Practice Alert
- PM Developments - GST implications for insolvencies
IPA members should be aware of the decision of the Federal Court in Deputy Commissioner of Taxation v PM Developments [2008] FCA 1886, 12 December 2008. That decision held that a liquidator is not personally liable for GST payable on sales of company assets by the liquidator. The Court rejected the Commissioner’s argument that the... Read More »
- Federal Court (Corporations) Rules - Cross-Border Insolvency
The Federal Court (Corporations) Amendment Rules 2008 (No 2) were registered on the Federal Register of Legislative Instruments on 14 October 2008 and commence on 15 October 2008. They amend the Federal Court (Corporations) Rules 2000 to give effect to the Model Law on Cross-Border Insolvency of the United Nations Commission... Read More »
- Changes to GEERS
Changes have been made to the General Employee Entitlements and Redundancy Scheme (GEERS) Operational Arrangements with effect from 15 December 2008. These changes concern: para 16(d) of the Operational Arrangements, as to rights of employees to GEERS on sale or transfer of a business; para 8(b)(iv), as to payments in lieu of notice (PILN)... Read More »
- ITSA's Personal Insolvency Regulator - September 2009
ITSA’s Personal Insolvency Regulator of September 2009 has been issued by ITSA’s independent Regulation and Enforcement branch has. In keeping with one of the branch’s main purposes it is aimed at informing practitioners of changes to personal insolvency law, both legislative and case law, and discussing areas of practice and Inspector-General requirements. Topics in this issue... Read More »
- Compound bank accounts - misalignment of personal and corporate insolvency
On the verge of a Productivity Commission report expected to confirm years of inaction in aligning personal and corporate insolvency processes, the Federal Court, assisted by submissions from ASIC, has come down against the use of joint bank accounts for insolvency administrations: Worrell, in the matter of regulation 5.6.06 of the Corporations Regulations 2001 [2010] FCA 934.... Read More »
- ATO Insolvency Facsimile Header
The Tax Office has developed an Insolvency Facsimile Header for practitioners to use when submitting correspondence for their clients. The header is now available on the Tax Professionals segment of ato.gov.au, having been added to the existing Contacting the Insolvency Team page: To use the fax header practitioners need to: ... Read More »
- Federal Court cross-border bankruptcy rules
The Federal Court (Bankruptcy) Rules 2005 have a new Part 14 ‘Proceedings under the Cross-Border Insolvency Act’, setting out the procedure for applications under the Cross-Border Insolvency Act 2008. The rules commence on 30 March 2009. New forms have also been inserted as follows: Form 18 Consent to act as designated person... Read More »
- Practice Alert
Please click on the links Subject Date Document Changes to CVL Dec 07 CVL Practice Update Update to CVL Guidance Mar 08 CVLs Meeting and Forms FAQ on the IPA Code... Read More »
- ITSA's June 2009 Personal Insolvency Regulator newsletter
ITSA’s June 2009 Personal Insolvency Regulator newsletter is now on ITSA’s website. IPA members’ attention is drawn to these topics: coverage of ITSA’s new national business line structure, an IPA article on the need for independence in taking legal advice, the Accounting Professional & Ethical Standards Board’s (APESB) explanation of... Read More »
- ASIC's new on-line insolvency portal
ASIC has just launched a new online insolvency portal specifically designed to meet the needs of stakeholders likely to be impacted by corporate insolvency. ASIC says that the portal is part of ASIC's response to the increasing number of companies experiencing financial difficulty, or becoming insolvent, in the current economic environment. A new 'Insolvency' tab has replaced the... Read More »
- ATO response on PM Developments - GST liabilities - 9 Feb 09
On 9 February 2009, the ATO issued a Decision Impact Statement on Deputy Commissioner of Taxation v PM Developments Pty Ltd [2008] FCA 1886, 2008 ATC 20-078. See http://law.ato.gov.au/atolaw/view.htm?DocID=LIT/ICD/QUD159of2007/00001 The Statement sets out the ATO’s view of the impact of the decision. Importantly, the ATO explains to insolvency... Read More »
- Tax Laws Amendment (2009 Measures No. 5) Bill 2009 - insolvency and GST
The Tax Laws Amendment (2009 Measures No. 5) Bill 2009 was introduced into parliament on 16 September 2009. The Bill proposes to: amend the law relating to the GST to ensure that representatives of an incapacitated entity - liquidators administrators etc - are responsible for the GST consequences that arise during their appointment.... Read More »
- Increase in bankruptcy court fees
Creditors will be paying for increased filing fees for Bankruptcy Act applications in the Federal Court and the Federal Magistrates Court, which are both now the same: $1,983 for a corporation, and $828 for an individual. Previously there was a substantial difference between these two filing fees. The reason for the change is not known. One consequence... Read More »
- Economic Security Strategy payments and bankruptcy
ITSA has advised the IPA about the treatment for bankruptcy purposes of the Economic Security Strategy (ESS) payments that the Government is making to certain pensioners, carers and families between 8-19 December 2008. See the Social Security and Other Legislation Amendment (Economic Security Strategy) Act 2008. These payments form part of the Government’s economic... Read More »
- Website advertising to replace newspapers
