Finance is still anticipating that its pending revised income-sprinkling proposals will be effective throughout 2018
23 November 2017 - 11:40pm
Points made by Ted Cook include:
- As previously announced, the revised income sprinkling legislative proposals will not limit access to the lifetime capital gains exemption. What this means is that where the LCGE would be available prior to July 2017, that eligibility for the exemption will be preserved under the revised proposals.
- He reiterated the proposition that the revised income splitting proposals will look at total contributions, including previous contributions of capital or labour and assumptions of risk.
- In clarifying the annnouncement that measures to limit access to the lifetime capital gains exemption would not be proceeded with, he indicated that where the LCGE would be available prior to July 2017, that eligibility will be preserved under the revised proposals.
- The intention is still to have the (pending) revised split income proposals apply to 2018 and subsequent taxation years.
- Finance intends to continue to work on accommodating intergenerational transfers.
- Although s. 246.1 and the revised s. 84.1 are dead and the current focus is on passive income and income splitting, “We will have to see where we end up with the conversion of income into capital gains.”
- Finance is still working through key design elements in the revised passive income proposals, but also still expects that there will be detailed proposals in Budget 2018.