Agree Elwood

FWIW though Mr Prez - I did say that the current board were also to blame for not restructuring! However this was clearly Elliott's scheme that was put in place originally... and no matter which way you look at it, he has a history, not only at Carlton, for turning things to shit with his dodgy pushing of the financial rules...

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If meat is murder then yoghurt must be burglary
GO YOU BIG RED FIRE ENGINE
Move aside Kouta, Lance etc - you're holding us back... from entering the under 18s

no argument with that at all about Elliot

however the board was supposed to have gone threw the books with fine tooth comb and surely if they knew what they were doing they would have known well and truly about this possible scenario.

perhaps they lit is slide hoping that if they get found out they can blame the old board.

either way IMO i dont think either is to blame really. I would have thought its not possible to change the rules half way through the game - but considering some of the posts here that certainly doesnt seem to be the case.

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Got to love the stare Down by Setanta on Llyod

maybe the current board knew about it and were waiting on the Federal Court ruling before deciding to act. If the Court ruled against the ATO what would be the point in changing what was a profitable and not illegal operation? I'm sure they worked through the issue and had a contingency in place if the Court ruling went against them.

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The only way for some people to understand is for them to be on the receiving end

Left wing moralists
In self serving denial
They shit me no end

I would imagine that the Social Club was audited as part of its corporate governance and if the auditors didn't think there was anything untoward then it is all down to the change in ATO interpretation.

Has anyone here actually seen the assessment issued by the ATO?

If not, how can we blame the current board for something which it may have inherited? It is possible that the assessment is for certain years in the lead up to the Federal Court decision. It is also possible that following the ruling by the Federal Court that the club changed the structure of its operations.

It is also possible that the assessment includes recent years - which would be the current board's responsibility.

None of this would absolve the club from its tax liabilities for previous years.

However, all boards must take risk management decisions, and the board may have viewed the risk as being appropriate, rather than simply having ignored it.

Carlton were certainly not the only sporting club to be treating social club income in this manner. So to blame JE simply because of all of his other stuff ups is pretty lame thinking. If the Federal Court had held in favour of the taxpayer rather than the ATO we as members would be pissed off with the administration for not taking advantage prior year tax savings.

Prez, the ATO may not have simply changed its mind on this issue. It is likely that it had this view for quite some time and simply had to wait for the right test case to take to court to ensure a win. Also the ATO generally don't scaremonger. If it issues an assessment it is well past the stage of bluffing.

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A society grows great when old men plant trees whose shade they know they shall never sit in.

Good Ol Jack....What colour are the tiles in the Ladies?

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A Life!.....Great....I wonder where I can download one of those.

Sorry guys ( I am normally not rude) - but most of you are talking total crap with no understanding of the situation.

The following is the most sensible comment:



That is it in a nutshell. I have worked for companies big and small - this shit happens all the time. Advisers (Accountants) tell a company how to minimise tax legally. Tax law is VERY complex and a lot is up to interpretation. Now, from time to time the ATO challenges / changes these interpretations - often there is a court case and the outcome decides practise. A lot of Australias largest companies had this issue - including some of the 4 big banks (recently)- with a nice large tax bills at the end. And these companies have the best tax advice money can buy.

So stop this crap about who set it up and this being the Boards responsibility. The structure was probably set up (and worked tax wise for many years) based on sound advice. ATO changes the ball game - well shit happens. This has very little to do with the current Board's ability .

i wasnt implying the ATO was scaremongering - but more so Caro.

and mikkey i actually agree with.

i dont know stuff all about tax law - but it appears to be me from what i can gather here it appears the ATO themselves has moved the boundaries and if that is the case then i cant see how its the previous or current boards fault. they can only work with the rules they have in front of them and if that changes down the track then so be it.

i still stuggle though - from an ethical point of view - how they can change the interpretation and then expect everyone from years gone past to comply. Sure, we change the Tax Laws and everyone has to comply from here on out - but i was surprised to read that if they make a change, say in 2006 that that change can then be back dated to 2000 or further. Thats remarkable.

Could the ATO be seen to swaying judgement though to further the coffers? Certainly makes you wonder what hope businesses have when they tell you can do one thing, then 2 years later tell you you cant do it and then expect to get all the taxes back that they would have got in those two years in one fell swoop.

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Got to love the stare Down by Setanta on Llyod

Sorry mate, but to that I give you a big tongue sticking out emoticon thingy!

Yes - it was legal... but you can't tell me that it wasn't clearly a bit of a dodgy loophole that we thought we'd get away with for as long as we could. Let's bring heaps of revenue to the club via the social club and we wont get taxed... sounds great in theory, but as if the ATO aren't going to wake up to that sooner or later!

Possibly why only one other club set themselves up in the same way?

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If meat is murder then yoghurt must be burglary
GO YOU BIG RED FIRE ENGINE
Move aside Kouta, Lance etc - you're holding us back... from entering the under 18s

mikkey, you're being rude.

