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Income Tax Assessment Act 1997

  • - C2004A05138
  • In force - Superseded Version
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Act No. 38 of 1997 as made
An Act about income tax and related matters
Administered by: Treasury
Date of Assent 17 Apr 1997

 

 

 

 

 

 

Income Tax Assessment Act 1997

 

No. 38, 1997

 

 

 

 

 

An Act about income tax and related matters

  

  


Contents

Chapter 1—Introduction and core provisions                                       1

Part 1-1—Preliminary                                                                              1

Division 1—Preliminary                                                                                                2

1-1  Short title.................................................................................................... 2

1-2  Commencement.......................................................................................... 2

1-3  Differences in style not to affect meaning................................................... 2

Part 1-2—A Guide to this Act                                                                  3

Division 2—How to use this Act                                                                                    3

Subdivision 2-A—How to find your way around                                                     3

2-1  The design.................................................................................................. 3

Subdivision 2-B—How the Act is arranged                                                               4

2-5  The pyramid............................................................................................... 4

Subdivision 2-C—How to identify defined terms and find the definitions        5

2-10  When defined terms are identified............................................................ 5

2-15  When terms are not identified................................................................... 5

2-20  Identifying the defined term in a definition............................................... 6

Subdivision 2-D—The numbering system                                                                  7

2-25  Purposes................................................................................................... 7

2-30  Gaps in the numbering............................................................................. 7

Subdivision 2-E—Status of Guides and other non-operative material              8

2-35  Non-operative material............................................................................. 8

2-40  Guides...................................................................................................... 8

2-45  Other material........................................................................................... 8

Division 3—What this Act is about                                                                              9

Table of sections................................................................................................ 9

3-1  What this Act is about................................................................................ 9

3-5  Annual income tax...................................................................................... 9

3-10  Your other obligations as a taxpayer...................................................... 11

3-15  Your obligations other than as a taxpayer.............................................. 11

Part 1-3—Core provisions                                                                      12

Division 4—How to work out the income tax payable on your taxable income 12

4-1  Who must pay income tax........................................................................ 12

4-5  Meaning of you........................................................................................ 12

4-10  How to work out how much income tax you must pay.......................... 13

4-15  How to work out your taxable income................................................... 15

Division 6—Assessable income and exempt income                                             17

Guide to Division 6                                                                                                        17

6-1  Diagram showing relationships among concepts in this Division............ 18

Operative provisions                                                                                                    19

6-5  Income according to ordinary concepts (ordinary income)...................... 19

6-10  Other assessable income (statutory income)........................................... 19

6-15  What is not assessable income................................................................ 20

6-20  Exempt income....................................................................................... 21

6-25  Relationships among various rules about ordinary income..................... 22

Division 8—Deductions                                                                                                23

8-1  General deductions................................................................................... 23

8-5  Specific deductions................................................................................... 23

8-10  No double deductions............................................................................. 24

Part 1-4—Checklists of what is covered by concepts used in the core provisions           25

Division 9—Entities that must pay income tax                                                      25

9-1  List of entities........................................................................................... 25

9-5  Entities that work out their income tax by reference to something other than taxable income           26

Division 10—Particular kinds of assessable income                                            28

10-5  List of provisions about assessable income............................................ 28

Division 11—Lists of classes of exempt income                                                    42

11-1  Overview................................................................................................ 42

11-5  Entities that are exempt, no matter what kind of ordinary or statutory income they have               42

11-10  Ordinary or statutory income which is exempt, no matter whose it is.. 45

11-15  Ordinary or statutory income which is exempt only if it is derived by certain entities  46

Division 12—Particular kinds of deductions                                                          51

12-5  List of provisions about deductions........................................................ 51

Division 13—Tax offsets                                                                                             72

13-1  List of tax offsets.................................................................................... 72

Chapter 2—Liability rules of general application                                78

Part 2-5—Rules about deductibility of particular kinds of amounts 78

Division 26—Some amounts you cannot deduct, or cannot deduct in full      78

26-55  Limit on deductions.............................................................................. 78

Division 28—Car expenses                                                                                          80

Guide to Division 28                                                                                                      80

28-1  What this Division is about.................................................................... 80

28-5  Map of this Division.............................................................................. 81

Subdivision 28-A—Deductions for car expenses                                                   82

28-10  Application of Division 28................................................................... 82

28-12  Car expenses........................................................................................ 82

28-13  Meaning of car expense....................................................................... 82

Subdivision 28-B—Choosing which method to use                                               83

Guide to Subdivision 28-B                                                                                           83

28-14  What this Subdivision is about............................................................. 83

28-15  Choosing among the 4 methods........................................................... 83

Operative provision                                                                                                      85

28-20  Rules governing choice of method....................................................... 85

Subdivision 28-C—The “cents per kilometre” method                                        85

28-25  How to calculate your deduction.......................................................... 85

28-30  Depreciation......................................................................................... 86

28-35  Substantiation....................................................................................... 86

Subdivision 28-D—The “12% of original value” method                                  86

28-45  How to calculate your deduction.......................................................... 87

28-50  Eligibility.............................................................................................. 87

28-55  Depreciation......................................................................................... 88

28-60  Substantiation....................................................................................... 88

Subdivision 28-E—The “one-third of actual expenses” method                       88

28-70  How to calculate your deduction.......................................................... 88

28-75  Eligibility.............................................................................................. 89

28-80  Substantiation....................................................................................... 89

Subdivision 28-F—The “log book” method                                                            89

28-90  How to calculate your deduction.......................................................... 89

28-95  Eligibility.............................................................................................. 91

28-100  Substantiation..................................................................................... 91

Subdivision 28-G—Keeping a log book                                                                   92

Guide to Subdivision 28-G                                                                                           92

28-105  What this Subdivision is about........................................................... 92

28-110  Steps for keeping a log book.............................................................. 93

Operative provisions                                                                                                    93

28-115  Income years for which you need to keep a log book......................... 93

28-120  Choosing the 12 week period for a log book...................................... 94

28-125  How to keep a log book..................................................................... 94

28-130  Replacing one car with another........................................................... 95

Subdivision 28-H—Odometer records for a period                                             96

Guide to Subdivision 28-H                                                                                           96

28-135  What this Subdivision is about........................................................... 96

Operative provision                                                                                                      97

28-140  How to keep odometer records for a car for a period......................... 97

Subdivision 28-I—Retaining the log book and odometer records                    98

28-150  Retaining the log book for the retention period................................... 98

28-155  Retaining odometer records................................................................ 99

Subdivision 28-J—Situations where you cannot use, or don’t need to use, one of the 4 methods     100

Guide to Subdivision 28-J                                                                                         100

28-160  What this Subdivision is about......................................................... 100

Operative provisions                                                                                                  100

28-165  Exception for particular cars taken on hire........................................ 100

28-170  Exception for particular cars used in particular ways........................ 101

28-175  Further miscellaneous exceptions..................................................... 103

28-180  Car expenses related to award transport payments........................... 104

28-185  Application of Subdivision 28-J to PAYE earners and the entities that pay them      105

Division 36—Tax losses of earlier income years                                                106

Guide to Division 36                                                                                                   106

36-1  What this Division is about.................................................................. 106

Subdivision 36-A—Deductions for tax losses of earlier income years          106

36-10  How to calculate a tax loss for an income year................................... 106

36-15  How to deduct tax losses.................................................................... 107

36-20  Net exempt income............................................................................. 108

36-25  Special rules about tax losses............................................................. 110

Subdivision 36-B—Effect of you becoming bankrupt                                       112

Guide to Subdivision 36-B                                                                                         112

36-30  What this Subdivision is about........................................................... 112

Operative provisions                                                                                                  113

36-35  No deduction for tax loss incurred before bankruptcy........................ 113

36-40  Deduction for amounts paid for debts incurred before bankruptcy..... 113

36-45  Limit on deductions for amounts paid................................................ 114

Part 2-10—Capital allowances: rules about deductibility of capital expenditure           116

Division 40—Overview of capital allowances                                                     116

Guide to Division 40                                                                                                   116

40-1  What this Division is about.................................................................. 116

40-5  Map of Divisions 40 and 41................................................................. 117

Subdivision 40-A—What a capital allowance is                                                  118

40-7  Effect of this Division.......................................................................... 118

40-10  What expenditure qualifies?................................................................ 118

40-15  Who may deduct?............................................................................... 118

40-20  How to work out the deduction.......................................................... 119

40-25  Disposal, loss, destruction or termination of use: balancing adjustment 119

