From www.accountantsdaily.com.au: A recent Federal Court case, S.N.A Group Pty Ltd v Commissioner of Taxation, indicates that the documentation requirements for service fees set by the ATO may exceed what the court necessitated.

The case involved a Queensland family business where operating companies paid substantial fees to related entities without maintaining formal agreements, which drew scrutiny from the ATO.

The court ultimately ruled in favour of the family business, deciding that the fees were incurred in producing assessable income, and thereby challenging the ATO’s safe harbor guidelines regarding service trusts.