Commonwealth Numbered Regulations

1996 No. 346 INCOME TAX REGULATIONS (AMENDMENT) - REG 3

3.1 After Division 11A of Part 7, insert:

"Division 11B-Reportable payments in the fruit and
vegetable industry Interpretation

"147FC. (1) In this Division, unless the contrary intention appears:
'fresh produce' means produce other than:

   (a)  dried produce; or

   (b)  processed produce (within the meaning of subregulation (3)); or

   (c)  the juice of any produce; or

   (d)  any beverage made from produce; or

   (e)  cereals (except sweet corn), grains or oilseeds;
'produce' means fruit or vegetables (including sweet corn, nuts, herbs and
fungi);
'quarter' has the meaning set out in subsection 221A (1) of the Act;
'trader' has the meaning set out in regulation 147FE.

"(2) A reference in subregulation (1) to fruit or vegetables includes both
whole items, and parts of items, of fruit or vegetables.

"(3) For the purposes of paragraph (b) of the definition of 'fresh produce' in
subregulation (1), produce is taken to be processed if it has been canned,
bottled, frozen, cooked, pickled, roasted or subjected to any other treatment
to alter it from its natural state but is not taken to be processed simply
because it has been subjected to any one or more of the following forms of
treatment:

   (a)  cutting, chopping or peeling;

   (b)  waxing;

   (c)  storage under controlled atmospheric conditions;

   (d)  treatment having the effect of stimulating, hastening, delaying or
        simulating ripening;

   (e)  packaging or wrapping (either with or without other kinds of produce).

Payments in relation to produce declared to be reportable payments

"147FD. (1) Subject to subregulation (2), and for the purposes of paragraph
(a) of the definition of 'reportable payment' in section 220AC of the Act, a
payment is declared to be a reportable payment for the purposes of Division
1AA of Part VI of the Act if it is a payment that a trader makes, or is liable
to make, wholly or partly for the sale or supply of produce that:

   (a)  was sold or supplied as produce for human consumption; and

   (b)  consisted of:

        (i)    fresh produce; or

        (ii)   dried produce, if the person to whom the payment is made or is
               due is a person whose activity in the drying of produce, or
               trading in dried produce, is subsidiary to that person's
               activity in the growing of produce.

"(2) Subregulation (1) does not apply:

   (a)  to a payment of commission to an agent in relation to the sale or
        supply of produce; or

   (b)  to a payment made by a trader, otherwise than in the course of
        business, for the sale or supply of produce to the trader.

Who is a trader?

"147FE. (1) In this regulation, 'relevant produce' means fresh produce and
dried produce.

"(2) For the purposes of this Division, a person is a trader in relation to
the whole of a financial year if:

   (a)  one third or more of the person's gross income arising out of trading
        in, or acting as an agent in relation to, goods in the immediately
        preceding financial year was derived from the sale or supply of
        relevant produce; or

   (b)  in the immediately preceding financial year, the person paid, or
        became liable to pay, in the course of business (including business as
        an agent), amounts totalling not less than $500,000 for the sale or
        supply of relevant produce; or

   (c)  in any quarter in the immediately preceding financial year, the person
        paid, or became liable to pay, in the course of business (including
        business as an agent), amounts totalling not less than $125,000 for
        the sale or supply of relevant produce.

"(3) For the purposes of this Division, a person is a trader in relation to
the whole of the portion of a financial year commencing on the first day of
the second month of a quarter (in this subregulation called the 'commencing
day') and ending at the end of that financial year if the person is not a
person to whom subregulation (2) applies but:

   (a)  one third or more of the person's gross income arising out of trading
        in, or acting as an agent in relation to, goods in the most recently
        completed quarter preceding the commencing day was derived from the
        sale or supply of relevant produce; or

   (b)  in the most recently completed quarter preceding the commencing day,
        the person paid, or became liable to pay, in the course of business
        (including business as an agent), amounts totalling not less than
        $125,000 for the sale or supply of relevant produce.

"(4) A company is taken, for the purposes of subregulation (2) or (3), to have
paid, or been liable to pay, in the course of business (including business as
an agent), an amount specified in a paragraph of that subregulation, for the
sale or supply of relevant produce during the year or quarter specified in
that paragraph, if:

   (a)  the company is a group company (within the meaning of section 221ED of
        the Act) in relation to another company or other companies; and

   (b)  subject to subregulation (5), during that year or quarter, the company
        and all other companies in relation to which it is a group company
        paid, or became liable to pay, in the course of business (including
        business as an agent), amounts totalling not less than the amount
        specified in that paragraph for the sale or supply of relevant
        produce.

"(5) Paragraph (4) (b) does not apply to an amount that is an exempt
inter-corporate payment (within the meaning of section 220AC of the Act).".
[NOTE: An example for the purposes of subregulation 147FE (4): Company A has 3
subsidiaries, Company X, Company Y and Company Z. If, during the immediately
preceding financial year, X, Y and Z each paid, in the course of business
(including business as an agent), $200,000 for the sale or supply of relevant
produce, A, X, Y and Z are each taken to have paid not less than $500,000 for
that financial year.]