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  • Competent Authority determination

    This list outlines the information to send with your request for a determination from an Australian Competent Authority under:

    • Article 10(3)(c) of the tax treaty between Australia and the United Kingdom (Convention between the Government of Australia and the Government of the United Kingdom of Great Britain and Northern Ireland for the avoidance of double Taxation and the prevention of fiscal evasion with respect to taxes on income and on capital gains)
    • Article 16(5) of the tax treaty between Australia and the United States (Convention between the Government of Australia and the Government of the United States of America for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income)
    • similar provisions in other tax treaties.

    The following is not a complete list. The information required will depend on the circumstances of the applicant. Sending this information with your initial request will help achieve a quicker outcome. You may need:

    • a copy of the global corporate structure, in particular from the Australian payer company to ultimate parent
    • a description of activities undertaken by each company interposed between the Australian payer and ultimate parent including functions performed and employee numbers
    • a broad description of the business carried on by each company in the relevant treaty country, including functions performed and employee numbers (this will help establish relevance of the treaty country operations to the group wide business)
    • a history of companies from (and including) the Australian payer to ultimate parent including      
      • dates the companies were established
      • details of any
        • disposals or acquisitions
        • corporate restructures and liquidations
        • change of corporate residence
         
      • any proposed changes and the commercial reason for the respective changes
       
    • an explanation of any tax consolidated/multiple entry consolidated group changes or proposed changes
    • details of the capital structure of all companies in the chain from Australian payer to ultimate parent, including
      • each class of shares and whether any are listed and traded regularly in a recognised stock exchange, and associated rights (for example, voting, conversion and dividend rights)
      • nature of any changes to the capital structures in last three years
       
    • any of the following
      • confirmation that all companies in the chain beneficially own all dividends received
      • details of any company that is a nominee, agent or conduit
      • confirmation that the company does not have a legal or equitable obligation to surrender the dividends to another party
       
    • details of any beneficial ownership of dividends as the applicant, including commercial reasons of any
      • corporate restructure
      • new incorporation
      • interposition
      • acquisition
      • change of residency
      • other changes
       
    • a history of dividends confirming the amounts and use of funds
      • paid by the Australian company
      • received by the applicant (including from other companies)
      • paid by the applicant up the corporate chain
      • include each period of time the recipient of the dividend beneficially owned the dividend
       
    • the company's/group of companies' details of either
      • capital management policy
      • dividend policy
       
    • a copy of the financial statements for the current and prior three years for both the
      • Australian company
      • applicant
       
    • an explanation of the source of the income generating the unfranked dividend, including details of when the Australian payer receives from its subsidiaries either by
      • a return of capital
      • other distributions
       
    • confirmation of the residency of the applicant issued by the revenue authority of the treaty country
    • confirmation that the applicant does not carry on a business through a permanent establishment in Australia
    • an explanation of the tax treatment of dividend flows from Australian payer to ultimate parent
    • an explanation as to why the applicant does not satisfy the treaty conditions for relief under Article 10(3)(a) or (b) and needs to seek the determination from the Competent Authority
    • details of the commercial purpose for a creation or assignment of the shares or other rights for which the dividend is paid including details of any tax benefit or tax saving that arises as a result.

    Competent Authority determination – Article 4(1) of the Multilateral Instrument

    Australia’s tax treaties

    Non-individual taxpayers that are dual residents under Australia’s tax treaties which are modified by Article 4(1) of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting, also known as the Multilateral Instrument (MLI), will need to apply to either Competent Authority for a determination of their residency for the purposes of the relevant treaty. For information regarding the administrative approach for Australia/New Zealand taxpayers, see MLI Article 4(1) administrative approach.

    The taxpayer’s application must be lodged in the prescribed form and include the relevant information and documentation that support the taxpayer’s proposed position. To ensure timely consideration of their application, the taxpayer must provide a minimum level of supporting information and documentation as detailed in the list below. There is however no restriction on the level of supporting information that a taxpayer can provide beyond the minimum level as part of their initial notification.

    If either Competent Authority requires additional information or documentation to complete their evaluation of the taxpayer’s application, they may request it. All information received by a Competent Authority will be provided to the other Competent Authority.

    You can lodge an application for a determination via the APA/MAP Program Management Unit (see Next Step below).

    Minimum level of supporting information

    • a submission on the entity’s jurisdiction of residence for treaty purposes, including the commencement date of such self-determination
    • confirmation of the entity’s incorporation details, including
      • any relevant registration numbers
      • its principal place of business
      • its registered office addresses (including any overseas addresses)
       
    • the entity’s constitution or equivalent (for example, memorandum and articles of association)
    • an organisational chart, including reporting lines and where key senior executives are located
    • a brief description of the business carried on by the entity, including details such as
      • functions performed and where they are performed
      • number of employees and where they are located
       
    • a brief description of the reasons why the entity has been established as a dual resident
    • a description of the role and responsibility of each board member or senior executive who in substance is tasked with making key management and commercial decisions necessary for the conduct of the business as a whole, including details such as
      • their level of authority
      • formal powers (including any delegation powers)
      • where they reside and their tax residency
       
    • details of any other persons or entities (for example, shareholders, parent entities, advisors) that have the power to materially influence the entity’s key management and commercial decisions
    • confirmation of where the following types of documents are prepared, located and physically maintained
      • accounting records
      • company bank accounts
      • board minutes or equivalent documents recording high-level strategic decisions
       
    • copies of the minutes of the last three board meetings.

    The above list is supplemented by the ATO’s MAP web page which details the information and documentation that may be provided as part of a mutual agreement procedure (MAP) request.

    Australia’s tax treaty with New Zealand

    In recognition of the Single Economic Market agenda between Australia and New Zealand, which seeks to create a seamless trans-Tasman business environment, and the fact that our respective tax systems and administrations are comparable and both countries are committed to adopting measures to address BEPS risks, a joint administrative approach is available for certain taxpayers that satisfy a set of eligibility criteria.

    An eligible Australia/New Zealand taxpayer will not be required to provide the above information to either Competent Authority under the administrative approach. For more information see MLI Article 4(1) administrative approach.

    It is envisaged that, at this stage, this administrative approach will only be implemented between Australia and New Zealand. The approach does not apply to Australia’s other tax treaties modified by Article 4(1) of the MLI.

    Next step:

    • Mail your application to:

      APA/MAP Program Management Unit
      Public Groups and International
      Australian Taxation Office
      GPO Box 9977
      BRISBANE  QLD  4001
    • Send us your application or ask for help by emailing InternationalsGatekeeper@ato.gov.au.

    You should be aware that the internet is not a secure environment. We do not control the path of inbound and outbound emails, so the privacy of personal information sent by email cannot be guaranteed. You should be aware of this risk if you choose email to communicate with the ATO and those communications include your personal details.

    See also:

      Last modified: 27 May 2019QC 53148