After 35 years of stockbroking for some of the biggest houses and investors in Australia and the UK, the Secret Broker is regaling Stockhead readers with his colourful war stories — from the trading floor to the dealer’s desk.

Well, we are coming up to Australia’s tax year end and this means I get a cold shiver down my back. I can feel the taxman and Grim Reaper rolled into one, leaning over my shoulder.

I don’t know about you, but to me, death and tax both conjure up the same image as a tax collector never feels warm and fuzzy.

‘What do I do for a living? Oh, I’m a tax collector.’ Not a question you’d want to be asked when standing around the BBQ, sharing a few beers with some self-employed people.

Cue a frosty five minutes of silence. The best you might do is some advice on how they could save five grand or so, with some obscure tax break that only a few privileged people would know about.

There is so much red tape in Australia that even a GST set as a 10% tax has over 500 different explanations on what is or isn’t taxable.

Here is a link to the ATO website, that contains the A to Z of what food items are taxable or non-taxable. If I am feeling a bit depressed, I always open up the link to give me a real belly laugh, leaves me feeling so much better.

But if you haven’t got a spare few hours, I will help you out with some of their finest examples:

Chinese pancakes: GST-free; Food for human consumption that is not of a kind specified in Schedule 1 of the GST Act. Schedule 1, items 20 and 27 of the GST ACT do not apply because a Chinese pancake is a kind of tortilla or flatbread that does not contain a sweet filling or coating (refer to ATO ID 2002/908).

‘Kind of’. You’ve got to love that bit of English language, just thrown in with ‘tortilla or flatbread’.

If you ever run out of trivia questions for your next charity fundraiser, how about this for a Q and A:

Is a hot cross bun with a sweet filling or coating (other than a glaze, supplied hot or cold or requires cooking, heating, thawing or chilling prior to consumption) exempt from GST?

You could put that under the John Hewson section of your quiz night.

The answer is of course no, as it is taxable. However, if it was a ‘hot cross bun, plain without a sweet filling or coating (a glaze is not considered a sweet coating)’ then it would have been exempt from GST.


So now you know that the taxman/person/thing/reaper does not consider a sugary, sticky-finger glaze as a sweet coating.

If you scroll to the very end of the A to Zs, (it will cost you five minutes out of your life), you will be glad to know that the very last item is saved for ‘zabaglione (Italian cream mousse)’ which luckily for our Italian lovers is GST free. As is the item above it, which is of course my beloved frozen Yorkshire Pudding.

They are also GST free. As for the tax on gravy, I’m not so sure about, though I am now feeling very hungry!

I think by now you get the general gist of where the tax office stands in my list of ‘most admired offices for the bettering of the human race’. Somewhere down there with the zabaglione.

Less conversation, more action

Different cultures but now so close together, thanks to the ATO.

Going back to the ’80s in London, you could probably see the taxman as dressed in a white John Travolta disco suit, complete with the hairy chest and gold medallion, knocking on your front door when he knows your wife is home but you are not.

(Or was that me?)

Can’t really remember too much about those days, though I distinctly remember that tax in the UK back then was quite fun to grapple with.

In England at this time, every man, woman and child would get a yearly capital gain exemption of £5,800, which could not be rolled over to the next year.

Use it or lose it was our mantra to clients as the 5th of April started to approach.

Even newborns (legitimate or illegitimate) could somehow be used to take advantage of this ruling, hence the knocking on so many housewives’ front doors.

Nothing like comforting a vulnerable housewife at tax time, closely helping her tick the right boxes before suggesting if she’d like another little tax break running around.

Ah, those were the days. Shuffling bits of share certificates and transfer forms around the place, so that everyone in the family could be used as a CGT exemption.

This could be why the Irish families were so large. Each kid was worth £5,800 a year and ‘taters are tax free. Smart people, the Irish.

In our family alone, there were five of us and when I explained to my father how all of this worked, all of a sudden about 20 rellos (handily with the same surname) became part of our tax (scam/avoidance/PWC/furthering of the human race) scheme.

I would shuffle around all the paperwork and then collect 50% of any tax saved on their tax returns, thus giving me another excuse for turning up and knocking on all of those rewarding front doors.

Of course this cunning stunt only worked if you had made a nice paper gain in some shares – and these were the good years, thanks to Maggie Thatcher.

Unfortunately for me and my now vastly expanded family, all good things have to come to an end. Following a few paternity suits and having a particularly bad run in the old capital gains department, my share losses then meant that everyone had nothing to offset.

As losses could be carried forward but the £5,800 exemption couldn’t, I needed to keep them for when things got better for me.

The only takeaway I can give you to this story, apart from moving to Australia and having no forwarding address, is to always have the cash ready to pay your tax bills.

Don’t leave the amount you owe in shares, ready to be sold when the Grim Reaper has tapped your letter box, because there is nothing like a crash or a suspension of a holding to wreck your ability to pay.

You have the crash of ‘87 to thank me for that bit of advice and I have the English tax department to thank for me being in Australia.

Ronnie Biggs- You got the wrong country.



The Secret Broker can be found on Twitter here @SecretBrokerAU or on email at [email protected].

Feel free to contact him with your best stock tips and ideas.