Australia is leading the charge in matters of tax transparency, and while measures and focus in this space have already increased dramatically in recent years, this trend is set to continue.
Big business in Australia already makes disclosures at the public level, which includes the Board of Taxation’s voluntary tax transparency code, and the ATO’s annual report of entity tax information.
Disclosures to the ATO include the International Dealings Schedule, which details any international related party dealings, and through transfer pricing documentation for related party transactions, via the ATO's Key Taxpayer Engagement and Top 1,000 program, and many other measures. Australia has also adopted the OECD Country by Country reporting recommendations.
This minefield of obligations and dealings with a number of bodies, means that advisers need to understand exactly what information is required to be disclosed, to who, when, and how. While penalties can apply, and the ATO can use its formal powers of information gathering for those not being open and transparent, the overall goal should be kept in sight – are these increased disclosure requirements actually resulting in taxpayers paying their fair share of tax?
At October’s National Resources Tax Conference in Perth, Enzo Coia, CTA, and Lauren Jones, CTA, (both Deloitte), present the session ‘Tax Disclosures - Is Sunlight the Best Disinfectant?’
We spoke to Enzo about what to expect from their session.
“We’ll be covering on matters associated with transparency and the new disclosure requirements that corporate taxpayers have to navigate” he said.
“We’re going to look at the reasons behind the development of some transparency measures and the impact of disclosing too little, too late. Importantly, delegates will gain an understanding of the options available to them about disclosure as well as when failing to disclose can have adverse consequences.”
“Some taxpayers are under a misapprehension about what must be disclosed, what should be disclosed and the fact that even if disclosures are made, it may be too late to avoid penalties”
Enzo and Lauren will look at what additional information now needs to be provided as a result of compulsory and voluntary transparency measures, such as reportable tax positions, the tax transparency code, and getting to justified trust.
Questions around when information should be disclosed will be covered - can you wait until an audit starts? They will also look at how that information needs to be disclosed, for example, as part of the tax return, or as part of the statutory accounts, and to who – boards? the ATO? users of the statutory accounts?
“There are a number of legislative developments concerning transfer pricing disclosures and tax return disclosures that we will look at, and the Board of Taxation’s voluntary transparency code.”
The session will also ask where the benefit of the disclosures is, and if they are achieving their goal of seeing more taxpayers paying their fair share of tax.
“Delegates will deepen their understanding about tax transparency and their options to better engage with the ATO, and will come away with a better understanding of how the ATO will risk assess them.”
|Enzo Coia, CTA|
Enzo is a Tax Partner at Deloitte. He has 20 years’ experience providing advice on Australian and international taxation matters. Specialising in mergers and acquisitions, and divestments. He has a deep understanding of the energy and resources industry, having spent several years in a senior tax leadership position at a multinational oil and gas company, and has a particular interest in tax consolidation and, capital management.
Lauren is a Partner in the Deloitte Perth Business Tax team. Lauren specialises in providing Australian taxation advice on merger and acquisition transactions, particularly in the energy and resources sector. This includes managing large, complex tax due diligence projects, tax issues around financing structures, profit repatriation, permanent establishments, equipment leasing and global restructures as well as managing post-transaction tax integration issues.
This year’s program also provides updates on questions of increased complexity in transfer pricing, R&D claims, valuations and Part IVA. Other sessions will also on contingent consideration, project combinations and stamp duty as well as evaluating M&A opportunities.
Find out more about these sessions, and the rest of the program, on our website. Join us at Crown Perth, 24-26 October 2018, for the National Resources Tax Conference.