Compliance program 2011-12

Corporate restructures mergers and acquisitions

Australia's continuing recovery from the economic downturn is being accompanied by growth in merger and acquisition transactions involving complex arrangements and significant deal value.

These transactions involve a range of interactions with the tax system, giving rise to both income tax and indirect tax liabilities and entitlements, at both the corporate and shareholder level.

We have developed a mergers and acquisitions guide setting out the key compliance issues and common themes in merger and acquisition transactions. The guide is available on www.ato.gov.au

We will examine:

• restructures involving complex or novel financial arrangements and/or steps which do not appear to be necessary to achieve the business needs of the parties
• changes to effective ownership or control of businesses or assets where the appropriate taxing point is deferred or avoided
• arrangements that seek indirect tax benefits (see Financial supplies and GST for further details)
• issues relating to capital gains and losses made by Australian companies on the sale of overseas companies, including the sale of controlled foreign companies.

We continue to encourage businesses and their advisers to engage with us early and seek our advice on transactions before they occur.

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