Income Tax Assessment Act 1997

CHAPTER 4 - INTERNATIONAL ASPECTS OF INCOME TAX  

PART 4-5 - GENERAL  

Division 815 - Cross-border transfer pricing  

Subdivision 815-B - Arm ' s length principle for cross-border conditions between entities  

Operative provisions

SECTION 815-105   Object  

815-105(1)  
The object of this Subdivision is to ensure that the amount brought to tax in Australia from cross-border conditions between entities is not less than it would be if those conditions reflected:


(a) the arm ' s length contribution made by Australian operations through functions performed, assets used and risks assumed; and


(b) the conditions that might be expected to operate between entities dealing at *arm ' s length.

815-105(2)  
The Subdivision does this by specifying that, where an entity would otherwise get a tax advantage from actual conditions that differ from *arm ' s length conditions, the arm ' s length conditions are taken to operate for income tax and withholding tax purposes.


 

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