CPA Australia Tax News

This edition of Tax News was current at the time of publication on 13 August 2026. You can subscribe to the Tax News email in your comms preference centre. 

Fraud activity targeting tax professionals

The ATO is aware of a small number of tax professionals whose systems have been compromised and has put additional security measures and controls on these agents and their clients. The activity appears to involve malicious links embedded in job applications, CVs and inbound communications, such as emails. 

Exercise caution when opening emails, downloading attachments or clicking on unfamiliar links, including:

• Unexpected software or system updates
• Blue screen errors or system crashes
• Unusually slow device performance
• Unexplained mouse movements or activity

To maintain strong security practices:

• Shut down computers at the end of each day
• Regularly review and manage user access through Relationship Authorisation Manager (RAM) and Access Manager
• Remove outdated, unnecessary or inappropriate permissions
• Monitor user access and privileges on an ongoing basis

Data matching of motor vehicle registries

The ATO has registered a notice of a vehicle registries data-matching program covering 2025-26 through 2029-30. Data from state and territory registry authorities will be collected to identify relevant cases for tax compliance action. 

The ATO will look at the identification and transaction information of approximately 2.5 million individuals each financial year.

New ATO pre-fill TPAR data

Payments made to contractors and reported through the taxable payments annual report (TPAR) will appear as pre-filled income in tax returns, according to a press release from the ATO.

Payment data will show for industries including: 

• building and construction
• courier and road freight services
• cleaning
• information technology
• security, investigation and surveillance. 

Contractors should wait until after Friday 28 August to lodge, as this is the deadline for businesses to submit TPARs.

Australia and Canada establish tax arbitration procedure

The ATO has published a memorandum of understanding between Australia and Canada establishing a clear arbitration procedure for tax disputes arising under the Australia-Canada Covered Tax Agreement. 

ATO website updates

• Renewable energy compensation payments
• Key obligations for Pillar Two
• Commercial deals service 2026 survey results
• Tips to meet the Payday Super timeframe
• Check your corporate tax transparency data

Estimated industry levies for 2025–26

ASIC’s annual 2025-26 Cost Recovery Implementation Statement outlines estimated regulatory costs and levies for each industry subsector. 

Superannuation trustees have a FY 2025-26 estimated levy of $18,000 plus $8.65 per $1 million of assets above the $250 million threshold.

CGT and negative gearing (tranche 2) exposure draft

Treasury has issued exposure draft legislation for a second tranche of negative gearing and CGT reforms, along with a draft determination for how gains and losses will be apportioned around the 1 July 2027 transition.

The new-residential-dwelling and housing-use determination is proposed to apply from 2027-28. 

Proposed commencements:

• The CGT adjustments: the first date of the first quarter after Royal Assent. Will apply for assessments from 1 July 2027 and later income years. 
• Negative-gearing tranche 2 amendments: the first date of the first quarter after Royal Assent. 

Apportioning determination: the day after registration on the Federal Register of Legislation. Its operative method applies to relevant deferral realisation events occurring on or after 1 July 2027.

Send your comments by Tuesday 18 August to: [email protected]

TPB sanction reform

Treasury has issued exposure drafts of legislative instruments proposing to strengthen the TPB regulatory powers over tax agents and BAS agents.

TASA (Enhancing Tax Practitioners Board Sanctions) Regulations 2026 state what sanction and enforcement information the TPB must publish on its public register of tax and BAS agents. This amends the Tax Agent Services Regulations 2022.

TAS (Code of Professional Conduct) Amendment (Enhancing Tax Practitioners Board Sanctions) Determination 2026 requires agents to inform their clients about conduct that has resulted in sanctions by the TPB. This amends the Tax Agent Services (Code of Professional Conduct) Determination 2024.

Date of effect: 

The later of: 

1. the start of the day after each instrument is registered
2. the day Schedule 1 of this TLA Bill commences.

Payday Super rulings

The ATO released the following:

• LCR 2026/1 on issues including:
  • savings provisions and transitional issues such as timing mismatches
  • legacy arrangements relating to excess contributions made before 1 July 2026
  • the reversal of pre-1 July 2026 sacrificed contributions
  • overlapping actions or obligations that may arise during the applicable transition period, and more. 
• LCR 2026/2 on criteria for eligible contributions
• LCR 2026/3 on how the superannuation guarantee charge is calculated and assessed

Date of effect: 1 July 2026.

