The Australian Taxation Office (ATO) has announced the issuance on 12 August 2020 of final Taxation Ruling (TR) 2020/4 and Practical Compliance Guideline (PCG) 2020/7 concerning the arm’s length debt test for thin capitalisation purposes.

TR 2020/4 applies to years of income commencing both before and after its date of issue, although it will not apply to taxpayers to the extent that it confli…