Reducing Australia's Tax Distortions – The Taxation of Financial Arrangements and Enhancing Financial Risk Management
The Taxation of Financial Arrangements, or TOFA, is one of the most significant changes to occur to the Australian Taxation Act over the past two decades. Its aim is to reduce existing taxation distortions for Australian taxpayers and it broadly affects medium to large organisations across the breadth of the financial services industry. While at face value the TOFA Act appears to be straightforward, Ian Mathieson says in reality it is a complex regime to implement and poses many challenges for taxpayers, their record keepers, tax accountants and auditors. For the financial services firm to succeed in the post-TOFA era, from 1 July 2010 onwards, it must address the mandatory reporting requirements for its invesment administration systems. Firms will need to enhance their existing systems to manage the complex date and calculation services required by their clients and the Australian Taxation Office.
