Businesses warned to seek advice on new contracts

Assistant Treasurer Mark Arbib sparked a controversy in his last few hours as a senator, announcing the Government will tighten anti-avoidance tax provisions – but the detail of these new provisions won’t be confirmed until the spring sitting of Parliament, which is six months away.

Tax experts are up in arms over the announcement, warning businesses to seek professional advice when signing big new contracts or agreements as these could possibly be found in breach of the new Part IV anti-avoidance provisions when they are eventually passed.

Paul Drum, head of business and investment at CPA Australia, says the problem is that although the specifics of the new provisions will be introduced in spring, they will actually come into effect from today. That means any agreements or contracts made between now and when the legislation is written could end up being impacted.

“Seek professional advice before you sign anything,” he warns.

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