The Australian Tax Office’s (ATO) tax compliance efforts targeting international business and public groups focuses on specific tax risks, such as losses and profit shifting, and on specific events in the business life cycle, such as private equity investments and mergers and acquisitions, the agency said in a March 2 post to its website.
Issues attracting government scrutiny are capital gains tax, losses, profit shifting, concessions, and offshore evasion, the agency said.
Events attracting ATO’s attention are divestment of major assets and demergers, share buy backs, capital raising and returns of capital, private equity entries and exits, initial public offerings, trusts, consolidation, infrastructure investments, financial arrangements, cessation of business operations in Australia, and mergers and acquisitions.
The ATO also said it is “clustering common issues across taxpayers so we can treat them in a more timely, consistent, and effective manner.” As an example, the ATO cited its current review of the transfer pricing practices of offshore service hubs used by several mining companies.
The ATO also outlined its tax compliance focus for the following market segments: individuals, small business, privately owned and wealthy groups, tax professionals, goods and services tax, superannuation, and employers.