Subdivision 40-B—Summary and finding table                                                  121

40-30  Table of capital allowances................................................................. 121

Division 41—Common rules for capital allowances                                          128

Guide to Division 41                                                                                                   128

41-1  What this Division is about.................................................................. 128

41-5  Summary and finding table................................................................... 128

Subdivision 41-A—Common rule 1 (Roll-over relief for related entities)   130

Guide to Common rule 1                                                                                           130

41-10  What this Common rule is about........................................................ 130

Operative provisions                                                                                                  130

41-15  When is roll-over relief available?...................................................... 130

41-20  Disposals of property......................................................................... 131

41-25  How are the balancing adjustment provisions affected?..................... 132

41-30  What is the effect of the roll-over on the transferor’s and transferee’s entitlement to a deduction?              132

41-35  Subsequent applications of this Common rule—relief available even if subsequent transferor got no deduction         133

41-40  Subsequent disposal—modify the balancing adjustment accordingly. 133

41-45  Commissioner may amend assessment after recoupment despite section 170 of the Income Tax Assessment Act 1936              134

Subdivision 41-B—Common rule 2 (Non-arm’s length transactions)            135

41-65  Non-arm’s length transactions............................................................ 135

Subdivision 41-C—Common rule 3 (Anti-avoidance provisions relating to the ownership of property)      136

41-85  You are taken to be owner of property for purposes of certain anti-avoidance provisions           136

Division 43—Deductions for capital works                                                          137

Guide to Division 43                                                                                                   137

43-1  What this Division is about.................................................................. 137

43-2  Key concepts used in this Division....................................................... 137

Subdivision 43-A—Key operative provisions                                                      139

Guide to Subdivision 43-A                                                                                         139

43-5  What this Subdivision is about............................................................. 139

Operative provisions                                                                                                  139

43-10  Deductions for capital works.............................................................. 139

43-15  Amount you can deduct...................................................................... 140

43-20      Capital works to which this Division applies................................ 140

43-25  Rate of deduction................................................................................ 142

43-30  No deduction until construction is complete....................................... 142

43-35  Requirement for body corporate to be registered under the Industry Research and Development Act         143

43-40     Deduction for destruction of capital works..................................... 143

43-45  Application of Division 41 common rules.......................................... 144

43-50  Links and signposts to other parts of the Act..................................... 144

43-55  Anti-avoidance—arrangement etc. with tax-exempt entity.................. 145

Subdivision 43-B—Establishing the deduction base                                           146

Guide to Subdivision 43-B                                                                                         146

43-60  What this Subdivision is about........................................................... 146

43-65  Explanatory material........................................................................... 147

Operative provisions                                                                                                  147

43-70  What is construction expenditure?...................................................... 147

43-75  Construction expenditure area............................................................ 148

43-80  When capital works begin.................................................................. 150

43-85  Pools of construction expenditure...................................................... 151

43-90      Table of intended use at time of completion of construction......... 152

43-95  Meaning of hotel building and apartment building............................ 155

43-100  Certificates by Industry Research and Development Board.............. 156

Subdivision 43-C—Your area and your construction expenditure                156

Guide to Subdivision 43-C                                                                                         156

43-105  What this Subdivision is about......................................................... 156

43-110  Explanatory material......................................................................... 157

Operative provisions                                                                                                  157

43-115  Your area and your construction expenditure—owners................... 157

43-120  Your area and your construction expenditure—lessees and quasi-ownership right holders       158

43-125  Lessees’ or right holders’ pools can revert to owner........................ 159

43-130  Identifying your area on acquisition or disposal............................... 159

Subdivision 43-D—Deductible uses of capital works                                         160

Guide to Subdivision 43-D                                                                                         160

43-135  What this Subdivision is about......................................................... 160

Operative provisions                                                                                                  160

43-140  Using your area in a deductible way................................................. 160

43-145  Using your area in the 4% manner................................................... 164

43-150  Meaning of industrial activities........................................................ 168

Subdivision 43-E—Special rules about uses                                                         170

Guide to Subdivision 43-E                                                                                         170

43-155  What this Subdivision is about......................................................... 170

Operative provisions                                                                                                  171

43-160  Your area is used for a purpose if it is maintained ready for use for the purpose       171

43-165     Temporary cessation of use.......................................................... 172

43-170  Own use—capital works other than hotel and apartment buildings.. 172

43-175  Own use—hotel and apartment buildings......................................... 173

43-180  Special rules for hotel and apartment buildings................................ 173

43-185  Residential or display use................................................................. 175

43-190  Use of facilities not commonly provided, and of certain buildings used to operate a hotel, motel or guest house      176

43-195  Use for research and development activities must be in connection with a business  177

Subdivision 43-F—Calculation of deduction                                                       177

Guide to Subdivision 43-F                                                                                         177

43-200  What this Subdivision is about......................................................... 177

43-205  Explanatory material......................................................................... 178

Operative provisions                                                                                                  179

43-210  Deduction for capital works begun after 26 February 1992............. 179

43-215  Deduction for capital works begun before 27 February 1992.......... 181

43-220  Capital works taken to have begun earlier for certain purposes........ 182

Subdivision 43-G—Undeducted construction expenditure                               183

Guide to Subdivision 43-G                                                                                        183

43-225  What this Subdivision is about......................................................... 183

Operative provisions                                                                                                  184

43-230  Calculating undeducted construction expenditure—common step.... 184

43-235  Post‑26 February 1992 undeducted construction expenditure.......... 185

43-240  Pre‑27 February 1992 undeducted construction expenditure............ 186

Subdivision 43-H—Balancing deduction on destruction of capital works   186

Guide to Subdivision 43-H                                                                                        186

43-245  What this Subdivision is about......................................................... 186

Operative provisions                                                                                                  187

43-250  The amount of the balancing deduction............................................ 187

43-255  Amounts received or receivable........................................................ 188

43-260  Apportioning amounts received for destruction................................ 188

Chapter 3—Specialist liability rules                                                    189

Part 3-5—Corporate taxpayers and corporate distributions            189

Division 165—Income tax consequences of changing ownership or control of a company              189

Guide to Division 165                                                                                                 190

165-1  What this Division is about................................................................ 190

Subdivision 165-A—Deducting tax losses of earlier income years                190

Guide to Subdivision 165-A                                                                                      190

165-5  What this Subdivision is about........................................................... 190

Operative provisions                                                                                                  191

165-10  To deduct a tax loss.......................................................................... 191

165-12  Company must maintain the same owners........................................ 191

165-13  Alternatively, company must carry on same business...................... 192

165-15  Same people must control the voting power, or company must carry on same business            193

165-20  When company can deduct part of a tax loss................................... 194

Subdivision 165-B—Working out the taxable income and tax loss for the income year of the change         194

Guide to Subdivision 165-B                                                                                      194

165-23  What this Subdivision is about......................................................... 194

165-25  Summary of this Subdivision........................................................... 195

165-30  Flow chart showing the application of this Subdivision................... 197

When a company must work out its taxable income and tax loss under this Subdivision  198

165-35  On a change of ownership, unless the company carries on the same business           198

165-37  Who has more than a 50% stake in the company during a period..... 198

165-40  On a change of control of voting power in the company, unless the company carries on the same business             199

Working out the company’s taxable income                                                        200

165-45  First, divide the income year into periods......................................... 200

165-50  Next, calculate the notional loss or notional taxable income for each period              201

165-55  How to attribute deductions to periods............................................. 201

165-60  How to attribute assessable income to periods................................. 204

165-65  How to calculate the company’s taxable income for the income year 205

Working out the company’s tax loss                                                                       206

165-70  How to calculate the company’s tax loss for the income year........... 206

165-75  How to calculate the company’s notional loss or notional taxable income for a period when the company was a partner         207

165-80  How to calculate the company’s share of a partnership’s notional loss or notional net income for a period if both entities have the same income year............................................................................ 208

165-85  How to calculate the company’s share of a partnership’s notional loss or notional net income for a period if the entities have different income years..................................................................... 209

165-90  Company’s full year deductions include a share of partnership’s full year deductions              210

Subdivision 165-D—Tests for finding out whether the company has maintained the same owners                211

The primary and alternative tests                                                                           211

165-150  Who has more than 50% of the voting power in the company during a period        211

165-155  Who has rights to more than 50% of the company’s dividends during a period      212

165-160  Who has rights to more than 50% of the company’s capital distributions during a period       213

165-165  Rules about the primary test for a condition................................... 213

165-175  Tests can be satisfied by a single person........................................ 214

