Concessions for multinational corporations in Australia

Information about Foreign Multinational Enterprises

Regional Headquarter Concessions

Graph:

GERMAN PARENT COMPANY
Certain foreign source dividends passed through an Australian resident company (whether or not an RHQ) to a foreign resident shareholder are exempt from dividend withholding tax
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AUSTRALIAN COMPANY(RHQ)
support provides service to companies located in other countries (same region), the set up costs for those companies are deductions
for the Australian RHQ company.
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DOMPANY IN SINGAPUR OR NEW ZEALAND

Concessions
An eligible RHQ is entitled to deductions in respect of set up costs for the other company.
For example: An Australian RHQ could claim set up costs for the Singapore company in the Australian tax
return. The Singapore Company maybe do not produce any income in the first year.
Set up costs are:

• Expenditure incurred in setting up facilities in Australia, the main purpose of which is to provide
  RHQ support (management-related services, data services, and software support services)
• Reimbursement of such costs of the RHQ that were previously incurred by a foreign resident associated
  company.
  

Costs associated with undertaking a feasibility study, purchasing tangible assets (eg plant, land, buildings
or similar items) or relocating an RHQ between locations within Australia are excluded.
The costs must be incurred within 12 months before or after the date when the RHQ first derives assessable
income by providing RHQ support from the new facilities.

Advantage
The set up cost are deductions for the Australian company, which derives assessable income. This will reduce
the Australian company’s profit and therefore the taxable income.
Dividends could be forwarded to the parent company without Australian withholding tax from the amount.
The dividends are maybe still taxable income in Germany.
If you need any further information, please do not hesitate to contact us. We will be happy to assist you in
this matter.

Please also go to our website, which will give you further information about our service and our partners. www.europe-invest-australia.com

Dominic Hennig Juritax Pty Ltd
Level 12, 74 Castlereagh Street
Sydney NSW 2000
Fon: + 61 (0) 2 9223 9660      Fax +61 (0) 2 9223 9662

Email: T.Hennig@dominic.com.au