Tax ruling on service trusts will trouble SMEs.

Australasian Business Intelligence, May, 2006

Byline: Mark Fenton-Jones

May 15, 2006 (The Australian Financial Review - ABIX via COMTEX) -- Australian small and medium enterprises (SMEs) have a limited time to review their operating structures. The Australian Taxation Office (ATO) has heralded a crackdown on service trusts, and given businesses a deadline of 30 April 2007 to ensure compliance. SMEs have used the tax-efficient trusts for decades, but the ATO has suddenly decided to regulate them more tightly. The ATO has issued a set of charge rates and operational guidelines that it considers commercially comparable. While forced restructuring may be painful, PKF partner Lance Cunningham notes that it may advantage some businesses to refresh tired operating structures.

Publication Date: 16 May...