And your understanding of the situation is based on what?

On the board are you?

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This might sound extreme in the context of alleged sexual assault, drunken violence and a drug trafficking charge...

Totally agree with Mikkey, BHP Billiton recently got hit with a tax bill of almost $1 billion, due to a change in interpretation. This wasn't a result of a dodgy board decision.

but I think the tone of Caro's article was scaremongering.

1) Prez: Welcome to business. Unfortunately this is the way it works. We have very complex tax laws. Business’s (and individuals) try (legally) to minimise their tax "exposure". That is where all these nice companies like KPMG make their money. They give tax advice based on the law, the official interpretations / rulings and relevant court cases. The ATO from time to time changes the interpretation or comes up with new ones (if they feel practise does not comply with the intentions of the tax law). This is often challenged in court and the outcome decides practise. This can hurt business' as it is applied retrospectively. Just the way it is...

2) Wofister:
[quote] Yes - it was legal... but you can't tell me that it wasn't clearly dodgy loophole that we thought we'd get away with for as long as we could.â€

Let me give you one example of the type of issue at hand from todays Herald Sun which shows the "interpretation" issue can also be complex in personal tax matters:

The new Poker King from Preston faces either nil tax on his 10 million or nearly half of it in tax. Why you ask, well it depends on:

- was his winning based on "skill" or "luck". If it is the first he has to pay, if it is the second he gets off. He plays Texas Holdem (AFAIK) where there are 5 cards being turned and in many ways it is a combination of skill ("know when to hold them, know when to fold them... etc. - thanks Kenny ") and luck (i.e. good cards in the flop fitting your 2 cards ) on the day. So what is it going to be? Depends on interpretation. The ATO will take a look and he might challenge it in court if he does not like the interpretation . That does not mean he is dodgy, does it?

- hi tax issue also depends on if he is seen as a "professional" player or an "amateur". He is a Chiro, but he has played in tournaments and won money - so which status will it be? Again ATO interpretation folowed by maybe a court case.

The above just to illustrate why there are so many "interpretation issues" and tax cases in court.

some times i reckon im dyslexic

first time i read that i saw

"i have first hand teen sex issues being handled"

was thinking lucky bastard ... then i thought, that cant be right

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Got to love the stare Down by Setanta on Llyod

Mikkey - congratulations your are the only one making sense here.

I thought this was a Forum for people Talking Carlton - however ATM we have too many here only looking at things in "Black or White".

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"Hence you will not say that Greeks fight like heroes but that heroes fight like Greeks"?

Winston Churchill

I didn't say it wasn't legal... I said it was dodgy and innevitable that they would change the ruling as we were clearly taking a big advantage of it.

Nor did I argue that it wasn't complex by the way - the tax system has to be complex, and it's not until loopholes like this one are exposed that new rulings can be made. I would say we would certainly have gotten advice and thought "ripper - let's take advantage of this baby for as long as we can"... and much like a lot of other business advice on loopholes that our former President has received - it's come back to bite...

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If meat is murder then yoghurt must be burglary
GO YOU BIG RED FIRE ENGINE
Move aside Kouta, Lance etc - you're holding us back... from entering the under 18s

Does that mean if I was lucky to get this job, and lucky to make it through the last year...I don't have to pay tax?

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"The ability to speak doesn't make you intelligent." Qui-Gon Jinn 15-05-2005

"there’s more chance of me becoming the full forward for the [Western Bulldogs] than there is of any change in the Labor Party." Julia Gillard 18-05-2010

Why was it dodgy and why innevitable to come back and bite them? If your accountant tells you that you can split your income with your wife and save tax - is that dodgy? Would you not follow his advice? Would you think you do the wrong thing? Do you really think a responsible Board would sit there and go like you are writing above?

Do you think funnelling the club's revenue through the social club so as to avoid paying tax isn't dodgy?

Clearly 14 other clubs thought it was dodgy....

This is clearly different to a family tax situation.

Given our reportedly massive exposure - an exposure 15 other clubs don't have - I don't think it's unreasonable to hold someone to blame... you're right Agro, it's not just black and white... some faces should be very red...

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If meat is murder then yoghurt must be burglary
GO YOU BIG RED FIRE ENGINE
Move aside Kouta, Lance etc - you're holding us back... from entering the under 18s

From memory one of the original suggested initiatives of the new board was to simplify the financial structure of the club and bring it all in under the football club. For various reasons it wasn't going to be possible to do that in one hit. (Possibly to do with being close to trading while insolvent - I don't actually know but I'm fairly certain there were pretty good reasons).

As Wolfister pointed out the old structure wasn't "technically" illegal but it was based on an effort not to fund more schools, hospitals etc.

I have no idea why it still hasn't been done but I'm sure the club will make a public comment on the issue before too long.

Until then we can all sit in here and spout whatever about whatever but none of us appear to have any inside information on the club's position at this stage so why blame one board or another or anyone else for that matter until we have a better understanding?