27 January 2026 to 30 January 2026
Weekly Bulletin Contents
TAX
Tuesday 27 january 2026
ATO: Average foreign currency exchange rates for 2025 year
The ATO has released average foreign currency exchange rates for selected countries for the calendar year ending 2025 as follows (Aust $1 equivalent): Canada dollar – 0.9012; China renminbi – 4.6346; Europe Euro – 0.5713; Hong Kong dollar – 5.0277; Indian rupee – 56.2173; Indonesian rupiah – 10621.7928; Japanese yen – 96.4920; Malaysian ringgit – 2.7610; New Zealand dollar – 1.1088; Philippines peso – 37.0855; Singapore dollar – 0.8426; South Korean won – 916.6274; Swiss franc – 20.0759; Thab baht – 21.1992; United Kingdom sterling – 0.4893; United States dollar – 0.6449; Vietnamese dong – 16778.0398.
OECD report recommends Aust places greater reliance on GST
The OECD has released its Economic Survey of Australia for 2026. In relation to taxation, it has made a number of recommendations across various tax areas, including that Australia broaden its GST base and move away from personal income tax and corporate income tax and place greater reliance on indirect taxes (including land tax and motor fuel taxes). It also recommended that tax concessions for superannuation for high wealth individuals be tightened.
Wednesday 28 january 2026
No grounds for remission of shortfall penalties
The ART has ruled that there were no grounds for the remission of 50% shortfall penalties imposed for “false or misleading statements resulting from recklessness” in relation to three amended assessments for omitted income of some $180,000 – comprised of omitted rental income and unexplained bank deposits and payments. In refusing to remit the penalties the ART said: “..the Applicant’s conduct was not careless, passive or isolated. There was a wilful blindness and complete abdication of responsibility for her tax affairs. In the absence of a full and proper explanation, remission (even in part) would risk conveying a message that reckless indifference or voluntary disengagement carries no real consequences”. (Tilli and FCT (Taxation and business) [2026] ARTA 80, 23 January 2026)
ATO: GIC remission requests
The ATO has released examples where it may be likely to accept or more likely to decline general interest charge (GIC) remission requests. The ATO said while each case is decided on its own merits, circumstances where it’s likely that a request for remission would be approved, include: where you have been impacted by natural disaster (such as fire, flood or drought); where industrial action has impacted you or your tax or BAS agent; unforeseen collapse of a major debtor; sudden ill health of an individual, sole trader or key personnel in a small business; theft of, or damage to property critical to business operations; and bereavement of a family member.
Thursday 29 january 2026
PCG: ATO resource allocation for first year of Payday super
The ATO has released Practical Compliance Guideline 2026/1. It outlines how the Commissioner will allocate compliance resources for QE days in the first year of Payday Super, from 1 July 2026 to 30 June 2027. It states that the ATO will prioritise the application of compliance resources to employers of highest risk, and will not have cause to apply compliance resources in respect of employers falling in the low-risk zone. This final Guideline includes minor updates to provide clarity, including further details on when an employer will fall in the low-risk zone.
No grounds for remission of penalties where “acquaintance” lodged returns
The ART has ruled that there were no grounds to remit 50% shortfall penalties of some $62,000 imposed for recklessness in relation to 3 amended assessments. The taxpayer had allowed an old acquaintance, who had spruiked a so-called loophole to get all his tax back on social media, to lodge amended income tax returns on his behalf whereby “fraudulent deductions” were claimed equivalent to his gross income in each year. The taxpayer argued that: he was the victim of a scam; he thought he had made a voluntary disclosure; he took reasonable care; and that he was remorseful. However, in finding that the taxpayer had not proved that the amended assessments were excessive and that there were no grounds to remit the penalties, the ART said the taxpayer’s claims were insufficient factors to make remission appropriate in the circumstances. (Crawford and FCT (Taxation and business) [2026] ARTA 90, 28 January 2026)
Draft TD: Meaning of “right to occupy” for exemption for inherited home
The ATO has released draft Determination TD 2026/D1. It will clarify the Commissioner’s view on when an individual has a “right to occupy” a dwelling under a deceased’s will for the purposes of s 118-195(1) of the ITAA 1997 for the purposes of obtaining a CGT main residence exemption. Specifically, it states that the exemption limited to circumstances where a right to occupy has been expressly granted under the terms of the will to an individual specifically named in the will. Comments due by 27 February 2026.
Institute of Financial Professionals Australia: Writing a will to give the executor the power to give someone a right to occupy the inherited dwelling for the purposes of accessing the concession, will no longer suffice.
Friday 30 january 2026
Super thresholds: key increases flagged for 1 July 2026
The Australian Bureau of Statistics’ (ABS) recent CPI data points to a lift in the general transfer balance cap (TBC) from $2.0 million to $2.1 million effective 1 July 2026. This means members who start their first retirement phase income stream in 2026–27 are expected to have a personal TBC of $2.1 million.
What else changes if the cap rises?
Many total super balance (TSB) thresholds are linked to the general TBC. A rise in the general TBC from 1 July 2026 would allow member’s with a TSB of less than $2.1 million to make non-concessional contributions (NCCs) to super.
Currently members with a TSB of $2 million or more at 30 June of the previous year cannot make NCCs without breaching their cap. TSB limits which determine eligibility to utilise the two and three year NCC bring-forward rule will also change.
Contribution caps likely to rise
The concessional contribution (CC) cap is based on AWOTE figures that have not yet been released (expected late February). That said, it is expected that the CC cap will increase from $30,000 to $32,500 on 1 July 2026.
