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Australia: The Australian Taxation Office announces ‘Project Do It’

07 October 2014   (0 Comments)
Posted by: Author: Peter Collins
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Author: Peter Collins and David Earl (PwC Australia)

The Australian Commissioner of Taxation has announced a last chance opportunity for taxpayers with undisclosed offshore income, capital gains or over-claimed tax deductions relating to foreign income to voluntarily disclose their offshore arrangements to the Australian Taxation Office (ATO).

There are unprecedented benefits of the amnesty being offered to eligible taxpayers including, for example:

  • Tax being assessed only for the last four years (as opposed to an unlimited period of review in cases of fraud and evasion). 
  • Penalties being capped at 10% (compared to penalties of up to 75%). 
  • Voluntary disclosures will not be investigated for the purposes of criminal prosecution, nor will they be referred to any other Australian law enforcement agency.
  • Certainty being provided to taxpayers in the tax treatment of their offshore arrangements. 
  • Taxpayers being provided with the ability to enter into a binding  Deed of Settlement with the Commissioner to provide certainty regarding the future tax treatment of offshore arrangements. 

In certain circumstances, taxpayers have been declared ineligible from participating in the amnesty.

PwC observation:

The international tax environment is changing and Australia now has greater access to offshore information. In this environment of increased global transparency and information sharing, the message is clear - this amnesty provides the last chance for taxpayers to voluntarily disclose their offshore affairs to the ATO.

This article first appeared on pwc.com.


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