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NSW Annual Intensive Retreat: Managing tax risk for corporate taxpayers

Published on 04 Nov 2004 | Took place at Crowne Plaza, Terrigal , NSW

This year's Terrigal Intensive focused on the all-important area of your Corporate Clients.

And they are your corporate clients whether you are an internal adviser or an external adviser.

Tax risk is fundamentally the prospect or possibility of the ATO concluding that the tax liability is different from the tax liability that has been represented to the ATO and/or provided for in the financial reports of the company. At different times and in different ways, we all are involved in managing, or assisting others to manage, tax risk for Corporate Taxpayers.

But do we fully understand the legislation, case law and practice which underpin the more efficient management of tax risk?

Are there aspects that, if you were aware of them, would cause you to approach things or do things differently?

How important is this to you?

Please note that an updated version of the paper presented by Michael Walpole will be published in one of our journals in early 2005.

Get a 20% discount when you buy all the items from this event.

Individual sessions

The ATO Compliance Program 2004-2005

Author(s):  Neil MANN This paper discusses what the ATO is doing in relation to corporate taxpayers (especially large SMEs range of turnover $10-$100 million)?

Materials from this session:

Have you shut the windows or are they still open?

Author(s):  Michael WALPOLE

This paper discusses how to deal with tax risk - close all assessments. Including:

  • when does an assessment arise?
  • the effect of electronic lodgement
  • amendment periods (s170)
  • extension of normal amendments periods (s170(4A))
  • position of losses - TD2004/24, Ryan; Re BCD technologies
  • position of nil income
  • effect of not lodging returns
  • making certain you have an assessment
  • the effect of the consolidations regime.
Materials from this session:

Tax risk management

Author(s):  Andrew MILLS

This paper looks at how to deal with tax risk - looking at matters in respect of corporate governance, managing resources and relationships and staying in a job, from the perspective of internal tax managers. Including:

  • Position of Directors and other Officers
  • Position of internal tax managers and staff
  • Position of external Tax Advisors
  • Getting the most out of the relationship between internal and external advisors
  • Getting the most out of the relationship between internal advisors and the ATO relationship managers
  • Dealing with Treasury (law change)
  • Getting the most out of the relationship between internal advisors and external auditors
  • Getting the most out of the relationship between internal advisors and internal auditors - a report card
  • Importance of a Corporate Values System
  • Role of voluntary disclosure
  • What tax issues should be referred to the board?
  • What tax issues should be referred to external advisers - accountants, solicitors, barristers, valuers?
  • How do you advise the board?
  • What do you really need?
  • What is really at stake?
Materials from this session:

Planning out of control

Author(s):  Greg PRATT

This presentation covers 10 very painful planning examples including:

  • involvement in a mini-marketed scheme
  • sale and leaseback (post Hart?)
  • losing your losses
  • relying on someone else's ruling.
Materials from this session:

The consequences for internal and external advisors of becoming 'shadow directors'

Author(s):  John CURRIE

As an internal or external advisor, what personal risks are you exposing yourself to? This seminar paper covers the following topics:

  • personal liability for directors
  • what is a 'shadow director'?
  • what is a real director?
  • nominee directors
  • alternate directors
  • impact of the Sarbanes Oxley Act and CLERP 9 changes
  • what is a director for the purposes of tax and other revenue legislation?
Materials from this session:

The rulings system: have you got protection?

Author(s):  Ian STANLEY,  Judy SULLIVAN

This presentation discusses how to deal with tax risk - obtain a ruling. Including:

  • what is a ruling?
  • when is the Commissioner bound? - full and true disclosure revisited
  • who may rely upon a ruling?
  • when can you disregard a ruling?
  • what do you do when a ruling is unfavourable?
  • problems with rulings
    • timing and cost issues
    • partial rulings
    • anti-avoidance
    • arm's length arrangements
  • the ATO's agenda.
Materials from this session:

Are you following a shortcut to disaster? Are you doing the right housekeeping?

Author(s):  Mark BRADFORD

This seminar paper covers the following topics:

  • record keeping obligations
  • are your documents piling up?
  • are your in-house transactions out of control?
  • the effect of the consolidations regime
  • managing directors' minutes
  • understanding the importance of third party records/evidence, eg financiers
  • understanding the expectations of the ATO.
Materials from this session:

Today's Part IVA - a report card

Author(s):  Robert DEUTSCH Immediately after Hart, everyone was declaring victory. This paper discusses the real state of Part IVA today following the Hart decision and whether anything has actually changed.

Materials from this session:

Avoiding a bum RAP

Author(s):  Prof Robin H WOELLNER Taxpayers intending to take a contentious approach to their tax need to ensure at least a 50 per cent chance of success if the matter went to the AAT or Federal Court. Where that taxpayer's interpretation is not based on a 'reasonably arguable position', the taxpayer becomes liable to shortfall penalties.

Materials from this session:

Gone but not forgotten

Author(s):  Joe LOMBARDO

A specific example - debt forgiveness - what's the current state of play following the recent cases that were settled? This paper includes:

  • what will constitute a debt forgiveness?
  • what will not constitute a debt forgiveness? (eg. payment of commercial debt by guarantor not a debt forgiveness - TD 2004/17)
  • consequences of a debt forgiveness
  • the approach of the ATO including TR 2001/9
  • what types of situations are most likely to be attacked by the ATO?
  • unresolved issues.
Materials from this session:

What happens if I get it wrong? Am I just down in the dumps or also down in the dock?

Author(s):  David J WILLIAMS

This paper focusses on the non-civil which can flow from getting the management of tax risk wrong, including:

  • structure of the relevant provisions of the Criminal Code Act 1995
  • results of recent prosecutions - has the law changed?
  • is the actual tax position relevant to or needed in a prosecution?
  • the impact of a Round Robin
  • ATO Prosecution Policy
  • does it matter if I am an employee rather than a principal?
  • unresolved issues
  • what other risks lurk?
Materials from this session: