Mr Sakell’s comments follow last week's announcement by the Board of Taxation of proposed changes to Division 7A of part III of the Income Tax Assessment Act 1936.
While welcoming the board’s announcement, Mr Sakell has called on the government to accelerate the changes and to make sure more is done to support small business.
“In relation to Division 7A, we are concerned these worthwhile changes will be delayed until at least 2016. They are very relevant to the many small businesses that operate through companies and trusts that are subject to significant tax compliance in relation to the use of their profits within their own businesses,” he said.
Mr Sakell said other key opportunities that the government needs to look at as part of the Board of Taxation review include simplifying the small and medium-sized enterprise CGT concession rules; introducing safe harbours and carve-outs from transfer pricing documentation and compliance requirements; giving more flexibility to trusts; and reviewing the tax compliance and complexity arising from trusts making family trust elections.
Division 7A contains integrity provisions designed to prevent shareholders (or their associates) of private companies from inappropriately accessing the profits of those companies in the form of payments, loans or debt forgiveness transactions, according to the Board of Taxation’s website.