Rules affecting the operation of the tests                                                               214

165-180  Arrangements affecting beneficial ownership of shares................. 214

165-185  Shares treated as never having carried rights.................................. 214

165-190  Shares treated as always having carried rights................................ 215

165-195  Disregard redeemable shares.......................................................... 215

165-200  Rules do not affect totals of shares or rights................................... 216

165-205  Death of beneficial owner............................................................... 216

Subdivision 165-E—The same business test                                                         216

165-210  The test........................................................................................... 216

Division 166—Income tax consequences of changing ownership or control of a listed public company      218

Guide to Division 166                                                                                                 218

166-1  What this Division is about................................................................ 218

Subdivision 166-A—Deducting tax losses of earlier income years                219

166-5  How Subdivision 165-A applies to a listed public company.............. 219

166-10  How Subdivision 165-A applies to a 100% subsidiary of a listed public company   221

166-15  Companies can choose that this Subdivision is not to apply to them 222

Subdivision 166-B—Working out the taxable income and tax loss for the income year of the change         222

166-20  How Subdivision 165-B applies to a listed public company............ 222

166-25  How to work out the taxable income and tax loss............................ 224

166-30  How Subdivision 165-B applies to 100% subsidiary of a listed public company      225

166-35  Companies can choose that this Subdivision is not to apply to them 225

Subdivision 166-D—Tests for finding out whether the listed public company has maintained the same owners        226

Guide to Subdivision 166-D                                                                                      226

166-140  What this Subdivision is about....................................................... 226

Substantial continuity of ownership                                                                       227

166-145  Substantial continuity of ownership............................................... 227

The ownership tests                                                                                                     228

166-150  Who has more than 50% of the voting power in the listed public company at a particular time               228

166-155  Who has rights to more than 50% of the listed public company’s dividends at a particular time              228

166-160  Who has rights to more than 50% of the listed public company’s capital distributions at a particular time              229

Rules affecting the operation of the ownership tests                                          229

166-165  Rules in Division 165 apply........................................................... 229

Subdivision 166-F—How to treat shareholdings of less than 1%                   231

Guide to Subdivision 166-F                                                                                       231

166-215  What this Subdivision is about....................................................... 231

Special tracing rules for listed public companies                                               232

166-220  Shareholdings of less than 1% in the listed public company.......... 232

166-225  Shareholdings of less than 1% in an interposed listed public company 232

166-230  Notional shareholder...................................................................... 233

166-235  Notional shareholder taken to have minimum voting control, dividend rights and capital rights              235

166-240  Voting, dividend and capital shareholding of less than 1%............ 236

166-245  Shares that are part of a substantial shareholding........................... 237

When the rules in this Subdivision do not apply                                                  238

166-250  Limit on listed public company splitting its shares into different classes  238

166-255  If listed public company would not have otherwise passed the ownership tests      238

Subdivision 166-G—How to treat interposed superannuation funds, approved deposit funds and special companies              239

Guide to this Subdivision                                                                                           239

166-260  What this Subdivision is about....................................................... 239

Special tracing rules for listed public companies                                               240

166-265  When fund or special company is taken to control voting power... 240

166-270  When fund or special company is taken to have rights to dividends and capital       241

Division 170—Treatment of company groups for income tax purposes      243

Subdivision 170-A—Transfer of tax losses within wholly-owned groups of companies    243

Guide to Subdivision 170-A                                                                                      243

170-1  What this Subdivision is about........................................................... 243

170-5  Basic principles for transferring tax losses......................................... 244

170-10  When a company can transfer a tax loss........................................... 245

170-15  Income company is taken to have incurred transferred loss.............. 245

170-20  Who can deduct transferred loss....................................................... 245

170-25  Tax treatment of payment for transferred tax loss............................. 246

170-30  Companies must be in existence and members of the same wholly-owned group     246

170-35  The loss company............................................................................. 246

170-40  The income company........................................................................ 247

170-45  Maximum amount that can be transferred......................................... 248

170-50  Transfer by written agreement.......................................................... 250

170-55  Losses must be transferred in order they are incurred...................... 250

170-60  Income company cannot transfer transferred tax loss....................... 251

170-65  Agreement transfers as much as can be transferred.......................... 251

170-70  Amendment of assessments............................................................. 251

Division 175—Use of a company’s tax losses or deductions to avoid income tax                252

Guide to Division 175                                                                                                 252

175-1  What this Division is about................................................................ 252

Subdivision 175-A—Tax benefits from unused tax losses                                252

175-5  When Commissioner can disallow deduction for tax loss.................. 253

175-10  First case: income injected into company because of available tax loss 253

175-15  Second case: someone else obtains a tax benefit because of tax loss available to company        254

Subdivision 175-B—Tax benefits from unused deductions                              255

175-20  Income injected into company because of available deductions........ 255

175-25  Deduction injected into company because of available income......... 256

175-30  Someone else obtains a tax benefit because of a deduction or income available to company      256

175-35  Tax loss resulting from disallowed deductions................................. 258

Subdivision 175-D—Shareholding interest in the company                             259

175-65  When a person has a shareholding interest in the company.............. 259

Division 195—Special types of company                                                              260

Subdivision 195-A—Pooled development funds (PDFs)                                    260

Guide to Subdivision 195-A                                                                                      260

195-1  What this Subdivision is about........................................................... 260

Working out a PDF’s taxable income and tax loss                                             260

195-5  Deductibility of PDF tax losses.......................................................... 260

195-10  PDF cannot transfer tax loss............................................................ 261

195-15  Tax loss for year in which company becomes a PDF....................... 261

Part 3-45—Rules for particular industries and occupations             263

Division 330—Mining and quarrying                                                                    263

Guide to Division 330                                                                                                 264

330-1  What  this Division is about............................................................... 264

330-5  How petroleum mining is treated........................................................ 264

330-10  Diagram—the stages of mining........................................................ 264

Subdivision 330-A—Exploration and prospecting                                             267

330-15  Deduction for exploration or prospecting expenditure...................... 267

330-20  Meaning of exploration or prospecting............................................ 269

330-25  Meaning of minerals, petroleum and quarry materials................... 270

330-30  Meaning of eligible mining or quarrying operations....................... 270

330-35  No deduction for amount “transferred” by seller of right or information 271

330-40  Election that section 330-15 not apply to plant................................. 271

Subdivision 330-B—Exempt income from the sale of rights to mine            272

330-60  Genuine prospector exemption for ordinary income derived from the sale of rights to mine     272

Subdivision 330-C—Development and operation of a mine or quarry         274

330-80  Allowable capital expenditure is deductible...................................... 274

330-85  What is allowable capital expenditure?............................................ 275

330-90  Housing and welfare in mining........................................................ 276

330-95  Expenditure that is not allowable capital expenditure....................... 276

330-100  How much is deductible over how long?....................................... 277

330-105  Meaning of unrecouped expenditure.............................................. 280

330-110  Expenditure that does not relate to a mining property, quarrying property or petroleum field  281

330-115  Apportioning between mining and quarrying................................. 282

330-120  Resuming use of property for qualifying purposes........................ 282

330-125  Each mining property, quarrying property or petroleum field is separate from any other         282

Subdivision 330-D—Cash bidding                                                                          283

Guide to Subdivision 330-D                                                                                      283

330-145  What this Subdivision is about....................................................... 283

Operative provisions                                                                                                  284

330-150  Mining cash bidding payments....................................................... 284

330-155  Meaning of mining cash bidding payment and mining authority... 285

330-160  Exploration or prospecting cash bidding payments made when mining authority has been granted         285

330-165  Meaning of exploration or prospecting cash bidding payment and exploration or prospecting authority              286

330-170  Exploration or prospecting cash bidding payments made before mining authority has been granted       286

330-175  Meaning of entitlement to an eligible cash bidding amount........... 287

330-180  Transfer of entitlement to an eligible cash bidding amount............. 288

330-185  Limit on amount............................................................................. 288

330-190  Time limit on agreement................................................................. 289

330-195  Agreement must be in writing and signed...................................... 289

330-200  When a mining authority is related to an exploration or prospecting authority         289

330-205  Meaning of retention authority....................................................... 290

330-210  When a retention authority is related to an exploration or prospecting authority      290

330-215  Effect of renewal of authority......................................................... 290

Subdivision 330-E—Selling a right or information                                           290

330-235  Buyer and seller may agree to include allowable capital expenditure 291

330-240  Meaning of mining, quarrying or prospecting right and mining, quarrying or prospecting information               291

