You need to disclose Category A and B reportable tax positions in section B.
You only need to disclose Category A positions that exceed your entity's materiality amount.
You must confirm if your entity has any Category A or Category B disclosures.
Tax positions that are a Category C and Category A or B reportable tax position must be disclosed under section C. You must select No if your entity has a reportable tax position that is both a Category C and Category A or B position.
If you select No, go to Section C: Category C reportable tax positions.
If you select Yes, the next question will ask how many Category A or B reportable tax positions you are reporting.
Category A: Tax uncertainty in your entity's company tax return
A Category A reportable tax position is one where, given relevant authorities, you consider the position taken is either:
- about as likely to be correct as incorrect
- less likely to be correct than incorrect.
See also:
Category B: Tax uncertainty in financial statements
You must disclose a position as a Category B reportable tax position where your entity:
- prepares financial statements in accordance with the relevant accounting standards, including but not limited to applying AASB Interpretation 23 (PDF, 325KB)This link will download a file (Uncertainty over income tax treatments), in recognising, measuring and disclosing uncertain tax positions
- has recognised an uncertain tax position and/or disclosed a contingent liability (asset) in its financial statements for the corresponding income year.
The concepts of recognition, measurement and disclosure are to be given meanings in accordance with accounting principles.
See also:
How many Category A and B reportable tax positions are you reporting?
Enter the total number of reportable tax positions you are reporting at the How many Category A and B reportable tax positions (RTPs) are you reporting? field.
Using the PDF schedule
If you are completing the PDF version, once you enter the number of reportable tax positions you are disclosing and move off that field, the document will automatically display the required number of fields needed to make the disclosure(s).
You must complete all mandatory fields for each reportable tax position you are reporting.
RTP number
You must complete the RTP number field using the format:
- the relevant income year for the RTP in YYYY format – for example, 2021
- followed by a dash (-)
- followed by the number corresponding to the number in the box beside RTP at the top of the section for that disclosure, placing a zero (0) before numbers less than 10.
There should be no spaces in the RTP number. Numbers should be sequential in the order you report the positions. For example, number the first RTP 2021–01, with each subsequent RTP numbered 2021–02, 2021–03, and so on.
Have you discussed this position with the ATO?
For each disclosure, you must confirm if you (or another representative of your entity) have previously discussed the disclosure with us. All fields must be completed for each disclosure, no matter what answer you provide to this question.
RTP category
Enter the category of reportable tax position you are reporting in the RTP category:
- A for Category A
- B for Category B
- A & B (for both categories).
Using the PDF schedule
If you are completing the PDF version, select the appropriate category from the drop-down menu.
Concise description
Type a brief description of each Category A or B reportable tax position in the Concise description field. Briefly describe the arrangement(s) or transaction(s), including the facts and circumstances, relevant to the position you are disclosing.
Positions covered by a private ruling
Where a position is covered by a private ruling, you only need to provide the ATO reference number for the ruling in the Concise description field. The reference number is also referred to as the authorisation number.
You can find the relevant reference number related to your entity's private ruling in the top right corner of correspondence from us.
Positions covered by an APA application
A position subject to an APA application must be disclosed if it meets the criteria for a Category A or B reportable tax position. These positions must be disclosed even if the application has been accepted into our APA program.
For positions covered by an APA application, you only need to provide the ATO reference number for the APA application, in the Concise description field.
You can find the relevant reference number in the top right corner of correspondence from us related to your entity's APA application.
See also:
- Examples – disclosing reportable tax positions on the schedule
- Private rulings
- Advance pricing arrangements
Using the PDF schedule
Once information has been entered, the field will expand when you click another field. You will then be able to see all the information in the Concise description field.
Basis for position
Outline the position taken in your entity's tax return and the basis for that position, including:
- specific references in any legislation your entity relied on – don't just refer to a division or subdivision
- all relevant authorities you had regard to when concluding the likelihood of the position
- any industry or administrative practices.
If the position is covered by:
- a private ruling, type only private ruling in the Basis for position field, unless there are material differences in the implemented arrangement or transaction to what was described in the ruling. If material differences exist, you must state these key differences in the Basis for position field
- a ruling application, which has been withdrawn, type only private ruling application - withdrawn in the Basis for position field
- an APA application, type only APA application in the Basis for position field.
See also:
- Disclosing reportable tax positions on the schedule – examples 1 and 2
Using the PDF schedule
Once information has been entered, the field will expand when you click on or move onto another field. You will then be able to view all the text within the Basis for position field.
The field accepts 3,000 characters or approximately 500 words. You can attach additional information if required.