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This is a Bill, not an Act. For current law, see the Acts databases.
2002-2003
The Parliament of
the
Commonwealth of
Australia
HOUSE OF
REPRESENTATIVES
Presented and read a first
time
Taxation
Laws Amendment Bill (No. 7) 2003
No.
, 2003
(Treasury)
A
Bill for an Act to amend the law relating to taxation, and for related
purposes
Contents
Part 1—Amendments 4
Income Tax Assessment Act
1936 4
Income Tax Assessment Act
1997 6
Part 2—Application of
amendments 8
Income Tax Assessment Act
1997 9
Income Tax Assessment Act
1997 10
Part 1—Clarifying application of Parts I and II of that
Act 29
Crimes (Taxation Offences) Act
1980 29
Part 2—Application of the Criminal
Code 31
Crimes (Taxation Offences) Act
1980 31
Income Tax (Transitional Provisions) Act
1997 33
A New Tax System (Goods and Services Tax) Act
1999 38
Income Tax Assessment Act
1997 42
Income Tax (Transitional Provisions) Act
1997 51
Income Tax Assessment Act
1936 54
Part 1—Amendments 55
Income Tax Assessment Act
1997 55
Part 2—Application of
amendments 71
Part 1—Amendment of the Income Tax Assessment Act
1936 72
Part 2—Amendment of the Income Tax Assessment Act
1997 75
Part 3—Amendment of the Income Tax (Transitional Provisions) Act
1997 102
Part 1—Amendments commencing on 16 July
1999 109
Income Tax Assessment Act
1936 109
Part 2—Amendments commencing on 22 December
1999 110
Division 1—Withholding from mining
payments 110
Taxation Administration Act
1953 110
Division 2—Administrative
penalties 110
Taxation Administration Act
1953 110
Division 3—Correcting
cross-reference 111
Taxation Administration Act
1953 111
Division 4—Interest on
overpayments 112
Taxation (Interest on Overpayments and Early Payments) Act
1983 112
Part 3—Amendments commencing on 30 June
2000 113
Division 1—Life assurance company
definition 113
Income Tax Assessment Act
1936 113
Income Tax Assessment Act
1997 115
Superannuation Contributions Tax (Assessment and Collection) Act
1997 115
Division 2—Disallowance of
deductions 115
Income Tax Assessment Act
1936 115
Division 3—Deductions for life assurance
premiums 116
Income Tax Assessment Act
1936 116
Part 4—Amendments commencing on 1 July
2000 117
Division 1—Mutual life assurance company
definition 117
Income Tax Assessment Act
1936 117
Income Tax Rates Act
1986 117
Division 2—Due date for income
tax 117
Income Tax Assessment Act
1936 117
Division 3—Repeal of various redundant
provisions 118
Income Tax Assessment Act
1936 118
Income Tax Assessment Act
1997 118
Division 4—SGIOs 119
Income Tax Assessment Act
1936 119
Division 5—Registered
organizations 119
Income Tax Assessment Act
1936 119
Income Tax Assessment Act
1997 122
Superannuation Contributions Tax (Assessment and Collection) Act
1997 122
Superannuation Guarantee (Administration) Act
1992 123
Division 6—Miscellaneous amendments relating to repeal of
Divisions 8 and 8A of Part III of the Income Tax Assessment Act
1936 123
Income Tax Assessment Act
1936 123
Division 7—Life assurance company definition in section 27A
of the Income Tax Assessment Act
1936 126
Income Tax Assessment Act
1936 126
Superannuation Guarantee (Administration) Act
1992 127
Part 5—Amendment commencing on 30 June
2001 128
Taxation Administration Act
1953 128
Part 6—Amendments commencing on 1 July
2001 129
Income Tax Assessment Act
1936 129
Income Tax Assessment Act
1997 130
Part 7—Amendments commencing on Royal
Assent 131
Income Tax Assessment Act
1997 131
Income Tax Rates Act
1986 131
Income Tax (Transitional Provisions) Act
1997 132
Taxation Administration Act
1953 135
Part 8—Amendments commencing on Royal Assent or
later 136
Income Tax Assessment Act
1936 136
Taxation Administration Act
1953 136
A Bill for an Act to amend the law relating to taxation,
and for related purposes
The Parliament of Australia enacts:
This Act may be cited as the Taxation Laws Amendment Act (No. 7)
2003.
(1) Each provision of this Act specified in column 1 of the table
commences, or is taken to have commenced, on the day or at the time specified in
column 2 of the table.
|
Commencement information |
||
|---|---|---|
|
Column 1 |
Column 2 |
Column 3 |
|
Provision(s) |
Commencement |
Date/Details |
|
1. Sections 1 to 4 and anything in this Act not elsewhere covered by
this table |
The day on which this Act receives the Royal Assent |
|
|
2. Schedule 1 |
The day on which this Act receives the Royal Assent |
|
|
3. Schedule 2 |
30 June 2003 |
|
|
4. Schedule 3 |
1 July 2003 |
|
|
5. Schedule 4 |
The day after this Act receives the Royal Assent |
|
|
6. Schedule 5 |
Immediately after the commencement of Schedule 16 to the New
Business Tax System (Consolidation and Other Measures) Act 2003 |
|
|
7. Schedule 6 |
The day on which this Act receives the Royal Assent |
|
|
8. Schedule 7 |
Immediately after the commencement of Part 1 of Schedule 10 to
the Taxation Laws Amendment Act (No. 6) 2003 |
|
|
9. Schedules 8 and 9 |
The day on which this Act receives the Royal Assent |
|
|
10. Schedule 10 |
The day on which this Act receives the Royal Assent |
|
|
11. Schedule 11, Part 1 |
Immediately after the commencement of item 51 of Schedule 5 to
the Taxation Laws Amendment Act (No. 2) 1999 |
|
|
12. Schedule 11, Part 2 |
Immediately after the commencement of item 21 of Schedule 12 to
the A New Tax System (Tax Administration) Act 1999 |
|
|
13. Schedule 11, Part 3 |
Immediately after the start of 30 June 2000 |
|
|
14. Schedule 11, Part 4 |
Immediately after the start of 1 July 2000 |
|
|
15. Schedule 11, Part 5 |
Immediately after the commencement of item 61 of Schedule 1 to
the Taxation Laws Amendment Act (No. 3) 2001 |
|
|
16. Schedule 11, Part 6 |
Immediately after the start of 1 July 2001 |
|
|
17. Schedule 11, Part 7 |
The day on which this Act receives the Royal Assent |
|
|
18. Schedule 11, Part 8 |
The later of: (a) the start of the day on which this Act receives the Royal Assent;
and (b) immediately after the start of the day on which the Taxation Laws
Amendment Act (No. 4) 2003 receives the Royal Assent |
|
Note: This table relates only to the provisions of this Act
as originally passed by the Parliament and assented to. It will not be expanded
to deal with provisions inserted in this Act after assent.
(2) Column 3 of the table is for additional information that is not part
of this Act. This information may be included in any published version of this
Act.
Each Act that is specified in a Schedule to this Act is amended or
repealed as set out in the applicable items in the Schedule concerned, and any
other item in a Schedule to this Act has effect according to its
terms.
Section 170 of the Income Tax Assessment Act 1936 does not
prevent the amendment of an assessment made before the commencement of this
section for the purposes of giving effect to this Act (other than item 38
of Schedule 10, so far as that item provides for the insertion of
sections 830-15 and 830-20 into the Income Tax (Transitional Provisions)
Act 1997).
Income Tax Assessment Act
1936
1 After section 23AK
Insert:
(1) A payment is exempt from income tax if:
(a) the payment is received by an individual who is a resident of
Australia; and
(b) the payment is received from a source in a foreign country;
and
(c) the payment is not received directly or indirectly from an associate
(within the meaning of section 318) of the recipient; and
(d) the payment is in connection with:
(i) any wrong or injury; or
(ii) any loss of, or damage to, property; or
(iii) any other detriment;
that is suffered by the recipient or another individual as a result
of:
(iv) persecution by the National Socialist regime of Germany during the
National Socialist period; or
(v) persecution by any other enemy of the Commonwealth during the Second
World War; or
(vi) persecution by an enemy-associated regime during the Second World
War; or
(vii) flight from persecution mentioned in subparagraph (iv), (v) or
(vi); or
(viii) participation in a resistance movement during the Second World War
against forces of the National Socialist regime of Germany; or
(ix) participation in a resistance movement during the Second World War
against forces of any other enemy of the Commonwealth.
Duration of Second World War
(2) For the purposes of subsection (1), the duration of the Second
World War includes:
(a) the period immediately before the Second World War; and
(b) the period immediately after the Second World War.
Enemy-associated regime
(3) For the purposes of subsection (1), a regime is an
enemy-associated regime if, and only if, it was:
(a) in alliance with; or
(b) occupied by; or
(c) effectively controlled by; or
(d) under duress from; or
(e) surrounded by;
either or both of the following:
(f) the National Socialist regime of Germany;
(g) any other enemy of the Commonwealth.
Legal personal representative etc.
(4) Subsection (1) applies to a payment received by the legal
personal representative of an individual in a corresponding way to the way in
which that subsection would have applied if the payment had been received by the
individual.
(5) Subsection (1) applies to a payment received by:
(a) the legal personal representative of a deceased individual;
or
(b) the trustee of a trust established by the will of a deceased
individual;
in a corresponding way to the way in which that subsection would have
applied if:
(c) the individual had not died; and
(d) the payment had been received by the individual.
Income Tax Assessment Act
1997
2 Section 11-15 (table row relating to foreign
aspects of income taxation)
Before:
|
resistance fighter and victim of wartime persecution, pension and etc.
of |
23(kca) |
insert:
|
resistance fighter and victim of wartime persecution, payments
to |
23AL |
3 At the end of
section 118-37
Add:
(5) A *capital gain or
*capital loss you make as a result of receiving
a payment or property is disregarded if:
(a) you are an individual who is an Australian resident; and
(b) you receive the payment or property from a source in a foreign
country; and
(c) you do not receive the payment or property directly or indirectly from
an *associate of yours; and
(d) the payment or property you receive is in connection with:
(i) any wrong or injury; or
(ii) any loss of, or damage to, property; or
(iii) any other detriment;
that you, or another individual, suffered as a result of:
(iv) persecution by the National Socialist regime of Germany during the
National Socialist period; or
(v) persecution by any other enemy of the Commonwealth during the Second
World War; or
(vi) persecution by an enemy-associated regime during the Second World
War; or
(vii) flight from persecution mentioned in subparagraph (iv), (v) or
(vi); or
(viii) participation in a resistance movement during the Second World War
against forces of the National Socialist regime of Germany; or
(ix) participation in a resistance movement during the Second World War
against forces of any other enemy of the Commonwealth.
(6) For the purposes of subsection (5), the duration of the Second
World War includes:
(a) the period immediately before the Second World War; and
(b) the period immediately after the Second World War.
(7) For the purposes of subsection (5), a regime is an
enemy-associated regime if, and only if, it was:
(a) in alliance with; or
(b) occupied by; or
(c) effectively controlled by; or
(d) under duress from; or
(e) surrounded by;
either or both of the following:
(f) the National Socialist regime of Germany;
(g) any other enemy of the Commonwealth.
(8) Subsection (5) applies to a payment or property received by the
*legal personal representative of an individual
in a corresponding way to the way in which that subsection would have applied if
the payment or property had been received by the individual.
(9) Subsection (5) applies to a payment or property received
by:
(a) the *legal personal representative of
a deceased individual; or
(b) the trustee of a trust established by the will of a deceased
individual;
in a corresponding way to the way in which that subsection would have
applied if:
(c) the individual had not died; and
(d) the payment or property had been received by the
individual.
Part 2—Application
of amendments
4 Application of amendments
The amendments made by this Schedule apply to assessments for the 2001-2002
income year and later income years.
Income Tax Assessment Act
1997
1 Subsection 30-25(2) (at the end of the
table)
Add:
|
2.2.28 |
Australian-American Educational Foundation |
the gift must be made after 30 April 2003 |
|
2.2.29 |
The Australian Literacy and Numeracy Foundation Limited |
the gift must be made after 11 October 2002 |
|
2.2.30 |
The Constitution Education Fund |
the gift must be made after 20 June 2003 |
2 Subsection 30-45(2) (at the end of the
table)
Add:
|
4.2.21 |
Crime Stoppers Western Australia Limited |
the gift must be made after 31 October 2002 |
|
4.2.22 |
New South Wales Crime Stoppers Limited |
the gift must be made after 31 October 2002 |
|
4.2.23 |
Crime Stoppers Tasmania |
the gift must be made after 28 November 2002 |
|
4.2.24 |
Crime Stoppers Queensland Limited |
the gift must be made after 23 January 2003 |
|
4.2.25 |
Crime Stoppers Australia Ltd |
the gift must be made after 4 June 2003 |
|
4.2.26 |
Alcohol Education and Rehabilitation Foundation Limited |
the gift must be made after 5 June 2003 |
3 Subsection 30-70(2) (table
item 8.2.2)
After “28 February 1999”, insert “and before
4 February 2003”.
Income Tax Assessment Act
1997
1 Subsection 30-5(3)
Omit “list”, substitute “identify”.
2 Subsection 30-5(4B)
Repeal the subsection, substitute:
(4B) Subdivision 30-DB allows you to spread deductions for certain
gifts and covenants over up to 5 income years.
3 Section 30-15 (table item 1,
paragraph (aa) in the column headed “Special
conditions”)
Omit “mentioned by name in the relevant table item in
Subdivision 30-B”, substitute “mentioned by name in regulations
made for the purposes of section 30-105”.
4 Section 30-15 (table item 1,
paragraph (c) in the column headed “Special
conditions”)
After “any conditions set out in”, insert “, or
ascertained in accordance with,”.
5 Section 30-15 (table item 2,
paragraph (a) in the column headed
“Recipient”)
Omit “any purposes set out in the item of the table”,
substitute “any purposes set out in, or ascertained in accordance with,
the item of the table”.
6 Section 30-15 (table item 4,
paragraph (a) in the column headed
“Recipient”)
Omit “the Australiana Fund”, substitute “a fund,
authority or institution specified in regulations made for the purposes of this
item”.
7 Section 30-15 (table item 4,
paragraph (ba) in the column headed “Special
Conditions”)
Omit “unless it is the Australiana Fund”, substitute
“unless it is a fund, authority or institution specified in regulations
made for the purposes of this item”.
8 Section 30-15 (cell at table item 6,
column headed “Recipient”)
Repeal the cell, substitute:
|
|
A fund, authority or institution specified in regulations made for the
purposes of this item |
|
|
|
9 At the end of
section 30-15
Add:
(4) Subsection 46(2) of the Acts Interpretation Act 1901 does not
apply to regulations made for the purposes of item 4 or 6 of the table in
subsection (2).
Note: For special provisions about regulations, see
Subdivision 30-FA.
10 Subsection 30-17(1)
Omit “described in”, substitute “covered
by”.
11 Paragraph 30-17(1)(a)
Omit “mentioned by name in an item of a table in
Subdivision 30-B”, substitute “mentioned by name in regulations
made for the purposes of section 30-105”.
12 Paragraph 30-17(1)(c)
Repeal the paragraph, substitute:
(c) a fund, authority or institution specified in regulations made for the
purposes of item 4 of the table in section 30-15.
13 At the end of subsection
30-20(1)
Add:
Note: Section 30-105 deals with specific
recipients.
14 Subsection 30-20(2)
Repeal the subsection.
15 At the end of subsection
30-25(1)
Add:
Note: Section 30-105 deals with specific
recipients.
16 Subsection 30-25(2)
Repeal the subsection.
17 Paragraph 30-30(1)(a)
Omit “subsection 30-25(1)”, substitute
“section 30-25”.
18 Paragraph 30-30(1)(b)
Repeal the paragraph, substitute:
(b) a fund, authority or institution that satisfies the following
conditions:
(i) the fund, authority or institution is specified in regulations made
for the purposes of section 30-105; and
(ii) a condition that, under the regulations, is applicable to gifts made
to the fund, authority or institution is expressed as “the condition set
out in section 30-30”;
19 Paragraph 30-30(1)(c)
Omit “institution, or of the College,”, substitute “fund,
authority or institution”.
20 Paragraph 30-30(1)(d)
Omit “institution, or the College,”, substitute “fund,
authority or institution”.
21 Subsection 30-35(1)
Omit “subsection 30-25(1)”, substitute
“section 30-25”.
22 At the end of subsection
30-40(1)
Add:
Note: Section 30-105 deals with specific
recipients.
23 Subsection 30-40(2)
Repeal the subsection.
24 At the end of subsection
30-45(1)
Add:
Note: Section 30-105 deals with specific
recipients.
25 Subsection 30-45(2)
Repeal the subsection.
26 At the end of subsection
30-50(1)
Add:
Note: Section 30-105 deals with specific
recipients.
27 Subsection 30-50(2)
Repeal the subsection.
28 At the end of subsection
30-55(1)
Add:
Note: Section 30-105 deals with specific
recipients.
29 Subsection 30-55(2)
Repeal the subsection.
30 Section 30-60
Repeal the section.
31 Group heading before
section 30-65
Repeal the heading.
32 Section 30-65
Repeal the section.
33 At the end of subsection
30-70(1)
Add:
Note: Section 30-105 deals with specific
recipients.
34 Subsection 30-70(2)
Repeal the subsection.
35 Subsection 30-75(1)
Omit “subsection 30-70(1)”, substitute
“section 30-70”.
36 At the end of subsection
30-80(1)
Add:
Note: Section 30-105 deals with specific
recipients.
37 Subsection 30-80(2)
Repeal the subsection.
38 Subsection 30-85(1)
Omit “subsection 30-80(1)”, substitute
“section 30-80”.
39 Group heading before
section 30-90
Repeal the heading.
40 Section 30-90
Repeal the section.
41 Group heading before
section 30-95
Repeal the heading.
42 Section 30-95
Repeal the section.
43 At the end of subsection
30-100(1)
Add:
Note: Section 30-105 deals with specific
recipients.
44 Subsection 30-100(2)
Repeal the subsection.
45 Group heading before
section 30-105
Repeal the heading, substitute:
46 Section 30-105
Repeal the section, substitute:
(1) This table sets out specific recipients.
|
Specific recipients |
||
|---|---|---|
|
Item |
Fund, authority or institution |
Special conditions |
|
12.1.1 |
a fund, authority or institution specified in the regulations |
the condition or conditions (if any) that, under the regulations, are
applicable to gifts made to the fund, authority or institution
concerned |
(2) A condition may require that a gift must be made:
(a) after a specified date (which may be before the regulations take
effect); or
(b) before a specified date (which may be before the regulations take
effect); or
(c) during a specified period (which may begin before the regulations take
effect).
(3) A condition may require that a gift must be made for a specified
purpose.
(4) A condition may be expressed as “the condition set out in
section 30-30”.
(5) A condition may be expressed as “the condition set out in
section 30-110”.
(6) Subsections (2), (3), (4) and (5) do not limit
subsection (1).
(7) Subsection 46(2) of the Acts Interpretation Act 1901 does not
apply to regulations made for the purposes of this section.
Note: For special provisions about regulations, see
Subdivision 30-FA.
(1) This section applies to a fund, authority or institution if:
(a) the fund, authority or institution is specified in regulations made
for the purposes of section 30-105; and
(b) a condition that, under the regulations, is applicable to gifts made
to the fund, authority or institution is expressed as “the condition set
out in section 30-110”.
(2) You can deduct a gift that you make to the fund, authority or
institution only if, at the time of making the gift:
(a) the fund, authority or institution has agreed to give the
*Environment Secretary, within a reasonable
period after the end of the income year in which you made the gift, statistical
information about gifts made to the fund, authority or institution during that
income year; and
(b) the fund, authority or institution has a policy of not acting as a
mere conduit for the donation of money or property to other institutions, bodies
or persons.