An increase in the CC cap will flow through to an increase in the NCC cap which is set at four times the CC cap. This would translate to the NCC cap rising to $130,000 and the three-year bring forward amount would rise to $390,000.
Taxpayer carrying on business re sale of 3 residential units
In a matter related to the sale of 3 residential units, the ART has found, on balance, that the taxpayer failed to show that the profits from the sales were not ordinary income from a business and that the properties were not trading stock. Likewise, it was concluded that the taxpayer had failed to show that the activities were not in furtherance of the enterprise for GST purposes and that, therefore, the sales were subject to GST. However, the ART found that the Commissioner’s GST assessment for one BAS period was time-barred from assessment. Among other things, the ART noted that the fact that “debt repayment was needed because of a marital split did not remove the sale of the properties from being a sale in the ordinary course of business”. (RRKC and FCT [2026] ARTA 95 (28 January 2026)
ATO: Key dates for employers in 2026
The ATO has listed key dates for employers for 2026, and what they need to do.
- 28 February 2026 – Lodge and pay your super guarantee charge (SGC) statement to us by this date if you missed the 28 January SG due date for the Oct to Dec 2025 quarter.
- 31 March 2026 – The FBT year ends on 31 March 2026. If you’ve provided fringe benefits between 1 April 2025 and 31 March 2026, then ensure you’re ready for FBT obligations.
- 28 April 2026 – SG contributions for the Jan to March 2026 quarter to your employee’s super funds are due; allow time for payments to be received if using a clearing house.
- 21 May 2026 – lodge your FBT return and pay by this date if you have an FBT liability and are lodging by paper. If you’re lodging electronically through a tax agent, you have until 25 June 2026.
- 28 May 2026 – Lodge and pay your super guarantee charge (SGC) statement to us by this date if you missed the 28 April SG due date for the January to March 2026 quarter.
- 1 July 2026 – Small Business Super Clearing House is closed.
- 1 July 2026 – Payday Super begins – you’ll need to change how frequently you pay super.
- 14 July 2026 – Finalise your Single Touch Payroll (STP) data for the 2025–26 year, so your employees have the information they need to lodge their income tax returns. Include any reportable fringe benefits amounts in STP or on their payment summary.
28 July 2026 – SG contributions for the April to June 2026 quarter are due into the super fund so allow extra time if you’re using a clearing house.
SUPER & FINANCIAL SERVICES
Super thresholds: key increases flagged for 1 July 2026
The Australian Bureau of Statistics’ (ABS) recent CPI data points to a lift in the general transfer balance cap (TBC) from $2.0 million to $2.1 million effective 1 July 2026. This means members who start their first retirement phase income stream in 2026–27 are expected to have a personal TBC of $2.1 million.
What else changes if the cap rises?
Many total super balance (TSB) thresholds are linked to the general TBC. A rise in the general TBC from 1 July 2026 would allow members with a TSB of less than $2.1 million to make non-concessional contributions (NCCs) to super.
Currently members with a TSB of $2 million or more at 30 June of the previous year cannot make NCCs without breaching their cap. TSB limits which determine eligibility to utilise the two and three year NCC bring-forward rule will also change.
Contribution caps likely to rise
The concessional contribution (CC) cap is based on AWOTE figures that have not yet been released (expected late February). That said, it is expected that the CC cap will increase from $30,000 to $32,500 on 1 July 2026.
An increase in the CC cap will flow through to an increase in the NCC cap which is set at four times the CC cap. This would translate to the NCC cap rising to $130,000 and the three-year bring forward amount would rise to $390,000.
ASIC highlights key conduct and market risks for 2026
ASIC has released its Key issues outlook 2026, setting out the major risks it expects to shape within Australia’s financial system this year. Some key themes ASIC is watching in 2026 include:
- Superannuation operational and service failures
ASIC has identified continuing concerns in superannuation administration, including processing delays, poor customer support, inadequate systems, and vulnerabilities to scams and fraud.
- High-risk investments and questionable advice models impacting retirement outcomes
ASIC has flagged the risk of aggressive marketing, lead generation practices and templated (“cookie-cutter”) advice approaches driving consumers into complex or higher-risk products that may not be appropriate, especially where switching activity is encouraged without taking into account the client’s circumstances.
Technology-driven harms and the rise of AI-enabled misconduct
ASIC points to increasing harms linked to digital engagement and automation, including AI-enabled scams, misleading online content, and potential risks from advanced AI tools that can operate with greater autonomy. Cyber risk and third-party technology dependencies remain a central concern.
Payday Super: ATO outlines “first-year” compliance approach
With Payday Super commencing on 1 July 2026, the ATO has released guidance (PCG 2026/1) explaining how it will focus its compliance resources in the 2026-27 income year.
What “on-time” looks like
In simple terms, SG is generally expected to reach an employee’s fund within 7 business days of payday (subject to limited alternative timing rules in specific situations).
ATO’s risk-based approach (first year only)
The ATO will use a practical “traffic light” approach when deciding where to direct compliance effort:
- Low risk: The employer is clearly trying to do the right thing (for example, contributions are made in time but are rejected due to data issues) and the error is fixed promptly so there is no remaining SG shortfall.
- Medium risk: The employer doesn’t meet the low-risk criteria, but any shortfalls are fully rectified within a reasonable “catch-up” window after quarter-end.
- High risk: SG remains unpaid or underpaid beyond the catch-up window. These cases will be prioritised.
What advisers can do now
For employer clients, encourage early readiness: review pay-cycle processes, confirm clearing house timeframes, tighten data quality to avoid rejected payments, and set up regular reconciliations so exceptions are identified and corrected quickly.