International tax & business 2020

Structuring cross-border transactions: Part 1

Source: Taxation In Australia Journal Article

Published Date: 1 Apr 2020


TD 2019/D6 and TD 2019/D7 raise important considerations in international tax planning and the structuring of Australian investments, as all capital gains (whether foreign-sourced or not) that are attributed to a foreign resident beneficiary of an Australian resident trust are now assessable to that beneficiary, unless the trust is a fixed trust. The draft determinations are contentious due to a disconnect between the relevant legislative provisions and the ATO's interpretation of them, and as they do not address Australia's double tax agreements. Further, they lead to differing tax outcomes for foreign residents assessed on capital gains from the disposal of non-taxable Australian property, depending on the structure through which they derive that gain. Consequently, foreign resident taxpayers require more clarity on this aspect of Australian tax law.

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International tax & business 2020

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