47 Section 30-115
Omit “described (except by name) in Subdivision 30-A, 30-B or
30-D”, substitute “that is covered by Subdivision 30-A, 30-B or
30-D (but is not specified in the regulations)”.
48 Subparagraphs 30-125(1)(b)(i) and
(ii)
Repeal the subparagraphs, substitute:
(i) is covered by item 1, 2 or 4 of the table in section 30-15
but is not specified in regulations made for the purposes of item 4 of that
table; and
(ii) is not described by name in regulations made for the purposes of
section 30-105 if it is covered by item 1 of that table; and
49 Subsection 30-125(2)
Omit “described (but not by name) in item 1, 2 or 4 of the table
in section 30-15”, substitute “covered by item 1, 2 or 4
of the table in section 30-15 (but is not specified in regulations made for
the purposes of item 4 of that table)”.
50 Subsection 30-125(2)
Omit “in Subdivision 30-B”, substitute “in
regulations made for the purposes of section 30-105”.
51 Paragraph 30-227(2)(a)
Omit “described in”, substitute “covered
by”.
52 Subparagraph
30-227(2)(a)(ii)
Repeal the subparagraph, substitute:
(ii) specified in regulations made for the purposes of item 4 or 6 of
that table; or
(iia) mentioned by name in regulations made for the purposes of
section 30-105; or
(iib) the Commonwealth (for the purposes of Artbank); or
53 Paragraph 30-227(2)(b)
Omit “described in”, substitute “covered
by”.
54 Section 30-228
Omit “described in”, substitute “covered
by”.
55 Paragraph 30-230(2)(a)
Repeal the paragraph, substitute:
(a) a fund, authority or institution specified in regulations made for the
purposes of item 4 of the table in section 30-15; or
56 Subsection 30-230(2A)
Omit “The Australiana Fund”, substitute “a fund,
authority or institution specified in regulations made for the purposes of
item 4 of the table in section 30-15”.
57 Subdivisions 30-DB to
30-DE
Repeal the Subdivisions, substitute:
This Subdivision allows you to elect to spread deductions for certain gifts
and covenants over up to 5 income years. There are some different requirements
for environmental, heritage and cultural property gifts and conservation
covenants.
Table of sections
Operative provisions
30-247 Gifts and covenants for which elections can be
made
30-248 Making an election
30-249 Effect of election
30-249A Requirements—environmental property
gifts
30-249B Requirements—heritage property
gifts
30-249C Requirements—certain cultural property
gifts
30-249D Requirements—conservation
covenants
[This is the end of the Guide.]
(1) An election under this Subdivision may be made for a gift, made on or
after 1 July 2003, that is:
(a) a gift of:
(i) money; or
(ii) property valued by the Commissioner at more than $5,000;
made to a fund, authority or institution covered by item 1 or 2 of
the table in section 30-15; or
(b) a gift that is covered by item 4, 5 or 6 of the table in
section 30-15.
(2) An election under this Subdivision may also be made for entering into
a *conservation covenant, under
Division 31, on or after 1 July 2003.
(1) If you can deduct an amount:
(a) under this Division for a gift covered by subsection 30-247(1);
or
(b) under Division 31 for entering into a
*conservation covenant covered by subsection
30-247(2);
you may make a written election to spread that deduction over the current
income year and up to 4 of the immediately following income years.
(2) In the election, you must specify the percentage (if any) of the
deduction that you will deduct in each of the income years.
(3) You must make the election before you lodge your
*income tax return for the income year in which
you made the gift or entered into the covenant.
(4) You may vary an election at any time. However, the variation can only
change the percentage that you will deduct in respect of income years for which
you have not yet lodged an *income tax
return.
(5) Unless section 30-249A, 30-249B or 30-249C applies, the election
and any variation must be in the *approved
form.
Note: Sections 30-249A, 30-249B and 30-249C provide for
the form of elections and variations for gifts covered by those
sections.
(1) In each of the income years you specified in the election, you can
deduct the amount corresponding to the percentage you specified for that
year.
(2) You cannot deduct the amount that you otherwise would have been able
to deduct for the gift in the income year in which you made the gift or entered
into the covenant.
(1) This section applies if you make an election for a gift of property
made to a fund, authority or institution:
(a) covered by section 30-55; or
(b) specified in regulations made for the purposes of this
paragraph.
Note: For special provisions about regulations, see
Subdivision 30-FA.
(2) You must give a copy of the election to the
*Environment Secretary before you lodge your
*income tax return for the income year in which
you made the gift.
(3) If you vary the election, you must give a copy of the variation to the
*Environment Secretary before you lodge your
*income tax return for the first income year to
which the variation applies.
(4) The election and any variation must be in a form approved in writing
by the *Environment Secretary.
(1) This section applies if you make an election for a gift of property
made to a fund, authority or institution:
(a) covered by item 6 of the table in section 30-15;
or
(b) specified in regulations made for the purposes of this
paragraph.
Note: For special provisions about regulations, see
Subdivision 30-FA.
(2) You must give a copy of the election to the
*Heritage Secretary before you lodge your
*income tax return for the income year in which
you made the gift.
(3) If you vary the election, you must give a copy of the variation to the
*Heritage Secretary before you lodge your
*income tax return for the first income year to
which the variation applies.
(4) The election and any variation must be in a form approved in writing
by the *Heritage Secretary.
(1) This section applies if you make an election for a gift covered by
item 4 or 5 of the table in section 30-15.
(2) You must give a copy of the election to the
*Arts Secretary before you lodge your
*income tax return for the income year in which
you made the gift.
(3) If you vary the election, you must give a copy of the variation to the
*Arts Secretary before you lodge your
*income tax return for the first income year to
which the variation applies.
(4) The election and any variation must be in a form approved in writing
by the *Arts Secretary.
(1) This section applies if you make an election for a
*conservation covenant.
(2) You must give a copy of the election to the
*Environment Secretary before you lodge your
*income tax return for the income year in which
you entered the covenant.
(3) If you vary the election, you must give a copy of the variation to the
*Environment Secretary before you lodge your
*income tax return for the first income year to
which the variation applies.
58 After Subdivision 30-F
Insert:
Table of sections
30-311 When this Subdivision applies
30-312 Gazettal, tabling and disallowance
30-313 Timing of gifts
30-314 Terminating or limiting the deductibility of
gifts
30-314A Application of the Acts Interpretation Act
1901
This Subdivision applies to regulations made for the purposes of any of
the following provisions:
(a) item 4 of the table in section 30-15;
(b) item 6 of the table in section 30-15;
(c) section 30-105;
(d) paragraph 30-249A(1)(b);
(e) paragraph 30-249B(1)(b).
Notification in the Gazette
(1) The regulations must be notified in the Gazette within 21 days
after the regulations are made.
Tabling and disallowance
(2) The Minister must cause a copy of the regulations to be tabled in each
House of the Parliament within 15 sitting days of that House after the
regulations are made.
(3) Either House may, following a motion upon notice, pass a resolution
disallowing the regulations. To be effective, the resolution must be passed
within 15 sitting days of that House after the copy of the regulations was
tabled in that House.
(4) If neither House passes such a resolution, the regulations take
effect:
(a) in the case of the first set of regulations—on 1 July 2003;
or
(b) in any other case—on the day immediately after the last day on
which such a resolution could have been passed.
(1) The regulations do not apply to gifts made before 1 July
2003.
(2) Unless the contrary intention appears in the regulations, the
regulations apply to gifts made on or after 1 July 2003.
(1) If an amending regulation has the effect of terminating or limiting
the deductibility of gifts made to a particular fund, authority or institution
after a particular time (the termination/limitation time), the
amending regulation may only be made if:
(a) the termination/limitation time occurs at or after the time when the
amending regulation takes effect; or
(b) both:
(i) the termination/limitation time is not earlier than 60 days before the
day on which the amending regulation is made; and
(ii) the amending regulation gives effect to a public announcement made by
the Minister, or another Minister, at or before the termination/limitation
time.
(2) A copy of an announcement referred to in subparagraph (1)(b)(ii)
must be published on the Internet.
This Subdivision has effect despite:
(a) sections 48 to 49 of the Acts Interpretation Act 1901;
or
(b) if those sections are repealed and replaced by other provisions that
deal with corresponding matters—the replacement provisions.
59 Subsection 30-315(2) (note)
Omit “item 2.2.1”, substitute
“item 3.1.1”.
60 Subsection 30-315(2) (table items 1A, 1AA, 2
to 3, 5, 9AA to 17AA, 18 to 32, 34 to 34A, 36 to 40, 45A, 49 to 53A, 55, 59 to
62, 64A, 65, 67 to 69, 71 to 72C, 73A to 77A, 78, 80, 81, 83, 85, 86, 88 to 91,
94, 94B, 95A, 97AA to 104B, 106 and 109 to 112)
Repeal the items.
61 Subsection 30-315(2) (cell at table
item 112AA, column headed “Provision”)
Repeal the cell, substitute:
|
|
|
|
Subdivision 30-DB |
62 Subsection 30-315(2) (table items 112A to
113, 114A, 116A, 118 to 118A, 122, 122A to 123A and 125 to
128)
Repeal the items.
63 Subsection 31-5(3) (note)
Omit “30-DE”, substitute “30-DB”.
64 Paragraph 31-10(1)(a)
After “any conditions set out in”, insert “, or
ascertained in accordance with,”.
65 Subsection 31-10(2)
Repeal the subsection, substitute:
(2) If:
(a) the fund, authority or institution is not specified in regulations
made for the purposes of section 30-105; and
(b) the *conservation covenant was
entered into on or after 1 July 2003;
the fund, authority or institution must also:
(c) be in Australia; and
(d) meet the requirements of section 30-17 (about the endorsement of
deductible gift recipients) or be a *prescribed
private fund.
(3) If:
(a) the fund, authority or institution is specified in regulations made
for the purposes of section 30-105; and
(b) the *conservation covenant was
entered into on or after 1 July 2003;
the fund, authority or institution must also pass the hypothetical gift
test set out in subsection (4).
(4) For the purposes of subsection (3), a fund, authority or
institution passes the hypothetical gift test if, assuming that a gift had been
made to the fund, authority or institution when the
*conservation covenant was entered
into:
(a) both:
(i) a condition of a kind mentioned in subsection 30-105(2) would have
been applicable to the gift; and
(ii) that condition would have been met; or
(b) no condition of a kind mentioned in subsection 30-105(2) would have
been applicable to the gift.
Note: Subsection 30-105(2) deals with the timing of
gifts.
66 Paragraph 50-60(b)
Repeal the paragraph, substitute:
(b) is a fund that is covered by an item in a table in
Subdivision 30-B (other than section 30-105); or
(ba) is a fund that:
(i) is covered by an item in the table in section 30-105;
and
(ii) passes the hypothetical gift test set out in subsection (2);
or
(bb) is a fund covered by item 2 of the table in section 30-15;
or
67 At the end of
section 50-60
Add:
(2) For the purposes of subsection (1), a fund passes the
hypothetical gift test if, assuming that a gift had been made to the fund at the
time when the relevant *statutory income or
*ordinary income was derived:
(a) both:
(i) a condition of a kind mentioned in subsection 30-105(2) would have
been applicable to the gift; and
(ii) that condition would have been met; or
(b) no condition of a kind mentioned in subsection 30-105(2) would have
been applicable to the gift.
Note: Subsection 30-105(2) deals with the timing of
gifts.
(3) Paragraphs (1)(b), (ba) and (bb) apply in a case where the
relevant *statutory income or
*ordinary income is derived on or after
1 July 2003.
68 Subsection 50-75(2)
Repeal the subsection, substitute:
(2) In determining for the purposes of this Subdivision whether an
institution, fund or other body incurs its expenditure or pursues its objectives
principally in Australia, disregard distributions of any amount from a fund
that:
(a) is operated by the institution, fund or other body; and
(b) either:
(i) is a fund that is covered by an item in a table in
Subdivision 30-B (other than section 30-105); or
(ii) is a fund that is covered by an item in the table in
section 30-105, and that passes the hypothetical gift test set out in
subsection (2A).
(2A) For the purposes of subsection (2), a fund passes the
hypothetical gift test if, assuming that a gift had been made to the fund at the
relevant time:
(a) both:
(i) a condition of a kind mentioned in subsection 30-105(2) would have
been applicable to the gift; and
(ii) that condition would have been met; or
(b) no condition of a kind mentioned in subsection 30-105(2) would have
been applicable to the gift.
Note: Subsection 30-105(2) deals with the timing of
gifts.
(2B) Subsection (2) applies in a case where the relevant
*statutory income or
*ordinary income is derived on or after
1 July 2003.
69 Paragraph 207-130(4)(a)
Repeal the paragraph, substitute:
(a) both:
(i) the entity’s name is specified in regulations made for the
purposes of section 30-105; and
(ii) the entity passes the hypothetical gift test set out in
subsection (4A); and
70 Paragraphs 207-130(4)(b) and
(c)
Omit “it”, substitute “the entity”.
71 After subsection 207-130(4)
Insert:
(4A) For the purposes of subsection (4), an entity passes the
hypothetical gift test if, assuming that a gift had been made to the entity at
the time when the *franked distribution was
made:
(a) both:
(i) a condition of a kind mentioned in subsection 30-105(2) would have
been applicable to the gift; and
(ii) that condition would have been met; or
(b) no condition of a kind mentioned in subsection 30-105(2) would have
been applicable to the gift.
Note: Subsection 30-105(2) deals with the timing of
gifts.
(4B) Subsection (4) applies in a case where the
*franked distribution is made on or after
1 July 2003.
72 Transitional—Division 30 of the
Income Tax Assessment Act 1997
(1) Despite the amendments made by this Schedule, Division 30 of the
Income Tax Assessment Act 1997 continues to apply, in relation to gifts
made before 1 July 2003, as if those amendments had not been
made.
(2) Despite the amendments made by this Schedule, Subdivision 30DE of
the Income Tax Assessment Act 1997 continues to apply, in relation to
covenants entered into under Division 31 of that Act before 1 July
2003, as if those amendments had not been made.
73 Transitional—section 30-30 of the
Income Tax Assessment Act 1997
(1) This item applies to a declaration that was:
(a) about the Marcus Oldham Farm Management College; and
(b) in force under subsection 30-30(1) of the Income Tax Assessment Act
1997 immediately before the commencement of this item.
(2) The declaration has effect, after the commencement of this item, as if
it had been made under subsection 30-30(1) of the Income Tax Assessment Act
1997 as amended by this Schedule.
74 Transitional—section 30-110 of the
Income Tax Assessment Act 1997
(1) This item applies to an agreement that was in force under
section 30-60 of the Income Tax Assessment Act 1997 immediately
before the commencement of this item.
(2) The agreement has effect, after the commencement of this item, as if it
had been made under section 30-110 of the Income Tax Assessment Act
1997 as amended by this Schedule.
75 Transitional—Division 31 of the
Income Tax Assessment Act 1997
Despite the amendments made by this Schedule, Division 31 of the
Income Tax Assessment Act 1997 continues to apply, in relation to
covenants entered into before 1 July 2003, as if those amendments had not
been made.
76 Transitional—Division 50 of the
Income Tax Assessment Act 1997
Despite the amendments made by this Schedule, Division 50 of the
Income Tax Assessment Act 1997 continues to apply, in relation to
ordinary income or statutory income derived before 1 July 2003, as if those
amendments had not been made.
77 Transitional—Division 207 of the
Income Tax Assessment Act 1997
Despite the amendments made by this Schedule, Division 207 of the
Income Tax Assessment Act 1997 continues to apply, in relation to a
franked distribution made before 1 July 2003, as if those amendments had
not been made.
Part 1—Clarifying
application of Parts I and II of that Act
Crimes (Taxation Offences)
Act 1980
1 Paragraph 3(2)(a)
Before “sales tax” (wherever occurring), insert
“old”.
2 Paragraphs 13(1)(a), (b) and
(d)
Before “sales tax”, insert “old”.
3 Paragraphs 14(1)(a), (b) and
(d)
Before “sales tax”, insert “old”.
4 Paragraphs 15(1)(a), (b) and
(d)
Before “sales tax”, insert “old”.
5 Paragraphs 16(1)(a), (b) and
(d)
Before “sales tax”, insert “old”.
6 Paragraphs 17(1)(a), (b) and
(d)
Before “sales tax”, insert “old”.
7 Paragraphs 18(1)(a), (b) and
(d)
Before “sales tax”, insert “old”.
8 Paragraphs 19(1)(a), (b) and
(d)
Before “sales tax”, insert “old”.
9 Paragraphs 20(1)(a), (b) and
(d)
Before “sales tax”, insert “old”.
10 Application
Each amendment made by this Part applies in relation to acts and omissions
happening after this Part commences.
Part 2—Application
of the Criminal Code
Crimes (Taxation Offences)
Act 1980
11 Paragraphs 3(2)(a) and (b)
Omit “purpose, or a purpose,”, substitute
“intention”.
12 Subsection 5(1)
Omit “for the purpose, or for purposes which include the
purpose,”, substitute “with the intention”.
13 Paragraph 5(2)(a)
Omit “for the purpose, or for purposes which include the
purpose,”, substitute “with the intention”.
14 At the end of section 5
Add:
Penalty: Imprisonment for 10 years or 1,000 penalty units, or
both.
15 Subsection 6(1)
Omit “for the purpose, or for purposes which include the
purpose,”, substitute “with the intention”.
16 Paragraph 6(2)(a)
Omit “for the purpose, or for purposes which include the
purpose”, substitute “with the intention”.
17 At the end of section 6
Add:
Penalty: Imprisonment for 10 years or 1,000 penalty units, or
both.
18 At the end of subsections 7(1) and
(2)
Add:
Penalty: Imprisonment for 10 years or 1,000 penalty units, or
both.
19 Paragraph 7(3)(b)
Omit “for the purpose, or for purposes which include the
purpose”, substitute “with the intention”.
20 At the end of section 8
Add:
Penalty: Imprisonment for 10 years or 1,000 penalty units, or
both.
21 Subsection 9(1)
Repeal the subsection.
Note: The heading to section 9 is altered by omitting
“Penalties” and substituting “Prosecutions and
convictions”.
22 Subsections 13(2), 14(2), 15(2), 16(2), 17(2),
18(2), 19(2) and 20(2)
Omit “purpose, or a purpose,” (wherever occurring), substitute
“intention”.
23 Application
Each amendment made by this Part applies in relation to acts and omissions
happening after this Part commences.
Income Tax (Transitional
Provisions) Act 1997
1 After Division 701C
Insert:
Table of Subdivisions
701D-A Object of this Division
701D-B Membership rules allowing transitional foreign loss makers to remain
outside consolidated group
Table of sections
701D-1 Object of this Division
(1) The object of this Division is to allow an entity that is a potential
subsidiary member of a consolidated group to utilise an overall foreign loss
during a transitional period, rather than have the head company utilise the loss
subject to the restrictions in Subdivision 707-C of the Income Tax
Assessment Act 1997.
(2) Therefore, this Division allows the head company to prevent the entity
from being a subsidiary member of the group, for a transitional
period.
[The next section is section 701D-10.]
Table of sections
701D-10 Transitional foreign loss maker not member of group
if certain conditions satisfied
701D-15 Choice to apply transitional rules to
entity
(1) The Income Tax Assessment Act 1997 and this Act have
effect as if an entity (the transitional foreign loss maker) is
not a subsidiary member of a consolidated group at a particular time (the
transitional time) if:
(a) the group came into existence at a particular time (the
formation time) before 1 July 2004; and
(b) apart from this section, the transitional foreign loss maker would be
a subsidiary member of the group at the transitional time; and
(c) the transitional time is not later than 3 years after the formation
time; and
(d) the head company of the group has made a choice under
section 701D-15 to apply this section to the transitional foreign loss
maker; and
(e) the continuous ownership condition in subsection (2) is
satisfied; and
(f) the foreign loss condition in subsection (3) is satisfied;
and
(g) the no-subsidiary condition in subsection (4) is
satisfied.
