The SAIT Corporate Tax Technical Work Group recommends aligning the treatment of local hedge fund collective investment schemes (CIS) with other CIS categories by amending section 9D(2)(D) of the Income Tax Act. The issue arises because the 2024 Taxation Laws Amendment Bill expands the definition of a “company” to include hedge fund CISs but fails to update corresponding provisions that exempt CISs from controlled foreign company (CFC) rules. Without this adjustment, local hedge fund CISs investing in foreign counterparts may be inappropriately classified as CFCs, creating unnecessary administrative burdens. The group proposes synchronizing this amendment with future tax years to facilitate consistent and practical implementation within existing reporting frameworks.
