Published on 04 Sep 13
by NEW SOUTH WALES DIVISION, THE TAX INSTITUTE
In the context of mergers & acquisitions (“M&A”) and group restructures, the quantum of the varioustransaction costs can be quite significant. Such costs include legal costs, duties, borrowing costs, various types of advisory fees, arranger fees, etc. The income tax and GST treatment of transaction costs will depend on various facts associated with the transaction, including the nature of the expense, whether they are purchaser or seller costs, and whether they are incurred by a tax consolidated group.
This practical presentation provides an overview of the various issues that need to be considered in determining the income tax and GST treatment of transactioncosts in various scenarios, including:
- successful v unsuccessful acquisition
- seller v purchaser
- costs incurred by the Target entity
- costs incurred after the Target joins a tax consolidated group
- costs charged to an “arranger”
- treatment of borrowing costs
- apportionment of costs
- restructuring costs.
Mark is a Partner at PwC, with Australian and international tax experience in the infrastructure, property, private equity and financial services industries. Mark rejoined PwC in 2012, following nearly five years with Australian listed company Challenger Limited, as Director of Structuring & Solutions. Current at 19 September 2016
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Craig is a Director at PwC, with Australian and UK indirect tax experience in the mergers and acquisitions, infrastructure, property and financial services industries. Craig joined the VAT team at PwC UK as a graduate in September 2000 and transferred to the Sydney GST team of PwC Australia in 2005. Craig has over 8 years experience working in Australian GST, focussing on providing advice on the GST implications of acquisitions and disposals, including undertaking tax due diligence work with respect to target entities and advising on the recovery of GST on transaction costs. Craig is a member of the Chartered Institute of Taxation (UK). Current at 23 September 2013
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