iscover
Accounting Times’ top 10 stories for 2025
A look back into some of the top headlines in accounting news this year with a recap of Accounting Times’ top 10 most-read stories this year.
Our most-read story this year was about everybody’s favourite topic: rental property tax deductions. After a Canberra rental property was rendered uninhabitable due to a roof leak, its owners – Sydney-based mum and dad investors – spent nine months and $138,000 getting the roof repaired.
Despite the eye-watering cost, Manu Gupta, principal partner at tax advisory firm M G Arthur & Associates, successfully argued that the couple’s expenditure counted as repairs and not capital under complex rental deduction laws.
In an exclusive interview with Accounting Times, Gupta said he knew that an ATO audit would be extremely likely once the couple submitted their tax return. As expected, the ATO audited the client and initially denied the deductions. However, Gupta persisted with an objection, and after careful deliberation, the ATO accepted the deductions in full.
The case exemplified Australia's complex rental deduction rules and reflected the importance of seeking a second opinion when advising clients on complex tax matters, told us.
Anti-money laundering and counter-terrorism financing (AML/CTF) has also been on accountants’ radars this year, with new rules set to take effect from 1 July 2026.
The expanded regime will capture ‘gatekeeper professions’ such as real estate agents, lawyers and accountants that provide designated services, including assisting with real estate transactions and setting up trust and company structures.
AUSTRAC, Australia’s financial intelligence unit, has been busy this year educating ‘Tranche 2’ entities about their incoming obligations.
These include requirements to enrol and register with AUSTRAC, develop and maintain an AML/CTF program, train staff, conduct initial and ongoing customer due diligence, report suspicious transactions and keep adequate records of their program. Businesses would also be required to develop and maintain an AML/CTF program and appoint a designated AML/CTF officer to be responsible for compliance in that area.
In a landmark decision, the NSW Court of Appeal determined in August 2025 that Uber drivers were employed by the company under ‘relevant contracts,’ and amounts paid by Uber to its drivers were wages under the Payroll Tax Act 2007.
The judgment left Uber liable to pay a whopping $81 million in payroll taxes, plus interest.
Tax lawyer Lisa To called this case a “wake-up call for businesses,” especially for those that relied heavily on contract workers. The outcome would have sweeping implications for those operating in the gig economy, mortgage broking and medical sectors.
To advised affected firms to take stock of their affairs over the past five years, given that revenue authorities had the power to investigate payroll tax liabilities retrospectively. She also encouraged companies to ensure their contractual agreements reflected commercial reality and to be proactive with authorities if issues were identified.
In October, a former Ernst & Young (EY) taxation partner who was terminated over an altercation with a Sydney bar manager failed to convince a court it was a breach of the partnership agreement.
Leonard Nicita contested his November 2023 termination for pushing and bumping his chest against the manager of Sydney bar, Dean & Nancy, during an argument over a missing jacket. Police attended and charged Nicita with common assault.
The judge found it was open for EY to terminate Nicita under the partnership agreement if it held a good-faith opinion that it was the best choice for the partnership. This opinion was supported by Nicita’s “track record” of misconduct, which included propositioning a married colleague at a Miami Vice-themed work Christmas party and a failure to inform the NSW Law Society he had been charged with common assault.
In March, the bill to tighten the definition of a fuel-efficient vehicle for the luxury car tax and end GIC deductions passed through Parliament.
Under the changes, the higher threshold applied to fuel-efficient cars for the luxury car tax would apply to fewer car types. For the 2024–25 financial year, the luxury car tax threshold for fuel-efficient vehicles is $91,387, while the threshold for other vehicles is set at $80,567.
The bill also contained amendments that would deny deductions for general interest charge and shortfall interest charge.
Taxpayers were restricted from claiming deductions for general interest charge (GIC) and shortfall interest charge (SIC) incurred on or after 1 July 2025, after Parliament passed amendments on 26 March.
In February, the government banned foreign investors from buying homes in Australia and cracked down on land banking practices in an effort to free up housing supply. Exceptions would be given for investments that would significantly boost housing supply, and for the Pacific Australia Mobility (PALM) scheme.
The government said that the “minor but meaningful” change would help address the housing crisis by allowing Australians to buy homes that would have otherwise been bought by foreign investors.
Between 2022 and 2023, foreign buyers purchased 1,800 properties in Australia, marking a small portion of property purchases. Over 630,000 residential properties changed hands during the 2023 calendar year, according to data from online property exchange network PEXA.
The ATO raked in $4.5 billion in GST and income tax liabilities in 2024–25 from its compliance activities with public and multinational businesses. The Tax Office said it would continue to focus on large businesses and multinational profit shifting to uphold compliance across the broader tax system.
The ATO acknowledged that large businesses had demonstrated some of the highest levels of tax compliance across all groups. Despite this, the authority noted that a “well-resourced and robust audit program” would remain necessary to address Australia’s profit shifting risks.
Since the Tax Avoidance Taskforce commenced, the ATO has raised $26.9 billion in liabilities from public and multinational businesses. They attributed $15.4 billion of this to the additional funding and resourcing dedicated to the taskforce’s activities.
This year, the government proposed an additional ‘Division 296’ tax on large superannuation balances, which caused quite a stir amongst tax experts.
In September, a tip to the Australian Financial Review indicated the government was contemplating changes to controversial aspects of its Div 296 super tax proposal, which would impose an additional 15 per cent tax on earnings of superannuation balances above $3 million.
While experts had welcomed the prospect of substantive tax reform to curb inequality, the government’s super tax proposal generated substantial controversy. The lack of indexation of the $3 million threshold and the taxation of unreleased gains garnered fierce industry backlash.
Spoiler alert: the tip was proven to be true when, in October, the government revealed it would amend the policy so it would no longer apply to unrealised gains, and that the $3 million threshold would be indexed.
In February, the Full Federal Court ruled that a tax scheme involving the sale of Billabong shares from a family trust to a super fund had the dominant purpose of obtaining a tax benefit. The case involved certain tax schemes undertaken by Billabong founder Gordon Merchant, based on advice provided by EY.
The Commissioner believed that the Billabong scheme had been entered into or carried out for the dominant purpose of enabling the Merchant Family Trust to obtain a tax benefit, being the capital loss incurred by it on the Billabong share sale.
The Tax Office cancelled the benefit by determining that the entire capital loss was not incurred by the Merchant Family Trust, which then increased the taxable income of the Merchant Family Trust. The majority of the court upheld that the taxpayer’s schemes had the dominant purpose of obtaining a tax benefit.
In March, the ATO highlighted some of its priorities for large and multinational public businesses in 2025, including major focus areas for the Tax Avoidance Taskforce.
Deputy commissioner Fiona Knight said the Tax Avoidance Taskforce would focus on arrangements that appear to be designed to avoid the inclusion of capital gains in the assessable income of Australian resident entities when disposing of assets.
According to the ATO, the taskforce was successful in holding the largest and wealthiest taxpayers to account over the course of 2023 and 2024, having directly secured over $10 billion in additional revenue.
From 2016 to 30 June 2024, the taskforce funding helped secure around $32.4 billion in additional tax revenue and raised $38.7 billion in tax liabilities from large public groups, multinationals, wealthy individuals and private groups.
About the author