Department of Education not liable to SGC: DIS

The ATO has issued an Interim DIS on the Federal Court's decision in Department of Education v FCT (2026). In that case, the Court held that the department was not liable to the Superannuation Guarantee Charge for failing to pay superannuation contributions in relation to a "salary loading allowance" paid annually to teachers, as the allowance did not fall within the relevant notional earnings base or within the relevant employees' OTE.

The ATO has appealed to the Full Federal Court. Meanwhile, ATO states in the Interim DIS that LCR 2026/D1 on qualifying earnings for Payday Super continues to reflect the ATO's views on the interpretation of OTE, which is included within the term "qualifying earnings" in s 10A of the SGAA from 1 July 2026.

No input tax credits for legal fees incurred in proceedings

In Trustee for the Premier Aviation Holdings Unit Trust and FCT (2026), a unit trust was denied input tax credits (ITCs) in respect of legal fees incurred in oppressive conduct proceedings commenced against a company in which the trust held shares.

The ART agreed with the ATO as it was not satisfied that Premier was carrying on an enterprise during the relevant period (July 2020 to September 2023) and was not entitled to the disputed ITCs. 

The ART also rejected Premier's alternative argument that it had pivoted to carrying on an enterprise of litigation after 2019. 

Unit trust acquisitions aggregated in Victoria

In ISPT Pty Ltd as trustee for ISPT Retail Australia Property Trust v Commissioner of State Revenue (2026),  the Supreme Court of Victoria upheld a landholder duty assessment as the Commissioner was correct to aggregate two separate acquisitions of units in a landholder under s 78(1)(a)(ii) of the Duties Act 2000 (Vic). 

Firstly, the Court said that before a person acquires a "further interest" in terms of s 78(1)(b), there must have been a prior acquisition of a significant interest that constitutes a "relevant acquisition" under s 78(1)(a). 

The Court also agreed that, in determining the duty consequences of an acquisition, one considers only the interest acquired.

Strong public interest in cash consultation

The Reserve Bank of NZ’s survey to gather feedback on cash services in New Zealand is now closed, with nearly 6000 responses. 

The consultation asked about local access to withdraw cash, deposit cash and swap cash for low-denomination banknotes and coins. Findings will be released in late September.

Horticultural sector under scrutiny

IR issued a media release and RA 26/02: Non-compliance in the horticultural sector.

The alert highlights concerns about a number of practices in the horticultural sector, including:

• schedular payments being paid without deducting withholding tax correctly
• complex labour contracting arrangements obscuring their true nature
• cash payments for workers

Taxpayers who knowingly participate in such arrangements to evade tax will be committing one or more criminal offences under the TAA 1994.

GST eligibility for PSCs

IR was asked if a personal services company (PSC) can register for GST when it provides the services of a director or board member, even if that individual could not register for GST if those services were provided directly.

IR says the PSC would be eligible. If the PSC contracts directly with the company or organisation and supplies the services of the director or board member under that contract, those supplies are not excluded from the definition of “taxable activity” by s 6(3)(b) or s 6(3)(c)(iii).

However, if the director or board member contracts directly with the company or organisation but is required to pay their fees to the PSC because they are an employee of the PSC, s 6(4) applies, i.e., treated as consideration for a supply of services by the PSC to the company or organisation.

GST treatment of directors’ fees and board members’ fees

Three public rulings (BR Pub 23/01 – 23/03) on the GST treatment of directors’ fees and board members’ fees have been withdrawn due to amendments to s 6(4) of the GST Act.

All items have been updated to reflect the change from tax invoices to taxable supply information and for general clarity.

Court of Appeal upholds award of indemnity costs 

The Court of Appeal has dismissed an appeal against two High Court judgments awarding indemnity costs of $50,274.71 to the Commissioner of Inland Revenue.

The Court of Appeal had previously struck out the underlying substantive appeal but allowed the appeal against the award of indemnity costs to proceed. 

The central question was whether the High Court Judge erred in exercising his discretion to award indemnity costs. The Court concluded that the High Court Judge “addressed the correct legal principles and applied them to the facts of the judicial review proceedings”. 

The appeal was dismissed, with costs and disbursements awarded to the Commissioner.

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