In media release No 2010/027, issued 17 December 2010, the Assistant Treasurer and Minister for Financial Services and Superannuation, Bill Shorten, announced amendments to the income tax laws to provide certainty for US-based fund managers whose funds have invested in Australia.
The Assistant Treasurer said that US-based fund managers investing in Australia may be adversely affected by the recent application of certain US accounting rules to managed funds, widely referred to as "Fin 48". Under these rules, funds are required to make disclosures in their financial accounts in relation to uncertain tax positions, including for prior income years.
Where a foreign managed fund has not lodged a tax return for the 2009-10 or prior income years in respect of certain investment income of the fund, the ATO will not be permitted to raise an assessment in respect of that income, except where the fund lodges a tax return disclosing such income. The amendments will take effect from 17 December 2010.
"I will consult closely with the Financial Centre Taskforce (formerly the Australian Financial Centre Forum) and industry representatives in designing legislation to implement these changes, including appropriate integrity rules," Mr Shorten said.