Exchange of information
The exchange of information with other jurisdictions improves tax administrative practices worldwide. Mechanisms used to exchange tax information with other jurisdictions include:
- exchange of information articles included in our double tax agreements
- tax information exchange agreements.
Exchange of information is limited to jurisdictions that have an agreement with Australia. The exchange is dependent on the cooperation of their tax administrations to collect information, and in some cases there may be restrictions on how we use the information and documents received from them.
Information can be requested by us or may be given by the foreign authority on its own initiative. Before requesting information from another jurisdiction, we consider whether the information is either:
- held within Australia, or is in the custody or control of someone within Australia, and may be accessible using our domestic access powers
- able to be obtained using an offshore information notice.
We generally make requests for information from foreign tax authorities where:
- we have been unable to obtain information or documents from you or third parties in Australia
- we suspect you or your representative has failed to disclose offshore income or assets to us
- we require bulk data to confirm foreign-sourced income is being returned by Australian taxpayers.
Australia is also a party to the Multilateral Convention on Mutual Administrative Assistance in Tax Matters. The convention is a freestanding agreement designed to promote international cooperation. It provides for:
- the exchange of information
- the service of documents
- other forms of cooperation including joint audits
- assistance in collection of outstanding tax liabilities.
Some tax treaty articles and multilateral conventions also facilitate international debt recovery and use a cooperative approach to collection.
Cross-border transactions within the global economy create the potential for tax risks across tax administrations, including Australia's.
Our participation in the Joint International Tax Shelter Information Centre is a key part of our overall strategy to deal with aggressive tax planning. The centre plays an important role in the detection of abusive tax schemes and identifying those who promote and invest in them. Our membership increases our intelligence on abusive tax schemes and helps us deal with those schemes.
We also work with the Organisation for Economic Cooperation and Development (fiscal affairs working party) on tax evasion matters to address the economic, social and governance challenges of globalisation.