What does it mean to have a binding Tax Ruling?

September 22, 2017

The Index Mortgage takes the benefit of Product Ruling PR 2017/3, issued by the Australian Taxation Office.  The Commissioner of Taxation explains the effect of that ruling like so:-

If you rely on this ruling, the Commissioner must apply the law to you in the way set out in the ruling (unless the Commissioner is satisfied that the ruling is incorrect and disadvantages you, in which case the law may be applied to you in a way that is more favourable for you provided the Commissioner is not prevented from doing so by a time limit imposed by the law).  You will be protected from having to pay any underpaid tax, penalty or interest in respect of the matters covered by this ruling if it turns out that it does not correctly state how the relevant provision applies to you.