330-245  Limit on amount that can be included in the agreement................... 292

330-250  Capital expenditure on buildings or other improvements only counts toward the limit if buyer gets rights to them 293

330-255  Time limit on agreement................................................................. 294

330-260  Agreement must be signed and in writing...................................... 294

330-265  Election under subsection 88B(5) of the Income Tax Assessment Act 1936 voids agreement  294

330-270  Agreement results in seller giving up further deductions................ 294

330-275  Apportionment between mining and quarrying.............................. 295

Subdivision 330-F—Excess deductions                                                                  295

Guide to Subdivision 330-F                                                                                       295

330-295  What this Subdivision is about....................................................... 295

Operative provisions                                                                                                  296

330-300  Limit on amounts deductible under Subdivision 330-C for the income year            296

330-305  Limit on amounts deductible under Subdivision 330-A for the income year            297

330-310  Excess amount deductible for the next income year........................ 297

330-315  Election not to limit amounts deductible under Subdivision 330-A or 330-C          299

330-320  Excess amount not deductible for certain property......................... 300

330-325  Excess amount not deductible if specified in a section 330‑235 agreement              300

330-330  Excess amount set off against income exempt under section 330-60 301

Subdivision 330-G—Petroleum resource rent tax payments                           302

330-350  Payments of petroleum resource rent tax........................................ 302

Subdivision 330-H—Transporting the product                                                   303

330-370  Transport capital expenditure is deductible..................................... 303

330-375  Meaning of transport capital expenditure...................................... 304

330-380  Meaning of transport facility and public body................................ 305

330-385  Meaning of mining or quarrying transport................................... 305

330-390  Meaning of processed materials, treatment and concentration...... 305

330-395  How much is deductible over how long?....................................... 306

330-400  What if you stop using property for mining or quarrying transport? 307

330-405  Resuming use of property for mining or quarrying transport......... 307

330-410  Apportionment between mining and quarrying.............................. 308

330-415  No double deductions for port or other ship facility....................... 308

Subdivision 330-I—Rehabilitating the site                                                           308

330-435  Deduction for expenditure on rehabilitation.................................... 309

330-440  Meaning of rehabilitation............................................................... 309

330-445  Meaning of ancillary activities and eligible building site................ 310

330-450  No deduction for certain expenditure.............................................. 310

330-455  Property used for rehabilitation taken to be used for the purpose of producing assessable income          311

Subdivision 330-J—Balancing adjustment                                                           311

Guide to Subdivision 330-J                                                                                       311

330-475  What this Subdivision is about....................................................... 311

Operative provisions                                                                                                  312

330-480  When a balancing adjustment is required........................................ 312

330-485  How to do the adjustment............................................................... 314

330-490  Meaning of termination value........................................................ 315

330-495  Meaning of written down value...................................................... 315

330-500  What if there is a disposal of part of an interest in property?.......... 316

Subdivision 330-K—Partial change of ownership                                              316

330-520  Partial change of ownership........................................................... 316

Subdivision 330-L—Modification of Common rules                                         318

330-540  Which Common rules apply........................................................... 318

330-545  Modification to Common rule 1 (Roll-over relief for related entities) 318

330-547  Roll-over relief............................................................................... 319

330-550  Transferee inherits certain characteristics from transferor............... 320

330-555  Leases: subsection 88B(5) of the Income Tax Assessment Act 1936 election has no effect     321

330-560  Modification to Common rule 2 (Non-arm’s length transactions).. 321

Subdivision 330-M—Special situations                                                                 322

Guide to Subdivision 330-M                                                                                     322

330-580  What this Subdivision is about....................................................... 322

Operative provisions                                                                                                  323

330-585  Recoupment of capital expenditure................................................. 323

330-590  Deductions under this Division take priority over other deductions 323

330-595  Mining, quarrying or prospecting—getting someone else to do the work                324

330-600  No deduction for petroleum income sharing................................... 325

330-605  No deduction for paying transferees or sub-lessees of mining, quarrying or prospecting rights              326

Division 375—Australian films                                                                               327

Subdivision 375-G—Film losses                                                                              327

Guide to Subdivision 375-G                                                                                      327

375-800  What this Subdivision is about....................................................... 327

Operative provisions                                                                                                  327

375-805  Does your tax loss have a film component?................................... 327

375-810  What is a film loss?........................................................................ 329

375-815  Deductibility of film losses............................................................. 329

375-820  Order in which tax losses are to be deducted.................................. 329

Chapter 4—Collection and recovery of income tax (and some other taxes)        330

Part 4-5—Collection of income tax instalments                                  330

Division 750—Guide to Part 4-5                                                                             330

750-1      What this Part is about.................................................................. 330

750-5  What instalments of income tax do you have to pay?......................... 330

750-10  Instalments collected periodically..................................................... 331

750-15  Instalments collected in respect of particular transactions................. 331

750-20  What happens if your income tax is less than the instalments you have paid? How do you get a refund? 332

Part 4-10—Withholding taxes: liability and collection provisions    333

Division 765—Withholding tax on dividends, interest and royalties             333

Guide to Division 765                                                                                                 333

765-1  What this Division is about................................................................ 333

765-5  Where to find the rules about the withholding tax.............................. 333

Division 766—Withholding tax on payments for mining operations on Aboriginal land 334

Guide to Division 766                                                                                                 334

766-1  What this Division is about................................................................ 334

766-5  Where to find the rules about the withholding tax.............................. 334

Division 767—Interest paid by companies on bearer debentures                   335

Guide to Division 767                                                                                                 335

767-1  What this Division is about................................................................ 335

767-5  Where to find the rules about the tax.................................................. 335

Division 768—Withholding tax on income notionally accruing under certain deferred interest investments             336

Guide to Division 768                                                                                                 336

768-1  What this Division is about................................................................ 336

768-5  Where to find the rules about the withholding tax.............................. 336

Part 4-30—Collecting Medicare levy and HECS with income tax   337

Division 785—Medicare levy                                                                                   337

Guide to Division 785                                                                                                 337

785-1  What this Division is about................................................................ 337

785-5  Where to find the rules about Medicare levy...................................... 337

Division 786—HECS (Higher Education Contribution Scheme)                    338

Guide to Division 786                                                                                                 338

786-1  What this Division is about................................................................ 338

786-5  Where to find the rules about repaying HECS contributions.............. 338

Chapter 5—Administration                                                                 339

Part 5-30—Record-keeping and other obligations                             339

Division 900—Substantiation rules                                                                        339

Guide to Division 900                                                                                                 339

900-1  What this Division is about................................................................ 339

Subdivision 900-A—Application of Division                                                       340

900-5  Application of the requirements of Division 900................................ 340

900-10  Substantiation requirement............................................................... 340

900-12  Application of Division 900 to PAYE earners and the entities that pay them            341

Subdivision 900-B—Substantiating work expenses                                            342

900-15  Getting written evidence................................................................... 342

900-20  Keeping travel records...................................................................... 343

900-25  Retaining the written evidence and travel records............................. 343

900-30  Meaning of work expense................................................................. 343

900-35  Exception for small total of expenses............................................... 345

900-40  Exception for laundry expenses below a certain limit....................... 346

900-45  Exception for work expense related to award transport payment...... 346

900-50  Exception for domestic travel allowance expenses........................... 347

900-55  Exception for overseas travel allowance expenses............................ 347

900-60  Exception for reasonable overtime meal allowance........................... 348

900-65  Crew members on international flights need not keep travel records 348

Subdivision 900-C—Substantiating car expenses                                               348

900-70  Getting written evidence................................................................... 348

900-75  Retaining the written evidence and odometer records....................... 349

Subdivision 900-D—Substantiating business travel expenses                          350

900-80  Getting written evidence................................................................... 350

900-85  Keeping travel records...................................................................... 350

900-90  Retaining the written evidence and travel records............................. 351

900-95  Meaning of business travel expense................................................. 351

Subdivision 900-E—Written evidence                                                                   352

Guide to Subdivision 900-E                                                                                      352

900-100  What this Subdivision is about....................................................... 352

Operative provisions                                                                                                  353

900-105  Ways of getting written evidence.................................................... 353

900-110  Time limits...................................................................................... 353

900-115  Written evidence from supplier....................................................... 354

900-120  Written evidence of depreciation expense....................................... 354

900-125  Evidence of small expenses............................................................ 355

900-130  Evidence of expenses considered otherwise too hard to substantiate 356

900-135  Evidence on a group certificate....................................................... 356

Subdivision 900-F—Travel records                                                                       357

