The Australian Treasury has launched a public consultation on the tax impacts of implementing the new accounting standard for insurance contracts.
The Government is seeking information and comments from interested parties on the tax impacts of implementing the new accounting standard for insurance contracts (AASB17) which will apply mandatorily for annual reporting periods beginning on or after 1 January 2021. This will inform the Government's consideration of whether and what changes may be needed to the tax law as a consequence of the move to the new accounting standard.
Consideration of the tax implications of AASB17 also provides an opportunity to seek comments on two other insurance taxation issues that relate to the operation of the current provisions:
- First, whether the tax law for health insurers should be codified rather than relying on the ordinary principles; and
- Second, whether the tax law should specify how to calculate outstanding claims liabilities for general insurance companies.
You can submit responses to this consultation up until 31 January 2019.