Australia Tax Agency Clarifies Substantiation of DTA Residency in Arrangements Involving Fiscally Transparent Entities

The Australian Taxation Office June 11 clarified substantiation of DTA residency claims in arrangements involving fiscally transparent entities (FTEs). The clarification includes that: 1) when a DTA with Australia allows benefits for entities that are ultimate investors in an FTE, evidence is required that the investor is resident in the foreign country; 2) these entities are liable for tax in their residence country on the income; 3) residency evidence for interest holders of FTEs in private equity arrangements is largely expected to be primary evidence; 4) for each ultimate investor, the minimum residency evidence is tax identification forms, but incorporation ...