In a strategic move by the Commissioner of Taxation to assess risk up front and allocate resources more effectively in relation to key compliance areas such as transfer pricing, cross border arbitrage and tax haven activity, the Australian Taxation Office have released the fi nal instructions to the International Dealings Schedule - Financial Services (IDS-FS) for the 2011 income year. The IDS-FS forms part of the Australian income tax return and requires fi nancial services taxpayers to disclose certain information about their cross-border transactions. It replaces the existing Schedule 25A and Thin Capitalisation schedules, but also requires additional information to be provided.  

While the impacted taxpayers for the 2011 income year are broadly restricted to fi nancial services entities (excluding superannuation funds) with a gross turnover of A$250m or more on their previous income tax return, general and life insurance entities and foreign banks and foreign bank branches, the Commissioner of Taxation expects that an IDS will be mandatory for all taxpayers for the 2011-12 income year onwards.