Tax on compensation received for inappropriate advice

Again, the answer to a tax question is “it all depends”.

       

 

On the heels of the banking and financial services Royal Commission, the Australian Taxation Office has published information about how tax applies for people who receive compensation from a financial institution that provided inappropriate advice and/or did not provide advice it should have. This can include compensation for the loss of an investment, or a refund of fees or interest.

Capital gains tax comes into play, and the compensation amount may count as part of your assessable income if it’s a refund of adviser fees that you’ve already claimed as a tax deduction.

Contact us if you’ve received compensation from your bank or adviser and need to know more.

 

 

AcctWeb

Latest Accounting News

Catch-up Contributions

July 2019 sees the introduction of the new catch-up contribution rules, which allow people with less than...

Read More

Life Insurance

Important:  A major change to life insurance in many super funds.           The Federal...

Read More

Community tip-offs trigger ATO visits

Around 700 small businesses in Western Australia are set to receive door knocks from the ATO next month...

Read More

Australia at a glance

The following link takes you to a site that sets it all out in black and white, though a strong coffee will...

Read More

2019: Tax Time Checklists – Individuals; Company; Trust; Partnership; and Super Funds

Printing and completing these checklists makes it more efficient for your tax agent to complete your tax...

Read More

Small business clients need to be ready for STP by 30 September

The original deadline of 1-7-2019 has been extended.  Read more about what every small business needs to do...

Read More

Big four firm outlines new financial year checklist for SMSFs

With the new financial year starting, one of the big four accounting firms has highlighted the key areas on...

Read More

Alert – Online Share Accommodation

Home-owners should consider the wider taxation implications of renting the family home before taking a...

Read More

ATO flashes warning over $7.2bn car expenses claims

Over $7.2 billion in work-related car expenses claimed last year have placed the popular deduction firmly in...

Read More

Vital statistics for our great nation.

            One great source of data about Australia. Become better acquainted with the country we...

Read More

3 out of 4 tax dob-ins are about business

The Tax Office has confirmed that the majority of “tip-offs” it receives about possible tax avoidance are...

Read More

Tax on compensation received for inappropriate advice

Again, the answer to a tax question is “it all depends”.           On the heels of the...

Read More