Published on 01 Feb 18
by "THE TAX SPECIALIST" JOURNAL ARTICLE
Liabilities have long been clumsily handled by Australia’s consolidation regime, and deductible liabilities have proved to be particularly difficult to wrangle. Not only are liabilities treated as being merely tools for establishing the value of assets, but also the current regime provides for the value of liabilities to potentially be recognised multiple times. This article proposes to: set out the current approach to dealing with deductible liabilities on entry into a consolidated group; identify why change is necessary; discuss the proposed changes (including the “competing” 2015 and 2017 proposals); and identify any outstanding issues. The merits of various proposals to fix the treatment of deductible liabilities on entry into a group are assessed, with the author concluding that the latest round of proposed amendments is philosophically unambitious but practically fit for purpose.
Antony is a Senior Manager at PwC.
- Current at
25 June 2018