18 Jun 10 Instalment warrants industry meeting updateAs reported last week, Kirsten Fish FTIA (Clayton Utz) and Angie Ananda FTIA attended a meeting with Treasury and the ATO on Friday, 11 June 2010 regarding the proposed income tax treatment of instalment warrants.
The most important point to note from the meeting was that Treasury were open to expanding the availability of look through treatment to a wider range of arrangements than those currently proposed to be covered by legislative amendments in relation to the tax treatment of instalment warrants. Treasury will consider submissions on this issue and make recommendations to Government accordingly.
One of the main issues that Treasury will consider when assessing extensions of look through treatment will be whether there is a substantial existing market that would no longer be sustainable without legislative change to permit look through treatment for the arrangement in question. It appears that Treasury’s recommendations will generally be to protect such markets.
The exposure draft for the new legislation is in process and there will be consultation on it in due course.
The ATO indicated that they would not be providing rulings on instalment warrants until they have certainty regarding the correct legal position. The ATO could not commit to a timeframe.