We’ve published a final tax determination on the early stage investor tax offset scheme we alerted you to in December 2024.
This determination confirms our draft view – that the anti-avoidance provisions in the Income Tax Assessment Act 1936 can apply to this scheme, potentially cancelling any tax benefit received by participants.
What it means
Our view applies to taxpayers involved in this scheme before, during and after the date of the final determination. It’s likely participants will have to pay back any offset claimed. Penalties and interest may also apply.
You should advise clients against getting involved. If a client has already invested, encourage them to contact us for help. If they proactively approach us, they may be eligible for a reduction in any penalties.
Advisers found to be promoting this scheme could face serious consequences through the Promoter Penalty Laws. Registered tax agents may be referred to the Tax Practitioners Board to assess if there’s been a breach of the Tax Agent Services Act 2009.
More information on tax schemes
For more information visit Recognising, rejecting and reporting unlawful tax and super schemes.