Commonwealth Consolidated Acts Commonwealth Consolidated ActsPart 1 -- Primary producers' income averaging
Income Tax Assessment Act 1997
1 Subsection 392 - 20(1)
Omit "if you are a beneficiary presently entitled to all or part of the trust income for the income year", substitute "if you satisfy the requirements in subsection ( 2), (3) or (4)".
2 Subsections 392 - 20(2) and (3)
Repeal the subsections, substitute:
Primary production business carried on by a trust with beneficiary presently entitled to income of the trust
(2) You satisfy the requirements in this subsection if:
(a) you are a beneficiary of the trust referred to in subsection ( 1); and
(b) you are presently entitled to a share of the income of the trust for the income year; and
(c) if you are presently entitled to less than $1,040 of the income of the trust for the income year--the Commissioner is satisfied that your interest in the trust was not acquired or granted wholly or primarily to enable your income tax to be adjusted under this Division.
Primary production business carried on by a fixed trust with no income of the trust
(3) You satisfy the requirements in this subsection if:
(a) you are a beneficiary of the trust referred to in subsection ( 1); and
(b) at all times during the income year, the manner or extent to which each beneficiary of the trust can benefit from the trust is not capable of being significantly affected by the exercise, or non - exercise, of a power; and
(c) the trust does not have any income of the trust for the income year to which a beneficiary of the trust could be presently entitled; and
(d) if the trust had income of the trust for the income year, you would have been presently entitled to a share of the income of the trust.
Primary production business carried on by a non - fixed trust with no income of the trust
(4) You satisfy the requirements in this subsection if you do not satisfy the requirements in subsection ( 3) and you are a chosen beneficiary of the trust referred to in subsection ( 1) for the purposes of section 392 - 22 for the income year.
Corporate unit trusts and public trading trusts
(5) You are not taken to carry on a * primary production business carried on by the trustee of:
(a) a corporate unit trust (as defined in section 102J of the Income Tax Assessment Act 1936 , which deals with corporate unit trusts); or
(b) a public trading trust (as defined in section 102R of the Income Tax Assessment Act 1936 , which deals with public trading trusts).
3 After section 392 - 20
Insert:
392 - 22 Trustee may choose that a beneficiary is a chosen beneficiary of the trust
(1) The trustee of a trust may choose that a beneficiary of the trust is a chosen beneficiary of the trust for an income year if the trust does not have income of the trust for the income year to which a beneficiary of the trust could be presently entitled.
(2) The maximum number of choices that the trustee may make in respect of the trust for an income year is the higher of:
(a) the number of individuals that were taken to be carrying on a * primary production business carried on by the trust under subsection 392 - 20(1) in the income year immediately before the current income year; and
(b) 12.
(3) A choice made under subsection ( 1) must be:
(a) in writing; and
(b) signed by the trustee and the person chosen.
(4) The trustee can make the choice no later than the time it lodges the trust's * income tax return for the income year to which the choice relates. However, the Commissioner can allow the trustee to make a choice at a later time.
(5) A choice cannot be revoked or varied.
Part 2 -- Farm management deposits
Income Tax Assessment Act 1936
4 Section 97A (note)
Omit "subsection 393 - 25(3)", substitute "subsections 393 - 25(3), (4), (5) and (6)".
5 Section 202DL (note)
Omit "subsection 393 - 25(4)", substitute "section 393 - 28".
Income Tax Assessment Act 1997
6 Subsection 393 - 5(1) (note 2)
Omit "subsections 393 - 25(2) and (3)", substitute "subsections 393 - 25(2), (3), (4), (5) and (6)".
7 Subsection 393 - 25(2) (heading)
Repeal the heading, substitute:
Primary production business carried on by a partnership
8 Before subsection 393 - 25(3)
Insert:
Primary production business carried on by a trust
9 Subsection 393 - 25(3)
Omit "trustee, if you are an individual who is a beneficiary presently entitled to a share of the income of the trust", substitute "trust, if you satisfy the requirements in subsection ( 4), (5) or (6)".
