MLC Lifetime has reached an agreement to resolve a legacy tax dispute with the Australian Taxation Office (ATO).
The dispute relates to the tax treatment of a reinsurance contract entered into by MLC Lifetime in the 1998 tax year and amended in the 2000 tax year.
Under a deed of settlement MLC Lifetime will, on a without admission of liability basis, agree to pay a pre-tax amount of $38.5 million to resolve the dispute in full.
In 2007, the ATO issued an amended assessment to MLC Lifetime claiming approximately $54 million of primary tax together with interest. The total amount in dispute was $84 million pre-tax.
The settlement would not have any impact on MLC customers or policy holders, an MLC representative told InvestorDaily.
The dispute was disclosed in NAB Group's and National Wealth Management Holding's 2009 full year financial results.