Continuous ownership condition
(2) The continuous ownership condition is satisfied if the transitional
foreign loss maker was a wholly-owned subsidiary of the entity that became the
head company of the group throughout the period:
(a) beginning at the start of 1 July 2002; and
(b) ending at the transitional time.
Foreign loss condition
(3) The foreign loss condition is satisfied if:
(a) the transitional foreign loss maker incurred an overall foreign loss
(as defined in section 160AFD of the Income Tax Assessment Act 1936)
in respect of the 2001-02 income year or an earlier income year; and
(b) the amount of the overall foreign loss has not been fully taken into
account under one or more applications of section 160AFD of the Income
Tax Assessment Act 1936 to the transitional foreign loss maker in relation
to an income year or income years ending before the transitional time;
and
(c) assuming that the transitional foreign loss maker had become a
subsidiary member of a consolidated group at the formation time, as a result all
or part of the overall foreign loss would have been transferred at that time to
the head company of the group under Division 707 of the Income Tax
Assessment Act 1997.
No-subsidiary condition
(4) The no-subsidiary condition is satisfied if, at the transitional
time:
(a) the transitional foreign loss maker does not hold any membership
interests in any other entity; or
(b) both of the following conditions are satisfied:
(i) the transitional foreign loss maker holds one or more membership
interests in one or more other entities;
(ii) assuming that the head company of the group (rather than the
transitional foreign loss maker) held that interest or those interests, none of
those other entities would be a subsidiary member of the group.
Transitional foreign loss maker stays in consolidatable
group
(5) To avoid doubt, subsection (1) does not prevent the transitional
foreign loss maker from being a member of a consolidatable group at the
transitional time for the purposes of:
(a) paragraph 126-50(6)(b) of the Income Tax Assessment Act 1997;
and
(b) paragraphs 170-5(2A)(b) and 170-105(2A)(b) of that Act; and
(c) subparagraph 820-599(2)(c)(iii) of that Act.
(1) The head company of a consolidated group may make a choice in the
approved form to apply section 701D-10 to another entity.
(2) However, the head company cannot make that choice if subsection
701D-10(1) previously prevented the entity from being a subsidiary member of a
consolidated group.
(3) The choice must be made by the later of:
(a) the end of the period described in subsection 703-50(3) of the
Income Tax Assessment Act 1997 for giving the Commissioner the choice
under section 703-50 of that Act that the group is taken to be
consolidated; and
(b) 30 days after the Taxation Laws Amendment Act (No. 7) 2003
received the Royal Assent.
(4) The choice cannot be revoked.
2 After paragraph 707-325(1)(c)
Insert:
(ca) neither the real loss-maker nor the value donor has been, at any time
before the initial transfer time, a transitional foreign loss maker prevented by
subsection 701D-10(1) from being a subsidiary member of a consolidated group;
and
3 After paragraph 707-350(1)(d)
Insert:
(da) the real loss-maker has not been, at any time before the initial
transfer time, a transitional foreign loss maker prevented by subsection
701D-10(1) from being a subsidiary member of a consolidated group; and
4 At the end of
Subdivision 719-B
Add:
(1) This section applies if the group mentioned in subsection 701D-10(2)
of this Act is a MEC group.
(2) For the purposes of that subsection, in determining whether an entity
was at a particular time (the ownership time) a wholly-owned
subsidiary of the entity that became the head company of the group (the
head entity), make the assumption in
subsection (3).
(3) The assumption is that the head entity owned at the ownership time
each membership interest covered by subsection (4).
(4) A membership interest is covered by this subsection if it was
beneficially owned at the ownership time by any entity that became an eligible
tier-1 company of the group at the formation time.
A New Tax System (Goods and
Services Tax) Act 1999
1 At the end of
Division 110
Add:
(1) A supply is not a *taxable
supply to the extent that it occurs because of the operation of these
provisions:
(a) Part 3-90 of the *ITAA
1997;
(b) Part 3-90 of the Income Tax (Transitional Provisions) Act
1997.
(2) Without limiting the scope of subsection (1), for the purposes of
that subsection, the operation mentioned in that subsection includes an
operation that results from:
(a) a choice made under the provisions mentioned in that subsection;
or
(b) any other voluntary action provided for by those provisions.
(3) This section has effect despite section 9-5 (which is about what
are taxable supplies).
(1) This section applies if:
(a) an entity makes a supply because it enters into or becomes a party to
an agreement; and
(b) the agreement satisfies the requirements of subsections 721-25(1) and
(2) of the *ITAA 1997 in relation to an
existing or future *group liability of the
*head company of a
*consolidated group or
*MEC group.
(2) The supply is not a *taxable supply
to the extent that it relates to the fact that the agreement satisfies those
requirements.
(3) This section has effect despite section 9-5 (which is about what
are taxable supplies).
(1) A supply made to a *TSA contributing
member of a *consolidated group or a
*MEC group is not a
*taxable supply if:
(a) the supply is a release from an obligation relating to a
*contribution amount in relation to a
*group liability of the
*head company of the group; and
Example: The obligation could be a contractual obligation
created by the agreement under which the contribution amount was
determined.
(b) the TSA contributing member has, for the purposes of subsection
721-30(3) of the *ITAA 1997, left the group
clear of the group liability.
Note: See section 721-35 of the ITAA 1997 for when a
TSA contributing member has left a group clear of the group
liability.
(2) This section has effect despite section 9-5 (which is about what
are taxable supplies).
(1) This section applies if:
(a) an entity makes a supply because it enters into or becomes a party to
a written agreement; and
(b) the agreement deals with the distribution of economic burdens and
benefits directly related to *tax-related
liabilities mentioned in subsection 721-10(2) of the
*ITAA 1997 of the
*head company of a
*consolidated group or
*MEC group, among
*members and former members of the group;
and
(c) if the group is not in existence when the entity enters into or
becomes a party to the agreement—the agreement contemplates that the
parties to the agreement will become members of the group when it does come into
existence; and
(d) the agreement complies with the requirements (if any) set out in the
regulations.
(2) The supply is not a *taxable supply
to the extent that it relates to the fact that the agreement deals with the
distribution mentioned in paragraph (1)(b).
(3) Without limiting paragraph (1)(b), the agreement deals with the
distribution mentioned in that paragraph if it includes one or more of the
following kinds of provisions:
(a) provisions for *members or former
members of the group to contribute towards payment of
*tax-related liabilities mentioned in
subsection 721-10(2) of the *ITAA 1997 of the
*head company of the group;
(b) provisions for payments to be made to a member or former member of the
group in recognition of activities or attributes of that member that have the
effect of reducing the amount of those liabilities.
(4) This section has effect despite section 9-5 (which is about what
are taxable supplies).
2 Section 195-1
Insert:
consolidated group has the meaning given by
section 703-5 of the *ITAA 1997.
3 Section 195-1
Insert:
contribution amount has the meaning given by paragraph
721-25(1)(b) of the *ITAA 1997.
4 Section 195-1
Insert:
group liability of a *head
company of a *consolidated group or a
*MEC group has the meaning given by paragraph
721-10(1)(a) of the *ITAA 1997.
5 Section 195-1
Insert:
head company of a
*consolidated group or a
*MEC group has the meaning given by subsection
995-1(1) of the *ITAA 1997.
6 Section 195-1
Insert:
MEC group has the meaning given by section 719-5 of the
*ITAA 1997.
7 Section 195-1 (at the end of the definition
of member)
Add:
; or (c) in relation to a *consolidated
group—has the meaning given by section 703-15 of the
*ITAA 1997.
8 Section 195-1 (note at the end of the
definition of taxable supply)
After “110-10”, insert “, 110-15, 110-20, 110-25,
110-30”.
9 Section 195-1
Insert:
tax-related liability has the meaning given by
section 255-1 in Schedule 1 to the Taxation Administration Act
1953.
10 Section 195-1
Insert:
TSA contributing member of a
*consolidated group or a
*MEC group has the meaning given by paragraph
721-25(1)(a) of the *ITAA 1997.
11 Application
The amendments made by this Schedule apply, and are taken to have applied,
in relation to net amounts for tax periods starting, or that started, on or
after 1 July 2002.
Income Tax Assessment Act
1997
1 Section 205-15 (table
item 4)
Omit “at the end of the income year of the last partnership or trust
interposed between the entity and the corporate tax entity that made the
distribution”, substitute “at the time specified in
subsection (2)”.
2 At the end of
section 205-15
Add:
(2) A *franking credit covered by
item 4 of the table arises at the end of the income year:
(a) that is an income year of the last
*partnership or trust interposed
between:
(i) the entity; and
(ii) the *corporate tax entity that made
the distribution; and
(b) during which the *franked
distribution *flows indirectly to the
entity.
3 Subsection 205-25(1)
Repeal the subsection, substitute:
(1) An entity satisfies the residency requirement for an
income year in which, or in relation to which, an event specified in a relevant
table occurs if:
(a) the entity is a *company, or a
*corporate limited partnership, to which at
least one of the following subparagraphs applies:
(i) the entity is an *Australian resident
for more than one half of the 12 months immediately preceding the event if the
event occurs before the end of the income year;
(ii) the entity is an Australian resident at all times during the income
year when the entity exists if the event occurs at or after the end of the
income year;
(iii) the entity is an Australian resident for more than one half of the
income year (whether or not the event occurs before the end of the income year);
or
(b) the entity is a *corporate unit trust
for the income year; or
(c) the entity is a *public trading trust
for the income year.
4 Link note before
Division 220
Repeal the link note, substitute:
Table of Subdivisions
Guide to Division 219
219-A Application of imputation rules to life insurance companies
219-B Franking accounts of life insurance companies
This Division sets out how the imputation rules are applied to a life
insurance company.
Table of sections
219-10 Application of imputation rules to life insurance
companies
(1) This Part (except this Division) applies to a
*life insurance company in the same way as it
applies to any other company.
(2) However, that application is subject to the modifications set out in
this Division.
Table of sections
219-15 Franking credits
219-30 Franking debits
219-40 Residency requirement
219-45 Assessment day
219-50 Amount attributable to shareholders’ share of
income tax liability
219-55 Adjustment resulting from an amended
assessment
(1) The table in section 205-15 does not apply to a
*life insurance company.
(2) The following table sets out when a
*franking credit arises under this section in
the *franking account of a
*life insurance company.
|
Franking credits in the franking account |
|||
|---|---|---|---|
|
Item |
If: |
A credit of: |
Arises: |
|
1 |
the company *pays a PAYG instalment;
and the company satisfies the *residency
requirement for the income year in relation to which the PAYG instalment is
paid; and the payment is made before the company’s
*assessment day for that income year;
and the company is a *franking entity for the
whole or part of the relevant *PAYG instalment
period |
that part of the payment that: (a) the company estimates will be attributable to the
*shareholders’ share of the income tax
liability of the company for that income year; and (b) is attributable to the period during which the company was a franking
entity |
on the day on which the payment is made (see note 1 to this
subsection) |
|
2 |
the company *paid a PAYG instalment;
and the company satisfied the *residency
requirement for the income year in relation to which the PAYG instalment was
paid; and the payment was made before the company’s
*assessment day for that income year;
and the company was a *franking entity for the
whole or part of the relevant *PAYG instalment
period |
that part of the payment that is attributable to: (a) the *shareholders’ share of the
income tax liability of the company for that income year; and (b) the period during which the company was a franking entity |
on the company’s assessment day for that income year (see note 1 to
this subsection) |
|
3 |
the company *pays a PAYG instalment;
and the company satisfies the *residency
requirement for the income year in relation to which the PAYG instalment is
paid; and the payment is made on or after the company’s
*assessment day for that income year;
and the company is a *franking entity for the
whole or part of the relevant *PAYG instalment
period |
that part of the payment that is attributable to: (a) the *shareholders’ share of the
income tax liability of the company for that income year; and (b) the period during which the company was a franking entity |
on the day on which the payment is made |
|
4 |
the company *pays income tax;
and the company satisfies the *residency
requirement for the income year for which the tax is paid; and the company is a *franking entity for the
whole or part of that income year |
that part of the payment that is attributable to: (a) the *shareholders’ share of the
income tax liability of the company for that income year; and (b) the period during which the company was a franking entity |
on the day on which the payment is made |
|
5 |
a *franked distribution is made to the
company; and the company satisfies the *residency
requirement for the income year in which the distribution is made; and the company is a *franking entity when it
receives the distribution; and the company is entitled to a *tax offset
under Division 207 because of the distribution; and the tax offset is not subject to the refundable tax offset rules in
Division 67 |
the amount of the tax offset |
on the day on which the distribution is made |
|
6 |
a *franked distribution
*flows indirectly to the company through a
*partnership or trust; and the company is a *franking entity when the
franked distribution is made; and the company is entitled to a *tax offset
under Division 207 because of the distribution; and the tax offset is not subject to the refundable tax offset rules in
Division 67 |
the amount of the tax offset |
at the time specified in subsection (3) |
|
7 |
the company incurs a liability to pay
*franking deficit tax under section 205-45
or 205-50 |
the amount of the liability |
immediately after the liability is incurred |
Note 1: On the assessment day, a franking credit that arose
under item 1 of the table:
• is reversed by a franking debit that arises under
item 1 of the table in section 219-30; and
• is replaced with a franking credit that arises under
item 2 of the table in this section.
Note 2: Section 219-50 tells you how to work out the
part of an amount that is attributable to the shareholders’ share of the
income tax liability of the company for the income year.
Note 3: To find out whether a tax offset under
Division 207 is subject to the refundable tax offset rules: see
section 67-25.
(3) A *franking credit covered by
item 6 of the table arises at the end of the income year:
(a) that is an income year of the last
*partnership or trust interposed
between:
(i) the *life insurance company;
and
(ii) the *corporate tax entity that made
the distribution; and
(b) during which the *franked
distribution *flows indirectly to the life
insurance company.
(1) The table in section 205-30 (except item 2) applies to a
*life insurance company in the same way as it
applies to any other company.
(2) The following table sets out when a
*franking debit arises under this section in
the *franking account of a
*life insurance company.
|
Franking debits in the franking account |
|||
|---|---|---|---|
|
Item |
If: |
A debit of: |
Arises: |
|
1 |
a *franking credit arises for the company
under item 1 of the table in section 219-15
(*payment of a PAYG instalment) |
the amount of the franking credit |
on the company’s *assessment day for
the income year mentioned in that item |
|
2 |
the company *receives a refund of income
tax; and the company satisfies the *residency
requirement for the income year to which the refund relates; and the company was a *franking entity for the
whole or part of that income year |
that part of the refund that is attributable to: (a) the *shareholders’ share of the
income tax liability of the company for that income year; and (b) the period during which the company was a franking entity |
on the day on which the refund is received |
Note 1: On the assessment day, a franking debit that arises
under item 1 of this table reverses the effect of a franking credit that
arose under item 1 of the table in section 219-15.
Note 2: Section 219-50 tells you how to work out the
part of an amount that is attributable to the shareholders’ share of the
income tax liability of the company for the income year.
The tables in sections 219-15 and 219-30 are relevant for the
purposes of subsection 205-25(1) (about the residency requirement).
A *life insurance company’s
assessment day for an income year is the earlier of:
(a) the day on which the company furnishes its
*income tax return for that income year;
or
(b) the day on which the Commissioner makes an assessment of the amount of
the company’s taxable income for that income year under section 166
of the Income Tax Assessment Act 1936.
(1) Subsection (2) applies to a
*life insurance company in relation to the
payment or refund mentioned in an item of a table in this Subdivision (except
item 1 of the table in section 219-15).
(2) For the purposes of this Part, the part of the payment or refund that
is attributable to the *shareholders’
share of the income tax liability of the company for an income year must be
worked out as follows:
Method statement
Step 1. Work out the part of the company’s total income tax
liability for the income year that is attributable to the company’s
shareholders.
The result of this step is the shareholders’ share of
the income tax liability of the company for the income year.
Step 2. Divide the step 1 result by that total income tax
liability.
The result of this step is the shareholders’ ratio for
the income year.
Step 3. Multiply the amount of the payment or refund by the
*shareholders’ ratio.
The result of this step is the part of the payment or refund that is
attributable to the *shareholders’ share
of the income tax liability of the company for the income year.
(3) For the purposes of this Part, the estimate mentioned in item 1
of the table in section 219-15 (the part of a payment estimated to be
attributable to the *shareholders’ share
of a company’s income tax liability for an income year) must be worked out
on the basis of:
(a) subject to paragraph (b), the method statement in
subsection (2); and
(b) the company’s reasonable estimate of the amounts that, on the
company’s *assessment day for the income
year, will be:
(i) its total income tax liability for the income year; and
(ii) the part of that total income tax liability that is attributable to
its shareholders.
(4) In working out the part of the income tax liability of a
*life insurance company that is attributable to
the shareholders of the company for the purposes of this section, regard is to
be had to the accounting records of the company.
(1) This section applies in relation to the
*franking account of a
*life insurance company if:
(a) the assessment of the company’s income tax liability for an
income year is amended on a particular day (the adjustment day);
and
(b) the *shareholders’ ratio (the
new ratio) based on the amended assessment is different from the
shareholders’ ratio used previously in relation to that income year to
work out a *franking credit or
*franking debit for the company; and
(c) the franking account would have a different balance on the adjustment
day if the new ratio had been used to work out all the franking credits and
franking debits covered by paragraph (b).
(2) On the adjustment day, a *franking
credit or *franking debit (as appropriate) of
the amount worked out under subsection (3) arises in the
*franking account.
(3) The amount is an adjustment that will bring the
*franking account to the balance that it would
have on the adjustment day if the new ratio had been used to work out all the
*franking credits and
*franking debits covered by
paragraph (1)(b).
Example: On the basis of a shareholders’ ratio of 60%
for the income year, franking credits of the amounts of $6,000, $6,000, $6,000
and $6,000 arose under item 2 of the table in section 219-15 for
Company X.
An amended assessment results in a new shareholders’
ratio of 70%. Under this section, a franking credit of $4,000 arises on the day
of the amended assessment to bring the balance of the franking account from
$24,000 to $28,000, which would be the account’s balance if the new
shareholders’ ratio had been used.
5 Subsection 995-1(1)
Insert:
assessment day for an income year of a
*life insurance company has the meaning given
by section 219-45.
6 Subsection 995-1(1)
Insert:
shareholders’ ratio for an income year of a
*life insurance company has the meaning given
by section 219-50.
7 Subsection 995-1(1)
Insert:
shareholders’ share of the income tax liability of a
*life insurance company for an income year has
the meaning given by section 219-50.
8 Application
Subject to the rules on the application of Part 3-6 of the Income Tax
Assessment Act 1997 set out in the Income Tax (Transitional Provisions) Act
1997, the amendments made by items 1 to 7 apply to events that occur on or
after 1 July 2002.
Income Tax (Transitional
Provisions) Act 1997
9 Before Division 220
Insert:
Table of sections
219-40 Reversing and replacing (on tax paid basis) certain
franking credits that arose before 1 July 2002
219-45 Reversing (on tax paid basis) certain franking debits
that arose before 1 July 2002
(1) This section applies if:
(a) a franking credit arose before 1 July 2002 in the franking
account of a life insurance company under section 160APVJ of the Income
Tax Assessment Act 1936 in relation to a PAYG instalment in respect of an
income year; and
(b) the company’s assessment day (the assessment
day) for that income year occurs on or after 1 July 2002;
and
(c) the company has a franking account (the new franking
account) under section 205-10 of the Income Tax Assessment Act
1997.
