Court also provided useful commentary on TOFA balance adjustment rules
The Federal Court on February 21, 2025, held in聽 that the circumstances surrounding the termination of a taxpayer鈥檚 gaming licenses in Victoria did not create a 鈥渇inancial arrangement鈥� subject to the Taxation of Financial Arrangements (TOFA) rules.
Although not decisive to the court鈥檚 holding, the court provided useful commentary on the TOFA balancing adjustment rules, which provide that a balancing adjustment amount can arise if, broadly, there is not alignment between the net financial benefits received and provided under a financial arrangement and the amounts that have been included in assessable income and/or allowed as a deduction. The court noted that the amounts included in income or allowed as a deduction are concerned with amounts deductible or assessable聽under the TOFA regime, rather than under other provisions. In addition, the court stated that an issuance of shares may be a provision of a financial benefit for the purposes of the balancing adjustment.
For more information, contact a 乐鱼（Leyu）体育官网 tax professional in Australia:
Julian Humphrey |聽jrhumphrey@kpmg.com.au
Sagar Joshi |聽sjoshi10@kpmg.com.au