Double Penalties for Tax Avoidance and Transfer Pricing Schemes

KnowledgeDouble Penalties for Tax Avoidance and Transfer Pricing Schemes

Double Penalties for Tax Avoidance and Transfer Pricing Schemes

The Australian Treasury released an exposure draft bill to impose stronger penalties to combat tax avoidance and profit shifting. The draft legislation will apply to companies with annual global revenue exceeding AU$1 billion that are obliged to comply with the Country by Country (CbC) reporting.

Taxpayers failing to comply with the CbC reporting on time will result in late lodgement penalties. Double penalties will be imposed to taxpayers that do not have a reasonable arguable position (e.g. transfer pricing documentation). Increased penalties apply to any scheme benefit an entity gets on or after 1 July 2015, regardless of when the scheme was entered into.

This draft legislation significantly increases the importance of having transfer pricing documentation that can provide a RAP under Subdivision 284-E.

For more information about these penalties please contact Transfer Pricing Solutions on admin@transferpricingsolutions.com.au www.transferpricingsolutions.com.au.

Related Blogs

20 Mar

Transfer Pricing Guidelines for Headquarters in Singapore

Singapore is often a preferred location for setting up headquarters as the door  to conduct business in Asia. The IRAS  has released its views on how Singapore HQ's should plan and implement their transfer pricing framework. Want to know more? Read our article with our views on IRAS TP Guidelines for Singapore HQs. 


READ MORE READ MORE
10 Feb

Malaysia Transfer Pricing Update

The Malaysian Finance Bill 2020 incorporates transfer pricing-related changes to the current Income Tax Act, 1967 (“ITA”). The changes permit significantly greater authority to the Malaysia Inland Revenue Board (“MIRB”) and re-emphasises the importance of transfer pricing compliance, with effect from 1 January 2021.


READ MORE READ MORE
12 Aug '20

ATO issues COVID-19 guidance on AU Transfer Pricing

Thec Covid-19 pandemic has triggered the most severe recession and is causing enormous damage to the world economy. The economic downturn will impact a group’s transfer prices, analysis and documentation, more so with the BEPS Action Plans in place and the high level of transfer pricing scrutiny across the globe.


READ MORE READ MORE