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SME and private clients: Transfer pricing outside the top 1,000


The ATO has focused significant resources and attention in recent years to managing transfer pricing risk through large corporate assurance programs and the release of risk guidance through practical compliance guidelines, tax determinations and tax alerts. In the authors’ view, this approach is aimed at managing the tax risk of large businesses. As large businesses provide a significant portion of tax in Australia, the ATO’s focus on gaining assurance that these entities are paying their fair share of tax is not unexpected. However, it seems that the ATO has ignored, or is unaware of, the unintentional consequences that this focus has had on managing transfer pricing risk in the small-to-medium enterprise (SME) business segment. This article identifies transfer pricing considerations and challenges currently faced by SMEs and outlines the ATO’s evolving approach to dealing with the transfer pricing arrangements of SMEs.

Author profiles

Aileen O'Carroll
Aileen O’Carroll is Partner/Executive Director in the Tax Consulting division of Pitcher Partners Melbourne and heads up the firm’s transfer pricing service offering. Aileen has over 12 years consulting experience providing advice on a broad range of transfer pricing matters to clients across a range of different industries. Prior to joining Pitcher Partners in 2016, Aileen worked with the National Australia Bank in assisting them to implement OECD Action 13 – Country by Country (“CbC”) Reporting. During this time, Aileen worked extensively with a wide range of stakeholders globally and domestically. She established an Action 13 working group with industry peers and also consulted regularly with the ATO on CbC, which included development of the Australian Local File. She has also worked with KPMG UK and Australia for 10 years in the transfer pricing practice, advising clients on transfer pricing matters, including financing arrangements, business restructures, risk review, audit defense assistance, implementation and operationalisation of transfer pricing policies and putting in place transfer pricing documentation. - Current at 27 August 2018
Christine Cornish
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