Guide to Subdivision 900-F                                                                                       357

900-140  What this Subdivision is about....................................................... 357

900-145  Purpose of a travel record............................................................... 357

Operative provisions                                                                                                  357

900-150  Recording activities in travel records.............................................. 357

900-155  Showing which of your activities were income-producing activities 358

Subdivision 900-G—Retaining and producing records                                     358

Guide to Subdivision 900-G                                                                                      358

900-160  What this Subdivision is about....................................................... 358

900-165  The retention period........................................................................ 359

Operative provisions                                                                                                  359

900-170  Extending the retention period if an expense is disputed................ 359

900-175  Commissioner may tell you to produce your records..................... 359

900-180  How to comply with a notice.......................................................... 359

900-185  What happens if you don’t comply................................................. 360

Subdivision 900-H—Relief from effects of failing to substantiate                 360

900-195  Commissioner’s discretion to review failure to substantiate........... 360

900-200  Reasonable expectation that substantiation would not be required.. 361

900-205  What if your documents are lost or destroyed?............................... 361

Subdivision 900-I—Award transport payments                                                  362

Guide to Subdivision 900-I                                                                                        362

900-210  What this Subdivision is about....................................................... 362

Operative provisions                                                                                                  362

900-215  Deducting an expense related to an award transport payment......... 362

900-220  Definition of award transport payment......................................... 363

900-225  Substituted industrial instruments................................................... 364

900-230  Changes to industrial instruments applied for before 29 October 1986 364

900-235  Changes to industrial instruments solely referable to matters in the instrument        365

900-240  Deducting in anticipation of receiving award transport payment.... 365

900-245  Effect of exception in this Subdivision on exception for small total of expenses     365

900-250  Effect of exception in this Subdivision on methods of calculating car expense deductions      366

Part 5-35—Miscellaneous                                                                     368

Division 909—Regulations                                                                                       368

909-1  Regulations......................................................................................... 368

Chapter 6—The Dictionary                                                                 369

Part 6-1—Concepts and topics                                                            369

Division 950—Rules for interpreting this Act                                                      369

950-100  What forms part of this Act............................................................ 369

950-105  What does not form part of this Act............................................... 370

950-150  Guides, and their role in interpreting this Act................................. 370

Division 960—General                                                                                              371

Subdivision 960-E—Entities                                                                                     371

960-100  Entities............................................................................................ 371

Subdivision 960-H—Abnormal trading in shares or units                               372

960-220  Meaning of trading........................................................................ 372

960-225  Abnormal trading........................................................................... 372

960-230  Abnormal trading—5% of shares or units in one transaction......... 373

960-235  Abnormal trading—suspected 5% of shares or units in a series of transactions      373

960-240  Abnormal trading—suspected acquisition or merger...................... 374

960-245  Abnormal trading—20% of shares or units traded over 60 day period 374

Division 975—Concepts about companies                                                            375

Subdivision 975-A—General                                                                                    375

975-100  When a company is in existence..................................................... 375

975-150  Position to affect rights in relation to a company............................ 376

Subdivision 975-W—Wholly-owned groups of companies                              376

975-500  Wholly-owned groups.................................................................... 376

975-505  What is a 100% subsidiary?........................................................... 376

Part 6-5—Dictionary definitions                                                          378

Division 995—Definitions                                                                                         378

995-1  Definitions.......................................................................................... 378

 


 

 

Income Tax Assessment Act 1997

No. 38, 1997

 

 

 

An Act about income tax and related matters

[Assented to 17 April 1997]

The Parliament of Australia enacts:

Chapter 1Introduction and core provisions

Part 1-1Preliminary 

  


 

Division 1Preliminary

  

Table of sections

1-1........... Short title

1-2........... Commencement

1-3........... Differences in style not to affect meaning

1-1  Short title

                   This Act may be cited as the Income Tax Assessment Act 1997.

1-2  Commencement

                   This Act commences on 1 July 1997.

1-3  Differences in style not to affect meaning

             (1)  This Act contains provisions of the Income Tax Assessment Act 1936 in a rewritten form.

             (2)  If:

                     (a)  that Act expressed an idea in a particular form of words; and

                     (b)  this Act appears to have expressed the same idea in a different form of words in order to use a clearer or simpler style;

the ideas are not to be taken to be different just because different forms of words were used.

Note:          A public or private ruling about a provision of the Income Tax Assessment Act 1936 is taken also to be a ruling about the corresponding provision of this Act, so far as the 2 provisions express the same ideas: see sections 14ZAAM and 14ZAXA of the Taxation Administration Act 1953.


 

Part 1-2A Guide to this Act

Division 2How to use this Act

Table of Subdivisions

2-A       How to find your way around

2-B       How the Act is arranged

2-C       How to identify defined terms and find the definitions

2-D       The numbering system

2-E       Status of Guides and other non-operative material

Subdivision 2-AHow to find your way around

2-1  The design

                   This Act is designed to help you identify accurately and quickly the provisions that are relevant to your purpose in reading the income tax law.

                   The Act contains tables, diagrams and signposts to help you navigate your way.

                   You can start at Division 3 (What this Act is about) and follow the signposts as far into the Act as you need to go. You may also encounter signposts to several areas of the law that are relevant to you. Each one should be followed.

                   Sometimes they will lead down through several levels of detail. At each successive level, the rules are structured in a similar way. They will often be preceded by a Guide to the rules at that level. The rules themselves will usually deal first with the general or most common case and then with the more particular or special cases.

Subdivision 2-BHow the Act is arranged

2-5  The pyramid

                   This Act is arranged in a way that reflects the principle of moving from the general case to the particular.

                   In this respect, the conceptual structure of the Act is something like a pyramid. The pyramid shape illustrates the way the income tax law is organised, moving down from the central or core provisions at the top of the pyramid, to general rules of wide application and then to the more specialised topics.


 

Subdivision 2-CHow to identify defined terms and find the definitions

Table of sections

2-10......... When defined terms are identified

2-15......... When terms are not identified

2-20......... Identifying the defined term in a definition

2-10  When defined terms are identified

             (1)  Many of the terms used in the income tax law are defined.

             (2)  Most defined terms in this Act are identified by an asterisk appearing at the start of the term: as in “*business”. The footnote that goes with the asterisk contains a signpost to the Dictionary definitions starting at section 995‑1.

2-15  When terms are not identified

             (1)  Once a defined term has been identified by an asterisk, later occurrences of the term in the same subsection are not usually asterisked.

             (2)  Terms are not asterisked in the non-operative material contained in this Act.

Note:          The non-operative material is described in Subdivision 2-E.

             (3)  The following basic terms used throughout the Act are not identified with an asterisk. They fall into 2 groups:


 

Key participants in the income tax system

 

Item

This term:

is defined in:

1.

Australian resident

section 995-1

2.

Commissioner

section 995-1

3.

company

section 995-1

4.

entity

section 960-100

5.

individual

section 995-1

6.

partnership

section 995-1

7.

person

section 995-1

8.

trustee

section 995-1

9.

you

section 4-5

Core concepts

 

Item

This term:

is defined in:

1.

amount

section 995-1

2.

assessable income

Division 6

3.

assessment

section 995-1

4.

deduct, deduction

Division 8

5.

income tax

section 995-1

6.

income year

section 995-1

7.

taxable income

section 4-15

8.

this Act

section 995-1

2-20  Identifying the defined term in a definition

                   Within a definition, the defined term is identified by bold italics.


 

Subdivision 2-DThe numbering system

Table of sections

2-25......... Purposes

2-30......... Gaps in the numbering

2-25  Purposes

                   Two main purposes of the numbering system in this Act are:

   To indicate the relationship between units at different levels.

                   For example, the number of Part 2-15 indicates that the Part is in Chapter 2. Similarly, the number of section 165-70 indicates that the section is in Division 165.

   To allow for future expansion of the Act. The main technique here is leaving gaps between numbers.

2-30  Gaps in the numbering

                   There are gaps in the numbering system to allow for the insertion of new Divisions and sections.

                   Except where the gaps follow a regular pattern, notes are included at the end of one group of units to indicate the number of the next unit.


 

Subdivision 2-EStatus of Guides and other non-operative material

Table of sections

2-35......... Non-operative material

2-40......... Guides

2-45......... Other material

2-35  Non-operative material

                   In addition to the operative provisions themselves, this Act contains other material to help you identify accurately and quickly the provisions that are relevant to you and to help you understand them.

                   This other material falls into 2 main categories.

