Part IVA: The General Anti-Avoidance Regime for income tax
The general anti-avoidance regime (GAAR) within the income tax legislation can apply to any transaction, at any time, if the ATO considers that the sole or dominant purpose of a transaction (or series of transactions) was to obtain a tax benefit.
The GAAR is highly technical and requires detailed consideration of the unique factual matrix associated with any transaction or transactions to which it might apply. At the highest level of generality, it is designed to apply to transactions that are ‘blatant, artificial, or contrived’ or, thought of another way, to transactions which have about them some feature that can be characterised as uncommercial and that can therefore be explained as having the sole or dominant purpose of achieving a tax benefit.
ABL has represented numerous clients in disputes concerning the application of the GAAR, including groups that have or entered into stapled arrangements. We have represented clients before the ATO’s GAAR Panel on numerous occasions, and have instructed senior counsel to appear with us at GAAR Panel meetings.
Given the complexity of GAAR issues and the high value of transactions targeted by the ATO, it is important that these issues are handled carefully from the very start. Whether it is front end transaction advice or back end dispute assistance, ABL has the knowledge and experience to assist you when it matters.
Contact our tax team
ABL is the tax controversy sector leader in end-to-end management of taxation disputes and litigation arising from ATO compliance activities and audits. If you have identified issues or would like assistance in reviewing risks or uncertainties, please contact one of our team members below.
