In-house transfer pricing challenges and insights with a Global Head of Tax

Copy of Copy of 0078LEARN_CTA3_Blog_images_refresh_Twitter-Blog-Header-1024x512 (5)

With a top-notch program of high-profile and expert presenters from across the legal and accounting professions, the ATO and corporate Australia, our highly anticipated 2021 National Transfer Pricing Conference is just around the corner!

Ahead of the event, we caught up with Pete Rhodes, ATI, Global Head of Tax at Aristocrat Leisure Limited to chat about his tax experience and the topic of in-house transfer pricing.

Get to know Pete

Pete has been a member of The Tax Institute since 2019, and volunteering with The Tax Institute as part of our various technical committees for around five years now. He joined Aristocrat Leisure Limited as Director of International Tax in early 2019 and is now the Global Head of Tax at Arisocrat. Prior to that he was at PwC, specialising in international tax advice for multinational clients looking to expand offshore, enter Australia or grow inorganically via M&A.

Outside of his work in tax, Pete said he is, “married with two young boys (4 and 7) and a third “fur child” (aka dog) so when I’m not at work, I’m frantically trying to keep up at home!”

“I’ve recently revived my love for the guitar, having done nothing since high school when I played in a local band. It’s been quite fun to use my brain in a different way again, and I’m also using it as an opportunity to teach my eldest son who got a guitar for his last birthday. I love the outdoors and try to stay as active as I can, which isn’t that much of a challenge given my kids just don’t know how to stop!”

Pete’s session at the 2021 National Transfer Pricing Conference

This year, Pete will be part of a panel discussion looking at the transfer pricing challenges and issues facing in-house transfer pricing leaders, as part of Session 5A: The ongoing evolution of the in-house transfer pricing function.

Increasingly sophisticated tax authorities, a growing web of laws and reporting requirements, and growing awareness of the space means the internal transfer pricing function of a large corporations is increasingly important to understand and optimise.

In the session, Pete and fellow panel members, Ed Baghdasarayan, ATI, PwC and Carynne Howitt, CTA, Lion Pty Ltd explore and discuss industry perspectives around the evolving nature of the in-house transfer pricing function in the new world, including:

The role of in-house tax teams from transfer pricing policy design to execution, reporting and governance
Perspectives around how technology and other processes could be used to help automate / streamline aspects of the in-house transfer pricing function
Considerations around effectively managing transfer pricing within the organisation, including working with other teams around data and process, optimising resources and ensuring internal stakeholders are connected and aligned on key decisions, processes and outputs from the transfer pricing function.

“For those who are in-house practitioners, hopefully they’ll get some comfort that many of today’s transfer pricing issues are shared broadly within corporate Australia,” Pete explained.

“For advisors, there could be insights into what clients really worry about and value when it comes to advice in relation to their transfer pricing issues.”

Where else to find Pete at the Conference this year

“There’s so much to choose from this year – literally every session is a “must have”,” Pete told us.

“It’s always great to hear directly from the ATO on key themes, so the session on the draft intangibles PCG will be interesting. For similar reasons, I think the session involving Justice Davies will be really insightful.”

Day 2 – Friday, 6 August 2021

8:30 – 9:30am

Session 7: Transfer pricing in perspective This panel session, involving her Honour Justice Davies and other experienced senior transfer pricing practitioners, will consider matters that commonly arise in transfer pricing disputes, including:

The complexity in dealing with transfer pricing cases and how participants can assist in effective case management
The effective use of lay and expert witnesses in transfer pricing cases
Tips and traps in preparing transfer pricing documentation
Use of alternative dispute resolution processes to achieve “better” outcomes
The “reconstruction” puzzle in the transfer pricing rules.

Facilitator

Jerome Tse, CTA, King & Wood Mallesons

Panel Members

The Hon. Justice Jennifer Davies, Federal Court of Australia

Daniel McInerney QC, CTA, Victorian Bar

Damian Preshaw, CTA, Damian Preshaw Consulting Pty Ltd

Day 2 – Friday, 6 August 2021

9:30 – 10:30am

Session 8: The ATO’s intangibles strategy and draft PCG on intangibles

Application of the transfer pricing rules to intangibles continues to be a key focus area of the ATO. In this session, Chris Ferguson, Assistant Commissioner PGI, who heads up the ATO’s intangibles migration cluster, will provide valuable insights into the ATO’s thinking on transfer pricing risk in relation to intangibles and what the ATO is doing to address this risk. The session will cover:

The ATO’s intangibles strategy
Creation of the intangibles migration cluster
Testing of the strategy with international counterparts
TA 2018/2, including concerns about embedded royalties
TA 2020/1, including concerns relating to the identification and analysis of DEMPE functions in R&D arrangements
Draft PCG on intangibles
ATO’s intention in issuing the draft PCG
Arrangements of concern (e.g. mischaracterisation of DEMPE functions and arrangements that lack a commercial element)
Practical application
- Discussion of risk factors
- Discussion of the ATO’s documentation expectations

Presenter

Chris Ferguson, Australian Taxation Office

“I’m also really interested in where we’re heading in terms of transparency, so the session on Future trends, increased transparency and what it means for MNC businesses has a lot of promise for me,” Pete said.

Day 1 – Thursday, 5 August 2021

4:30 – 5:30pm

Session 6: Future trends, increased transparency and what it means for MNC businesses

The tax transparency agenda has been a feature of the mainstream media for some time now, both in Australia and overseas. This has in large part been driven by a perceived lack of trustworthiness on the part of MNCs. In order to address this issue of trust, a continuing trend can be seen amongst the governments of developed nations and international organisations advocating for (and in some cases legislating) rules that compel MNCs to disclose greater volumes of information relating to their cross-border tax affairs. Up until recently, much of this disclosure has not been made public, however recent developments in Europe suggest that it is only a matter of time before public disclosure of MNCs’ tax strategies, country-by-country reports, and possibly more, becomes expected and in some cases, compulsory. Whilst it can be debated whether publishing more data leads to increased trust, one thing is clear: increasing tax transparency is here to stay. So, the question becomes, what should MNCs be doing to stay ahead of the curve and to navigate some of the risks, complexities and potential pitfalls? In this session we will explore:

Recent trends in Europe leading towards mandatory public disclosure of tax information
Using some example case studies, how Australian outbound MNCs can be impacted by these rules even though the same rules don’t (yet) apply in Australia
Whether publishing more information solves (or exacerbates) the issue of trust
Where will it end?

Presenters

Tammy Eccles KPMG Tony Gorgas KPMG

Find out more about the 2021 National Transfer Pricing Conference

Download brochure