Top 500 private groups often have complex structures and arrangements that can have significant tax implications. So, it’s important that they seek the input of expert advisers, consult published ATO guidance, and engage with us directly when necessary to make sure they’re getting things right.
Having a documented procedure in place explaining when, and how, a Top 500 group should seek external advice is the third principle of an effective tax governance framework. It’s also a requirement for groups who want to achieve justified trust.
Our engagements show that some groups don’t have documented processes for seeking advice or where the process is documented the thresholds for seeking advice aren’t clear. This can lead to those groups not seeking advice on important transactions, that can cause errors that result in additional liabilities later on.
We recommend you set in place documented processes to:
- identify the escalation thresholds, including quantitative and qualitative factors, for when you should seek external advice
- inform your advisers of any significant changes within your group, or any new, or atypical transactions
- make sure the facts and assumptions underpinning the advice you receive are always based on accurate and current information
- consider our published guidance and advice
- know when, and how, you should engage with us directly and, where pre-lodgment positions are agreed to, lodge in accordance with that position.
More resources
For information about implementing effective tax governance, read our previous article Effective tax governance criteria for Top 500 private groups.
Our Findings report Top 500 tax performance program – June 2024 will also provide you with our most recent insights into issues and risks we’ve observed from our engagement with Top 500 private groups like yours, demonstrating the importance of tax governance.
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