2-40  Guides

                   The first is the “Guides”. A Guide consists of sections under a heading indicating that what follows is a Guide to a particular Subdivision, Division etc.

                   Guides form part of this Act but are kept separate from the operative provisions. In interpreting an operative provision, a Guide may only be considered for limited purposes. These are set out in section 950-150.

2-45  Other material

                   The other category consists of material such as notes and examples. These also form part of the Act. They are distinguished by type size from the operative provisions, but are not kept separate from them.


 

Division 3What this Act is about

  

Table of sections

3-1........... What this Act is about

3-5........... Annual income tax

3-10......... Your other obligations as a taxpayer

3-15......... Your obligations other than as a taxpayer

3-1  What this Act is about

                   This Act is mainly about income tax, and this Division is concerned only with income tax.

                   However, this Act also deals with a variety of other topics that may affect you:

 

Item

For a guide to this topic:

See:

1.

Medicare levy

Division 785

2.

HECS (Higher Education Contribution Scheme)

Division 786

3.

Withholding taxes

 

 

    on dividends, interest and royalties

Division 765

 

    on payments for mining operations on Aboriginal land

Division 766

 

    on interest paid by companies on bearer debentures

Division 767

 

    on certain income notionally accruing under deferred interest investments

Division 768

3-5  Annual income tax

             (1)  Income tax is payable for each year by each individual and company, and by some other entities.

Note 1:       Individuals who are Australian residents, and some trustees, are also liable to pay Medicare levy for each year. See Division 785.

Note 2:       Income tax is imposed by the Income Tax Act 1986 and the other Acts referred to in the definition of income tax in section 995-1.

             (2)  Most entities have to pay instalments of income tax before the income tax they actually have to pay can be worked out.

             (3)  This Act answers these questions:

                       1.  What instalments of income tax do you have to pay? When and how do you pay them?

See section 750-1.

                       2.  How do you work out how much income tax you must pay?

See Division 4, starting at section 4-1.

                       3.  What happens if your income tax is more than the instalments you have paid? When and how must you pay the rest?

                   See Division 1 (sections 204 to 220) of Part VI of the Income Tax Assessment Act 1936.

                       4.  What happens if your income tax is less than the instalments you have paid? How do you get a refund?

See section 750-20.

                       5.  What are your other obligations as a taxpayer, besides paying instalments and the rest of your income tax?

                   See section 3-10.

                       6.  Do you have any other obligations under the income tax law?

                   See section 3-15.

                       7.  If a dispute between you and the Commissioner of Taxation cannot be settled by agreement, what procedures for objection, review and appeal are available?

                   See Part IVC (sections 14ZL to 14ZZS) of the Taxation Administration Act 1953.

3-10  Your other obligations as a taxpayer

             (1)  Besides paying instalments and the rest of your income tax, your main obligations as a taxpayer are:

                     (a)  to keep records and provide information as required by:

                                  the Income Tax Assessment Act 1936; and

                                  Division 900 (which sets out substantiation rules) of this Act; and

                     (b)  to lodge returns as required by:

                                  the Income Tax Assessment Act 1936.

Tax file numbers

             (2)  Under Part VA of the Income Tax Assessment Act 1936, a tax file number can be issued to you. You are not obliged to apply for a tax file number. However, if you do not quote one in certain situations:

   you may become liable for instalments of income tax that would not otherwise have been payable;

   the amount of certain of your instalments of income tax may be increased.

3-15  Your obligations other than as a taxpayer

                   Your main obligations under the income tax law, other than as a taxpayer are:

   in certain situations, to deduct from money you owe to another person, and to remit to the Commissioner, instalments of income tax payable by that person.

See Part 4-5 (Collection of income tax instalments),
starting at section 750-1.


 

Part 1-3Core provisions

Division 4How to work out the income tax payable on your taxable income

  

Table of sections

4-1........... Who must pay income tax

4-5........... Meaning of you

4-10......... How to work out how much income tax you must pay

4-15......... How to work out your taxable income

4-1  Who must pay income tax

                   Income tax is payable by each individual and company, and by some other entities.

Note:          The actual amount of income tax payable may be nil.

For a list of the entities that must pay income tax,
see Division 9, starting at section 9-1.

4-5  Meaning of you

                   If a provision of this Act uses the expression you, it applies to entities generally, unless its application is expressly limited.

Note:          The expression you is not used in provisions that apply only to entities that are not individuals.

4-10  How to work out how much income tax you must pay

             (1)  You must pay income tax for each year ending on 30 June, called the financial year.

             (2)  Your income tax is worked out by reference to your taxable income for the income year. The income year is the same as the *financial year, except in these cases:

                     (a)  for a company, the income year is the previous financial year;

                     (b)  if you adopt an accounting period ending on a day other than 30 June, the income year is the accounting period adopted in place of the financial year or previous financial year, as appropriate.

Note:          The Commissioner can allow you to adopt an accounting period ending on a day other than 30 June. See section 18 of the Income Tax Assessment Act 1936.

             (3)  Work out your income tax for the *financial year as follows:

Method statement

Step 1.   Work out your taxable income for the income year.

To do this, see section 4-15.


 

Step 2.   Work out your basic income tax liability on your taxable income using:

               (a)     the income tax rate or rates that apply to you for the income year; and

              (b)     any special provisions that apply to working out that liability.

See the Income Tax Rates Act 1986.

Step 3.   Work out your tax offsets for the income year. A tax offset reduces the amount of income tax you have to pay.

For the list of tax offsets, see section 13-1.

Step 4.   Subtract your *tax offsets from your basic income tax liability. The result is how much income tax you owe for the *financial year. (If your total tax offsets exceed your basic income tax liability, you are not entitled to a refund, or to offset the excess against any other liability.)

Note:          Some tax offsets can be carried forward to a later year. See, for example, section 160AFE of the Income Tax Assessment Act 1936, which deals with the carry forward of excess foreign tax credits.

             (4)  For some entities, some or all of their income tax for the *financial year is worked out by reference to something other than taxable income for the income year.

See section 9-5.


 

4-15  How to work out your taxable income

             (1)  Work out your taxable income for the income year like this:

Method statement

Step 1.   Add up all your assessable income for the income year.

To find out about your assessable income, see Division 6.

Step 2.   Add up your deductions for the income year.

To find out what you can deduct, see Division 8.

Step 3.   Subtract your deductions from your assessable income (unless they exceed it). The result is your taxable income. (If the deductions equal or exceed the assessable income, you don’t have a taxable income.)

Note:          If the deductions exceed the assessable income, you may have a tax loss which you may be able to deduct in a later income year: see Division 36.


 

             (2)  There are cases where taxable income is worked out in a special way:

 

Item

For this case ...

See:

1.

A company does not maintain continuity of ownership and control during the income year and does not continue to carry on the same business

Subdivision 165‑B

2.

A company becomes a PDF (pooled development fund) during the income year, and the PDF component for the income year is a nil amount

section 124ZTA of the Income Tax Assessment Act 1936

3.

A shipowner or charterer:

    has its principal place of business outside Australia; and

    carries passengers, freight or mail shipped in Australia

section 129 of the Income Tax Assessment Act 1936

4.

An insurer who is not an Australian resident enters into insurance contracts connected with Australia

sections 142 and 143 of the Income Tax Assessment Act 1936

5.

The Commissioner makes a default or special assessment of taxable income

sections 167 and 168 of the Income Tax Assessment Act 1936

 


 

Division 6Assessable income and exempt income

  

Guide to Division 6

Table of sections

6-1........... Diagram showing relationships among concepts in this Division

Operative provisions

6-5........... Income according to ordinary concepts (ordinary income)

6-10......... Other assessable income (statutory income)

6-15......... What is not assessable income

6-20......... Exempt income

6-25......... Relationships among various rules about ordinary income

 

6-1  Diagram showing relationships among concepts in this Division

             (1)  Assessable income consists of *ordinary income and *statutory income.

             (2)  Some *ordinary income, and some *statutory income, is *exempt income.

             (3)  *Exempt income is not assessable income.

             (4)  Some *ordinary income, and some *statutory income, is neither assessable income nor *exempt income.

Operative provisions

6-5  Income according to ordinary concepts (ordinary income)

             (1)  Your assessable income includes income according to ordinary concepts, which is called ordinary income.

Note:          Some of the provisions about assessable income listed in section 10-5 may affect the treatment of ordinary income.

             (2)  If you are an Australian resident, your assessable income includes the *ordinary income you *derived directly or indirectly from all sources, whether in or out of Australia, during the income year.

