Newsflash – International Dealings Schedule 2012
The Australian Taxation Office is introducing the International Dealings Schedule (IDS) 2012 which replaces the previous Schedule 25A and Thin capitalisation schedule. Whilst some of the reasons for the new schedule are given as benefits to the taxpayer, including aligning the information sought to taxpayers record-keeping, business systems and standard business reporting, it also “gives you the opportunity to complete questions” that better align with Tax Office risk management processes.
Taxpayers must complete an IDS 2012 if they operate a company, partnership or trust that has international dealings, some of which have thresholds.
The IDS 2012 will capture data about international transactions that will be used for the Tax Office international risk assessment and mitigation strategies.
Two key changes between between the new IDS and the old Schedule 25A and Thin Capitalisation Schedule are that the:-
- reporting threshold of aggregate international dealings with related parties has been increased from $1 million to $2 million.
- new report appears to seek much more information (it is more that double the number of pages of the combined previous Schedule 25 and Thin Capitalisation schedule).
Many of our foreign owned clients have substituted accounting periods to align with the reporting requirements in the country of origin. The new IDS will apply to taxpayers lodging their 2011-12 tax return, and this will include early balancers with year end 31 December 2011. Clients with a substituted year end are required to lodge their return or IDS by July 2012. ( Non ELS lodgement is due by the 15th July and ELS lodgement is due by 30 July.)
A number of concerns have been raised that the new IDS will create a compliance burden for small and medium business’s. Clients dealing with international related parties will need to address the new requirements. Our firm will continue to provide specific advice to effected clients.
