Amounts you incurred in accordance with the issued product rulings will be tax deductible if the arrangement was carried on as described in the product ruling. If the schemes are wound-up or the implementation of the scheme changes in a material way, the relevant tax law will apply.

Amounts you incurred in accordance with the issued product rulings will be tax deductible if the arrangement was carried on as described in the product ruling. If the schemes are wound-up or the implementation of the scheme changes in a material way, the relevant tax law will apply. Where an expense is not actually invoiced or is written off, a deduction may not be available as these amounts may not have been ‘incurred’.

The deductions will be still be allowed in the year they have been claimed but the refunds will be included in assessable income.

Yes. Provided the Commissioner has exercised his discretion in the relevant product ruling. However, if the:

• discretion has expired
• arrangement is found to be implemented in a different manner, or
• project is wound-up

then the discretion does not apply and the amounts will need to be quarantined and cannot be offset against other income.

Generally, losses must be quarantined (under non-commercial loss provisions) until such time as the project produces a net amount of assessable income in a financial year. If the projects are wound-up, you will not be able to offset your quarantined losses.

Yes, if the schemes are wound-up or there is found to be a material difference in the way that the scheme is implemented as a result of the administration or later events. However, if you were accepted into a scheme under the terms and conditions set out in the relevant product ruling, the tax benefits ruled on in the product rulings apply up until the date the schemes are wound-up or a material change occurs.

Yes. They will continue to be deductible where the interest has been ruled on within the product ruling and the interest is incurred. This will apply even if the Projects have been wound-up.

No. Only the finance arrangements set out within a product ruling are covered by the relevant product ruling. If you have entered into a finance arrangement that is not set out in the product ruling, you may request a private ruling to provide you with certainty on the deductibility of interest incurred under that finance arrangement.

Loans to acquire income producing property generally result in interest expenses being deductible. However, where there are uncommercial features to the loan arrangement or the arrangement involves pre-payments of interest, then the tax rules may prevent deductibility or limit the amount of deductions that may be claimed in a single year. If you think that you may fall into either of these cases, you should seek independent advice or contact us for a private ruling on your personal circumstances.

To be covered by a product ruling you need to be within the ‘class of persons/entities’ to which the product ruling relates. In addition to this, a product ruling only applies to a scheme where the scheme is carried out in accordance with the arrangement described in the product ruling.

We are working with the administrators to fully understand what will occur if the MIS’s are wound-up or any other significant change occurs. An event like the winding up of the MIS or a significant change in the implementation of the scheme will mean that the product ruling will cease to apply. However, the ordinary provisions of the tax laws will still apply. We will issue guidance on the tax effects if this occurs or you may wish to apply for a private ruling on your individual circumstances.

The Tax Office is currently working with the Administrators to fully understand what will occur if the MIS’s are wound-up or leases are terminated.

There may be income tax and/or capital gains tax consequences depending on the circumstances and the amounts received.

Capital losses can only be used to offset capital gains while income tax losses can be used to offset other income.

If the new entity runs the scheme as per the product ruling, the tax office may make relevant changes and you will still be covered by the ruling.

If the new entity chooses to run the scheme differently, the product ruling will no longer apply. However, any costs you incur in remaining in the scheme may still be deductible under the relevant tax laws.

No. If you were accepted into the scheme outside of the dates specified within the product ruling, you will not be covered by that product ruling. If you wish to determine the tax consequences of participating in these projects, you need to apply for a private ruling from the Tax Office.

On an application made by a creditor, director or some other interested party, to either the Supreme or Federal Court, an Official Liquidator can be placed in charge of a company, its assets and business for the purpose of winding it up and distributing monies collected amongst creditors and if appropriate, shareholders.

The process from time of application to appointment of Liquidator is usually around four weeks.

On an application made by a creditor, director or some other interested party, to either the Supreme or Federal Court, an Official Liquidator can be placed in charge of a company, its assets and business for the purpose of maintaining and protecting assets until the Court formally considers any winding up application.

Such an order is generally made by the Court in circumstances where there is a real or perceived concern that either:

• assets of the company may be lost, removed or otherwise dissipated, or
• the company's business may be adversely affected by some pending event or the value of the business in someway reduced without the control and protection of the Provisional Liquidator.

A company which is solvent, but has come to the end of its useful purpose, is liquidated by shareholder resolution which results in the appointment of a Liquidator and the ultimate realisation and distribution of company assets.

No particular licence is required to act as a Liquidator in these circumstances.

The link attached here provides, free of charge, the forms and checklist for you to undertake such a Liquidation.

A secured creditor (ie one with either a fixed and or floating charge) can appoint an Official or Registered Liquidator to take control of assets subject to the charge and to realise them for the secured creditor's benefit; but regard must be had to the Receiver's obligations to other creditors, the company and its members.

The Receiver is commonly appointed as a Receiver and Manager so as to enable business activity to continue.When the Receiver has collected all available monies subject to the charge, the remaining assets (if any) and company are returned to the control of the directors but quite commonly, in the interim, a Liquidator will have been appointed and control will then be handed to the Liquidator

A company which is insolvent or is likely to become insolvent at some future date can obtain protection from creditor action by the appointment of a Registered Liquidator to act as Administrator of it.

The Administrator, while taking control of the company and where appropriate continuing its operation, must investigate the company's affairs and provide a report to creditors making a recommendation as to its future.

At a meeting of creditors, usually called 28 days after the Administrator's appointment, creditors will vote to decide whether to accept or reject any proposal that may be put forward as to how the company's affairs are dealt with into the future.

The Administrator is usually appointed by the Directors but can also be appointed by a Secured Creditor with a charge over all or a substantial portion of the company's assets.

Under Administration the functions of a Committee of Creditors are:

1. consulting with the administrators about matters relating to the administration.
2. to consider and receive reports by the administrators.
3. the Committee of Creditors also agree the remuneration of the administrators in line with the Act.
4. the frequency of meetings and reports is determined by the committee of creditors, these request must be reasonable.

Note: The committee of creditors is not able to give directions to the administrators, other than requiring the administrators to report on matters relating to the administration.