Supporting older Australians – exempting granny flat arrangements from Capital Gains Tax (CGT)

Closing Date: Thursday 29 April 2021

On 5 October 2020, the Government announced that it will provide a targeted capital gains tax (CGT) exemption for granny flat arrangements where there is a formal written agreement in place. Under the measure, CGT will not apply to the creation, variation or termination of a formal written granny flat arrangement providing accommodation for older Australians or people with disabilities.

CGT consequences are currently an impediment to the creation of formal and legally enforceable granny flat arrangements. When faced with a potentially significant CGT liability, families often opt for informal arrangements, which can lead to financial abuse and exploitation in the event that the family relationship breaks down. This measure will remove the CGT impediments, reducing the risk of abuse to vulnerable Australians.

The Government is seeking stakeholder views on exposure draft legislation and explanatory materials for amendments that would give effect to this announcement.

Further information available here.

 

Fringe benefits tax – exemption to support retraining and reskilling

Closing Date: Thursday 29 April 2021

On 2 October 2020, the Government announced that it will introduce an exemption from fringe benefits tax (FBT) for employer-provided retraining and reskilling benefits for redundant, or soon to be redundant, employees, where these benefits are not sufficiently connected to their current employment.

This measure will remove any disincentive in the FBT system to employers retraining redundant employees to help them transition to new employment opportunities. The exemption will not extend to retraining acquired by way of a salary packaging arrangement or to costs for which an income tax deduction is specifically denied, including Commonwealth supported places at universities or repayments towards Commonwealth student loans.

The Government is seeking stakeholder views on exposure draft legislation and explanatory materials for amendments that would give effect to this announcement.

Further information available here.

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