The diverted profits tax: a new landscape for advisers – 2017 Queensland Tax Forum

Anthony Portas CTA

The diverted profits tax (DPT) entered into law on 1 July 2017.

Multinational organisations with an annual global income of more than $1 billion (AUD) and an annual Australian income of more than $25 million now face a 40% tax on profits found to have been artificially shifted overseas.

The Government expects significant tax revenues from the new tax, which applies to the 2017 financial year, and to any schemes entered into before the law came into effect.

The DPT builds on the previous Government effort to combat tax avoidance by multinational companies operating in Australia – the Multinational Anti-Avoidance Law (MAAL), which came into play in December 2015. 

At the upcoming Queensland Tax Forum, MinterEllison's Anthony Portas CTA and Carmen McElwain CTA will present the session ‘Diverted profits tax and MAAL – How and when they apply and how to manage disputes.’ 

We spoke with Anthony about what their session will cover and some of the issues facing practitioners.

Anthony said: ‘In the first part of the session, I will be presenting on how the DPT and MAAL apply, and how to manage disputes when they are raised. I’ll provide a detailed briefing on the circumstances when the DPT can apply, including the various exclusions and carveouts from the rules. I’ll also discuss how the DPT interacts with the transfer pricing rules. I will then be joined by my fellow partner at MinterEllison, Carmen McElwain, who will discuss managing DPT risk and strategies for dealing with the ATO in relation to DPT disputes.’

The introduction of this law and the new tax, coupled with greater transparency required by significant global entities, has drastically changed the landscape for companies and those who advise them. 

According to Anthony, “every tax professional who works with large multinational companies will need to have an understanding of the diverted profits tax. In broad terms it can apply in many circumstances where the ordinary transfer pricing rules would otherwise apply. Accordingly, if a multinational corporation has cross-border transactions with Australia then the DPT will be a consideration.”

Anthony is Chair of the organising committee for the Forum’s dedicated corporate stream, and has more than 25 years’ experience in corporate and international tax, with a strong focus in the energy, resources and infrastructure sectors. Before joining MinterEllison he was the Head of Tax, Asia-Pacific, for the Anglo-American plc group, prior to which he worked for another big four firm.

Anthony’s co-presenter, Carmen McElwain CTA, leads MinterEllison’s Tax Controversy team. She has over 25 years’ experience managing tax controversy matters at the risk review and audit stages and in the conduct of tax litigation. Responsible for the management and conduct of major tax litigation cases on behalf of the ATO, Carmen also represents large corporates in their disputes against the ATO.

Looking at the rest of the program, Anthony told us: “I am really looking forward to hearing Grant Wardell-Johnson speak about the topic of 'Tax 2025'. Grant is a really engaging speaker and someone who thinks well beyond the tax technical. As someone who has spent my entire career in the tax profession, I have a real interest in thinking about what the profession will look like in ten, twenty and even fifty years' time.”

The corporate stream also features sessions looking at tax governance and justified trusts; an update on state taxes; an overview of financing and recent changes; an update on M&A issues; as well as a session with Sarah Blakelock CTA on resolving tax disputes in a global environment, among others.

You can find out more about Anthony and Carmen’s session, and the rest of the program, on our website.

The 2017 Queensland Tax Forum takes place on 24-25 August in Brisbane.


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