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Expanding TARP to capture goodwill and mining information


From 14 May 2013, the meaning of “taxable Australian real property” (TARP) has been expanded to capture goodwill and mining information. This article discusses the challenges facing the government and foreign residents when dealing with this new measure. It points out that the new measure will cause Australia’s domestic laws to be out of step with our key double tax agreements in relation to the taxation of capital gains realised by foreign residents, and that this may interfere with the outcome sought to be achieved by the new measure.

It discusses the meaning of goodwill and suggests that the new measure may well expand the scope of our capital gains tax provisions to capture value attributable to non-TARP assets as well as TARP assets. It discusses how the courts have dealt with the separate identification of mining information as an asset, and how one might value that asset in the hypothetical transaction required by our CGT provisions.

Author profile

Martin Fry FTI
Martin has been a Partner in the Allens Tax Group for over fifteen years, and has focused on resource companies, banks and infrastructure projects. He has extensive experience advising on the tax aspects of capital management transactions for ASX-listed companies, most recently in relation to Rio Tinto's 2015 off-market tender share buyback and on-market share buyback. He has also advised APRA-regulated banks on the tax aspects of hybrid equity and subordinated debt instruments. He advises consortia and financiers on the tax aspects of project finance for major infrastructure projects including M2, M5 and M7 motorways, among others. He is a Senior Fellow of the Law Faculty of the University of Melbourne. - Current at 12 February 2016
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