(2) A franking debit of the amount worked out in accordance with the
following formula is taken to have arisen in the new franking account on the
assessment day:
where:
amount of the 1936 Act credit means the amount of the
franking credit mentioned in paragraph (1)(a).
(3) On the assessment day, a franking credit of the amount mentioned in
item 2 of the table in section 219-15 of the Income Tax Assessment
Act 1997 arises in the new franking account in relation to a payment of the
PAYG instalment mentioned in paragraph (1)(a) of this section that was made
before 1 July 2002.
Note: On the assessment day, the franking credit mentioned
in paragraph (1)(a) is therefore:
• reversed by the franking debit arising under
subsection (2); and
• replaced with a franking credit arising under
subsection (3).
(1) This section applies if:
(a) a franking debit arose before 1 July 2002 in the franking account
of a life insurance company under section 160AQCNCE of the Income Tax
Assessment Act 1936 in relation to a PAYG instalment variation credit in
respect of an income year; and
(b) the company’s assessment day (the assessment day)
for that income year occurs on or after 1 July 2002; and
(c) the company has a franking account (the new franking
account) under section 205-10 of the Income Tax Assessment Act
1997.
(2) A franking credit of the amount worked out in accordance with the
following formula is taken to have arisen in the new franking account on
1 July 2002:
where:
amount of the 1936 Act debit means the amount of the franking
debit mentioned in paragraph (1)(a).
Note: As the effects of sections 160AQCNCE and 160APVN
of the Income Tax Assessment Act 1936 are not duplicated in the Income
Tax Assessment Act 1997, this section ensures that a debit arising under
section 160AQCNCE before 1 July 2002 is reversed on a tax paid basis
on that date if it has not been reversed under section 160APVN before that
date.
Income Tax Assessment Act
1936
1 At the end of subsection
23AB(8A)
Add “or 23AG”.
2 Subsection 79B(3A)
Omit “or 23AD”, substitute “, 23AD or
23AG”.
3 Application
The amendments made by this Schedule apply in respect of service performed
on or after 1 July 2001.
Income Tax Assessment Act
1997
1 Section 108-50 (note)
Omit “and section 124-725 (about a roll-over for a prospecting
or mining entitlement)”, insert “, section 124-725 (about a
roll-over for a prospecting or mining entitlement) and sections 124-895,
124-915 and 124-920 (about roll-overs for FSR transitions)”.
2 Subsection 108-75(2) (cell at table item 3,
column headed “Roll-over is obtained under this
provision:”)
Repeal the cell, substitute:
|
Subdivision 124-C or 124-O |
3 Section 109-55 (after table
item 6)
Insert:
|
6A |
A new owner obtains a replacement-asset roll-over for replacing an asset
that the original owner acquired before 20 September 1985 |
before 20 September 1985 |
sections 124-915 and 124-920 |
4 Section 109-55 (after table
item 7)
Insert:
|
7A |
You obtain a replacement-asset roll-over in relation to an FSR transition
and a replacement asset or part of a replacement asset relates to an original
asset that you acquired before 20 September 1985 |
before 20 September 1985 (for that replacement asset or that
part of a replacement asset that relates to a pre-CGT original asset) |
section 124-895 |
|
7B |
A new owner obtains a replacement-asset roll-over in relation to an FSR
transition and a replacement asset or part of a replacement asset relates to an
original asset that the original owner acquired before 20 September
1985 |
before 20 September 1985 (for that replacement asset or that
part of a replacement asset that relates to a pre-CGT original asset) |
sections 124-915 and 124-920 |
5 Section 112-115 (after table
item 14B)
Insert:
|
14BA |
Replacement assets acquired during an FSR transition |
Subdivision 124-O |
6 Subsection 124-5(1)
Omit “124-N”, substitute “124-O”.
7 Subsection 124-5(1) (note)
Omit “Note”, substitute “Note 1”.
8 At the end of subsection
124-5(1)
Add:
Note 2: Subdivision 124-O (about FSR transitions) also
provides for roll-overs in situations where a replacement CGT asset is acquired
by a new owner.
9 Subsection 124-5(2) (at the end of the
note)
Add “The consequences of the new owner roll-overs in
Subdivision 124-O (about FSR transitions) are set out in that
Subdivision.”.
10 Subsection 124-10(3) (note
1)
Omit all the words after “(about statutory licences)”,
substitute “, Subdivision 124-D (about strata title conversion) and
Subdivision 124-O (about FSR transitions).”.
11 Subsection 124-10(3) (note
2)
Omit all the words after “(about Crown leases)”, substitute
“, Subdivision 124-L (about prospecting and mining) and
Subdivision 124-O (about FSR transitions).”.
12 At the end of subsection 124-15(5) (after the
example)
Add:
Note: Subdivision 124-O provides a different rule for
FSR transitions.
13 At the end of
Division 124
Add:
Table of sections
Same owner roll-overs
124-880 Old licence roll-over (same owner)
124-885 Qualified licence roll-over (same
owner)
124-890 Rights roll-over (same owner)
124-895 Consequences of a same owner
roll-over
New owner roll-overs
124-900 Old licence roll-over (new owner)
124-905 Qualified licence roll-over (new
owner)
124-910 Rights roll-over (new owner)
124-915 Consequences of a new owner roll-over (where one CGT
asset comes to an end)
124-920 Consequences of a new owner roll-over (where more
than one CGT asset comes to an end)
Extension of FSR transition period
124-925 Special extension of the 10 March 2004 cut-off
date (same owner roll-overs)
124-930 Special extension of the 10 March 2004 cut-off
date (new owner roll-overs)
There is a roll-over if:
(a) you apply for an *Australian
financial services licence during the period beginning on 11 March 2002 and
ending on 10 March 2004; and
(b) at the time you make the application, you hold one or more licences,
registrations, approvals, authorities or other similar things (the old
licence or licences) that give you the status of a regulated principal
within the meaning of section 1430 of the Corporations Act 2001;
and
(c) you are granted an Australian financial services licence as a result
of the application; and
(d) that licence covers some or all of the activities that the old licence
or licences authorised you to carry on; and
(e) the old licence or licences cease to have effect (whether wholly or
partly):
(i) when the Australian financial services licence is granted to you;
or
(ii) if the Australian financial services licence is granted to you after
10 March 2004—on 10 March 2004.
Note: The period in paragraph (a) may be extended in
special circumstances: see section 124-925. If it is extended, the day in
subparagraph (e)(ii) changes too.
There is a roll-over if:
(a) you apply for an *Australian
financial services licence during the period beginning on 11 March 2002 and
ending on 10 March 2004; and
(b) at the time you make the application, you hold an Australian financial
services licence to which section 1434 of the Corporations Act 2001
applies (the qualified licence); and
(c) you are granted an Australian financial services licence as a result
of the application (the new licence); and
(d) if the new licence is granted on or before 10 March
2004—the qualified licence is revoked as a result of the new licence being
granted to you; and
(e) if the new licence is granted after 10 March 2004:
(i) the qualified licence ceases to have effect on 10 March 2004;
and
(ii) if the new licence had been granted on or before 10 March 2004,
the qualified licence would have been revoked as a result of the new licence
being granted.
Note: The period in paragraph (a) may be extended in
special circumstances: see section 124-925. If it is extended, the day in
paragraphs (d) and (e) changes too.
There is a roll-over if:
(a) one or more intangible *CGT assets
owned by you cease to exist during the period beginning on 11 March 2002
and ending on 10 March 2004; and
(b) the asset or assets cease to exist because of the termination of one
or more contracts; and
(c) the termination is directly connected with Chapter 7 of the
Corporations Act 2001 (as amended by the Financial Services Reform Act
2001) beginning to apply to you; and
(d) you acquire one or more intangible CGT assets by entering into one or
more contracts in substitution (whether wholly or partly) for the contract or
contracts that were terminated.
Note: The period in paragraph (a) may be extended in
special circumstances: see section 124-925.
(1) In each situation covered by section 124-880, 124-885 or 124-890,
where:
(a) your ownership of one or more *CGT
assets (the original asset or assets) comes to an end;
and
(b) you acquire one or more CGT assets (the replacement asset or
assets);
the consequences of that section applying are the consequences specified in
Subdivision 124-A, with the modifications set out below.
(2) The first element of the *cost base
and *reduced cost base of each replacement
asset includes any amount you paid to get the replacement asset (which can
include giving property: see section 103-5). This subsection does not apply
if subsection (3) applies.
Note: If subsection (3) applies, any amount you paid to
get the replacement asset is included in the cost base and reduced cost base by
subsection (5).
(3) In a situation where subsection 124-15(5) would otherwise apply (where
you *acquired some original assets before
20 September 1985 and some on or after that date), use subsections (4)
to (7) of this section instead of subsections 124-15(5) and (6).
(4) Each replacement asset, or part of a replacement asset, to the extent
that it relates to one or more original assets that were
*acquired before 20 September 1985, is
taken to be:
(a) a separate asset; and
(b) acquired before 20 September 1985.
(5) The first element of the *cost base
of each replacement asset that you are not taken to have
*acquired before 20 September 1985 is the
sum of:
(a) the amount worked out under the formula in subsection (6);
and
(b) either:
(i) any amount you paid to get the replacement asset (which can include
giving property: see section 103-5); or
(ii) for a replacement asset, part of which is treated as a separate asset
under subsection (4)—such part of any amount you paid to get the
asset (which can include giving property: see section 103-5) as is
reasonably attributable to the part of the asset that you are not taken to have
acquired before 20 September 1985.
(6) The formula is:
Note: If an original asset is an old licence that ceases to
have effect only partly, subsection (8) modifies this
formula.
(7) The first element of each replacement asset’s
*reduced cost base is worked out
similarly.
(8) If, in a situation covered by section 124-880, an old licence
mentioned in that section ceases to have effect only partly, then:
(a) a reference in Subdivision 124-A to the original asset’s
*cost base; and
(b) the reference in subsection (6) of this section to the total of
the *cost bases of the original
assets;
is taken to be a reference to such part of the cost base of the old licence
as is reasonably attributable to the part of the old licence that ceases to have
effect.
(1) There is a roll-over if:
(a) a person (the new owner) applies for an
*Australian financial services licence during
the period beginning on 11 March 2002 and ending on 10 March 2004;
and
(b) at the time the application is made, another person (the
original owner) holds one or more licences, registrations,
approvals, authorities or other similar things (the old licence or
licences) that give the original owner the status of a regulated
principal within the meaning of section 1430 of the Corporations Act
2001; and
(c) the new owner is granted an Australian financial services licence as a
result of the application; and
(d) if the Australian financial services licence is granted on or before
10 March 2004—the old licence or licences cease to have effect
(whether wholly or partly) because, as a result of the Australian financial
services licence being granted to the new owner, the original owner starts to be
covered by an exemption under subsection 911A(2) of the Corporations Act
2001 (or would be so covered by an exemption if that subsection applied) in
respect of the original owner’s regulated activities (within the meaning
of section 1430 of the Corporations Act 2001); and
(e) if the Australian financial services licence is granted after
10 March 2004:
(i) the old licence or licences cease to have effect (whether wholly or
partly) on 10 March 2004; and
(ii) if the Australian financial services licence had been granted before
10 March 2004, the old licence or licences would have ceased to have effect
(whether wholly or partly) for the reason mentioned in paragraph (d);
and
(f) subsection (2) or (3) applies.
Note: The period in paragraph (1)(a) may be extended in
special circumstances: see section 124-930. If it is extended, the day in
paragraphs (d) and (e) changes too.
(2) This subsection applies if the new owner and the original owner are
members of the same *consolidatable group at
the time that the new owner *acquires the
*Australian financial services
licence.
(3) This subsection applies if:
(a) at the time that the new owner
*acquires the
*Australian financial services licence, all of
the following apply:
(i) the new owner is a company or a trust;
(ii) if the new owner is a
trust—*CGT event E4 is capable of
applying to all of the units and interests in the trust;
(iii) all of the *membership interests in
the new owner are owned by the original owner; and
(b) the original owner is an individual who, at the same time as, or just
after, the new owner acquires the Australian financial services
licence:
(i) becomes an authorised representative (within the meaning of
section 761A of the Corporations Act 2001) of the new owner;
or
(ii) becomes an employee of the new owner; or
(iii) becomes a director (within the meaning of the Corporations Act
2001) of the new owner.
(1) There is a roll-over if:
(a) a person (the new owner) applies for an
*Australian financial services licence during
the period beginning on 11 March 2002 and ending on 10 March 2004;
and
(b) at the time the application is made, another person (the
original owner) holds an Australian financial services licence to
which section 1434 of the Corporations Act 2001 applies (the
qualified licence); and
(c) the new owner is granted an Australian financial services licence as a
result of the application (the new licence); and
(d) if the new licence is granted on or before 10 March
2004—the qualified licence is revoked as a result of the new licence being
granted to the new owner; and
(e) if the new licence is granted after 10 March 2004:
(i) the qualified licence ceases to have effect on 10 March 2004;
and
(ii) if the new licence had been granted on or before 10 March 2004,
the qualified licence would have been revoked as a result of the new licence
being granted; and
(f) subsection (2) or (3) applies.
Note: The period in paragraph (1)(a) may be extended in
special circumstances: see section 124-930. If it is extended, the day in
paragraphs (d) and (e) changes too.
(2) This subsection applies if the new owner and the original owner are
members of the same *consolidatable group at
the time that the new owner *acquires the new
licence.
(3) This subsection applies if:
(a) at the time that the new owner
*acquires the new licence, all of the following
apply:
(i) the new owner is a company or a trust;
(ii) if the new owner is a
trust—*CGT event E4 is capable of
applying to all of the units and interests in the trust;
(iii) all of the *membership interests in
the new owner are owned by the original owner; and
(b) the original owner is an individual who, at the same time as, or just
after, the new owner acquires the new licence:
(i) becomes an authorised representative (within the meaning of
section 761A of the Corporations Act 2001) of the new owner;
or
(ii) becomes an employee of the new owner; or
(iii) becomes a director (within the meaning of the Corporations Act
2001) of the new owner.
(1) There is a roll-over if:
(a) one or more intangible *CGT assets
owned by a person (the original owner) cease to exist during the
period beginning on 11 March 2002 and ending on 10 March 2004;
and
(b) the asset or assets cease to exist because of the termination of one
or more contracts; and
(c) the termination is directly connected with the original owner choosing
that another person (the new owner) will conduct, in place of the
original owner, the business of the original owner in relation to which
Chapter 7 of the Corporations Act 2001 (as amended by the
Financial Services Reform Act 2001) is to apply; and
(d) the new owner acquires one or more intangible CGT assets by entering
into one or more contracts in substitution (whether wholly or partly) for the
contract or contracts that were terminated; and
(e) subsection (2) or (3) applies.
Note: The period in paragraph (1)(a) may be extended in
special circumstances: see section 124-930.
(2) This subsection applies if the new owner and the original owner are
members of the same *consolidatable group at
the time that the new owner *acquires the
*CGT asset or assets mentioned in
paragraph (1)(d).
(3) This subsection applies if:
(a) at the time that the new owner
*acquires the
*CGT asset or assets mentioned in
paragraph (1)(d), all of the following apply:
(i) the new owner is a company or a trust;
(ii) if the new owner is a
trust—*CGT event E4 is capable of
applying to all of the units and interests in the trust;
(iii) all of the *membership interests in
the new owner are owned by the original owner; and
(b) the original owner is an individual who, at the same time as, or just
after, the new owner acquires the Australian financial services
licence:
(i) becomes an authorised representative (within the meaning of
section 761A of the Corporations Act 2001) of the new owner;
or
(ii) becomes an employee of the new owner; or
(iii) becomes a director (within the meaning of the Corporations Act
2001) of the new owner.
(1) In each situation covered by section 124-900, 124-905 or 124-910,
where:
(a) a person’s (the original owner’s) ownership
of one *CGT asset (the original
asset) comes to an end; and
(b) another person (the new owner) acquires one or more
*CGT assets (the replacement asset or
assets);
the consequences of that section applying are the consequences specified in
this section.
(2) A *capital gain or a
*capital loss that the original owner makes
from a *CGT event happening to the original
asset is disregarded.
(3) If the original owner *acquired the
original asset on or after 20 September 1985, the first element of each
replacement asset’s *cost base is
the sum of:
(a) the amount worked out under the formula in subsection (4);
and
(b) any amount the new owner paid to get the replacement asset (which can
include giving property: see section 103-5).
(4) The formula is:
Note: If the original asset is an old licence that ceases to
have effect only partly, subsection (7) modifies this
formula.
(5) The first element of each replacement asset’s
*reduced cost base is worked out
similarly.
(6) If the original owner *acquired the
original asset before 20 September 1985, the new owner is taken to have
acquired each replacement asset before that day.
(7) If, in a situation covered by section 124-900, an old licence
mentioned in that section ceases to have effect only partly, then the reference
in subsection (4) of this section to the original asset’s
*cost base is taken to be a reference to such
part of the cost base of the old licence as is reasonably attributable to the
part of the old licence that ceases to have effect.
(1) In each situation covered by section 124-900, 124-905 or 124-910,
where:
(a) a person’s (the original owner’s) ownership
of more than one *CGT asset (the original
asset or assets) comes to an end; and
(b) another person (the new owner) acquires one or more
*CGT assets (the replacement asset or
assets);
the consequences of that section applying are the consequences set out in
this section.
(2) A *capital gain or a
*capital loss that the original owner makes
from a *CGT event happening to any of the
original assets is disregarded.
(3) If the original owner *acquired all
the original assets on or after 20 September 1985, the first element of
each replacement asset’s *cost base is
the sum of:
(a) the amount worked out under the formula in subsection (4);
and
(b) any amount the new owner paid to get the replacement asset (which can
include giving property: see section 103-5).
(4) The formula is:
Note: If an original asset is an old licence that ceases to
have effect only partly, subsection (11) modifies this
formula.
(5) The first element of each replacement asset’s
*reduced cost base is worked out
similarly.
(6) If the original owner *acquired all
the original assets before 20 September 1985, the new owner is taken to
have acquired each replacement asset before that day.
(7) If the original owner *acquired some
of the original assets before 20 September 1985, each replacement asset, or
part of a replacement asset, to the extent that it relates to one or more
original assets that were *acquired before
20 September 1985, is taken to be:
(a) a separate asset; and
(b) acquired before 20 September 1985.
(8) If subsection (7) applies, the first element of the
*cost base of each replacement asset that is
not taken to have been *acquired before
20 September 1985 is the sum of:
(a) the amount worked out under the formula in subsection (9);
and
(b) either:
(i) any amount the new owner paid to get the replacement asset (which can
include giving property: see section 103-5); or
(ii) for a replacement asset, part of which is treated as a separate asset
under subsection (7)—such part of any amount the new owner paid to
get the asset (which can include giving property: see section 103-5) as is
reasonably attributable to the part of the asset that is not taken to have been
acquired before 20 September 1985.
(9) The formula is:
Note: If an original asset is an old licence that ceases to
have effect only partly, subsection (11) modifies this
formula.
(10) The first element of each replacement asset’s
*reduced cost base is worked out
similarly.
(11) If, in a situation covered by section 124-900, an old licence
mentioned in that section ceases to have effect only partly, then a reference in
subsection (4) or (9) of this section to the original asset’s
*cost base is taken to be a reference to such
part of the cost base of the old licence as is reasonably attributable to the
part of the old licence that ceases to have effect.
