2016 Federal Budget Update on Targeted amendments to Division 7A

Changes effective 1 July 2018 (i.e., 2018/19 income year)

1.1 Targeted amendments to Division 7A

From 1 July 2018, the government will make targeted amendments to improve the operation and  administration of Division 7A of the ITAA 1936, as a result of a number of recommendations from the Board of Taxation’s Post-implementation Review into Division 7A.  

These changes will provide clearer rules for taxpayers and assist in easing their compliance burden  while maintaining the overall integrity and policy intent of Division 7A. The amendments will include:  

• a self-correction mechanism for inadvertent breaches of Division 7A;

• appropriate safe-harbour rules to provide certainty;

• simplified Division 7A loan arrangements; and

• a number of technical adjustments to improve the operation of Division 7A and provide increased

certainty for taxpayers.

1.2 Tax Integrity Package – Better protecting whistle blowers

From 1 July 2018, the government will introduce new arrangements to better protect individuals who  disclose information to the ATO on tax avoidance behaviour and other tax issues.  

Under the new arrangements, individuals, including employees, former employees and advisers,  disclosing information to the ATO will be better protected under the law. 

  (Note: The information is sourced through National Tax and Accountants' Association - NTAA)