Legal professional privilege: lessons learned for multi-jurisdictional or multi-disciplinary matters

The ATO's appetite for challenging claims of legal professional privilege (LPP) has been highlighted by a recent Federal Court of Australia decision (Commissioner of Taxation v PricewaterhouseCoopers  [2022] FCA 278) and the consultation in the lead-up to the imminent release of the ATO's new LPP Protocol.

Increased scrutiny by ATO

From at least late 2018, the ATO has noted it had been 'increasingly testing the engagement' of legal advisors where it had received LPP claims in response to formal notices that appeared to be 'excessive'.

One of the ATO's key messages at the 30 November 2018 National Tax Liaison Group meeting was that law firms involved in providing advice on the validity of LPP claims should ensure their engagement included confirming the fundamental elements required to establish privilege, rather than make assumptions that these elements had been satisfied.