If the Australian Securities and Investments Commission makes a
declaration that provides for the relevant old legislation (within the meaning
of section 1430 of the Corporations Act 2001) to continue to apply
to you until the end of the period declared by the Commission, then:
(a) the period mentioned in paragraphs 124-880(a), 124-885(a) and
124-890(a) is modified in its application to you so that it ends on the last day
of the period declared by the Commission; and
(b) subparagraph 124-880(e)(ii) and paragraphs 124-885(d) and (e) are
modified in their application to you so that the day mentioned in those
subparagraphs is the last day of the period declared by the
Commission.
If the Australian Securities and Investments Commission makes a
declaration that provides for the relevant old legislation (within the meaning
of section 1430 of the Corporations Act 2001) to continue to apply
to a person who is an original owner mentioned in section 124-900, 124-905
or 124-910 until the end of the period declared by the Commission,
then:
(a) the period mentioned in paragraphs 124-900(1)(a), 124-905(1)(a) and
124-910(1)(a) is modified in its application to that person so that it ends on
the last day of the period declared by the Commission; and
(b) paragraphs 124-900(1)(d) and (e) and 124-905(1)(d) and (e) are
modified in their application to that person so that the day mentioned in those
subparagraphs is the last day of the period declared by the
Commission.
14 After subsection 152-45(1)
Insert:
Assets replaced during FSR transition (same owner
roll-overs)
(1A) If a *CGT asset is an asset (the
new asset) you acquired in a situation covered by
section 124-880, 124-885 or 124-890, then the active asset test in
section 152-35 applies as if:
(a) you had acquired the new asset when you acquired the original asset;
and
(b) the new asset had been your *active
asset at all times when the original asset was your active asset; and
(c) the new asset had not been your active asset at all times when the
original asset was not your active asset.
Note 1: Subdivision 124-O provides a roll-over for
certain CGT assets that come to an end as a result of an FSR
transition.
Note 2: If this subsection applies to a CGT asset, then
section 152-115 (which is about continuing time periods) will apply for the
15-year exemption.
Assets replaced during FSR transition (new owner
roll-overs)
(1B) If a *CGT asset is an asset (the
new asset) acquired in a situation covered by
section 124-900, 124-905 or 124-910, then the active asset test in
section 152-35 applies as if:
(a) the new owner had acquired the new asset when the original owner
acquired the original asset; and
(b) the new asset had been the *active
asset of the new owner at all times when the original asset was the original
owner’s active asset; and
(c) the new asset had not been the active asset of the new owner at all
times when the original asset was not the original owner’s active
asset.
Note 1: Subdivision 124-O provides a roll-over for
certain CGT assets that come to an end as a result of an FSR
transition.
Note 2: If this subsection applies to a CGT asset, then
section 152-115 (which is about continuing time periods) will apply for the
15-year exemption.
15 After subsection 152-115(1)
Insert:
Assets replaced during FSR transition (same owner
roll-overs)
(1A) If a *CGT asset is an asset (the
new asset) you acquired in a situation covered by
section 124-880, 124-885 or 124-890, then paragraphs 152-105(b) and
152-110(1)(b) and (c) (the 15-year and controlling individual rules) apply as if
you had acquired the new asset when you acquired the original asset.
Note: Subdivision 124-O provides a roll-over for
certain CGT assets that come to an end as a result of an FSR
transition.
Asset replaced during FSR transition (new owner
roll-overs)
(1B) If a *CGT asset is an asset (the
new asset) acquired in a situation covered by
section 124-900, 124-905 or 124-910, then paragraphs 152-105(b) and
152-110(1)(b) and (c) (the 15-year and controlling individual rules) apply as if
the new owner had acquired the new asset when the original owner acquired the
original asset.
Note: Subdivision 124-O provides a roll-over for
certain CGT assets that come to an end as a result of an FSR
transition.
16 Subsection 995-1(1) (the
Dictionary)
Insert:
Australian financial services licence has the meaning given
by section 761A of the Corporations Act 2001.
Part 2—Application
of amendments
17 Application of amendments
The amendments made by this Schedule apply to CGT events happening on or
after 11 March 2002.
Part 1—Amendment
of the Income Tax Assessment Act 1936
1 Subsection 92(2)
Omit “Where”, substitute “Subject to section 830-45
of the Income Tax Assessment Act 1997, if”.
2 Section 94B (paragraph (a) of the
definition of income tax law)
After “Division”, insert “and Division 830 of the
Income Tax Assessment Act 1997”.
3 At the end of
section 94D
Add:
(4) A limited partnership that is a foreign hybrid limited partnership in
relation to a year of income because of subsection 830-10(1) of the Income
Tax Assessment Act 1997 is not a corporate limited partnership in relation
to the year of income.
Note: As result, both the normal partnership provisions and
special provisions relating to foreign hybrid limited partnerships will apply to
the entity.
(5) If, for the purpose of applying this Act and the Income Tax
Assessment Act 1997 in relation to a partner’s interest in a limited
partnership, the partnership is a foreign hybrid limited partnership in relation
to a year of income because of subsection 830-10(2) of that Act, the partnership
is not a corporate limited partnership in relation to the partner’s
interest in relation to the year of income.
Note: As result, both the normal
partnership provisions and special provisions relating to foreign hybrid limited
partnerships will apply to the entity, but only in relation to the
partner’s interest.
4 At the end of
section 324
Add:
Note: Section 830-75 of the Income Tax Assessment
Act 1997 sets out additional circumstances, relating to entities that are
foreign hybrids, in which a gain or profit is subject to tax in a listed
country.
5 After section 485
Insert:
Limited partnerships that are treated as companies
(1) If:
(a) disregarding subsection 94D(5):
(i) at the end of a year of income, a taxpayer has an interest in a FIF
that is a corporate limited partnership for the purposes of Division 5A of
Part III in relation to the year of income; and
(ii) the interest consists of a share in the FIF; and
Note: The share will be an interest in the partnership that
is treated by Division 5A of Part III as a share.
(b) the entity satisfies the requirements of paragraphs 830-10(1)(a) to
(d) of the Income Tax Assessment Act 1997 in relation to the year of
income;
the taxpayer may elect that subsection (5) of this section applies in
relation to the interest in the FIF.
Actual companies
(2) If:
(a) at the end of a year of income, a taxpayer has an interest in a FIF
that consists of one or more shares in the FIF; and
(b) the interest is not one to which paragraph (1)(a) applies;
and
(c) the entity satisfies the requirements of paragraphs 830-15(1)(a) to
(c) of the Income Tax Assessment Act 1997 in relation to the year of
income;
the taxpayer may elect that subsection (5) of this section applies in
relation to the interest in the FIF.
Time limit for making election
(3) A taxpayer must make an election under this section:
(a) on or before the day on which the taxpayer lodges its return of income
for the year of income; or
(b) within a further time allowed by the Commissioner.
When election is in force
(4) If the taxpayer makes the election, it is in force during the year of
income and all later years of income.
Effect of election on interest in FIF etc.
(5) While the election is in force, the operative provision, and any other
provision of this Part relevant to the operation of that provision, does not
apply to the taxpayer in relation to the interest in the FIF consisting of the
share or shares or any option, convertible note, or other instrument, that
confers an entitlement to acquire the share or shares.
Note: The election will also have the effect under
Division 830 of the Income Tax Assessment Act 1997 of making the
company or limited partnership a foreign hybrid in relation to the
taxpayer’s interest in the FIF.
Effect of election on other interests in FIF
(6) However, subsection (5) does not have effect so far as that
interest in the FIF is relevant for the purpose of the application of this Part
in relation to the taxpayer, or any other taxpayer, in relation to any other
interest in the FIF.
Note: For example, in applying section 580 to work out
other taxpayers’ shares of the calculated profit of the FIF, the interest
would not be disregarded.
Election irrevocable
(7) The election is irrevocable.
6 Application
The amendments made by this Part have the same application to assessments
of a taxpayer, and for working out the attributable income of a CFC, as does
Division 830 of the Income Tax Assessment Act 1997.
Note: Division 830 of the Income Tax Assessment Act
1997 is inserted by Part 2 of this Schedule. Its application is given
by Division 830 of the Income Tax (Transitional Provisions) Act
1997, which is inserted by Part 3 of this
Schedule.
Part 2—Amendment
of the Income Tax Assessment Act 1997
7 Section 12-5 (table item headed
“partnerships”)
Before:
|
losses, partner’s share of partnership
loss............................ 90, 92 |
insert:
|
foreign hybrid loss exposure
adjustment............................. 830-50 |
|
|
8 Section 36-25 (after the table headed
“Tax losses of VCLPs, AFOFs and VCMPs”)
Insert:
Tax losses of entities that become foreign hybrids
|
Item |
For the special rules about this situation... |
See: |
|---|---|---|
|
1. |
An entity that has a tax loss becomes a
*foreign hybrid: it cannot deduct the loss
while it is a foreign hybrid. |
Section 830-115 |
9 Subsection 102-25(2)
Repeal the subsection, substitute:
(2) However, there are 3 exceptions: one for
*CGT events J2 and J3, one for CGT event K5 and
one for CGT event K12.
10 After subsection 102-25(2B)
Insert:
(2C) If:
(a) *CGT events happen for which you make
*capital gains or
*capital losses; and
(b) the capital gains or losses are taken into account in working out a
*foreign hybrid net capital loss amount;
and
(c) the foreign hybrid net capital loss amount is itself taken into
account in determining that *CGT event K12
happens;
CGT event K12 applies in addition to the other CGT events.
11 Section 104-5 (before table item relating to
CGT event L1)
Insert:
|
K12 Foreign hybrid loss exposure adjustment [See section 104-270] |
just before the end of the income year |
no capital gain |
the amount stated in subsection 104-270(3) |
12 At the end of
Subdivision 104-K
Add:
(1) CGT event K12 happens if, in accordance with paragraph
830-50(2)(b) or (3)(b), you make a *capital
loss under this section for an income year.
(2) The time of the event is just before the end of the income
year.
(3) You make a capital loss equal to the amount applicable
under paragraph 830-50(2)(b) or (3)(b).
13 Section 110-10 (before table item relating
to CGT event L1)
Insert:
|
K12 |
Foreign hybrid loss exposure adjustment |
104-270 |
|---|
14 Section 112-97 (after table
item 20)
Insert:
|
20A |
An entity becomes or ceases to be a foreign hybrid |
The total cost base and reduced cost base |
Sections 830-80 and 830-85 |
15 At the end of Part 4-5 (before the link
note)
Add:
Table of Subdivisions
Guide to Division 830
830-A Meaning of “foreign hybrid”
830-B Extension of normal partnership provisions to foreign hybrid
companies
830-C Special rules applicable while an entity is a foreign
hybrid
830-D Special rules applicable when an entity becomes or ceases to be a
foreign hybrid
This Division:
(a) provides for certain entities (called foreign hybrids) that are
treated as partnerships for the purposes of foreign tax, but as companies for
the purposes of tax within the meaning of this Act, to be treated as
partnerships for the purposes of this Act; and
(b) applies special rules to the entities in addition to those that
normally apply to partnerships.
[This is the end of the Guide.]
Table of sections
830-5 Foreign hybrid
830-10 Foreign hybrid limited partnership
830-15 Foreign hybrid company
The expression foreign hybrid means:
(a) a *foreign hybrid limited
partnership; or
(b) a *foreign hybrid company.
(1) A *limited partnership is a
foreign hybrid limited partnership in relation to an income
year if:
(a) it was formed in a foreign country; and
(b) *foreign tax is imposed under the law
of the foreign country on the partners, not the limited partnership, in respect
of the income or profits of the partnership for the income year; and
(c) at no time during the income year is the limited partnership, for the
purposes of a law of any foreign country that imposes foreign tax on entities
because they are residents of the foreign country, a resident of that country;
and
(d) disregarding subsection 94D(4) of the Income Tax Assessment Act
1936, at no time during the income year is it an Australian resident;
and
(e) disregarding that subsection, in relation to the same income year of
another taxpayer:
(i) the limited partnership is a *CFC at
the end of a *statutory accounting period that
ends in the income year; and
(ii) at the end of the statutory accounting period, the taxpayer is an
*attributable taxpayer in relation to the CFC
with an *attribution percentage greater than
nil.
(2) If a partner in a *limited
partnership makes an election under subsection 485AA(1) of the Income Tax
Assessment Act 1936 in relation to the partner’s interest in the
partnership, then, for the purpose of applying that Act and this Act in relation
to the partner’s interest, the limited partnership is a foreign
hybrid limited partnership in relation to any income year during which
the election is in force.
(1) A company is a foreign hybrid company in relation to an
income year if:
(a) at all times during the income year when the company is in existence,
the partnership treatment requirements for the income year in
subsection (2) or (3) are satisfied; and
(b) at no time during the income year is the company, for the purposes of
a law of any foreign country that imposes
*foreign tax on entities because they are
residents of the foreign country, a resident of that country; and
(c) at no time during the income year is the company an Australian
resident; and
(d) disregarding this Division, in relation to the same income year of
another taxpayer:
(i) the company is a *CFC at the end of a
*statutory accounting period that ends in the
income year; and
(ii) at the end of the statutory accounting period, the taxpayer is an
*attributable taxpayer in relation to the CFC
with an *attribution percentage greater than
nil.
Partnership treatment requirements specific to USA
(2) For the purposes of paragraph (1)(a), the partnership treatment
requirements are satisfied if:
(a) the company was formed in the United States of America; and
(b) for the purposes of the law of that country relating to
*foreign tax imposed by that country, the
company is a limited liability company that:
(i) is treated as a partnership; or
(ii) is an eligible entity that is disregarded as an entity separate from
its owner.
Partnership treatment requirements relating to any foreign
country
(3) For the purposes of paragraph (1)(a), the partnership treatment
requirements are also satisfied if:
(a) the company was formed in a foreign country (which may be the United
States of America); and
(b) for the purposes of the law of that country relating to
*foreign tax imposed by that country, the
company is treated as a partnership; and
(c) regulations are in force setting out requirements to be satisfied by a
company in relation to the income year for the purposes of this paragraph, and
the company satisfies those requirements.
(4) Regulations for the purposes of paragraph (3)(c) cannot set out
requirements in relation to any income year before the one in which the
regulations are made.
(5) If a *shareholder in a company makes
an election under subsection 485AA(2) of the Income Tax Assessment Act 1936
in relation to the shareholder’s share or shares in the company, then,
for the purpose of applying that Act and this Act in relation to the
shareholder’s share or shares, the company is a foreign hybrid
company in relation to any income year during which the election is in
force.
Note: The normal partnership provisions will apply of their
own force to foreign hybrids that are foreign hybrid limited
partnerships.
Table of sections
830-20 Treatment of company as a
partnership
830-25 Partners are the shareholders in the
company
830-30 Individual interest of a partner in net income etc.
equals percentage of notional distribution of company’s
profits
830-35 Partner’s interest in assets
830-40 Control and disposal of share in partnership
income
If a company is a *foreign hybrid
company in relation to an income year, the
*foreign hybrid tax provisions apply as if the
company were a partnership, and for that purpose the following provisions of
this Subdivision have effect.
The partners in the partnership are the
*shareholders in the company.
The individual interest of a partner in the
*net income or
*partnership loss of the partnership of the
income year is equal to the percentage that, if the profits of the company for
the income year were distributed at the end of the income year to its
*shareholders:
(a) if paragraph (b) does not apply—as dividends; or
(b) if the company’s *constitution
or other rules provide for the distribution of profits other than as
dividends—in accordance with the constitution or those rules;
the partner, as a shareholder, could reasonably be expected to receive of
the total distribution.
(1) The interest that each partner has in the assets of the partnership,
under the partnership agreement, is equal to the percentage in
subsection (2).
(2) The percentage is the percentage that, if the capital of the company
were distributed to its *shareholders on a
winding-up of the company at the end of the income year, the partner, as a
shareholder, could reasonably be expected to receive of the total
distribution.
(1) This section applies for the purposes of determining under
section 94 of the Income Tax Assessment Act 1936 whether the
partnership is so constituted or controlled, or its operations are so conducted,
that a partner does not have the real and effective control and disposal of the
partner’s share, or a part of the partner’s share, in the
*net income of the partnership of an income
year.
(2) The reference to the partner’s share, or a part of the
partner’s share, in the *net income is a
reference to any rights that the *shareholder
has under the *constitution or other rules of
the company that were taken into account under section 830-30 in working
out the individual interest of the partner in the partnership’s net income
or *partnership loss of the income
year.
Note: In the case of a foreign hybrid company, references in
this Subdivision that relate to partnerships are to be read subject to
Subdivision 830-B. For example, a reference to a partner will be a
reference to a shareholder in the company who is treated by
Subdivision 830-B as a partner.
Table of sections
830-45 Partner’s revenue and net capital losses from
foreign hybrid not to exceed partner’s loss exposure
amount
830-50 Deduction etc. where partner’s foreign hybrid
revenue loss amount and foreign hybrid net capital loss amount are less than
partner’s loss exposure amount
830-55 Meaning of foreign hybrid net capital loss
amount
830-60 Meaning of loss exposure
amount
830-65 Meaning of outstanding foreign hybrid revenue
loss amount
830-70 Meaning of outstanding foreign hybrid net
capital loss amount
830-75 Extended meaning of subject to
tax
(1) This section applies to a *limited
partner in a *foreign hybrid in relation to an
income year if the sum of the following amounts:
(a) any amount (a foreign hybrid revenue loss amount)
allowable to the partner as a deduction under subsection 92(2) of the Income
Tax Assessment Act 1936 in respect of a
*partnership loss of the foreign hybrid for the
income year;
(b) any *foreign hybrid net capital loss
amount of the partner in respect of the foreign hybrid for the income
year;
exceeds the partner’s *loss exposure
amount for the income year.
Reduction in foreign hybrid revenue loss amount or foreign hybrid net
capital loss amount
(2) If this section applies, the amount mentioned in paragraph (1)(a)
or (b), or each of the amounts mentioned in those paragraphs, is reduced so that
in total they equal the partner’s *loss
exposure amount. The partner must choose how much of the reduction is applied to
each of the amounts.
Effect of reducing foreign hybrid net capital loss amount
(3) If the partner’s *foreign
hybrid net capital loss amount in respect of the
*foreign hybrid for the income year is reduced
under subsection (2), the partner’s
*net capital gain or
*net capital loss for the income year is worked
out by assuming that the *capital gains and
*capital losses taken into account in working
out the partner’s foreign hybrid net capital loss amount were instead a
capital loss equal to the foreign hybrid net capital loss amount after the
reduction.
(1) This section applies if:
(a) the sum of a partner’s *foreign
hybrid revenue loss amount and *foreign hybrid
net capital loss amount for a *foreign hybrid
for an income year does not exceed the partner’s
*loss exposure amount for the foreign hybrid
for the income year (the difference being the partner’s
available loss exposure amount); and
(b) the partner has one or more
*outstanding foreign hybrid revenue loss
amounts or one or more *outstanding foreign
hybrid net capital loss amounts, or both, in respect of the foreign hybrid for
the income year.
Where sum of outstanding foreign hybrid revenue loss amounts and
outstanding foreign hybrid net capital loss amounts does not exceed available
loss exposure amount
(2) If the sum of the *outstanding
foreign hybrid revenue loss amounts and the
*outstanding foreign hybrid net capital loss
amounts does not exceed the *available loss
exposure amount:
(a) a deduction is allowable to the partner for the income year equal to
the sum of the outstanding foreign hybrid revenue loss amounts; and
(b) the partner makes a *capital loss for
the income year under section 104-270 equal to the sum of the outstanding
foreign hybrid net capital loss amounts.
Where sum of outstanding foreign hybrid revenue loss amounts and
outstanding foreign hybrid net capital loss amounts exceeds available loss
exposure amount
(3) If the sum of the *outstanding
foreign hybrid revenue loss amounts and the
*outstanding foreign hybrid net capital loss
amounts exceeds the *available loss exposure
amount, then either or both of the following apply:
(a) a deduction is allowable to the partner for the income year equal to
some or all of the outstanding foreign hybrid revenue loss amounts;
(b) the partner makes a *capital loss
under section 104-270 equal to some or all of the outstanding foreign
hybrid net capital loss amounts;
such that the sum of the deduction and the capital loss equals the
available loss exposure amount.
