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Proposed reforms to tax losses recoupment regime
January 2012
The Treasurer has released a consultation paper on potential improvements to the tax treatment of losses. The consultation paper considers options available to improve the operation of the tax loss rules and promote innovation and investment in Australia.The paper considers the removal of the company continuity of ownership and same business tests and substituting this with a different type of integrity test.
The paper comments that current loss recoupment tests operate in such a way that innovation and risk-taking in business is discouraged due to the inability to claim losses.
Other measures which are also being considered include the potential for losses incurred to give rise to a refundable tax offset and a reduction in the number of years (currently 5 years) over which deductions under the existing blackhole provisions can be claimed.
The Treasury is seeking submissions on these rules by 3 February 2012.
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The material and contents provided on this website and in our print, email or downloadable publications are informative in nature only. It is not intended to be advice and you should not act specifically on the basis of this information alone. If expert assistance is required, professional advice should be obtained. Liability limited by a scheme approved under Professional Standard Legislation.
