As we approach 2015, the big tax items on the minds of board members relate to the increasing focus of tax on international transactions, and the potential for reputational damage from new tax transparency measures.
The international tax landscape is changing with a number of changes about to impact multinationals and companies operating in the digital economy:
- Ireland has responded to international pressures by announcing the closing of a popular tax loophole used by multinationals, known as the “Double Irish Sandwich”
- The Base Erosion and Profit Shifting (BEPS) project is well underway, subjecting multinationals suspected of engaging in these behaviours to increasing scrutiny
- Australia’s new transfer pricing rules, which came into effect on 1 July 2013, require companies to self assess their own transfer pricing compliance and have documentation in place before lodgement of their annual tax return to substantiate their position.
Boards around Australia should also be concerned with the ATO’s new public disclosure measures. For companies with total income over $100M for the 2014 tax year, the ATO will publish tax data such as the company’s ABN, total income, taxable income, and income tax payable. To find out more, see Brett Cox’s article Global Tax Shake-up, published in the December issue of Company Director magazine. Please contact Brett Cox on 02 8226 1655 or firstname.lastname@example.org if you would like assistance with any aspect of your Australian or international tax planning.