Partner to choose how to apply subsection (3)
(4) The partner must choose:
(a) which of paragraphs (3)(a) and (b) is to apply or whether both
are to apply; and
(b) the amount of the deduction or
*capital loss, or the amounts of both;
and
(c) the particular outstanding foreign hybrid revenue loss amounts or
outstanding foreign hybrid net capital loss amounts, or both, to which they
relate.
If:
(a) the sum of a partner’s *capital
losses from *CGT events happening during an
income year in relation to a *foreign hybrid or
*CGT assets of a foreign hybrid;
exceeds:
(b) the sum of the partner’s
*capital gains from CGT events happening during
the income year in relation to the foreign hybrid or CGT assets of the foreign
hybrid;
the partner has a foreign hybrid net capital loss amount in
respect of the foreign hybrid for the income year equal to the excess.
(1) The loss exposure amount of a partner in a
*foreign hybrid for an income year is worked
out as follows:
Method statement
Step 1. Work out the sum of the amounts or
*market values of the contributions made by the
partner to the *foreign hybrid that, as at the
end of the income year:
(a) have not been repaid or returned to the partner; and
(b) have been contributed for at least 180 days, or are intended by the
partner to remain contributed for at least 180 days.
Step 2. Subtract the sum of the amounts of:
(a) all *limited recourse debts owed by
the partner at the end of the income year, to the extent that the
*borrowings concerned were for the purpose of
enabling the partner to make contributions to the
*foreign hybrid and the debts were secured by
the partner’s interest in the foreign hybrid; and
(b) all the partner’s *foreign
hybrid revenue loss amounts in respect of the foreign hybrid for previous income
years, after any reduction under subsection 830-45(2); and
(c) all the partner’s *foreign
hybrid net capital loss amounts in relation to the partnership for previous
income years, after any reduction under subsection 830-45(2); and
(d) all deductions allowed to the partner under subsection 830-50(2) or
(3) in respect of the foreign hybrid for previous income years; and
(e) all *capital losses that, as a result
of subsection 830-50(2) or (3), the partner made in respect of
*CGT event K12 in respect of the foreign hybrid
for previous income years.
Contribution in case of foreign hybrid company
(2) For the purposes of step 1 in the method statement in
subsection (1), if:
(a) the *foreign hybrid is a
*foreign hybrid company; and
(b) the partner *acquired its
*shares in the company from another
shareholder; and
(c) the payment or other consideration for the acquisition of the shares
did not constitute the making of a contribution by the partner to the foreign
hybrid;
the payment or other consideration is taken:
(d) to be a contribution by the partner to the foreign hybrid;
and
(e) to be so contributed for as long as the partner holds the shares;
and
(f) to have been repaid to the partner to the extent of any payment
that:
(i) the foreign hybrid makes to the partner in respect of the share;
and
(ii) the foreign hybrid describes as a return of capital; and
(iii) is attributable to the period during which the partner has held the
shares.
(1) This section applies if a *foreign
hybrid revenue loss amount of a partner in a
*foreign hybrid in relation to an income year
(the reduction year) is reduced under subsection
830-45(2).
(2) The partner has, for each later income year, an outstanding
foreign hybrid revenue loss amount equal to the amount of the reduction,
less the sum of any deductions allowable to the partner under subsection
830-50(2) or (3) in respect of the outstanding foreign hybrid revenue loss
amount for income years between the reduction year and the later income
year.
Outstanding foreign hybrid revenue loss amount not to form part of tax
loss
(3) To avoid doubt, a partner’s
*outstanding foreign hybrid revenue loss amount
for an income year cannot form part of a *tax
loss for the purposes of Division 36.
(1) This section applies if a *foreign
hybrid net capital loss amount of a partner in a
*foreign hybrid in relation to an income year
(the reduction year) is reduced under subsection
830-45(2).
(2) The partner has, for each later income year, an outstanding
foreign hybrid net capital loss amount equal to the amount of the
reduction, less the sum of any *capital losses
that, as a result of subsection 830-50(2) or (3), the partner makes in respect
of *CGT event K12 in respect of the outstanding
foreign hybrid net capital loss amount for income years between the reduction
year and the later income year.
Where entity becomes a partner
(1) If:
(a) an entity becomes a partner (the first partner) in a
*foreign hybrid in relation to an income year;
and
(b) a gain or profit of a capital nature accrues to another partner as a
result of the disposal of the whole or part of that other partner’s
interest in an asset of the foreign hybrid that happens when the first partner
becomes a partner; and
(c) apart from this subsection, the gain or profit is not
*subject to tax in a
*listed country in any
*tax accounting period; and
(d) if the foreign hybrid had disposed of the whole or an equivalent part
of the asset at the time of the disposal of the whole or the part of the
interest, any gain or profit of a capital nature that accrued to the foreign
hybrid in respect of the disposal would have been subject to tax in a listed
country in a tax accounting period;
then, for the purposes of Part X of the Income Tax Assessment Act
1936, the gain or profit mentioned in paragraph (b) is taken to be
subject to tax in the listed country, and in the tax accounting period,
mentioned in paragraph (d).
Where partner increases its interest
(2) If:
(a) an entity is a partner (the first partner) that
increases its interest in a *foreign hybrid in
relation to an income year; and
(b) a gain or profit of a capital nature accrues to another partner as a
result of the disposal of the whole or part of that other partner’s
interest in an asset of the foreign hybrid that happens when the first partner
increases its interest in the foreign hybrid; and
(c) apart from this subsection, the gain or profit is not
*subject to tax in a
*listed country in any
*tax accounting period; and
(d) if the foreign hybrid had disposed of the whole or an equivalent part
of the asset at the time of the disposal of the whole or the part of the
interest, any gain or profit of a capital nature that accrued to the foreign
hybrid in respect of the disposal would have been subject to tax in a listed
country in a tax accounting period;
then, for the purposes of Part X of the Income Tax Assessment Act
1936, the gain or profit mentioned in paragraph (b) is taken to be
subject to tax in the listed country, and in the tax accounting period,
mentioned in paragraph (d).
Where entity ceases to be a partner
(3) If:
(a) an entity ceases to be a partner in a
*foreign hybrid in relation to an income year;
and
(b) a gain or profit of a capital nature accrues to the entity as a result
of the disposal of its interest in an asset of the foreign hybrid that happens
when the entity ceases to be a partner; and
(c) apart from this subsection, the gain or profit is not
*subject to tax in a
*listed country in any
*tax accounting period; and
(d) any gain or profit of a capital nature that accrues to the entity as a
result of the disposal of its interest in the foreign hybrid that happens when
the entity ceases to be a partner is subject to tax in a listed country in a tax
accounting period;
then, for the purposes of Part X of the Income Tax Assessment Act
1936, the gain or profit mentioned in paragraph (b) is taken to be
subject to tax in the listed country, and in the tax accounting period,
mentioned in paragraph (d).
Where partner disposes of part of its interest
(4) If:
(a) an entity is a partner that disposes of part of its interest in a
*foreign hybrid in relation to an income year;
and
(b) a gain or profit of a capital nature accrues to the entity as a result
of the disposal of part of its interest in an asset of the foreign hybrid that
happens when the entity disposes of the part of its interest in the foreign
hybrid; and
(c) apart from this subsection, the gain or profit is not
*subject to tax in a
*listed country in any
*tax accounting period; and
(d) any gain or profit of a capital nature that accrues to the entity as a
result of the disposal of the part of its interest in the foreign hybrid is
subject to tax in a listed country in a tax accounting period;
then, for the purposes of Part X of the Income Tax Assessment Act
1936, the gain or profit mentioned in paragraph (b) is taken to be
subject to tax in the listed country, and in the tax accounting period,
mentioned in paragraph (d).
Note: In the case of a foreign hybrid company, references in
this Subdivision that relate to partnerships are to be read subject to
Subdivision 830-B. For example, a reference to a partner will be a
reference to a shareholder in the company who is treated by
Subdivision 830-B as a partner.
Table of sections
830-80 Setting the tax cost of partners’ interests in
the assets of an entity that becomes a foreign hybrid
830-85 Setting the tax cost of assets of an entity when it
ceases to be a foreign hybrid
830-90 What the expression tax cost is set
means
830-95 What the expression tax cost setting
amount means
830-100 What the expression tax cost
means
830-105 What the expression asset-based income tax
regime means
830-110 No disposal of assets etc. on entity becoming or
ceasing to be a foreign hybrid
830-115 Tax losses cannot be transferred to a foreign
hybrid
830-120 End of CFC’s last statutory accounting
period
830-125 How long interest in asset, or asset,
held
(1) This section applies if:
(a) an entity is a *foreign hybrid in
relation to an income year (the hybrid year); and
(b) the entity was in existence at the end of the preceding income year
(which may be the income year before this Division first applies to the entity);
and
(c) the entity was not a foreign hybrid in relation to that preceding
income year.
(2) For the purposes of applying an
*asset-based income tax regime for the hybrid
year and each later income year in relation to which the entity continues to be
a foreign hybrid, the *tax cost is set at the
start of the hybrid year, for each asset of the
*foreign hybrid in which each partner has an
interest at that time.
(1) This section applies if:
(a) an entity is a *foreign hybrid in
relation to an income year; and
(b) the entity is in existence at the start of the next income year;
and
(c) the entity is not a foreign hybrid in relation to that income year
(the post-hybrid year).
(2) For the purposes of applying an
*asset-based income tax regime for the
post-hybrid year and each later income year in relation to which the entity
continues not to be a foreign hybrid, the *tax
cost is set at the start of the post-hybrid year, for each asset of the entity
at that time.
The following table explains what the expression tax cost is set
at the start of the hybrid year or the post-hybrid year means, in
relation to an asset in which a partner has an interest or in relation to an
asset of the entity, for the purposes of each
*asset-based income tax regime:
|
Tax cost is set |
|||
|---|---|---|---|
|
Item |
If the following asset-based income tax regime is to
apply: |
The expression means that: |
|
|
1 |
Subdivisions 40-A to 40-D, sections 40-425 to 40-445 and
Subdivision 328-D |
the *adjustable value of the interest or
the asset at the start of the hybrid year or the post-hybrid year is varied so
that it equals the partner’s *tax cost
setting amount for the interest, or the entity’s tax cost setting amount
for the asset, at that time in relation to the
*asset-based income tax regime |
|
|
2 |
Division 70 |
the value of the interest or the asset at the start of the hybrid year or
the post-hybrid year under Division 70 is varied so that it equals the
partner’s *tax cost setting amount for
the interest, or the entity’s tax cost setting amount for the asset, at
that time in relation to the *asset-based
income tax regime |
|
|
3 |
Part 3-1 or 3-3 |
the *cost base or
*reduced cost base of the interest or the asset
at the start of the hybrid year or the post-hybrid year is varied so that it
equals the partner’s *tax cost setting
amount for the interest, or the entity’s tax cost setting amount for the
asset, at that time in relation to the
*asset-based income tax regime |
|
|
4 |
Division 16E of Part III of the Income Tax Assessment Act
1936 |
the Division applies as if the interest or the asset were
*acquired by the partner or the entity at the
start of the hybrid year or the post-hybrid year for a payment equal to the
partner’s *tax cost setting amount for
the interest, or the entity’s tax cost setting amount for the asset, at
that time in relation to the *asset-based
income tax regime |
|
|
5 |
Any other provision of this Act or the Income Tax Assessment Act
1936 |
the cost of the interest or asset at the start of the hybrid year or the
post-hybrid year is varied so that it equals the partner’s
*tax cost setting amount for the interest, or
the entity’s tax cost setting amount for the asset, at that time in
relation to the *asset-based income tax
regime |
|
(1) A partner’s tax cost setting amount for an
interest of the partner in an asset at the start of the hybrid year, in relation
to an *asset-based income tax regime, is worked
out as follows:
Method statement
Step 1. Work out what would have been the entity’s
*tax cost of the asset for the purposes of
applying the *asset-based income tax regime as
at the start of the hybrid year if it were not a
*foreign hybrid in relation to the hybrid
year.
Step 2. Multiply the result of step 1 by:
(a) if the entity is a *foreign hybrid
company in relation to the hybrid year—the percentage applicable to the
partner under subsection 830-35(2); or
(b) if the entity is a *foreign hybrid
limited partnership in relation to the hybrid year—the individual interest
of the partner in the asset, expressed as a percentage of the interests of all
of the partners in the asset.
Step 3. If the partner paid a premium in respect of the
*acquisition of its interest in the asset (see
subsection (2)), add the amount of the premium to the result of step 2. If
the partner received a discount in respect of the acquisition (see
subsection (2)), subtract the amount of the discount from the result of
step 2, but not to the extent that this would result in a negative
amount.
The result of step 3 is the partner’s tax cost setting
amount in respect of the asset.
(2) Work out whether the partner paid a premium or received a discount for
its interest in the asset using the following method statement:
Method Statement
Step 1. Add up all the amounts paid by the partner before the start
of the hybrid year for its *shares in the
entity (if the entity was a company), or for its interests in the assets of the
entity and in the entity (if the entity was a
*limited partnership), that it held at the
start of the hybrid year, and subtract all amounts received by the partner in
respect of those shares or interests by way of reduction in capital of the
entity.
Step 2. Work out the amount that, if the capital of the entity had
been distributed to its *shareholders on a
winding-up or to its partners on a dissolution, at the end of the income year
before the hybrid year, the partner could reasonably be expected to have
received of the total distribution.
Step 3. If the result of step 1 exceeds the result of step 2, the
partner paid a premium for its interest in the asset. If the result of step 2
exceeds the result of step 1, the partner received a discount for its interest
in the asset.
Step 4. Work out the amount of the premium or discount using the
formula:
(3) The entity’s tax cost setting amount for an asset
at the start of the post-hybrid year in relation to an
*asset-based income tax regime is equal to the
sum of what the partners’ *tax costs for
their interests in the asset would be at that time for the purpose of applying
the asset-based income tax regime if the entity had continued to be a
*foreign hybrid in relation to that income
year.
The tax cost of a partner’s interest in an asset or
of an asset of the entity for the purposes of applying an
*asset-based income tax regime at the start of
the post-hybrid year or the hybrid year is worked out using the following
table:
|
Tax cost of an asset |
||
|---|---|---|
|
Item |
If the asset-based income tax regime is: |
the tax cost of the interest or the asset is: |
|
1 |
Subdivisions 40-A to 40-D, sections 40-425 to 40-445 and
Subdivision 328-D |
the *adjustable value of the interest or
the asset at the start of the post-hybrid year or the hybrid year |
|
2 |
Division 70 |
the value of the interest or the asset at the start of the post-hybrid year
or the hybrid year under Division 70 |
|
3 |
Part 3-1 or 3-3 |
the *cost base or
*reduced cost base of the interest or the asset
at the start of the post-hybrid year or the hybrid year |
|
4 |
Division 16E of Part III of the Income Tax Assessment Act
1936 |
the amount that the partner or entity would need to receive if it were to
dispose of the interest or asset at the start of the post-hybrid year or the
hybrid year without an amount being assessable income of, or deductible to, the
partner or entity under section 159GS of the Income Tax Assessment Act
1936 |
|
5 |
Any other provision of this Act or the Income Tax Assessment Act
1936 |
the cost of the interest or the asset at the start of the post-hybrid year
or the hybrid year |
The provisions listed in the first column in relation to each item in the
table in section 830-100 are an asset-based income tax
regime.
To avoid doubt, the fact that an entity becomes or ceases to be a
*foreign hybrid in relation to an income year
does not cause:
(a) a *CGT event to happen to any
*CGT asset consisting of:
(i) any *share or interest in the entity;
or
(ii) any interest in an asset of the entity; or
(b) a disposal or any other event to happen to any other asset consisting
of such a share or interest.
(1) If an entity is a *foreign hybrid in
relation to an income year, it cannot deduct in that income year a
*tax loss for a
*loss year in relation to which it was not a
foreign hybrid.
Former foreign hybrid can deduct tax losses for income years before it
became a foreign hybrid
(2) This section does not prevent an entity that:
(a) is not a *foreign hybrid in relation
to an income year (the post-hybrid year); and
(b) was a foreign hybrid in relation to a previous income year;
and
(c) was not a foreign hybrid in relation to an income year (the
pre-hybrid year) before the previous year;
from deducting, in the post-hybrid year, a
*tax loss for the pre-hybrid year.
If:
(a) a taxpayer is a partner in an entity that becomes a
*foreign hybrid in relation to an income year;
and
(b) the entity was a *CFC at the end of
the taxpayer’s preceding income year; and
(c) the last *statutory accounting period
of the CFC did not end at the end of the taxpayer’s preceding income year;
and
(d) if it had so ended, the taxpayer would have been an
*attributable taxpayer in relation to the
CFC;
for the purposes of working out the
*attributable income of the CFC for the
taxpayer in respect of the last statutory accounting period of the CFC, that
statutory accounting period ends at the end of the taxpayer’s preceding
income year.
Partner’s interest in asset when entity becomes a foreign
hybrid
(1) If an entity becomes a *foreign
hybrid company in relation to an income year, the interest that a partner has in
an asset as mentioned in section 830-35 is taken to have been held by the
partner (except for the purposes of having the
*tax cost of the interest set) from the later
of the following times:
(a) when the entity *acquired the
asset;
(b) when the partner acquired its *shares
in the entity.
Entity’s asset when it ceases to be a foreign hybrid
company
(2) If:
(a) an entity is not a *foreign hybrid
company in relation to an income year (the post-hybrid year);
and
(b) the entity was a *foreign hybrid
company in relation to the preceding income year; and
(c) during:
(i) that preceding income year; or
(ii) any earlier income year in relation to which the entity was also a
foreign hybrid;
but not at the start of the first income year in relation to which the
entity was a foreign hybrid company, the partners in the foreign hybrid company
*acquired an interest in an asset that is an
asset of the entity at the start of the post-hybrid year;
the asset is taken to have been held by the entity (except for the purposes
of having the *tax cost of the asset set) from
the time the partners acquired their interests in the asset.
16 Subsection 995-1(1)
Insert:
asset-based income tax regime has the meaning given by
section 830-105.
17 Subsection 995-1(1)
Insert:
attributable taxpayer has the meaning given by Part X of
the Income Tax Assessment Act 1936.
18 Subsection 995-1(1)
Insert:
attribution percentage has the meaning given by Part X
of the Income Tax Assessment Act 1936.
19 Subsection 995-1(1)
Insert:
available loss exposure amount has the meaning given by
paragraph 830-50(1)(a).
20 Subsection 995-1(1) (at the end of the definition
of company)
Add:
Note: Division 830 treats foreign hybrid companies as
partnerships.
21 Subsection 995-1(1)
Insert:
foreign hybrid has the meaning given by
section 830-5.
22 Subsection 995-1(1)
Insert:
foreign hybrid company has the meaning given by
section 830-15.
23 Subsection 995-1(1)
Insert:
foreign hybrid limited partnership has the meaning given by
section 830-10.
24 Subsection 995-1(1)
Insert:
foreign hybrid net capital loss amount has the meaning given
by section 830-55.
25 Subsection 995-1(1)
Insert:
foreign hybrid revenue loss amount has the meaning given by
paragraph 830-45(1)(a).
