An urban myth is that the transfer pricing and thin capitalisation rules only apply to the big of town. Another is that they do not apply to trusts. The ATO is increasingly looking at the transfer pricing provisions when reviewing private groups. Further, the thin capitalization rules are going through a fundamental change from an asset based to earnings based safe harbour.
This session gives an overview of the transfer pricing and thin capitalization rules in the context of private groups:
- How the rules operate
- The types of transactions that typically are a focus during audit activity; and
- The evidence needed to support positions taken.