Minister's announcement on Upper Tier 2 extension, term subordinated notes and draft TOFA Bill
20 Apr 2010
In media release No 2010/066, 20 April 2010, the Assistant Treasurer, Senator Nick Sherry, announced three actions by the Government that he said "will provide a greater degree of certainty in relation to the tax treatment of key business finance transactions".
Specifically, the Government:
- has extended the debt/equity transitional period for Upper Tier 2 instruments to 1 July 2010,
- had the final regulations facilitating the debt tax treatment of certain term subordinated notes made and registered (as reported in last week's edition of TAXVINE - see 2010 TAXVINE No 14 (16 April 2010)), and
- has released for consultation draft legislation to refine the Taxation of Financial Arrangements (TOFA) to further boost clarity around the taxation treatment of financial arrangements.
The exposure draft legislation will give effect to the TOFA amendments announced in the Assistant Treasurer's media release, No 2009/043, 4 September 2009. It will also extend the debt/equity transitional period for Upper Tier 2 instruments to 1 July 2010. Details of the changes in the draft TOFA Bill are set out in detail in Attachment B to the media release.
The consultation period for the exposure draft TOFA Bill closes on 14 May 2010.