26 Subsection 995-1(1)
Insert:
foreign hybrid tax provisions means:
(a) the Income Tax Assessment Act 1936 (other than Division 5A
of Part III); and
(b) this Act (other than Subdivision 830-A and 830-B); and
(c) an Act that imposes any tax payable under the Income Tax Assessment
Act 1936 or this Act; and
(d) the Income Tax Rates Act 1986; and
(e) the Taxation Administration Act 1953, so far as it relates to
an Act covered by paragraph (a), (b) or (c); and
(f) any other Act, so far as it relates to an Act covered by
paragraph (a), (b), (c), (d) or (e); and
(g) regulations under an Act covered by any of the preceding
paragraphs.
27 Subsection 995-1(1)
Insert:
foreign tax has the meaning given by section 6AB of the
Income Tax Assessment Act 1936.
28 Subsection 995-1(1)
Insert:
loss exposure amount has the meaning given by
section 830-60.
29 Subsection 995-1(1)
Insert:
outstanding foreign hybrid net capital loss amount has the
meaning given by section 830-70.
30 Subsection 995-1(1)
Insert:
outstanding foreign hybrid revenue loss amount has the
meaning given by section 830-65.
31 Subsection 995-1(1) (at the end of the definition
of partnership)
Add:
Note: Division 830 treats foreign hybrid companies as
partnerships.
32 Subsection 995-1(1)
Insert:
statutory accounting period has the meaning given by
Part X of the Income Tax Assessment Act 1936.
33 Subsection 995-1(1)
Insert:
subject to tax has the meaning given by Part X of the
Income Tax Assessment Act 1936.
34 Subsection 995-1(1)
Insert:
tax accounting period has the meaning given by Part X of
the Income Tax Assessment Act 1936.
35 Subsection 995-1(1)
Insert:
tax cost has the meaning given by
section 830-100.
36 Subsection 995-1(1) (at the end of the definition
of tax cost is set)
Add “or 830-90”.
37 Subsection 995-1(1) (at the end of the definition
of tax cost setting amount)
Add “or 830-95”.
Part 3—Amendment
of the Income Tax (Transitional Provisions) Act 1997
38 At the end of Part 4-5
Add:
Table of sections
830-1 Standard application
830-5 Election to extend standard application for foreign
hybrids
830-10 Election to extend standard application for CFCs with
direct or indirect interests in foreign hybrid
830-15 Modified version of income tax law to apply for
certain past income years
830-20 Modifications of income tax law
Foreign hybrids
(1) Division 830 of the Income Tax Assessment Act 1997 applies
to assessments for the 2003-2004 income year, and each later income year, of a
taxpayer who will as a result be a partner in an entity that is a foreign hybrid
in relation to that income year.
CFCs that are, directly or indirectly, partners in foreign
hybrids
(2) Division 830 of the Income Tax Assessment Act 1997 applies
for the purpose of working out the attributable income, in relation to an
attributable taxpayer, for:
(a) the statutory accounting period that starts on 1 July 2003 or on
the day on which, as a result of an election under subsection 319(2) of the
Income Tax Assessment Act 1936, the statutory accounting period that
would otherwise start on 1 July 2003 starts; and
(b) each later statutory accounting period;
of a CFC that:
(c) will as a result be a partner in an entity that is a foreign hybrid in
relation to that statutory accounting period; or
(d) has, directly or indirectly through one or more other entities, an
interest in another entity that will, as a result, be a foreign hybrid in
relation to that statutory accounting period.
(1) If a taxpayer will, as a result of making an election under this
subsection, be a partner in an entity that is a foreign hybrid in relation to
the 2002-2003 income year, the taxpayer may elect that Division 830 of the
Income Tax Assessment Act 1997 applies to the taxpayer’s assessment
for the 2002-2003 income year.
(2) If:
(a) a taxpayer is, as a result of subsection 830-1(1) of this Act, a
partner in an entity that is a foreign hybrid in relation to the 2003-2004
income year; and
(b) the entity is a foreign hybrid in relation to that income year in a
case where the requirements in subsection 830-15(3) of the Income Tax
Assessment Act 1997 are satisfied;
the taxpayer may elect that Division 830 of the Income Tax
Assessment Act 1997 applies to the taxpayer’s assessment for the
2002-2003 income year as if the entity were a foreign hybrid in relation to that
income year.
(3) A taxpayer must make an election under this section:
(a) on or before the day on which the taxpayer lodges its income tax
return for the 2003-2004 income year; or
(b) within a further time allowed by the Commissioner.
(4) The election is irrevocable.
(1) If:
(a) an entity is an attributable taxpayer in relation to a CFC at the end
of the statutory accounting period that starts on 1 July 2002 or on the day
on which, as a result of an election under subsection 319(2) of the Income
Tax Assessment Act 1936, the statutory accounting period that would
otherwise start on 1 July 2002 starts; and
(b) either:
(i) if the attributable taxpayer makes an election under this subsection,
the CFC will, as a result, be a partner in an entity that is a foreign hybrid in
relation to that statutory accounting period; or
(ii) the CFC has, directly or indirectly through one or more other
entities, an interest in another entity that, if the attributable taxpayer makes
an election under this subsection, will, as a result, be a foreign hybrid in
relation to that statutory accounting period;
the attributable taxpayer may elect that Division 830 of the Income
Tax Assessment Act 1997 applies for the purpose of working out the
attributable income of the CFC for the statutory accounting period.
(2) If:
(a) for the purpose of working out the attributable income of a CFC in
relation to an attributable taxpayer, a CFC:
(i) is, as a result of subsection 830-1(2) of this Act, a partner in an
entity that is a foreign hybrid in relation to the statutory accounting period
mentioned in paragraph (a) of that subsection; or
(ii) has, directly or indirectly through one or more other entities, an
interest in another entity that is, as a result of subsection 830-1(2) of this
Act, a foreign hybrid in relation to that statutory accounting period;
and
(b) the entity mentioned in subparagraph (a)(i) or (ii) is also a
foreign hybrid in relation to that statutory accounting period in a case where
the requirements in subsection 830-15(3) of the Income Tax Assessment Act
1997 are satisfied;
the attributable taxpayer may elect that Division 830 of the Income
Tax Assessment Act 1997 applies for the purpose of working out the
attributable income of the CFC, in relation to the attributable taxpayer, for
the preceding statutory accounting period.
(3) An attributable taxpayer must make an election under this
section:
(a) on or before the day on which it lodges its income tax return for the
2003-2004 income year; or
(b) within a further time allowed by the Commissioner.
(4) The election is irrevocable.
Basic rule
(1) Subject to subsection (3), if:
(a) an income year (the past income year) of a taxpayer
started before:
(i) if section 830-5 of this Act does not apply to the
taxpayer—the 2003-2004 income year; or
(ii) if that section applies to the taxpayer—the 2002-2003 income
year; and
(b) either:
(i) a statutory accounting period of a CFC, in relation to which the
taxpayer was an attributable taxpayer at the end of that period and had an
attribution percentage greater than nil, ended in the past income year;
or
(ii) the taxpayer had an interest in a FIF at the end of the past income
year; and
(c) the CFC or FIF would have been a foreign hybrid in relation to the
past income year under:
(i) section 830-10 of the Income Tax Assessment Act 1997
(disregarding paragraph (1)(e) of that section); or
(ii) section 830-15 of that Act (disregarding paragraph (1)(d)
and subsection (3) of that section);
if that section had been in force in the past income year;
then, for the purposes mentioned in subsection (2) of this section,
the Income Tax Assessment Act 1936 applies with the modifications set out
in section 830-20 of this Act in working out:
(d) the attributable income of the CFC for the statutory accounting period
that ended in the past income year; or
(e) the notional income of the FIF for the notional accounting period that
ends in the past income year.
Purposes
(2) The purposes are:
(a) any amendment of an assessment of the taxpayer for the past income
year made before the commencement of this section; and
(b) the making of an assessment of the taxpayer for the past income year
between the commencement of this section and the end of 30 June 2004;
and
(c) any amendment of such an assessment; and
(d) the making of any assessment of the taxpayer for the past income year
that takes place after 30 June 2004 and before the end of the time within
which, if that assessment had been made on 1 July 2004, the Commissioner
could amend the assessment under paragraph 170(2)(b), (c) or (d) of the
Income Tax Assessment Act 1936; and
(e) any amendment of such an assessment.
Exception
(3) If:
(a) apart from this subsection, subsection (1) would apply to a
taxpayer in relation to a CFC for a past income year; and
(b) before the commencement of this section, the taxpayer lodged its
income tax return for the past income year; and
(c) the taxpayer prepared the income tax return on the basis that, for the
purposes of Part X of the Income Tax Assessment Act 1936, the CFC
was a resident of no particular unlisted country;
then subsection (1) does not apply to the taxpayer in relation to the
CFC for the past income year unless:
(d) if there is only one past income year to which paragraphs (a) to
(c) of this subsection apply—the taxpayer elects that the subsection
applies for the past income year; or
(e) if there is more than one past income year to which
paragraphs (a) to (c) of this subsection apply—the taxpayer elects
that the subsection applies for all of those past income years.
(4) The taxpayer must make the election:
(a) on or before the day on which the taxpayer lodges its income tax
return for the 2003-2004 income year; or
(b) within a further time allowed by the Commissioner.
(5) The election is irrevocable.
(1) This section sets out the modifications of the Income Tax
Assessment Act 1936 that, if section 830-15 of this Act so
provides, apply in working out for a taxpayer:
(a) the attributable income of a CFC for the statutory accounting period
that ended in an income year; or
(b) the notional income of a FIF for the notional accounting period that
ended in an income year.
CFC—residence
(2) If the CFC is not a resident of a particular listed country or a
particular unlisted country for the purposes of Part X of the Income Tax
Assessment Act 1936 (including after applying section 331 of that Act),
then for the purposes of that Part, the CFC is taken to be a resident of the
country under whose laws it was formed.
CFC—foreign tax paid by taxpayer
(3) For the purpose of subsection 393(1) of the Income Tax Assessment
Act 1936, if the taxpayer paid foreign tax (the actual foreign
tax) on its interest in an amount included in the notional assessable
income of the CFC for the statutory accounting period, then the CFC is taken to
have paid foreign tax in respect of the amount equal to the actual foreign tax
divided by the taxpayer’s direct attribution interest in the CFC at the
end of the statutory accounting period.
CFC—foreign tax paid by another CFC
(4) For the purpose of subsection 393(1) of the Income Tax Assessment
Act 1936, if:
(a) on the assumption in paragraph 830-15(1)(c) of this Act, another CFC
(the tracing CFC) would have been a partner in the foreign entity
that the CFC mentioned in subsection (1) of this section (the foreign
hybrid CFC) would have been; and
(b) the taxpayer had an attribution tracing interest in the tracing CFC
that was taken into account in calculating the taxpayer’s attribution
percentage for the foreign hybrid CFC at the end of the statutory accounting
period; and
(c) the tracing CFC paid foreign tax (the actual foreign
tax) on its interest in an amount included in the notional assessable
income of the foreign hybrid CFC for the statutory accounting period;
then the foreign hybrid CFC is taken to have paid foreign tax, in respect
of the amount included in its notional assessable income, equal to the actual
foreign tax divided by the tracing CFC’s direct attribution interest in
the foreign hybrid CFC at the end of the statutory accounting period.
FIF—foreign tax paid by taxpayer
(5) For the purpose of section 573 of the Income Tax Assessment
Act 1936, if the taxpayer paid foreign tax (the actual foreign
tax) on its interest in an amount included in the notional income of the
FIF for the notional accounting period, then the FIF is taken to have paid
foreign tax in respect of that amount equal to the actual foreign tax divided by
the attribution percentage applicable under section 581 of that Act to the
taxpayer in respect of the taxpayer’s interests in the FIF at the end of
the notional accounting period.
Part 1—Amendments
commencing on 16 July 1999
Income Tax Assessment Act
1936
1 After section 160AQCND
Insert:
(1) If a former exempting company has a class A exempting surplus at the
end of a franking year, there arises at the beginning of the next franking year
a class A exempting credit of the company equal to that class A exempting
surplus.
(2) If a former exempting company has a class C exempting surplus at the
end of a franking year, there arises at the beginning of the next franking year
a class C exempting credit of the company equal to that class C exempting
surplus.
2 Application
Section 160AQCNDA of the Income Tax Assessment Act 1936 applies
in relation to franking years ending after 7.30 pm by legal time in the
Australian Capital Territory on 13 May 1997.
Part 2—Amendments
commencing on 22 December 1999
Division 1—Withholding
from mining payments
Taxation Administration Act
1953
3 Subsection 12-320(2) in
Schedule 1
Repeal the subsection, substitute:
(2) Subsection (1) does not require the entity to withhold more than
the *mining withholding tax payable in respect
of the *mining payment.
Note: Section 128V of the Income Tax Assessment Act
1936 deals with mining withholding tax liability.
Division 2—Administrative
penalties
Taxation Administration Act
1953
4 Section 16-30 in Schedule 1
(heading)
Repeal the heading, substitute:
5 Section 16-35 in Schedule 1
(heading)
Repeal the heading, substitute:
6 Subsection 16-35(1) in Schedule 1 (note
2)
Omit “civil”, substitute
“administrative”.
7 Section 16-40 in Schedule 1
(heading)
Repeal the heading, substitute:
8 Subsection 16-140(3) in
Schedule 1
Omit “a civil”, substitute “an
administrative”.
9 Part 4-25 in Schedule 1
(heading)
Repeal the heading, substitute:
10 Section 288-10 in
Schedule 1
Omit “a civil”, substitute “an
administrative”.
11 Section 288-10 in Schedule 1 (note
2)
Omit “civil”, substitute
“administrative”.
12 Section 288-20 in
Schedule 1
Omit “a civil”, substitute “an
administrative”.
13 Section 288-20 in Schedule 1 (note
2)
Omit “civil”, substitute
“administrative”.
14 Division 298 in Schedule 1
(heading)
Repeal the heading, substitute:
Division 3—Correcting
cross-reference
Taxation Administration Act
1953
15 Paragraph 18-75(3)(b) in
Schedule 1
Omit “(2)(b)”, substitute “(1)(b)”.
Division 4—Interest
on overpayments
Taxation (Interest on
Overpayments and Early Payments) Act 1983
16 Paragraph 8G(1)(f)
Omit “first instalment day”, substitute “final instalment
day”.
Part 3—Amendments
commencing on 30 June 2000
Division 1—Life
assurance company definition
Income Tax Assessment Act
1936
17 Subsection 6H(6) (paragraph (a) of the
definition of credit union)
Omit “within the meaning of Division 8 of
Part III”.
18 Application
The amendment of section 6H of the Income Tax Assessment Act
1936 made by this Division applies in relation to years of income ending
after 30 June 2000.
19 Section 102M (definition of life
assurance company)
Repeal the definition.
20 Application
The amendment of section 102M of the Income Tax Assessment Act
1936 made by this Division applies in relation to years of income ending
after 30 June 2000.
21 Paragraph 128B(3)(gb)
Omit “(within the meaning of Division 8)”.
22 Application
The amendment of section 128B of the Income Tax Assessment Act
1936 made by this Division applies in relation to dividends paid after
30 June 2000.
23 Subsection 160AAB(1) (paragraph (a) of the
definition of eligible 26AH amount)
Omit “within the meaning of Division 8”.
24 Application
The amendment of paragraph (a) of the definition of eligible
26AH amount in subsection 160AAB(1) of the Income Tax Assessment Act
1936 made by this Division applies in relation to years of income ending
after 30 June 2000.
25 Subsection 160AAB(1) (paragraph (b) of the
definition of eligible 26AH amount)
Repeal the paragraph.
26 Application
The repeal of paragraph (b) of the definition of eligible 26AH
amount in subsection 160AAB(1) of the Income Tax Assessment Act
1936 by this Division applies in relation to policies issued on or after
1 July 2000.
27 Subparagraph 279D(1)(a)(ii)
Omit “or registered organization”.
28 Application
The amendment of section 279D of the Income Tax Assessment Act
1936 made by this Division applies to payments made on or after 1 July
2000.
29 Paragraphs 279E(1)(b) and
(c)
Omit “or a registered organisation”.
30 Application
The amendment of section 279E of the Income Tax Assessment Act
1936 made by this Division applies to policies issued on or after
1 July 2000.
31 Paragraphs 289A(1)(b) and
(c)
Omit “or a registered organisation”.
32 Application
The amendment of section 289A of the Income Tax Assessment Act
1936 made by this Division applies to policies issued on or after
1 July 2000.
33 Paragraph 272-125(2)(c) in
Schedule 2F
Omit “(within the meaning of section 110)”.
34 Application
The amendment of section 272-125 in Schedule 2F to the Income
Tax Assessment Act 1936 made by this Division applies in relation to years
of income ending after 30 June 2000.
Income Tax Assessment Act
1997
35 Section 10-5 (table item headed
“insurance”)
Omit “life assurance companies”, substitute
“life insurance companies”.
Superannuation
Contributions Tax (Assessment and Collection) Act 1997
36 Section 43 (definition of life assurance
company)
Omit “Division 8 of Part III”, substitute
“subsection 6(1)”.
37 Application
The amendment of section 43 of the Superannuation Contributions Tax
(Assessment and Collection) Act 1997 made by this Division applies in
relation to financial years ending after 30 June 2000.
Division 2—Disallowance
of deductions
Income Tax Assessment Act
1936
38 Paragraph 51AAA(1)(a)
Omit “116CD(2), 116GB(2) or”.
39 Paragraph 51AAA(1)(a)
Omit “life assurance companies, registered organisations
or”.
40 Application
The amendments of section 51AAA of the Income Tax Assessment Act
1936 made by this Division apply in relation to income derived on or after
1 July 2000.
Division 3—Deductions
for life assurance premiums
Income Tax Assessment Act
1936
41 Paragraph 67AAA(2)(a)
Omit “a risk component within the meaning of section 110”,
substitute “the risk component of the premium”.
42 Subsection 67AAA(3)
Insert:
risk component of a premium for a life assurance policy means
the amount of the premium worked out on the basis specified in the
regulations.
43 Application
The amendments of section 67AAA of the Income Tax Assessment Act
1936 made by this Division apply in relation to financing costs incurred on
or after 1 July 2000.
Part 4—Amendments
commencing on 1 July 2000
Division 1—Mutual
life assurance company definition
Income Tax Assessment Act
1936
44 Subsection 6(1) (definition of mutual life
assurance company)
Repeal the definition, substitute:
mutual life assurance company means a life assurance company
the profits of which are divisible only among the policy holders.
45 Subsection 26BC(1) (paragraph (b) of the
definition of public company)
Omit “(within the meaning of section 110)”.
46 Subparagraph 103A(2)(d)(i)
Omit “as defined by section 110”.
47 Subparagraph 23(4A)(c)(i)
Omit “(within the meaning of section 110 of the Assessment Act
as in force immediately before 1 July 2000)”.
48 Application
The amendment of subparagraph 23(4A)(c)(i) of the Income Tax Rates Act
1986 made by this Division applies in relation to the year of income
including 1 July 2000 and later years of income.
Division 2—Due
date for income tax
Income Tax Assessment Act
1936
49 After subsection 204(1)
Insert:
(1AA) To avoid doubt, the reference in subparagraph (1)(a)(ii) to an
assessment does not include a reference to an amended assessment.
50 Application
The amendment of section 204 of the Income Tax Assessment Act
1936 made by this Division applies in relation to income tax for the 2000-01
year of income and later years of income.
Division 3—Repeal
of various redundant provisions
Income Tax Assessment Act
1936
51 Subsection 267(1) (definition of
superannuation policy)
Repeal the definition.
Income Tax Assessment Act
1997
52 Section 12-5 (table item headed
“insurance and annuity business”)
Repeal the item.
53 Section 50-15 (note)
Repeal the note.
54 Section 118-1 (note 1)
Omit “• section 116DK (about life insurance
companies);”.
55 Subsection 995-1(1) (definition of CS/RA
class)
Repeal the definition.
