ARTICLE · 26 JANUARY 2026

ATO Warns On Contrived Property Development Structures: What Developers And Landowners Need To Know

McCarthy Durie Lawyers

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Early legal input at the structuring stage often makes the difference between a development model that withstands regulatory scrutiny and one that becomes costly to unwind.

AustraliaTax

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The Australian Taxation Office has recently issued Taxpayer Alert TA 2026/1, placing a spotlight on certain property development arrangements between related parties that the ATO considers high-risk and potentially non-compliant.

The Alert is particularly relevant to developers, landowners, family groups and private entities who use special purpose vehicles, development agreements or long-term construction contracts as part of their project structuring.

What Arrangements Are Under Scrutiny?

According to the ATO, the arrangements of concern typically involve:

a landowning entity and a related developer entity under common control;
the interposition of a special purpose developer between the landowner and the builder;

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