Taxation Institute Tax Counsel, Tamera Lang ATIA and Tony Frost FTIA (Greenwoods & Freehills) represented the Taxation Institute at the TOFA Working Group meeting on Thursday 25 November 2010. Since the working group's formation almost 2 years ago, 93 separate TOFA issues have been finalised. There are currently approximately 27 outstanding issues. Some of the outstanding issues include consolidation interactions and aspects of the hedging regime. There are currently 12 published ATOIDs and a draft tax determination on the interaction between s.230-45 and s.230-50. The ATO is currently working on two draft tax rulings - one covering the meaning of "arrangement" and the other dealing with non-assessable non-exempt income. During the meeting, the ATO discussed their preliminary views on subitem 104(3) (the carve-out from the un-grandfathering election for disposals of property) and whether it applies more broadly than deferred settlements. The professional bodies will be engaging with the ATO on this complex interpretative issue. The group also discussed TOFA issue 601 (which examines the application of the hedging provisions to a group of trusts that are consolidated for accounting purposes, but not tax consolidated). The ATO's preliminary view is that an entity can only access the hedging rules in relation to a hedged item that it owns. The ATO is considering publishing a tax determination on this issue.