Lifting the Veil on Foreign Tax Flow-Through Companies: Could Australian Closely Held Business Benefit from Their Governance Regimes?

8 Pages Posted: 11 Dec 2013

See all articles by Brett Freudenberg

Brett Freudenberg

Griffith University - Griffith Business School; Griffith University - Griffith Law School

Date Written: December 10, 2013

Abstract

Much of the literature considering whether Australia should follow the international trend of introducing a tax flow-through company has, may be for obvious reasons, focused on the potential tax implications. However, there is more than tax when it comes to considering this international trend as tax flow-through companies are not identical. Particularly, some tax flow-through companies have been in conjunction with the introduction of new business forms. This article will focus on the governance laws of two foreign new form tax flow-through companies: the United States’ Limited Liability Company; and the United Kingdom’s Limited Liability Partnership to analyse whether their governance regimes could be beneficial to Australian closely held businesses. In isolation from their tax treatment, it will be argued that while such new form tax flow-through companies offer some advantages there are serious concerns about their suitability.

Keywords: tax, flow-through, LLP, LLC, Australia, governance

JEL Classification: K34, K22

Suggested Citation

Freudenberg, Brett, Lifting the Veil on Foreign Tax Flow-Through Companies: Could Australian Closely Held Business Benefit from Their Governance Regimes? (December 10, 2013). Australian Journal of Corporate Law (2013) Vol. 28, No. 3, pp. 201-232, Available at SSRN: https://ssrn.com/abstract=2366200

Brett Freudenberg (Contact Author)

Griffith University - Griffith Business School ( email )

Brisbane, Queensland 4111
Australia

Griffith University - Griffith Law School ( email )

Nathan Campus, GU
Nathan 4111
Australia

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