Automotive Industry Update

The government has released draft legislation on the conduit foreign income measure.

The measure will replace the existing foreign dividend account rules and provide tax relief for the distribution of a broader range of foreign income, and implements the government’s decision in response to Recommendation 3.11(1) of the Board of Taxation’s report to the Treasurer on international taxation.

Conduit foreign income is foreign income received by a foreign resident via an Australian corporate tax entity. The measure will ensure those amounts are not taxed in Australia when distributed by the Australian corporate tax entity to its foreign owners.