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Re: Revenue Recognition and Withholding taxes in an International Business

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Newbie

Views 2107

Replies 5

 My questions normally receive the standard response.."see a tax specialist". I have - and received conflicting advise...so here goes;

1) with an Australian HQ'd company that has several overseas registered offices (subsidiaries) a number of business scenarios may exist in terms of invoicing, revenue receipt and delivery of prduct/services. i.e. a contract may be signed with the Australian business entity, delivered in Country B and invoiced to bank account in Country C. The majority of business costs are in country B. In this situation, where is the revenue recognised for tax purposes?

2) If revenue is recognised and taxed in Australia, are all overseas costs tax deductable in Australia directly or should they be "invoiced" back to Austalia? Finally;

3) If one of the directors/shareholders is a non resident Australian (for tax purposes) and ordinarily domiciled in, say, Singapore, would this Director's fees be liable to any withholding tax (or any other tax) if paid from the Australian company?

Any and all advise gratefully received, except "seek professional advice" unless that professional can be named !!

 

Thank you 

 

1 ACCEPTED SOLUTION

Accepted Solutions
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Best answer

Community Support

Replies 0

Hi @BBB,

 

Thanks for your questions!

 

Our role here in the Community is to help you find general information to manage your tax and super affairs. We often don't have enough information to be able to provide a definitive answer, and we don't want people to make important financial decisions based on incomplete information.


We've asked some technical specialists to look into the scenarios you've outlined in your post, and they've advised they'd need more information about your situation.


In this instance, we'd suggest following @Anonymous's suggestion and apply for a private ruling. Private rulings are binding advice from us that explains our view on how tax law applies to your specific situation. These rulings are a free service, and we usually respond within 28 days from receiving your request.

 

Thanks, JodieH

 

 

5 REPLIES 5

Anonymous

Replies 4

This forum is design for general taxation enquiries.  The issues invovling non-residency and double tax agreements can be very complex and require an appropriate level of response, and this forum is not equiped to provide that level of response.

 

I suggest the better approach is for you to apply for an ATO Private Ruling so the ATO can provide a tailored response to your particular circumstances so you get it right the first time. 

 

ATO general enquiries 13 28 66

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Newbie

Replies 3

well thats a very helpful response Mr MVF. Most enlightening.  It is iteresting to note that out of the 5,713 members on this forum you are confident that not one of them can provide any advise.

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Anonymous

Replies 2

Absolutely, as you are the one that has stated you have already received conflicting advice from "tax professionals", so its in your own best interests to have the issues addressed properly by the ATO through the appropriate channels, instead of receiving more conflicting advice ....

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Newbie

Replies 1

If you dont mind, MVF, I'd like to seek feedback from the Community. It is, after all, the reason why I signed up. Most forums, whether it be to fixing bugs on an iPhone to changing a spare tyre on a Jeep, will have contentious or conflicting responses - that's partly the value of such forums. I can then consider the best course of action. 

Highlighted

Best answer

Community Support

Replies 0

Hi @BBB,

 

Thanks for your questions!

 

Our role here in the Community is to help you find general information to manage your tax and super affairs. We often don't have enough information to be able to provide a definitive answer, and we don't want people to make important financial decisions based on incomplete information.


We've asked some technical specialists to look into the scenarios you've outlined in your post, and they've advised they'd need more information about your situation.


In this instance, we'd suggest following @Anonymous's suggestion and apply for a private ruling. Private rulings are binding advice from us that explains our view on how tax law applies to your specific situation. These rulings are a free service, and we usually respond within 28 days from receiving your request.

 

Thanks, JodieH