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 AIG Australia > For Businesses > Management Liabilities > Mergers and Acquisitions > TaxOpinionLiabilityIns
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Tax Opinion Liability Insurance
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What is it?
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Tax liability insurance helps a taxpayer reduce or eliminate a
contingent tax exposure arising from the tax treatment of a transaction,
investment or other activity where the underlying legal conclusions
supporting that tax treatment may be subject to future challenge by
the relevant tax authorities.
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Why do you need it?
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Tax liability insurance effectively provides certainty to taxpayers
in particular areas where there is uncertainty in the application
of the tax laws where, for example, the tax authorities will not
issue advance rulings or where there is inadequate time for the
taxpayer to obtain an advance ruling.
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Who needs it?
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Taxpayers find that Tax liability insurance may be an effective tool
in the following areas:
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- Successor liability issues in the context of M&A transactions
where, due to joint and several liability issues, an acquirer is
concerned about an historic tax position taken by the target company
or its consolidated tax group;
- Protection of a group's tax position following reorganisations
(for example, hive down, demerger or disposal);
- Tax consequences resulting from a change of ownership;
- Intra-group transfers/reorganizations; or
- Where parties do not wish to obtain prior clearance from the tax authorities.
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Find out more
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Contact us
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