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  • High wealth private groups tax performance program

    The high wealth private groups tax performance program builds on our previous work with high wealth individuals, and is a key element under the Tax Avoidance Taskforce. The program provides greater assurance to the community that high wealth private groups are paying the right amount of tax.

    We've designed the program to support willing participation by high wealth private groups. It features one-to-one tailored engagement, as well as public guidance targeted to tax risks affecting high wealth private groups.

    The high wealth private groups program runs for four years.

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    Who is covered by this program

    We define high wealth private groups as Australian resident individuals who, together with their associates, control wealth of more than $50 million. The program doesn't cover private groups that are already a part of the Top 500 private groups tax performance program.

    We use sophisticated data matching and analytic models to identify wealthy individuals and link them to associated entities. We then look at the group of entities as a whole. This private group approach helps us to better understand the businesses of high wealth private groups, and provide them with a more tailored experience.

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    How we tailor our approach to you

    We engage with each high wealth private group, either directly through a streamlined assurance review or through targeted guidance on risks relevant to your circumstances.

    If you're a high wealth private group, we intend to increase our understanding of your business and the environment you operate in. We use improved data and analytics to identify trends and priority risks specific to high wealth private groups.

    This means we can better tailor our approach and develop strategies to help you address and mitigate tax risks. We'll work with you by:

    • letting you know about issues that attract our attention
    • publishing public advice and guidance on issues facing high wealth private groups
    • partnering through early engagement and pre-lodgment agreements for commercial deals to provide certainty on significant transactions and events
    • engaging with you through streamlined assurance reviews and audits, where appropriate.

    Streamlined assurance reviews

    A streamlined assurance review lets us resolve matters quickly and cooperatively in a transparent way. We select material risks and significant transactions to review over a two-year period, and aim to give you certainty on those issues.

    Generally, the review will proceed as follows:

    Notification

    We'll notify you in writing to let you know we plan to start a streamlined assurance review in the coming months.

    Contact

    We'll contact you when we commence a streamlined assurance review. You'll have the option of meeting with us to discuss your situation. This gives us the opportunity to better understand your business and discuss what information we'll need from you.

    Request for information

    We'll send you a letter – tailored to your specific circumstances – requesting information we need for the review. You'll be asked:

    • about your business as a whole, including your tax governance arrangements
    • for information on specific risks we have identified for your group.

    Resolving issues

    After we receive your response and consider the information you have provided, we'll contact you to discuss our analysis and next steps. We may organise a meeting to discuss any areas of concern we have identified.

    In most cases, we'll complete the review within four months. This starts from the time we receive your response to our initial request for information.

    How to prepare for a review

    When we notify you about the review, we'll also let you know the types of questions and documents we typically ask for from all high wealth private groups. This gives you time to consider responses to questions that may apply to your circumstances, and locate relevant documents.

    Many of the documents we typically request are those you'll already have on hand, such as:

    • information used to prepare your income tax return
    • your company’s group structure
    • tax governance documentation.

    Prior to receiving the request for information, we encourage you to review your records and recent significant transactions or business events. You may wish to contact your adviser and discuss any tax risks you've identified. You have the opportunity to correct any mistakes by making a voluntary disclosure at any time during the review.

    Tax governance

    During the review, we'll also assess the effectiveness of your tax governance arrangements.

    Having effective tax governance signals to us that you are managing tax and super risks and have processes in place to ensure ongoing compliance.

    You can choose to self-assess your tax governance before the review using our online tools and guidance.

    What to expect at the end of the review

    At the end of the review we'll:

    • outline the events and transactions where we agree with the tax treatment adopted and have tax assured
    • give specific feedback based on what we observed during the review (this feedback may highlight areas for improvement and provide guidance on what you can do to mitigate risks in the future)
    • outline any risks we're not satisfied with and what next steps we intend to take.

    If there are no outstanding concerns about your tax affairs, we'll conclude the engagement. Any future engagements will only be based on new risks, new information or significant changes in your tax situation.

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    Last modified: 30 Oct 2019QC 60504