             (3)  If you are not an Australian resident, your assessable income includes:

                     (a)  the *ordinary income you *derived directly or indirectly from all *Australian sources during the income year; and

                     (b)  other *ordinary income that a provision includes in your assessable income for the income year on some basis other than having an *Australian source.

             (4)  In working out whether you have derived an amount of *ordinary income, and (if so) when you derived it, you are taken to have received the amount as soon as it is applied or dealt with in any way on your behalf or as you direct.

6-10  Other assessable income (statutory income)

             (1)  Your assessable income also includes some amounts that are not *ordinary income.

Note:          These are included by provisions about assessable income.
For a summary list of these provisions, see section 10-5.

             (2)  Amounts that are not *ordinary income, but are included in your assessable income by provisions about assessable income, are called statutory income.

Note:          Many provisions in the summary list in section 10-5 contain rules about ordinary income. These rules do not change its character as ordinary income.

             (3)  If an amount would be *statutory income apart from the fact that you have not received it, it becomes statutory income as soon as it is applied or dealt with in any way on your behalf or as you direct.

             (4)  If you are an Australian resident, your assessable income includes your *statutory income from all sources, whether in or out of Australia.

             (5)  If you are not an Australian resident, your assessable income includes:

                     (a)  your *statutory income from all *Australian sources; and

                     (b)  other *statutory income that a provision includes in your assessable income on some basis other than having an *Australian source.

6-15  What is not assessable income

             (1)  If an amount is not *ordinary income, and is not *statutory income, it is not assessable income (so you do not have to pay income tax on it).


 

             (2)  If an amount is *exempt income, it is not assessable income.

Note:          If an amount is exempt income, there are other consequences besides it being exempt from income tax. For example:

    the amount may be taken into account in working out the amount of a tax loss (see section 36‑10);

    you cannot deduct as a general deduction a loss or outgoing incurred in deriving the amount (see Division 8).

                   To find out about exempt income, see section 6-20.

6-20  Exempt income

             (1)  An amount of *ordinary income or *statutory income is exempt income if it is made exempt from income tax by a provision of this Act.

For summary lists of provisions about exempt income,
see sections 11-5, 11-10 and 11-15.

             (2)  *Ordinary income is also exempt income to the extent that this Act excludes it (expressly or by implication) from being assessable income.

Note:          Some express provisions result in ordinary income being neither assessable income nor exempt income. See, for example, section 121EG of the Income Tax Assessment Act 1936, dealing with offshore banking units.

             (3)  By contrast, an amount of *statutory income is exempt income only if it is made exempt from income tax by a provision of this Act outside this Division.


 

6-25  Relationships among various rules about ordinary income

             (1)  Sometimes more than one rule includes an amount in your assessable income:

   the same amount may be *ordinary income and may also be included in your assessable income by one or more provisions about assessable income; or

   the same amount may be included in your assessable income by more than one provision about assessable income.

For a summary list of the provisions about assessable income,
 see section 10-5.

However, the amount is included only once in your assessable income for an income year, and is then not included in your assessable income for any other income year.

             (2)  Unless the contrary intention appears, the provisions of this Act (outside this Part) prevail over the rules about *ordinary income.

Note:          This Act contains some specific provisions about how far the rules about ordinary income prevail over the other provisions of this Act.


 

Division 8Deductions

  

Table of sections

8-1........... General deductions

8-5........... Specific deductions

8-10......... No double deductions

8-1  General deductions

             (1)  You can deduct from your assessable income any loss or outgoing to the extent that:

                     (a)  it is incurred in gaining or producing your assessable income; or

                     (b)  it is necessarily incurred in carrying on a *business for the purpose of gaining or producing your assessable income.

             (2)  However, you cannot deduct a loss or outgoing under this section to the extent that:

                     (a)  it is a loss or outgoing of capital, or of a capital nature; or

                     (b)  it is a loss or outgoing of a private or domestic nature; or

                     (c)  it is incurred in relation to gaining or producing your *exempt income; or

 

                     (d)  a provision of this Act prevents you from deducting it.

For a summary list of provisions about deductions, see section 12-5.

             (3)  A loss or outgoing that you can deduct under this section is called a general deduction.

8-5  Specific deductions

             (1)  You can also deduct from your assessable income an amount that a provision of this Act (outside this Division) allows you to deduct.

             (2)  Some provisions of this Act prevent you from deducting an amount that you could otherwise deduct, or limit the amount you can deduct.

             (3)  An amount that you can deduct under a provision of this Act (outside this Division) is called a specific deduction.

For a summary list of provisions about deductions, see section 12-5.

8-10  No double deductions

                   If 2 or more provisions of this Act allow you deductions in respect of the same amount (whether for the same income year or different income years), you can deduct only under the provision that is most appropriate.


 

Part 1-4Checklists of what is covered by concepts used in the core provisions

Division 9Entities that must pay income tax

  

Table of sections

9-1........... List of entities

9-5........... Entities that work out their income tax by reference to something other than taxable income

9-1  List of entities

                   Income tax is payable by the entities listed in the table.

                   Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 

Item

Income tax is payable by this kind of entity:

because of this provision:

1.

An individual

section 4-1

2.

A company, that is:

·       a body corporate; or

·       an unincorporated body (except a partnership)

section 4-1

3.

A corporate limited partnership (as defined in section 94D)

section 94J

4.

A mutual insurance association (as described in section 121)

section 121

5.

A trustee (except one covered by a later item in this table), but only in respect of some kinds of income of the trust

sections 98, 99, 99A and 102

6.

The trustee of a corporate unit trust

section 102K

7.

The trustee of a public trading trust

section 102S

8.

The trustee of a complying superannuation fund

section 278

9.

The trustee of a non-complying superannuation fund

section 286

10.

The trustee of a complying approved deposit fund

section 289

11.

The trustee of a non-complying approved deposit fund

section 294

12.

The trustee of a pooled superannuation trust

section 296

9-5  Entities that work out their income tax by reference to something other than taxable income

             (1)  For some entities, some or all of their income tax for the *financial year is worked out as described in the table.

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 

 

Item

This kind of entity is liable to pay income tax worked out by reference to:

See:

1.

A trustee covered by item 5 in the table in section 9-1 is liable to pay income tax worked out by reference to the net income of the trust for the income year.

sections 98, 99 and 99A

2.

The trustee of a corporate unit trust is liable to pay income tax worked out by reference to the net income of the trust for the income year.

section 102K

3.

The trustee of a public trading trust is liable to pay income tax worked out by reference to the net income of the trust for the income year.

section 102S

4.

An entity that is liable to pay income tax (worked out by reference to taxable income or otherwise) is also liable to pay income tax worked out by reference to diverted income or diverted trust income for the income year.

section 121H

5.

An Australian insurer that re-insures overseas can elect to pay, as agent for the re-insurer, income tax worked out by reference to the amount of the re-insurance premiums.

section 148

             (2)  For entities covered by an item in the table in subsection (1), the income year is the same as the *financial year, except in these cases:

                     (a)  for a company, or an entity covered by item 2 or 3 in the table, the income year is the previous financial year;

                     (b)  if an entity adopts an accounting period ending on a day other than 30 June, the income year is the accounting period adopted in place of the financial year or previous financial year, as appropriate.

Note:          The Commissioner can allow an entity to adopt an accounting period ending on a day other than 30 June. See section 18 of the Income Tax Assessment Act 1936.


 

Division 10Particular kinds of assessable income

  

10-5  List of provisions about assessable income

The provisions set out in the table:

   include in your assessable income amounts that are not *ordinary income; and

   vary or replace the rules that would otherwise apply for certain kinds of *ordinary income.

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 

accrued leave transfer payments

 

.......................................................................................................

26(ec)

allowances

 

see employment

 

annual leave

 

see leave payments

 

annuities

 

.......................................................................................................

27H

approved deposit fund (ADFs)

 

see superannuation

 

attributable income

 

see controlled foreign corporations and foreign investment funds

 

 


 

avoidance of tax

 

general .........................................................................................

177F

diversion of income ..................................................................

121H

profits shifted out of Australia ................................................

136AD, 136AE

see also transfers of income

 

bad debt

 

debt recovered after a deduction allowed for a bad debt ..

63(3)

balancing adjustment

 

see depreciation, industrial property, investments, mining, research & development, scientific research and timber

 

banking

 

offshore banking activities, income from .............................

121EG(1)

offshore banking unit, deemed interest on payments to by owner .....................................................................................


121EK

barter transactions

 

.......................................................................................................

