Thin capitalisation: ATO interpretive guidance on arm’s length debt test ruling

Jenny Wong explores the much awaited Draft Taxation Ruling TR 2019/D2 Income tax: thin capitalisation – the arm’s length debt test.

The Australian Taxation Office (ATO) published the much awaited Draft Taxation Ruling TR 2019/D2 Income tax: thin capitalisation – the arm’s length debt test on 5 April. The Draft Ruling will be subject to submissions, but once finalised, is proposed to apply as interpretive guidance retrospectively.Also, a draft Practical Compliance Guideline is coming and this is intended to provide administrative guidance to taxpayers in applying the test.Thin capitalisation has been in the spotlight ...

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Authors: Jenny Wong

Published Date: 10 April 2019