Compliance program 2011-12

Good tax corporate governance

We encourage large businesses to have in place sound management controls for tax governance and tax risks. Large businesses can anticipate a review of their corporate governance processes for managing income and indirect tax risk as a part of a risk review conducted by us. Our review of tax-governance processes may set the tone for the enquiry into tax issues - as the outcome may highlight potential weaknesses or deficiencies concerning compliance with tax obligations.

Businesses may report incorrect amounts of GST if their systems for capturing and recording taxation information fail. Businesses going through systems upgrades or other business changes are most at risk of incorrectly reporting their GST.

This year we will hold governance and risk workshops with the mining, retail, manufacturing, agriculture, electricity, gas, water and waste industries to share concerns in the area of compliance with GST.

Our relationship managers program will continue to work with large corporates, focusing on internal control and systems for all tax types in relation to mining joint ventures and merger and acquisition transactions.

We provide a number of products to assist businesses accurately assess and manage their tax risks including:

• annual compliance arrangements - help businesses achieve practical certainty and reduce compliance costs through upfront dialogue and disclosure
• advance pricing arrangement - an agreement between us and large business on the future application of the arm's-length principle in their international dealings with related parties. Like annual compliance arrangement, advance pricing arrangements provide practical certainty and reduce compliance costs for international dealings
• our rulings program - our view on a transactions, issues or products, providing taxpayers with legal certainty, provided they have disclosed all material facts
• publications addressing corporate governance and outlining our approach and processes - such as the Large business and tax compliance booklet and the GST governance and risk management guide, both available at www.ato.gov.au

Sections within Large businesses

• Good tax corporate governance
• Working together
• Obtaining certainty
• Cooperative compliance
• Corporate restructures mergers and acquisitions
• Foreign residents
• Inappropriate outcomes involving consolidation
• Profit shifting
• Private equity - exiting Australia
• GST and international and cross-border transactions
• Non-resident withholding tax
• Stapled group financing
• Taxation of financial arrangements (TOFA)
• Financial supplies and GST
• Foreign partnerships
• Black-hole expenditure
• Exploration expenditure
• Tax and capital losses
• Research and development claims
• Property transactions and GST
• Superannuation funds
• Alternative fuels