ATO releases updated draft tax ruling on royalties, software

While the draft ruling is on software arrangements, the ATO is expected to apply some of the principles conveyed to a broader range of transactions, as detailed by Paul Sorrell, Jennifer Ta and Amanda Maguire.

The Australian Taxation Office (ATO), on 17 January 2024, released a revised draft taxation ruling in relation to the characterisation of payments by a distributor for software related rights. Draft Taxation Ruling TR 2024/D1 Income tax: royalties - character of payments in respect of software and intellectual property rights (Draft Ruling) focuses on the electronic distribution of software, including in particular cloud and subscription-based distribution models. The Draft Ruling replaces ...

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Authors: Paul Sorrell, Jennifer Ta,

Published Date: 18 January 2024