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An analysis by Corrs Chambers Westgarth, Taxand Australia
Australia’s Federal Court has ruled against the Australian Taxation Office (ATO) in favour of PepsiCo, exempting the company from Royalty Withholding Tax and Diverted Profits Tax for certain cross-border IP licensing arrangements in a significant tax case.
Cameron Blackwood, Craig Boyle and Michael Carroll from Corrs Chambers Westgarth, Taxand Australia, analyse this decision, which is significant for both Australian companies and global corporations with similar arrangements, as it clarifies how royalties and intangible assets are taxed. It also highlights the ATO’s stance on anti-avoidance rules, which may affect how similar tax issues are handled in the future, particularly in light of new penalty regulations for incorrectly reported royalty payments.
You can read the full decision and analysis here.
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