CPA Australia Tax News

This edition was current at the time of publication.

Time to reform a creaking tax system?

Australia’s tax system is creaking under the weight of demographic change, widening generational divides, and a growing sense that hard work no longer pays as it once did.

Independent MP Allegra Spender’s Personal Tax White Paper proposes a bold, budget neutral rebalancing: lower taxes on wages, funded by reducing concessions on investment income.

In her recent National Press Club address on 11 March 2026, she put this challenge squarely on the table, arguing that “the Australian covenant — the promise that hard work leads to a decent life — is worth defending”. 

The heart of Spender’s argument is simple. As her White Paper notes, “if you earn $100,000 from wages, you pay around $23,000 in taxes… if you earn that from capital gains, you pay around $7,000”. The system’s heaviest burden falls on younger Australians, who are more likely to earn income from labour, rent rather than own, and juggle HECs debts, childcare costs, and rising living expenses.

Spender’s proposal includes four key measures:

• Reducing the capital gains tax discount from 50 per cent to 30 per cent
• Ring fencing negative gearing
• Introducing a 27.5 per cent minimum tax on investment income
• Aligning superannuation earnings thresholds with income tax thresholds.

These proposals would fund cuts to marginal tax rates, including lowering the bottom rate to 13 per cent.

CPA Australia has long advocated for principled, coherent, and sustainable tax reform. It is reform that improves system integrity, supports productivity, and strengthens intergenerational fairness. 

Spender is right that tax reform has been avoided for too long. Australia needs a tax system that supports productivity, fairness, and long-term sustainability.

At least Spender is not looking at changing CGT and negative gearing in isolation. Her proposal is not the final answer, but it is a serious contribution to a debate Australia can no longer postpone.  

I welcome your thoughts. Email me.

Jenny Wong
Tax Lead
CPA Australia

 

TPB warning against false or misleading information

The Tax Practitioners Board  has issued a release noting a recent conviction of a former tax agent for making a false or misleading statement in a material particular in a renewal application for registration. 

The agent responded "No" to a question asking whether he or any associated entities over which he had direct or indirect control, had overdue tax obligations. This statement proved to be false as at the time of lodgement, multiple entities associated with the agent recorded outstanding tax lodgements.

The TPB warns that it will take action where false or misleading information is provided in support of registration or renewal.

Compulsory trust beneficiary TFN reporting

Treasury has released draft rules that from 1 July 2026, trustees of closely held trusts will require to report a beneficiary’s TFN in the Trust tax return where:

• The beneficiary is presently entitled to a share of the Trust’s income for the year
• The beneficiary has quoted their TFN to the trustee before lodgment of the Trust tax return; and
• The trustee has not reported the beneficiary’s TFN under the Trust Beneficiary Non-Disclosure Tax rules that year.

The TFN must be provided by the earlier of the following dates:

• the date the trust return is lodged, or
• the date the trust return is required to be lodged,
  unless the Commissioner allows additional time. 

The changes being made to the 2027 Trust tax return are: 

1. Adding two new labels‘
a. Are you a closely held trust?’
b. ‘No TFN available’ checkbox within the Statement of Distribution (SOD) section.
2. Introducing a new software validation to make the TFN field in the SoD mandatory.

 

ATO website updates

• Private wealth Deputy Commissioner's priorities 
• 3 BAS tips 
• Key updates for FBT tax time
• Super processing schedule
• Logbook check-in time 
• Dividend and franking credit yields 
• Correcting your Public CBC report 

 

 

SUPERANNUATION AND FINANCIAL PLANNING

Real-time superannuation payments 

Australian Payments Plus (AP+) has released the Guide to Real-time Superannuation Payments, providing comprehensive guidance on how real-time payment infrastructure can support the transition to Payday Super from 1 July 2026. 

The guide explains how the New Payment Platform's (NPP's) real-time payment capabilities support the transition to Payday Super by enabling 24/7 payments with no cut-offs, enhanced data capabilities with 280-character description fields, real-time verification of payer details, and immediate payment status confirmation. 

Preventing perpetrator access to victims' super death benefits 

Treasury has released the consultation paper entitled Preventing perpetrators from accessing victims' super death benefits (the Paper). 

The Paper seeks public feedback on policy options to close a legal loophole that currently allows perpetrators of family and domestic violence to receive the superannuation death benefits of their victim-survivors. 

This is because superannuation death benefits are generally paid under superannuation law and a fund's governing rules, and circumstances such as the existence of a valid binding nomination or prescriptive governing rules may limit the trustee's ability to take account of allegations of family and domestic violence.

