Friday, 15 May 2015

Transfer pricing announcements in Australian Federal Budget

The Australian Government's 2015/16 Federal Budget released on 12 May contained several measures targeted at multinationals. The key announcements included:

  • A commitment to implement the new OECD transfer pricing documentation requirements, including country-by-country (CbC) reporting, from 1 January 2016.
  • Higher penalties for companies that enter into tax avoidance or profit shifting schemes.
  • A new anti-avoidance rule aimed at multinationals selling to Australian customers where the revenue and profits are booked by a non-resident under a structure that is designed to avoid creating a permanent establishment (PE) in Australia.

Other relevant announcements included the provision of additional funding to the Australian Taxation Office (ATO) for auditing transfer pricing and international tax issues under its International Structuring and Profit Shifting Project and taking steps towards adopting other actions from the OECD Base Erosion and Profit Shifting project such as anti-hybrid rules.
Source & more info: PwC