China desk

Pillar Two Has Arrived: Far More Than Another Reporting RequirementInternational tax reform has accelerated in recent years, but only a small number of initiatives have materially reshaped how multinational groups are governed, structured, and managed. Pillar Two is one of them.Developed in response to concerns around base erosion and profit...

The unanimous New South Wales Court of Appeal decision in the Uber payroll tax case marks a turning point for Australia’s gig economy and platform-based businesses. The Court ruled that payments to Uber drivers are “wages” under the Payroll Tax Act, overturning the previous decision in Uber’s favour. This serves as a warning to all businesses using contractor and centralised payment models to urgently reassess payroll tax risks. Industries such as healthcare, education, finance, insurance, and domestic services must review and adapt their business structures to ensure compliance with evolving payroll tax obligations. 

The tax law amendment effective from 1 July 2025 has a significant impact on taxpayers’ ability to deduct ATO interest charges (GIC and SIC). With the repeal of prior deductibility rights, taxpayers must correctly determine the scope of deductible interest. This article systematically reviews the principles established in key tax ruling, determination and case law, demonstrating that deductions for GIC and SIC are now almost entirely disallowed in practice. It further extends the discussion to the deductibility of financing interest, noting that in the context of non-deductible GIC/SIC, taxpayers who raise funds through borrowings to meet their tax liabilities may still be able to claim deductions under relevant tax laws, depending on the nature of the entity and the commerciality of the arrangement. The article compares the treatment of non-business individuals, sole traders, and corporate taxpayers, and explores working capital alternatives, offering businesses practical pathways for compliant and efficient tax management.