International Tax Series - Part 6: Takeover: Sale to a multinational

Published on 11 Nov 2020 | Took place at Online, NSW

Mask ‘R’ Us has received an approach to sell the entire business to a multinational enterprise Mega Corp. Jane and Judy now seek advice on the key tax considerations on exit.

• sale of whole business vs foreign subsidiaries? Where is the value, IP etc
• exit event – CGT discount if sold at AusCo level and consideration of flow through trust consequences
• if sell at US HoldCo level, potential for no Australian CGT (768-G), but unfranked earnings sitting in vendor AusCo
• consider AusCo implications of retaining Australian business and IP vs selling Australian business
• comparison of overall Australian individual tax outcomes under sale of AusCo or US HoldCo
• if ForeignCo acquires AusCo, how do conduit foreign income rules operate for repatriation of ongoing profits, plus Taxable Australian Property (and potential withholding tax considerations) on subsequent exit.