Tabcorp resolves tax treatment dispute

Tabcorp Holdings and the Australian Taxation Office have resolved a dispute about income tax treatment of payments for various licences and authorities.

In an announcement authorised by the Tabcorp Disclosure Committee, the company explained that the amount of tax liabilities and interest in dispute has been paid in full by Tabcorp to the Commissioner.

ATO will refund Tabcorp approximately £83m as part of the settlement. This represents 20 per cent of the disputed tax liabilities and interest. Each proceeding brought by the taxpayers will be dismissed.

For its part, Tabcorp will pay roughly $37m to The Lottery Corporation under the terms of the Separation Deed of March 25, 2022 between the two entities.

Consequently, Tabcorp will recognise a benefit of around $45m after tax in its financial statements for the year ending June 30,2024, which will be treated as a significant item.

An agreement was also reached as part of the settlement in relation to how Tabcorp will treat future licence fees payable in respect of renewals of relevant existing licences. Going forward, Tabcorp must treat the fees as being of a capital nature, subject to agreed limitations.

Tabcorp does not believe this will have any material effect on future results.