The Australian Taxation Office (ATO) has released guidance on international transactions that captured its attention.

These transactions include:

  1. Related party financing – Cross-border financing arrangements involving non-arm’s length terms or conditions.
  2. Intangible assets for privately owned and wealthy groups – International arrangements that don’t recognise or incorrectly characterise intangible assets.
  3. Controlled foreign entities for privately owned and wealthy groups – Australian entities who fail to report or incorrectly report attributable foreign income.
  4. Thin capitalisation for privately owned and wealthy groups – Entities that do not comply with or incorrectly apply the thin capitalisation rules.
  5. Transfer pricing – services and other dealings – Income not subjected to domestic tax due to non-arm’s length conditions of international related party dealings.
  6. Non-resident withholding tax for interest, dividend or royalty for privately owned and wealthy groups – Entities that fail to withhold tax on interest, dividend or royalty payments to foreign residents.
  7. Income from overseas branches for privately owned and wealthy groups – Overseas branch or permanent establishment income incorrectly recognised as NANE branch income.
  8. Mischaracterisation of inbound foreign funds for privately owned and wealthy groups – Cross-border arrangements that mischaracterise inbound foreign funds.
  9. Foreign residents disposing of taxable Australian property for privately owned and wealthy groups – Disposals of taxable Australian property by foreign residents.
  10. Hybrid mismatch rules for privately owned and wealthy groups – Hybrid mismatch arrangements which exploit differences in the laws of two or more tax jurisdictions.
  11. Significant global entities and country-by-country reporting entities for privately owned and wealthy groups – Entities that met the definition of SGE or CBC reporting entity but failed to self-assess as one.
  12. Other issues or arrangements that attract our attention in privately owned and wealthy groups