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The new service will see the ATO provide hands-on guidance on significant commercial transactions as the government looks to attract foreign businesses to invest in and relocate to Australia.
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ATO launches new business investment service
01 July 2021
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Assistant Treasurer Michael Sukkar on Tuesday announced the launch of Australia’s New Investment Engagement Service (NIES), which will be active from 1 July.
The program, first flagged in the 2021–22 federal budget, is designed to encourage new, foreign business investment in Australia and incentivise it by offering investors the opportunity for close engagement with, and hands-on guidance from, the ATO in the lead-up to major commercial transactions.
“The NIES will further support business by providing customised guidance and improve the process for foreign businesses looking to invest in Australia,” Mr Sukkar said in a statement.
“The service will provide investors with objective information, promote confidence and assist in understanding potential tax risks arising from their proposed investment structures prior to the execution.”
All foreign businesses that come through the Global Business and Talent Attraction Taskforce will be eligible for the NIES program, while other Australian and foreign businesses that make new investments in Australia worth $250 million or more will be eligible, too.
Under the program, investors will have access to a dedicated team at the ATO with whom they will be able to discuss their proposed transactions and any assistance they may need.
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The engagement, according to the ATO, would begin with an engagement discussion where investors would be free to present a proposed transaction, the key tax issues that they require ATO guidance on, whether a FIRB application will need to be lodged, and any other time and commercial sensitivities.
The ATO said that, before progressing any further, both parties would then agree on what guidance and assistance will be provided, based on the commercial time frames of the investment.
The Tax Office would later alert the business to any material risks, should they arise, in their report. The report would also identify steps an investor can take to mitigate risks related to the discussed transaction, should any arise.
The NIES program does not, however, replace private rulings and Advance Pricing Agreements.
“If the investor is seeking something of this nature, the NIES team will work with the investor and the relevant team to ensure outcomes are delivered in the shortest time possible,” the ATO said.
Mr Sukkar said the program will help investors make better informed decisions related to their investments and the tax implications that accompany them.
He said the NIES program complements the work of the Global Business and Talent Attraction Taskforce, an initiative that seeks out leading global businesses and looks to lure them to Australia.
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