10 Subsection 393 - 25(4)
Repeal the subsection, substitute:
Primary production business carried on by a trust with beneficiary presently entitled to income of the trust
(4) You satisfy the requirements in this subsection if:
(a) you are an individual and a beneficiary of the trust referred to in subsection ( 3); and
(b) you are presently entitled to a share of the income of the trust for the income year.
Primary production business carried on by a fixed trust with no income of the trust
(5) You satisfy the requirements in this subsection if:
(a) you are an individual and a beneficiary of the trust referred to in subsection ( 3); and
(b) at all times during the income year, the manner or extent to which each beneficiary of the trust can benefit from the trust is not capable of being significantly affected by the exercise, or non - exercise, of a power; and
(c) the trust does not have any income of the trust for the income year to which a beneficiary of the trust could be presently entitled; and
(d) if the trust had income of the trust for the income year, you would have been presently entitled to a share of the income of the trust.
Primary production business carried on by a non - fixed trust with no income of the trust
(6) You satisfy the requirements in this subsection if you do not satisfy the requirements in subsection ( 5) and you are an individual and a chosen beneficiary of the trust referred to in subsection ( 3) for the purposes of section 393 - 27 for the income year.
11 After section 393 - 25
Insert:
393 - 27 Trustee may choose that a beneficiary is a chosen beneficiary of the trust
(1) The trustee of a trust may choose that a beneficiary of the trust is a chosen beneficiary of the trust for an income year if the trust does not have any income of the trust for the income year to which a beneficiary of the trust could be presently entitled.
(2) The maximum number of choices that the trustee may make in respect of the trust for an income year is the higher of:
(a) the number of individuals to which subsection 393 - 25(3) applied in the income year immediately before the current income year; and
(b) 12.
(3) A choice made under subsection ( 1) must be:
(a) in writing; and
(b) signed by the trustee and the person chosen.
(4) The trustee can make the choice no later than the time it lodges the trust's * income tax return for the income year to which the choice relates. However, the Commissioner can allow the trustee to make a choice at a later time.
(5) A choice cannot be revoked or varied.
393 - 28 Application of Division to beneficiary no longer under legal disability
If:
(a) a * farm management deposit was made by a trustee on behalf of a beneficiary of a trust; and
(b) the beneficiary was under a legal disability when the deposit was made; and
(c) the beneficiary is no longer under a legal disability;
then this Division, and Division 4A of Part VA of the Income Tax Assessment Act 1936 , apply as if the beneficiary had made the deposit.
Note: Division 4A of Part VA of the Income Tax Assessment Act 1936 is about quotation of tax file numbers in connection with farm management deposits.
12 Section 393 - 35 (note to table item 1)
Omit "subsections 393 - 25(2) and (3)", substitute "subsections 393 - 25(2), (3), (4), (5) and (6)".
Income Tax (Transitional Provisions) Act 1997
13 After section 393 - 10
Insert:
393 - 27 Trustee may choose that a beneficiary is a chosen beneficiary of the trust
If a beneficiary of a trust was covered by paragraph ( c) of the definition of primary producer in section 393 - 25 in Schedule 2G to the Income Tax Assessment Act 1936 in the 2009 - 10 income year, treat subsection 393 - 25(3) of the Income Tax Assessment Act 1997 as having applied to the beneficiary for the purpose of determining the maximum number of choices that the trustee may make under subsection 393 - 27(2) of that Act for the 2010 - 11 income year.
Part 3 -- Application provision
14 Application provision
The amendments made by this Schedule apply to:
(a) assessments for the trustee of a trust for an income year that is the 2010 - 11 income year or a later income year; or
(b) assessments for a beneficiary of a trust that relate to the 2010 - 11 income year or a later income year of the trust.