Consolidation, deductible liabilities and Meat Loaf-style reform
Source: The Tax Specialist Journal Article
Published Date: 1 Feb 2018
Liabilities have long been clumsily handled by Australia's consolidation regime, and deductible liabilities have proved to be particularly difficult to wrangle. Not only are liabilities treated as being merely tools for establishing the value of assets, but also the current regime provides for the value of liabilities to potentially be recognised multiple times. This article proposes to: set out the current approach to dealing with deductible liabilities on entry into a consolidated group; identify why change is necessary; discuss the proposed changes (including the competing 2015 and 2017 proposals); and identify any outstanding issues. The merits of various proposals to fix the treatment of deductible liabilities on entry into a group are assessed, with the author concluding that the latest round of proposed amendments is philosophically unambitious but practically fit for purpose.
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Details
- Published By: Antony Faisandier
- Published On:1 Feb 2018
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