Tax Transparency Statement

FOR THE YEAR ENDED 30 JUNE 2021

PERRON INVESTMENTS PTY LTD AND ITS CONTROLLED ENTITIES

Overview

The Perron Group, incorporating Perron Investments Pty Ltd and subsidiaries and a number of related entities, operates under a comprehensive tax risk management charter which is designed to ensure that the Group conducts itself in a lawful manner with respect to all of its tax obligations.

In carrying on its activities, Perron Group:

  • ­has robust tax governance, with ongoing oversight from its key executives, Audit Committee and Board of Directors;

  • ­has a low risk appetite and does not engage in aggressive tax strategies; and

  • ­undertakes to comply with all of its statutory obligations in a timely and transparent manner.

To demonstrate the Group’s commitment to tax transparency, the Perron Group publishes this Tax Transparency Statement on a voluntary basis as part of the Board of Taxation’s Tax Transparency Code.

This Statement sets out the details of the Group’s corporate structure, as well as its approach to tax compliance, tax risk management and corporate governance.

Perron Group Structure

Perron Group is a substantial, privately owned, Perth based group whose main investment and business activities comprise:

  • ­a property investment portfolio of shopping centres, an office tower and a number of industrial properties;

  • ­a residential land development business;

  • ­a motor vehicle and spare parts distribution business;

  • ­iron ore royalties;

  • ­a managed listed equities portfolio; and

  • ­an unlisted infrastructure portfolio.

The main operating entity is Perron Investments Pty Ltd (PIPL). Together with its subsidiaries PIPL is consolidated for income tax purposes, resulting in all members of the consolidated group being treated as a single corporate taxpayer. As a result, PIPL is responsible for the income tax liability of the consolidated tax group, and intra-group transactions are eliminated in order to determine the consolidated tax group’s taxable income.

A number of investments and a business are owned and operated in related trusts that are not part of the PIPL consolidated tax group. These trusts distribute their net income to PIPL.

Tax Status

For financial reporting purposes, PIPL and its subsidiaries prepare consolidated financial statements which detail the consolidated accounting profit or loss before tax and related tax expense or benefit. A full reconciliation of the consolidated accounting net profit to income tax paid is set out below.

The prima facie tax on accounting net profit is reconciled to the income tax expense as follows:

The effective tax rates for the 2021 and 2020 years are set out as follows:

PIPL is a corporate taxpayer with total income in excess of $100 million, which means it is included in the Australian Taxation Office’s annual Public Disclosure of Entity Information Report. This report discloses PIPL’s total income, taxable income and income tax payable for the relevant financial year.

PIPL pays tax in relation to its own activities and those of its wholly owned subsidiaries at the Australian corporate tax rate of 30%. PIPL paid corporate income tax of $145.1 million (2020: $62.7 million) in the year ended 30 June 2021.

Approach to Tax Governance

The Directors’ approach to tax is aligned with the Group’s business objectives and a high standard of corporate responsibility.  The Board ensures the Group’s systems, procedures and practices exhibit a high standard of corporate governance, ethical behaviour and risk management.

Support of the principles of transparency and honest engagement with revenue authorities is reflected in the Tax Risk Management (‘TRM’) Charter which has been in place for many years. The TRM Charter codifies specific policies including:

  • identifying and reducing tax risk in relation to our business operations and investments by paying the correct amount of tax and meeting all tax reporting obligations;

  • ­not entering into artificial, blatant or contrived tax schemes;

  • ­mitigating the tax risk associated with the potential application of anti-avoidance legislation to transactions entered into by PIPL and the wider Perron Group;

  • ­anticipating and responding promptly to tax legislative requirements and amendments; and

  • ­ensuring these TRM policies and objectives continue to underpin the Group’s tax compliance, reporting and payment obligations.

The policy objectives of the Group’s TRM Charter are achieved by providing a robust framework for identifying and managing tax risk, as well as ensuring that material tax issues are escalated to Board level for further consideration.

Engagement with Revenue Authorities

Under the TRM Charter, the Group also endeavours to collaborate and be transparent with both Federal and State revenue authorities. This includes but is not limited to actively addressing the Group’s tax affairs by way of seeking private binding rulings where appropriate and engaging with the revenue authorities in a responsive and complete manner.

Contributions to the Australian Tax System

The Perron Group is subject to various federal, state and local government taxes. These taxes amount to approximately $203.7 million (2020: $119.1 million) and are either borne by Perron Group as a cost of business, or are remitted by the Group as part of our contribution to the administration of the tax system. 

The information provided below summarises Perron Group’s Australian tax contribution for the 30 June 2021 financial year.

PERRON INVESTMENTS PTY LTD

ABN: 48 000 003 976