The international taxation services specialists at International Commercial Services are focused on advising our international clients with local operations and our Australian clients with overseas business and investment interests and requirements. We will help you set up a business structure that is both tax-effective and minimises any double taxation, along with managing compliance and the implementation of tax-effective profit-repatriation strategies for taxation services.
Our global footprint is so vast that we have our international partner firms who can help support your business in other countries if necessary.
International Tax Compliance
We will work closely and communicate concisely with you so you feel at ease with Australian tax compliance requirements but gain an understanding of how it can tie with the rest of your global organisation and be able to predict its future impact.
We understand that the Australian taxation reporting requirements can be complicated for an international business, let us help you in managing your domestic tax compliance obligations, so you can not only meet the taxation services compliance requirements but also capture the knowledge of how it correlates with the rest of your business and be able to anticipate the future of your organisation in Australia.
International Commercial Services will ensure that your reporting systems are set up to accurately report the information required for compliance in a vast array of Australian obligations so that you are kept up to date in a timely manner.
Financing a Corporate Subsidiary
In Australia, it is not uncommon for companies to be financed using debt. By using debt financing, it can retain full control of the business and governance. What also makes this method popular is that the interest on repayments is tax-deductible.
However, it is important to identify the entity from which the funding is sourced as tax consequences from a director’s loan is different from one acting as a trustee or director of the company.
Companies can also be financed through the issuance of shares via private equity investors, venture capitalists, or an IPO on the ASX.
The tax treatment of raising equity will vary depending on how exactly the equity was financed.
Transfer Pricing Rules
Transfer pricing rules have been implemented to counter international profit-sharing techniques often used by multinational entities to determine their pricing based on arm’s length methodologies.
This allows for the ATO to reallocate income or adjust deductions accordingly. The rule allows the branches and divisions of the same organisations to reflect non-arm’s length transactions between the Australian entity and the overseas entity of the same organisation.
If your global turnover exceeds AUD$1 billion, please continue reading on. There are new country-by-country reporting rules which affect significant global entities who pass the above test. Australian tax laws also contain various anti-avoidance rules that could cancel tax benefits or even alter the way in which the tax law applies for a particular entity. It is important that we help you stay on top of these rules to ensure you are not caught out unexpectedly.
Fringe Benefits Tax (FBT)
Most international organisations we have come across do give their employers Fringe Benefits which are reportable in Australia.
Fringe benefits are certain benefits that have been provided to their employees or to the associates of their employees. They are not normally deductible expenses for the employee and employer alike and as such FBT would have to be payable by the organisation based on the taxable value of the benefit at the highest personal tax rate of 47%.
This allows employers to claim a deduction for the payment of FBT and eventuates in the similar tax treatment of general salary and wage income and the fringe benefits reportable provided to the employees at the top highest personal tax rate, except for certain concessionally taxed benefits.
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