Australian operator Tabcorp has been refunded AU$83.0m (£42.7m/€49.8m/US$53.4m) after resolving a tax dispute with the Australian Taxation Office (ATO
The case relates to income tax treatment of payments for various licences and authorities. Tabcorp says it paid the disputed amount of tax liabilities and interest in full. The refunded amount represents 20% of the disputed tax liabilities and interest.
Each proceeding brought by the taxpayers will be dismissed. In turn, and in line with the ATO settlement, Tabcorp will pay approximately $37.0m to The Lottery Corporation Limited (TLC) under the businesses’ separation deed.
In March 2022 Tabcorp set out details for the demerger of TLC lottery operations from wagering, media and gaming services. The demerger scheme came into effect in June of the same year, marking the end of a process that began in July 2021.
As such, Tabcorp will recognise a benefit of approximately $45.0m after tax from the ATO settlement. This will be reflected in financial statements for the year ending 30 June 2024 and treated as a significant item.
The settlement also includes an agreement as to how Tabcorp treats future licence fees for the renewals of existing licences. Subject to agreed limitations, Tabcorp must treat such fees as being of a capital nature.
Tabcorp says it does not believe this will have any material effect on future results.
