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The Tax Institute Submission | Guidance on the meaning of affiliate and withdrawn Taxation Ruling TR 2002/6

Published on 17 Nov 21 by THE TAX INSTITUTE

Based on feedback from our members, and their concerns about the lack of technical guidance on the meaning of affiliate following the withdrawal of former Taxation Ruling TR 2002/6 Income tax: Simplified Tax System: eligibility – grouping rules (STS affiliate, control of non-fixed trusts) (the Ruling), The Tax Institute is writing to highlight the need for practical guidance from the Australian Taxation Office (ATO) on this subject.

The Ruling provided guidance on the application of the non-fixed trust control rule and simplified tax system (STS) affiliate under former Division 328 of the Income Tax Assessment Act 1997 (ITAA 1997). Following the repeal of the STS, the Commissioner withdrew the Ruling without replacement on the basis that it related to a now-repealed regime and had no ongoing relevance.

Although we agree that the original basis for the Ruling is obsolete, The Tax Institute considers that the withdrawn guidance about STS affiliates provides useful and contemporary guidance generally about the definition of an affiliate which remains a relevant concept in the current tax law.

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The Tax Institute is Australia's leading professional association and educator in tax, with offices in most major cities. Focusing solely on tax, the Institute provides the best resources, education and networks. Our mission is to equip tax professionals with everything they need to demonstrate the highest level of expertise and increase the advancement of public knowledge and understanding. We are also committed to propelling members into the future and onto the global stage with the introduction of the Chartered Tax Adviser designation.
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