With just under a month to go until Project DO IT closes on 19 December 2014, the Tax Office has provided some further guidance on dealing with offshore structures to qualify for the benefits available under Project DO IT. One of the key eligibility conditions requires a taxpayer to ensure that their offshore structure is brought within the Australian tax system. To this end, the Tax Office has recently updated its Project DO IT Website to illustrate the Commissioner’s views on the key issues (and indicative tax outcomes) in the following scenarios:
- Scenario 1: Offshore company holding pre-disclosure-period funds;
- Scenario 2: Offshore company holding listed shares;
- Scenario 3: Offshore trust holding listed shares;
- Scenario 4: Transferor trust with no attributable taxpayer;
- Scenario 5: Leaving some assets within an offshore structure;
- Scenario 6: Loan-back arrangement;
- Scenario 7: Foreign Investment Fund (FIF) interests.
The Tax Office notes that its views on the specific tax issues in these scenarios are general in nature and do not constitute binding advice. Rather, they represent examples of how a taxpayer may be able to bring their offshore tax affairs into order under Project DO IT. Importantly, the Commissioner will still need to consider a taxpayer’s particular circumstances, and in some cases it will be appropriate to finalise matters through entering into a settlement deed, the Tax Office said.
[LTN 226, 21/11/14]