Send your comments to by 3 April [email protected]

 

PROFESSIONAL DEVELOPMENT

Excel Masterclass: Discovering Dynamic Arrays 

Last chance to register. 

Discover the new way to create flexible formulas that populate a range with a single formula. Register now. 

CPA Australia AI Build Day: NSW 

Understand how AI is reshaping the profession and where real opportunity lies. You’ll learn AI techniques tailored to real world practice, including drafting audit queries, summarising financial statements, and extracting data directly from trial balances. Register now.

 

LEGISLATION

Bills to implement Division 296, amend LISTO passed

Legislation to implement Division 296 to reduce the tax concessions available to individuals with a Total Superannuation Balance (TSB) exceeding $3 million and align the Low-Income Superannuation Tax Offset (LISTO) with broader income tax and superannuation settings, has passed parliament with no amendments.

The Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 and Superannuation (Building a Stronger and Fairer Super System) Imposition Bill 2026 introduce Division 296 into the Income Tax Assessment Act 1997 (ITAA 1997) and reduces the tax concessions for individuals with large TSBs from the 2026-27 income year onwards by imposing a tax of:

• 15 percent on realised earnings based on the percentage of the individual's TSB exceeding the $3 million threshold and
• a further 10 percent on realised earnings based on the percentage of the TSB exceeding the $10 million threshold.

The legislation also introduces key changes to the LISTO from 1 July 2027 to apply to the income years 2027-28 and beyond:

• increasing the eligibility for LISTO threshold from $37,000 to $45,000
• increasing the maximum LISTO payment from $500 to $810, in line with the recent increases in the Superannuation Guarantee rate and
• linking the LISTO payment rates and thresholds with the personal income tax thresholds and the Superannuation Guarantee rate.

Both bills now await Royal Assent.

Withholding variation for certain office holders

Treasury has registered the Taxation Administration (PAYG Withholding Variation for Company Directors and Certain Office Holders) Legislative Instrument 2026. The Instrument reduces to nil, the amount that an entity must withhold from certain payments to an individual, where the full amount of the payment must be paid to another entity of which the individual is a director, partner or employee.

The Instrument also exempts the entity making the payment from requirements to notify the Commissioner under the Single Touch Payroll (STP) reporting framework and requirements to issue payment summaries which may otherwise apply in respect of the payment.

Date of effect: 6 March 2026.

 

 

RULINGS AND GUIDANCE

ATO ID 2010/124 withdrawn - CGT event C1

The ATO has withdrawn Interpretative Decision ATO ID 2010/124: CGT event C1: sale of shares without the owner's consent - stockbroker's mistake. The withdrawal marks a shift in how the ATO classifies the unauthorised sale of shares due to a broker's error, where:

• previously the ATO considered shares sold without consent due to a mistake triggered CGT event C1 (loss or destruction), which meant that taxpayers were allowed to access replacement asset roll-over under Subdiv 124-B of the ITAA 1997;
• currently the ATO maintains that such a sale is simply a disposal of an asset, which triggers CGT event A1, ie the replacement asset roll-over is no longer available.

Class ruling

Class Ruling CR 2026/9 (Seven West Media Limited - scrip for scrip roll-over) - Eligible shareholders can choose to obtain scrip for scrip roll-over if they made a capital gain from the disposal of their shares.

 

CASES 

Pilot's medical expenses not deductible 

An airline pilot has been denied a deduction for expenses incurred in regaining his medical certificates. The taxpayer claimed deductions (of just over $22,900) for the medical expenses he incurred but the ART agreed with the ATO that they were not deductible. The ART considered the taxpayer's situation was akin to the "pre-employment medical examination" that is required to get a job, the expenses of which are not deductible. (Farley and FCT [2026] ARTA 255, ART, Burch GM, 23 February 2026.)

ATO loses appeal on truck driver's expenses  

The ATO has lost an appeal against an ART decision that a truck driver was entitled to a deduction for food expenses based on the ATO's reasonable daily amount. The Federal Court find that the ART did not err in concluding that the taxpayer had demonstrated that the amounts claimed had been incurred. Nor had the ART imposed a lower burden of proof on the taxpayer when it came to evaluating whether he had discharged his onus to prove that he had incurred the amounts claimed.
In addition, the ART did not find that the existence of a "reasonable expectation" within the meaning of s 900-200 ITAA 1997 relieved the taxpayer of his obligation to prove that the relevant expenses were incurred. (FCT v Shaw [2026] FCA 197, Fed Ct, Colvin J, 4 March 2026.)

 

 

 

 

 

 

 

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