Taxation
ATO access policy for corporate board documents on tax compliance risk
04 February 2005On 23 December 2004, the ATO released a practice statement setting out its access policy for corporate board documents on tax compliance risk (practice statement). The practice statement follows a letter sent by the Commissioner of Taxation, Michael Carmody, to 1500 Chairs of major Australian listed corporates in January 2004 and various speeches the commissioner has since given, reinforcing his message that boards should become more involved in the tax aspects of major transactions.
Importantly, the practice statement applies to documents prepared by a wider group of advisors than the guidelines on professional accounting advisers' papers (guidelines). Under those guidelines, the ATO does not seek access to taxation advice prepared by external professional accounting advisors independent of the taxpayer, other than in exceptional circumstances. The practice statement adds to this by providing that the ATO will not seek access to corporate board documents prepared by suitably qualified in-house or independent advisors created for the sole purpose of providing advice or opinion to the board of directors on tax compliance risks and their likelihood and impact, except in exceptional circumstances. Who might be considered a 'suitably qualified in-house or independent advisor' is not detailed in the practice statement.
For more information, see the Tax Brief ATO Access to Board Papers on Tax Compliance Risk prepared by our associated tax advisory firm, Greenwoods & Freehills and the ATO's practice statement.
