Beyond the numbers with Grant Thornton: Listen now
Critically, the start date has been deferred to 1 July 2022, and there is now a 2 year transitional period to 1 July 2024 for arrangements that were low risk under the Suspended Guidelines.
Otherwise, the final PCG is substantially the same as the draft, albeit with more examples as to how the ATO would apply the guidelines, and with some concessions around the risk factors.
The deferred start date provides professional services businesses (management and partners) appropriate time to consider the impact of the PCG on their business structures, remuneration and compliance obligations. We will be publishing information on next steps as developments emerge.
The ATO has finalised the Practical Compliance Guidelines (PCG) for the allocation of profits by professional firms. Now what?
ATO releases PCG 2021/4: Allocation of professional firm profits
Watch our March 2021 webinar on demand: Allocation of profits within professional services firms (DRAFT PCG)
Draft PCG 2021/D2: Allocation of profits within professional services firms – what do we know so far?
Grant Thornton submission on Draft PCG 2021/D2 Allocation of professional firm profits – ATO compliance approach
We have significant expertise in the structuring of professional services practices generally and on this specific matter, having authored or contributed to submissions on the draft PCG to the ATO on behalf of clients, professional bodies and on our own behalf.
Please contact us to discuss how we can support your business, including assessing key areas of exposure, implications for existing arrangements, forecast income.
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