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An overview by Corrs Chambers Westgarth, Taxand Australia
Multinational companies generate significant value from intangible assets such as intellectual property, software, and goodwill. However, these assets also pose complex tax challenges. The Australian Taxation Office (ATO) is increasing its scrutiny of intangibles, recognising them as key drivers of corporate value.
Angelina Lagana, Eugenia Kolivos and Joseph Tranzillo from our Australian member firm Corrs Chambers Westgarth, have analysed recent court cases—including PepsiCo and Oracle—which highlight major disputes over royalty withholding tax and transfer pricing, with significant implications for multinationals operating in Australia.
The ATO has strengthened its compliance efforts, ramping up audits and litigation, particularly in the IT, pharmaceutical, and financial services sectors. New measures, including targeted penalties and anti-avoidance provisions, reflect the government’s commitment to ensuring fair taxation of intangible-related profits. However, evolving regulations and differing judicial interpretations add to the uncertainty for businesses. To navigate these risks, multinationals must proactively review their intangible asset arrangements and ensure compliance.
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