56 Subsection 995-1(1) (definition of CS/RA
component)
Repeal the definition.
57 Subsection 995-1(1) (definition of registered
organisation)
Repeal the definition.
58 Subsection 995-1(1) (definition of tax
advantaged business)
Repeal the definition.
59 Subsection 995-1(1) (definition of tax
advantaged insurance fund)
Repeal the definition.
Income Tax Assessment Act
1936
60 Subsection 6(1) (definition of
SGIO)
Repeal the definition.
61 Section 24AN
Omit “or an SGIO”.
62 Section 24AN (note 3)
Repeal the note.
63 Application
The amendments of section 24AN of the Income Tax Assessment Act
1936 made by this Division apply to income derived on and after 1 July
2000.
Division 5—Registered
organizations
Income Tax Assessment Act
1936
64 Subsection 6H(6) (definition of credit
union)
Repeal the definition, substitute:
credit union means a credit union as defined in
section 23G, except a life assurance company.
65 Application
The amendment of section 6H of the Income Tax Assessment Act
1936 made by this Division applies to assessments for years of income
starting on or after 1 July 2000.
66 Subsection 27A(1) (definition of registered
organization)
Repeal the definition.
67 Paragraph 27A(12)(c)
Omit “or registered organisation”.
68 Application
The amendments of section 27A of the Income Tax Assessment Act
1936 made by this Division apply to assessments for years of income starting
on or after 1 July 2000.
69 Subparagraph 103A(2)(d)(iia)
Repeal the subparagraph.
70 Application
The amendment of section 103A of the Income Tax Assessment Act
1936 made by this Division applies to years of income starting on or after
1 July 2000.
71 Section 140C (definition of registered
organisation)
Repeal the definition.
72 Application
The amendment of section 140C of the Income Tax Assessment Act
1936 made by this Division applies to assessments for years of income
starting on or after 1 July 2000.
73 Section 140ZI
Omit “or a registered organisation”.
Note: The heading to section 140ZI is altered by
omitting “or registered organisation”.
74 Application
The amendment of section 140ZI of the Income Tax Assessment Act
1936 made by this Division applies to assessments for years of income
starting on or after 1 July 2000.
75 Subsection 159GP(1) (definition of ineligible
annuity)
Omit “or by a registered organization, within the meaning of that
Subdivision,”.
76 Application
The amendment of section 159GP of the Income Tax Assessment Act
1936 made by this Division applies to assessments for years of income
starting on or after 1 July 2000.
77 Subsection 267(1) (definition of registered
organization)
Repeal the definition.
78 Subsection 275(1)
Omit “, registered organisation”.
79 Application
The amendment of subsection 275(1) of the Income Tax Assessment Act
1936 made by this Division applies in relation to years of income starting
on or after 1 July 2000.
80 Paragraph 275(5)(b)
Omit “or registered organization”.
81 Application
The amendment of subsection 275(5) of the Income Tax Assessment Act
1936 made by this Division applies in relation to policies issued on or
after 1 July 2000.
82 Section 299B
Omit “or a registered organization”.
83 Application
The amendment of section 299B of the Income Tax Assessment Act
1936 made by this Division applies to assessments for years of income
starting on or after 1 July 2000.
84 Subsection 299D(1)
Omit “or a registered organization”.
85 Application
The amendment of section 299D of the Income Tax Assessment Act
1936 made by this Division applies to assessments for years of income
starting on or after 1 July 2000.
86 Paragraph 272-125(2)(d) in
Schedule 2F
Repeal the paragraph.
87 Application
The amendment of section 272-125 in Schedule 2F to the Income
Tax Assessment Act 1936 made by this Division applies on and after
1 July 2000.
Income Tax Assessment Act
1997
88 Subsection 152-305(1) (note
2)
Omit “or registered organisations”.
89 Subsection 152-325(7) (note)
Omit “or registered organisations”.
Superannuation
Contributions Tax (Assessment and Collection) Act 1997
90 Section 43 (paragraph (b) of the
definition of member)
Omit “or from a registered organisation”.
91 Saving
If, immediately before 1 July 2000, a person was a member as defined
in section 43 of the Superannuation Contributions Tax (Assessment and
Collection) Act 1997 (as in force at that time), the person does not cease
to be a member for the purposes of that Act because of the amendment of the
definition of member in that section made by this
Division.
92 Section 43 (definition of registered
organisation)
Repeal the definition.
93 Section 43 (paragraph (c) of the
definition of superannuation provider)
Omit “company; or”, substitute
“company.”.
94 Section 43 (paragraph (d) of the
definition of superannuation provider)
Repeal the paragraph.
95 Saving
If, immediately before 1 July 2000, an entity (as defined in the
Income Tax Assessment Act 1997) was a superannuation provider as defined
in section 43 of the Superannuation Contributions Tax (Assessment and
Collection) Act 1997 (as in force at that time), the entity does not cease
to be a superannuation provider for the purposes of that Act because of the
amendments of the definition of superannuation provider in that
section made by this Division.
Superannuation Guarantee
(Administration) Act 1992
96 Paragraph 15A(3)(a)
Omit “or a registered organisation”.
Note: The heading to subsection 15A(3) is altered by
omitting “or registered organisation”.
97 Subsection 15A(6) (definition of benefit
body)
Omit “, an RSA provider or a registered organisation”,
substitute “or an RSA provider”.
98 Subsection 15A(6) (definition of life
assurance company)
Omit “27A(1)”, substitute “6(1)”.
99 Subsection 15A(6) (definition of registered
organisation)
Repeal the definition.
100 Application
The amendments of the Superannuation Guarantee (Administration) Act
1992 made by this Division apply in relation to test times (within the
meaning of section 15A of that Act) on or after 1 July 2000.
Division 6—Miscellaneous
amendments relating to repeal of Divisions 8 and 8A of Part III of the
Income Tax Assessment Act 1936
Income Tax Assessment Act
1936
101 Subsection 27A(1) (paragraph (a) of the
definition of eligible annuity)
Repeal the paragraph.
102 Subsection 27A(1) (paragraph (a) of the
definition of qualifying annuity)
Repeal the paragraph, substitute:
(a) an annuity purchased after 12 January 1987, wholly with
rolled-over amounts, that has at any time been an eligible annuity in relation
to any taxpayer; or
103 Subparagraph
27A(12)(c)(iii)
Omit “an Australian policy (as defined by subsection 110(1))”,
substitute “a life assurance policy issued in Australia”.
104 Application
The amendments of section 27A of the Income Tax Assessment Act
1936 made by this Division apply to assessments for years of income starting
on or after 1 July 2000.
105 Subsection 67AAA(3) (definition of life
assurance policy)
Repeal the definition.
106 Application
The amendment of section 67AAA of the Income Tax Assessment Act
1936 made by this Division applies to assessments for years of income
starting on or after 1 July 2000.
107 Section 102M (definition of eligible
policy)
Repeal the definition, substitute:
eligible policy means:
(a) an exempt life insurance policy (as defined in the Income Tax
Assessment Act 1997); or
(b) a virtual PST life insurance policy (as defined in that
Act).
108 Section 102M (definition of life
assurance business)
Repeal the definition.
109 Application
The amendments of section 102M of the Income Tax Assessment Act
1936 made by this Division apply to assessments for years of income starting
on or after 1 July 2000.
110 Subsection 159SJ(1) (paragraph (a) of the
definition of applicable fund)
Omit “a CS policy, or an exempt policy,”, substitute “an
exempt life insurance policy (as defined in the Income Tax Assessment Act
1997)”.
111 Subsection 159SJ(1) (definition of CS
policy)
Repeal the definition.
112 Subsection 159SJ(1) (definition of exempt
policy)
Repeal the definition.
113 Subsection 159SJ(1) (paragraph (b) of the
definition of superannuation pension)
Omit “a CS policy or an exempt policy, being in each case a
policy”, substitute “an exempt life insurance policy (as defined in
the Income Tax Assessment Act 1997) that is”.
114 Application
The amendments of section 159SJ of the Income Tax Assessment Act
1936 made by this Division apply to assessments for years of income starting
on or after 1 July 2000.
115 Subparagraph 279D(1)(a)(ii)
Omit “an exempt policy (within the meaning of Division 8 of
Part III) or RA policy (within the meaning of Division 8 of
Part III)”, substitute “either an exempt life insurance policy
(as defined in the Income Tax Assessment Act 1997) or a life assurance
policy covered by subparagraph (b)(i) of the definition of virtual
PST life insurance policy in subsection 995-1(1) of that Act while the
policy was held by the deceased person,”.
116 Application
The amendment of section 279D of the Income Tax Assessment Act
1936 made by this Division applies to assessments for years of income
starting on or after 1 July 2000.
117 Subsection 290A(4) (definition of CS
policy)
Repeal the definition.
118 Subsection 290A(4) (subparagraph (b)(ii) of
the definition of fixed interest complying ADF)
Repeal the subparagraph, substitute:
(ii) virtual PST life insurance policies (as defined in the Income Tax
Assessment Act 1997) issued by a life assurance company.
119 Application
The amendments of section 290A of the Income Tax Assessment Act
1936 made by this Division apply to years of income starting on or after
1 July 2000.
120 Subsection 482(1)
Omit “an Australian policy as defined by section 110”,
substitute “a policy issued in Australia”.
121 Application
The amendment of section 482 of the Income Tax Assessment Act
1936 made by this Division applies in relation to notional accounting
periods starting on or after 1 July 2000.
Division 7—Life
assurance company definition in section 27A of the Income Tax Assessment
Act 1936
Income Tax Assessment Act
1936
122 Subsection 27A(1) (definition of life
assurance company)
Repeal the definition.
123 Application
The amendment of section 27A of the Income Tax Assessment Act
1936 made by this Division applies to assessments for years of income
starting on or after 1 July 2000.
124 Section 140C (definition of life
assurance company)
Repeal the definition.
125 Application
The amendment of section 140C of the Income Tax Assessment Act
1936 made by this Division applies to assessments for years of income
starting on or after 1 July 2000.
126 Subsection 159GP(1) (definition of ineligible
annuity)
Omit “, within the meaning of Subdivision AA of
Division 2,”.
127 Application
The amendment of section 159GP of the Income Tax Assessment Act
1936 made by this Division applies to assessments for years of income
starting on or after 1 July 2000.
Superannuation Guarantee
(Administration) Act 1992
128 Subsection 15A(6) (definition of life
assurance company)
Omit “27A(1)”, substitute “6(1)”.
129 Application
The amendment of the Superannuation Guarantee (Administration) Act
1992 made by this Division applies in relation to test times (within the
meaning of section 15A of that Act) on or after 1 July
2000.
Part 5—Amendment
commencing on 30 June 2001
Taxation Administration Act
1953
130 Paragraph 298-5(b) in
Schedule 1
Omit “162-C”, substitute “162-D”.
Part 6—Amendments
commencing on 1 July 2001
Income Tax Assessment Act
1936
131 Subsection 22A(1) (table item 7, column
headed “Corresponding provision of the Income Tax Assessment Act
1997”)
Omit “sections 50-10 and 50-20”, substitute
“section 50-10”.
132 Section 102M (paragraph (a) of the
definition of exempt entity)
Omit “50-20,”.
133 Application
The amendment of section 102M of the Income Tax Assessment Act
1936 made by this Part applies in relation to the year of income including
1 July 2001 and later years of income.
134 Subsection 121F(1) (paragraph (aa) of the
definition of relevant exempting provision)
Omit “50-20,”.
135 Application
The amendment of section 121F of the Income Tax Assessment Act
1936 made by this Part applies in relation to the year of income including
1 July 2001 and later years of income.
136 Subparagraph 128B(3)(a)(i)
Omit “, 50-10 or 50-20”, substitute “or
50-10”.
137 Application
The amendment of section 128B of the Income Tax Assessment Act
1936 made by this Part applies in relation to income derived on or after
1 July 2001.
138 Paragraph 269B(1)(b)
Omit “50-20,”.
139 Paragraph 272-90(7)(b) in
Schedule 2F
Omit “, 50-10 or 50-20”, substitute “or
50-10”.
140 Application
The amendment of paragraph 272-90(7)(b) in Schedule 2F to the
Income Tax Assessment Act 1936 made by this Part applies in relation to
the year of income including 1 July 2001 and later years of
income.
Income Tax Assessment Act
1997
141 Section 11-5 (table item headed
“finance”)
Repeal the item.
142 Subparagraph 43-55(1)(a)(i)
Omit “50-20,”.
143 Application
The amendment of section 43-55 of the Income Tax Assessment Act
1997 made by this Part applies in relation to the income year including
1 July 2001 and later income years.
Part 7—Amendments
commencing on Royal Assent
Income Tax Assessment Act
1997
144 Section 208-145 (table item 2, column
headed “If:”)
Omit “this item”, substitute “item 7 of the table in
section 208-115”.
145 Application
The amendment of section 208-145 of the Income Tax Assessment Act
1997 made by this Part applies in relation to income years ending on or
after 1 July 2002.
146 Subsection 995-1(1)
Insert:
SPOR taxpayer has the meaning given by section 6AD of
the Income Tax Assessment Act 1936.
147 Subsection 12(6)
After “13”, insert “, 14”.
148 Paragraph 12(7)(a) (definition of
B)
Omit “or credit”, substitute “, credit or other tax
offset (as defined in the Income Tax Assessment Act
1997)”.
149 Paragraph 12(7)(b) (definition of
B)
Omit “or credit”, substitute “, credit or other tax
offset (as defined in the Income Tax Assessment Act
1997)”.
150 Paragraph 12(8)(a) (definition of
B)
Omit “or credit”, substitute “, credit or other tax
offset (as defined in the Income Tax Assessment Act
1997)”.
151 Paragraph 12(8)(b) (definition of
B)
Omit “or credit”, substitute “, credit or other tax
offset (as defined in the Income Tax Assessment Act
1997)”.
152 Subsections 23(5) and (6)
Omit “or credit”, substitute “, credit or other tax
offset (as defined in the Income Tax Assessment Act
1997)”.
153 Application
The amendments of the Income Tax Rates Act 1986 (except the
amendment of subsection 12(6) of that Act) made by this Part apply to
assessments for the 1998-99 year of income and later years of income.
Income Tax (Transitional
Provisions) Act 1997
154 After Division 205
Insert:
Table of sections
208-111 Converting former exempting
company’s exempting account balance on 30 June 2002
(1) This section has effect for the purposes of working out the following
for a company that was a former exempting company (as defined in Part IIIAA
of the Income Tax Assessment Act 1936) at the end of 30 June
2002:
(a) whether the company has an exempting surplus or an exempting deficit
for the purposes of the Income Tax Assessment Act 1997 at a time after
30 June 2002;
(b) the company’s class A exempting account balance (as defined in
that Part) at a time after 30 June 2002;
(c) the company’s class C exempting account balance (as defined in
that Part) at a time after 30 June 2002.
Class A exempting surplus at the end of 30 June 2002
(2) If the company had a class A exempting surplus (as defined in
Part IIIAA of the Income Tax Assessment Act 1936) at the end of
30 June 2002:
(a) a class A exempting debit equal to the surplus is taken to have arisen
immediately before the end of 30 June 2002 for the purposes of that Part;
and
(b) an exempting credit of the amount worked out using the formula is
taken to have arisen at the start of 1 July 2002 in the exempting account
that the company has under section 208-110 of the Income Tax Assessment
Act 1997:
Note: Section 205-5 (with sections 160APU and
160AQCNM of the Income Tax Assessment Act 1936) may affect whether the
company had such a surplus at the end of 30 June 2002 and the amount of
that surplus, but this section does not (because this section affects the
company’s exempting account balance only after then).
Class C exempting surplus at the end of 30 June 2002
(3) If the company had a class C exempting surplus (as defined in
Part IIIAA of the Income Tax Assessment Act 1936) at the end of
30 June 2002:
(a) a class C exempting debit equal to the surplus is taken to have arisen
immediately before the end of 30 June 2002 for the purposes of that Part;
and
(b) an exempting credit of the amount worked out using the formula is
taken to have arisen at the start of 1 July 2002 in the exempting account
that the company has under section 208-110 of the Income Tax Assessment
Act 1997:
Note: Section 205-5 (with sections 160APU and
160AQCNM of the Income Tax Assessment Act 1936) may affect whether the
company had such a surplus at the end of 30 June 2002 and the amount of
that surplus, but this section does not (because this section affects the
company’s exempting account balance only after then).
Class A exempting deficit at end of 30 June 2002
(4) If the company had a class A exempting deficit (as defined in
Part IIIAA of the Income Tax Assessment Act 1936) at the end of
30 June 2002 and its 2001-02 franking year (as defined in that Part) ended
earlier:
(a) a class A exempting credit equal to the deficit is taken to have
arisen at the end of 30 June 2002 for the purposes of that Part;
and
(b) an exempting debit of the amount worked out using the formula is taken
to have arisen at the start of 1 July 2002 in the exempting account that
the company has under section 208-110 of the Income Tax Assessment Act
1997:
Note: If the company’s 2001-02 franking year ended at
the end of 30 June 2002 and it would have had a class A exempting deficit
at that time apart from section 160AQCNO of the Income Tax Assessment
Act 1936, that section will have eliminated the deficit and
either:
(a) increased the company’s liability for franking
deficit tax; or
(b) reduced the franking credit arising under
section 205-10 of this Act in the franking account the company has under
the Income Tax Assessment Act 1997.
Class C exempting deficit at end of 30 June 2002
(5) If the company had a class C exempting deficit (as defined in
Part IIIAA of the Income Tax Assessment Act 1936) at the end of
30 June 2002 and its 2001-02 franking year (as defined in that Part) ended
earlier:
(a) a class C exempting credit equal to the deficit is taken to have
arisen at the end of 30 June 2002 for the purposes of that Part;
and
(b) an exempting debit of the amount worked out using the formula is taken
to have arisen at the start of 1 July 2002 in the exempting account that
the company has under section 208-110 of the Income Tax Assessment Act
1997:
Note: If the company’s 2001-02 franking year ended at
the end of 30 June 2002 and it would have had a class C exempting deficit
at that time apart from section 160AQCNO of the Income Tax Assessment
Act 1936, that section will have eliminated the deficit and
either:
(a) increased the company’s liability for franking
deficit tax; or
(b) reduced the franking credit arising under
section 205-10 of this Act in the franking account the company has under
the Income Tax Assessment Act 1997.
Taxation Administration Act
1953
155 Subsection 2(1) (at the end of
paragraphs (a) to (dac) of the definition of law enforcement
agency)
Add “or”.
156 Subsection 2(1) (paragraph (dad) of the
definition of law enforcement agency)
Repeal the paragraph.
157 Subsection 2(1) (at the end of
paragraph (dae) of the definition of law enforcement
agency)
Add “or”.
158 Subsection 2(1) (paragraph (daf) of the
definition of law enforcement agency)
Repeal the paragraph, substitute:
(daf) the Crime and Misconduct Commission of Queensland; or
159 Subsection 2(1) (at the end of
paragraph (da) of the definition of law enforcement
agency)
Add “or”.
160 Sections 47 and 48
Repeal the sections.
Part 8—Amendments
commencing on Royal Assent or later
Income Tax Assessment Act
1936
161 Subsection 121F(1) (paragraph (c) of the
definition of relevant exempting provision)
Repeal the paragraph, substitute:
(c) paragraph 320-37(1)(a) of the Income Tax Assessment Act
1997;
162 Application
The amendment of section 121F of the Income Tax Assessment Act
1936 applies in relation to amounts derived on or after 1 July
2000.
Taxation Administration Act
1953
163 Section 16-43 in Schedule 1
(heading)
Repeal the heading, substitute:
164 Subsection 16-43(2) in Schedule 1
(note)
Omit “civil”, substitute
“administrative”.