Australian franchises under tax inspection




All four Australian Super 14 franchises are to be investigated by the Australian Tax Office (ATO) after a number of third-party side payments were discovered in the Western Force’s books.

The ATO is looking at the possible tax implications of the ‘sponsor payments’ , as well as thoroughly reviewing all player remunerations and payments to other associations at players’ directions, at the Force, as well as the Reds, Brumbies, and Waratahs.

The move has produced one eyebrow-raising discovery, according to Australia’s Herald, with a documented formal offer to the Waratahs lock Al Kanaar involving a number of third-party payments.

A signed letter from Force chief executive officer Peter O’Meara outlined a A$258,000 ($212,000) package including cash, travel, a car allowance and a third-party arrangement with a sponsor which was underwritten by the club.

The offer, a potential breach of Australian Rugby Union player contract protocols, also included a A$30,000 ($24,650) annual salary for Kanaar to become an “environmental advisor” for one of four companies.

One of the companies was a Force sponsor, Perth-based fuel technology company Firepower.

The full offer included an annual basic salary of A$110,000 ($88,000), potential match payments of $52,000 ($40,000), air fares valued at $16,000 ($10,500) and a motor vehicle as one of many perks.

The ARU has already held an inquiry into the offer to Kanaar, but the case was never resolved as the status of the offer was never clear, with O’Meara saying the offer had never been formally made because it had not gone to any other party.

The Force incurred an A$110,000 ($88,000) fine, but that was for talking to Kanaar in Perth while he was under contract. The fine was partially suspended.

However the new document, coupled with a confirmation that the offer had been faxed but not formally tabled, may change this, and it further turns up the scrutiny on the Force’s recruitment practices ahead of next season.


365 Digital

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