Tax Avoidance Laws to come into effect across Australia from the start of 2016
Legislation has been passed that will see multinational companies with annual revenue above AU$1 billion report income, tax, and transfer pricing arrangements to the ATO (Australian Taxation Office), and the penalties for tax evasion increased.
Under the new laws, multinationals will need to provide the Commissioner of Taxation with information on overall transfer pricing policies, and global allocation of income and economic activity in the business. The main aim being, to close up tax loopholes and increase public scrutiny of companies active in tax avoidance measures.
The maximum fine for a firm found guilty of tax avoidance can be up to 120% and 60% respectfully for any company found to be using a profit sharing scheme. Under BEPS (Base Erosion and Profit Sharing), the OECD (Organisation for Economic Cooperation and Development) expects to retrieve as much as $240 billion in lost revenue each year.It is suggested that at least 25% of businesses will fail to meet the first deadline proposed by the OECD, which comes into effect from 1st January 2016.
This has led to an increased demand from leading professional services firms, including Big 4, for Transfer Pricing Specialists to bolster their numbers and effectively manage their increased work load.
For more information regarding Tax opportunities in Sydney and Australia. Please contact Mark Ellis in the Sydney office.