Corrs In Brief: Private Equity in Tax Office Crosshairs

18 December 2009

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In a dramatic move on the night of 11 November 2009, the Australian Taxation Office obtained a court order freezing the National Australia Bank account thought to hold the $1.5 billion gain made by TPG on the exit from its investment in Myer. Media reports suggest the account was found to hold just $45 but the ATO proceeded to serve assessments on TPG totalling $678 million made up of $452 million of primary tax and $226 million of penalty.

The ATO has now made its position on private equity clear in two Draft Taxation Determinations released on 16 December 2009.

The drafts deal with the distinction between ordinary income and capital gains on the one hand and treaty shopping on the other.

For a full copy of this document, please download the attached PDF via the link on the right.

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