The Australian Taxation Office released its revised policies and procedures for the Advance Pricing Agreements program on 23 July 2015. The updated guidance has been provided in the form of Practice Statement Law Administration PSLA 2015/4, which is administratively binding on the ATO and replaces PSLA 2011/1. PSLA 2015/4 confirms that the ATO is open to the use of Advance Pricing Agreements and provides further clarity on the ATO’s administrative approach and the necessary stepping stones for acceptance of an APA application into the program.
Some of the key changes concern the establishment of a formal APA Program Management Unit, the formation of an ATO triage function, insight into the three broad stages of the APA process and additional clarification of the internal ATO decision-making process as to when an application is more likely to be accepted in to the program.
The revised PSLA sends a strong hint that the ATO wants to encourage taxpayers to pursue APAs. However, the PSLA is also making it clear an APA is not appropriate for all taxpayers and that there will be a greater level of ATO due diligence than before.