As insolvency practitioners are aware, newsprint advertising for creditors and others is expensive, apart from becoming archaic. In bankruptcy, where creditors meetings are called pursuant to sections 73 or 188 of the Bankruptcy Act, Regulation 4.19 and Schedules 2 and 6 of the regulations require such meetings to be advertised in a manner approved by the Inspector-General. ... Read More »
- Insolvency inquiry announced - IPA response - nature of committee process
The Senate has referred to the Economics References Committee the following issue: The role of liquidators and administrators, their fees and their practices, and the involvement and activities of the Australian Securities and Investments Commission, prior to and following the collapse of a business. The Economics References Committee is to inquire and report by Tuesday 31 August... Read More »
- ITSA's Personal Insolvency Regulator - objections, government payments, etc
The latest issue of the Personal Insolvency Regulator , from ITSA’s Bankruptcy Regulation branch (BR), has just appeared on the ITSA website. It should be read by all IPA members who practise in personal insolvency. A summary of some of the issues and other comments for IPA members follow: Bankruptcy reform – progress ... Read More »
- Bruton Holdings - Revised ATO Receivables Policy
The ATO has released a revised version of Ch 12 of its Receivables Policy dealing with garnishees notices that address the recent High Court decision in Bruton Holdings Pty Ltd (in liq) v DCT – see details below. Chapter 12 sets out the Commissioner's power to recover tax debts from third parties owing money to,... Read More »
- ASIC Insolvency Information Sheets
ASIC has released a revised package of insolvency information sheets to increase awareness of company insolvency procedures among directors, employees, creditors and shareholders. These have the endorsement of the IPA. ASIC asks that practitioners provide a copy of the list of insolvency information sheets available from the ASIC website, or of the relevant information sheet/s, to those affected... Read More »
- Obtaining information from the ATO - new guidance available
The Australian Tax Office has advised the IPA of its position in responding to requests by insolvency practitioners for tax and other information about the insolvent. ATO officers have secrecy and privacy obligations in relation to the affairs of taxpayers, for example under s 16 of the Income Tax Assessment Act 1936. Phone/fax contacts... Read More »
- Consumer Credit Protection - should practitioners be excluded?
Insolvency practitioners may have received a letter from ASIC about the new National Consumer Credit Protection Act 2009 which commences on 1 July 2010. ASIC's letter says it assumes you are “a provider of budgeting and/or debt management advice” and as such it refers to obligations you may need to meet under this new law, failing... Read More »
- Use of deregistration applications in CVLs
16.7.10: We republish this 2008 item below about which the IPA continues to receive a number of queries from members. Any law reform ideas on the finalisations of liquidations, in particular whereby the costs of finalisations are reduced, are welcome. Michael Murray IPA Legal Director mmurray@ipaa.com.au ------------------------------------------------------- We have received a number... Read More »
- Corporate insolvency reforms apply only to 2008 administrations
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- Providers of Education Services to Overseas Students
The Victorian Registration and Qualifications Authority (VRQA) has written to practitioners in relation to appointments to businesses of this kind. The VRQA regulates all education and training providers in Victoria. The regulatory framework governing these providers is complex, and incorporates both Federal and State regulation. It reports that the education... Read More »
- Service of tax penalty notices
The Tax Office has issued an impact statement on the decision of the NSW Court of Appeal in DCT v Meredith [2007] NSWCA 354, (2007) ATC 5353, which concerned whether the giving of a Director Penalty Notice (“DPN”) by post under s 222AOF of ITAA 1936 could be rebutted by evidence of non-receipt or non-delivery. ... Read More »
- Pre-appointment tax returns in liquidations - requirements to lodge
The law provides that the Commissioner of Taxation can require a liquidator to prepare and lodge any overdue tax returns for a company in liquidation, including returns for periods prior to the liquidator’s date of appointment: see s 163 Income Tax Assessment Act 1936. Recently, the ATO and the IPA agreed... Read More »
- Cross-Border Insolvency Act 2008
The Cross-Border Insolvency Act 2008 commenced on 1 July 2008. The Act gives effect to the Model Law on Cross Border Insolvency developed by the United Nations. The Model Law is Schedule 1 to the Act. Cross border insolvency is a term used to describe situations where an insolvent debtor... Read More »
- Changes to Courts' Bankruptcy Rules - annulments etc
The Federal Court has made changes to Part 7 of its Bankruptcy Rules that affect timings in the section 153B annulment process and in relation to the trustee's report; and in a review of a sequestration order made by a registrar. Trustees should note the quicker time requirements An annulment application must now be served by the... Read More »
- APES 330 Insolvency Services
On 17 September 2009, the Accounting and Professional Standards Board approved APES 330 Insolvency Services which will be effective from 1 April 2010. Early adoption of APES 330 is permitted. IPA’s Technical Director – Kim Arnold – has been acknowledged as making a significant contribution to the Standard in particular in assisting with advice on... Read More »