July 2016, the House of Representatives voted into Cyprus Law its provisions on 5 April 2019.
The three measures explained below are applicable from 1 January 2019. Additional measures based on ADAD II are expected to be voted by the House of Representatives by 1 January 2020. These measures apply to all companies and entities that are subject to Cyprus tax, including entities that while are not Cyprus tax residents, they have a Cypriot permanent establishment.
The erosion of member states (MS) tax sovereignty in the European Union (EU)
In its 2019 European Semester the European Commission (Commission) communicated to the European Parliament, the European Council, the Council and other bodies, its country specific recommendations. In the area of taxation the Commission states < The transposition of EU legislation and of international agreed initiatives will help curtail aggressive tax planning practices. Certain features of some Member States’ tax systems, i.e. Cyprus, Hungary, Ireland, Malta and the Netherlands however may be used by companies that engage in aggressive tax planning>.
Macau SAR Financial Service Bureau (“DSF”) issued Mutual Agreement Procedure (“MAP”) Guidelines
In May 2019, the Financial Service Bureau has published a set of guidelines for Mutual Agreement Procedure (“MAP”) – a procedure to resolve disputes for Double Tax Agreements for the Avoidance of Double Taxation (“DTA”) with respect to Taxes on Income. The purpose of these guidelines is to provide practical information regarding the MAP whose request for initiation may be submitted before the Financial Service Bureau (“DSF”).
The Promulgation of Concessional Tax Incentives for Securities Sector and E-Tax Service
2019 is a year of reformation in terms of tax regulations in Cambodia. Two of the highlights being the promulgation of the new tax incentives offered to public listing companies and investors which is more favorable than ever before in Cambodia, under the Sub-Decree No.01 ANKr.BK ("Sub-Decree No.01"), issued by Royal Government of Cambodia on 4 January 2019. In the same year, the tax authority has launched a new e-Tax Service system that is expected to improve the management of tax collection and boost convenience for taxpayers in various ways.
Q&As between the Ministry of Finance and the State Taxation Administration of PRC and Journalists on Standards for Determining the Individual Income Tax Residency Threshold as 183 Days
In March 2019, the Chinese government released an Announcement on the Standards for Determining the Length of Residence of Non-PRC-domiciled Individuals as jointly issued by the Ministry of Finance(MOF) and the State Taxation Administration(STA). Following are the Q&As between the MOF, the STA and journalists on standards for determining the length of residence in China as 183 days.
Hong Kong Inland Revenue Department (IRD) Revises Practice Notes on Deduction of Foreign Taxes
In July 2019, the Inland Revenue Department has published an update version of Department Interpretation and Practice Notes (DIPN) No. 28 (Revised) on the provisions relating to deduction of foreign taxes. The changes were made in light of the enactment of Inland Revenue (Amendment) (No. 6) Ordinance 2018. IRD would provide more guidance in DIPN No. 28 (Revised).
Restriction on Deductibility of Interest
Restriction on deductibility of interest under Section 140C of the Income Tax Act 1967 and Income Tax (Restriction on Deductibility of Interest) Rules 2019, has been introduced to restrict deductions for interest expenses or any other payments which are economically equivalent to interest, to ensure that such expenses commensurate with the business income.
The article is a discussion of Brexit and the implications it may have on the UK from a tax perspective. The tax team at Reanda UK has discussed the possible indirect and direct tax implications of Brexit on the UK. They also discuss the harmonious EU directive and the movement of employees within the EU which could potentially be impacted by the UK’s exit from the EU.