Surgery with anaesthetics: Mergers and acquisitions taxation

Prior to the late 1990s, there were no specific provisions giving relief from significant tax exposures that arose when implementing corporate restructures. Since that time, the introduction of scrip-for-scrip relief (1999), the tax consolidation regime (2002) and demerger relief (2002) have without doubt facilitated numerous corporate restructures and takeovers that could not otherwise have been implemented. This article focuses on some of the more important problem areas and anomalies that exist in the application of the scrip-for-scrip, demerger and consolidation provisions in the context of takeovers and corporate restructures. In addition, reference is made to some issues associated with distributions that may relate to a takeover or restructure. The article primarily focuses on restructures involving corporate entities, and does not seek to address issues that can arise in relation to transactions involving trusts or trust structures.