Ross Hocking, Divyansh Sharma and Melissa Bader discuss changes to the RTP schedule to company income tax returns.
The Reportable Tax Position (RTP) schedule to company income tax returns requires large businesses to disclose their most contestable and material tax positions.
In June 2016, we reported the Australian Taxation Office's (ATO) proposed changes to the 2017 RTP schedule. The ATO has now completed the first of the two tranche process which involves substantial changes made to RTP Category C. It has also released its Guide to Reportable Tax Positions 2017.
Category C previously required disclosure of reportable transactions or events where certain large CGT events generated a significant book to tax difference. Category C has now been expanded to cover a list of questions on the following specific issues that are concerning to the ATO:
There are no materiality thresholds for Category C and the questions will be updated regularly throughout the year. Only taxpayers with income years ending on or after 30 June 2017 will be required to answer the new Category C questions.
Next year, the ATO will extend the RTP requirements for companies in economic groups with turnovers above $250 million and with income years ending on or after 30 June 2018.