21, 21A, 26(e)

beneficiaries

 

see trusts

 

benefits

 

business, non-cash ....................................................................

21A

consideration, non-cash ...........................................................

21

meals you provide in an in-house dining facility .................

26AAAC

see also employment and superannuation

 

bonus shares

 

see shares

 

bounties

 

.......................................................................................................

26(g)

capital gains

 

.......................................................................................................

160ZO

see also insurance

 




car expenses

 

cents per kilometres reimbursement of .................................

26(eaa)

CFCs

 

see controlled foreign corporations

 

charters

 

see shipping

 

child

 

non-trust income of, unearned ...............................................

102AE

trust income of, unearned ........................................................

102AG

company

 

see controlled foreign corporations, co-operative company, directors, dividends, liquidation, shareholders and shares

 

compensation

 

deductible loss or outgoing, insurance or indemnity for .....

26(j)

lessee pays for non-compliance with covenant to repair ...

26(l)

live stock or trees, recoveries for loss of ................................

26B

profit or income, insurance or indemnity for loss of ...........

26(j)

trading stock, insurance or indemnity for loss of ................

26(j)

see also embezzlement, insurance, live stock and scientific research

 

consideration

 

see benefits

 

controlled foreign corporations (CFCs)

 

attributable income of ..............................................................

456 to 459A

see also dividends and taxes

 

co-operative company

 

receipts of ...................................................................................

119

credit union

 

see co-operative company

 

currency gains

 

see foreign exchange

 

death

 

see trusts

 

debt/equity swap

 

see shares and units

 

defence forces

 

allowances and benefits for service as a member of ..........

26(ea)

depreciation

 

excess over depreciated value at disposal of property, treatment of .........................................................................


59

pooled depreciated property, profits on the disposal, loss or destruction of .......................................................................


62AAT

development allowance

 

partnership property acquired under a pre-27 February 1992 contract .................................................................................


82AHA(5), (6)

partnership which claimed a development allowance deduction, disposal of interest in ......................................


82AJ

directors

 

excessive remuneration or retirement payment from company ..............................................................................


109

distributions

 

see dividends

 

dividends

 

general .........................................................................................

44(1)

distribution from a controlled foreign corporation ..............

47A(1)

foreign taxes on, grossing up of ..............................................

6AC

franked dividends, credits on ..................................................

160AQT

repayments of foreign income tax deducted from .............

26A

see also liquidation

 

drought investment allowance

 

partnership which claimed drought investment allowance deduction, disposal of interest in ......................................


656

elections

 

reimbursement of expenses of ................................................

74(2), 74A(4)

electricity connections

 

recovery of expense of .............................................................

70A(5)

eligible termination payments (ETPs)

 

.......................................................................................................

27A to 27H

embezzlement

 

recovery of loss from ................................................................

26(k)

employees

 

see shares

 

employment

 

allowances and benefits in relation to employment or rendering services ................................................................


26(e), 26(ea)

return to work payments ..........................................................

26(eb)

see also accrued leave transfer payments, eligible termination payments and leave payments

 

FIFs

 

see foreign investment funds

 

films

 

Australian, proceeds of investment in ...................................

26AG

foreign exchange

 

gains .............................................................................................

82Y

foreign investment funds (FIFs)

 

attributable income of ..............................................................

529

foreign tax paid in respect of a foreign investment fund attribution account payment ............................................


26D

see also taxes

 

franked dividends

 

see dividends

 

improvements

 

see leases

 

imputation

 

see dividends

 

income equalisation deposits

 

withdrawals from ......................................................................

159GD

industrial property

 

consideration for disposal of ...................................................

124P

see also research & development

 

infrastructure borrowings

 

see interest

 

insurance

 

bonuses .......................................................................................

26(i), 26AH

company, demutualisation of ................................................

121AT

foreign life assurance policy ....................................................

529

life assurance, transfer of contributions by superannuation fund or approved deposit fund to ....................................


275

payments from a non-resident reinsurer in respect
of a loss .................................................................................


148

premiums in respect of Australian business received by non-resident insurers ...................................................................


143

premiums paid to a non-resident for reinsurance ................

148

premiums paid to mutual insurance association .................

121

premiums payable to a non-resident for insurance of property in Australia ...........................................................................


142(1)

premiums payable to a non-resident for insuring an event that can only happen in Australia ............................................


142(1)

premiums payable to a non-resident under an insurance contract with a resident ......................................................


142(2)

rebates and premiums refunded to a superannuation fund trustee ....................................................................................


279A(1)

see also compensation, embezzlement and life assurance companies

 

interest

 

infrastructure borrowings, on ..................................................

159GZZZZG

loans raised in Australia by foreign governments, on .........

27

overpaid tax, on ........................................................................

26(jb)

qualifying securities, on ............................................................

159GQ, 159GW(1)

see also co-operative companies and leases

 

investments

 

non-interest bearing Commonwealth securities, gains on disposal or redemption of ..................................................


26C

prizes from investment-related lotteries ................................

26AJ

qualifying securities, payments to partial residents made under .....................................................................................


159GW(2)

qualifying securities, amount assessable to issuer of ..........

159GT(1B)

qualifying securities, balancing adjustment on the transfer of


159GS

securities, variation in terms of ...............................................

159GV(2)

securities lending arrangements ..............................................

26BC

traditional securities, gains on the disposal or redemption of ...


26BB

see also films and interest

 

leases

 

crown leases used for primary production, assignment
of ............................................................................................


88A(3)

improvements made by lessee to land ..................................

87

interest component of payments under non-leveraged finance leases .....................................................................................


159GK

lessees’ payments for non-compliance with covenant to repair .................................................................................................


26(l)

partnership leasing property under non-leveraged finance lease, new partner or contribution of capital since 14 May 1985 ......................................................................................



159GO

premiums on old leases ............................................................

84

premiums relating to a grant or assignment .........................

26AB

profit on disposal of previously leased motor vehicles ......

26AAB

leave payments

 

accrued leave transfer payment .............................................

26(ec)

annual leave, received in lieu of retirement or
termination ...........................................................................


26AC

long service leave, received in lieu of retirement or termination .................................................................................................


26AD

life assurance companies

 

consideration for transfer of equity in protection fund
of ............................................................................................


116DF

disposal of assets of ..................................................................

116CB(3), 116CC(2), 116CD, 116GA(2), 116GB

winding-up payments out of protection fund of .................

116DD

liquidation

 

distribution to a shareholder in winding up a company .....

47(1)

live stock

 

death or destruction of .............................................................

36, 36AAA, 36AA

departing Australia and ............................................................

36, 36AAA, 36AA

insolvency, and ..........................................................................

36, 36AAA, 36AA

profits on death or disposal of ................................................

36, 36AAA, 36AA

see also compensation and trading stock

 

loans

 

fees for the procurement of .....................................................

26(h)

see also interest and shareholders

 

long service leave

 

see leave payments

 

losses

 

see compensation

 

lotteries

 

see investments

 

meals

 

see benefits

 

mining

 

balancing adjustment on disposal of property ....................

330-485

minors

 

see child

 

motor vehicles

 

see car expenses and leases

 

mutual insurance

 

see insurance

 

non-cash benefits

 

see benefits and employment

 

offshore banking units

 

see banking

 

partnerships

 

net income of, partner’s interest in .........................................

92(1)

uncontrolled partnership income, effect of ..........................

94

see also development allowance, drought investment allowance and leases

 

petroleum

 

resource rent tax, recovery of .................................................

330-350(3)

see also mining

 

pooled depreciated property

 

see depreciation

 

premiums

 

see insurance, leases and superannuation

 

prizes

 

see investments

 

profits

 

business partly in Australia and partly overseas .................

43(1)

profit-making undertakings or the sale of property acquired for profit-making by sale ...................................................


25A

see also avoidance of tax

 

property

 

see profits and trusts

 

quarrying

 

see mining

 

rates

 

refund of .....................................................................................

72(2)

reimbursements

 

see car expenses, dividends, elections, electricity connections, embezzlement, insurance, petroleum and taxes

 

reinsurance

 

see insurance

 

research & development

 

consideration for loss or disposal of plant or buildings used for .................................................................................................


73B(23) to (27C), 73G(4)

return on ......................................................................................

73B(27A), (27C)

transferee of property used for, effect of disposal or change of use by ...............................................................................


73F(10)

residual value

 

see industrial property

 

retirement payments

 

see directors, leave payments and shareholders

 

rights to income

 

see transfers of income

 

roads

 

see timber

 

royalties

 

.......................................................................................................

26(f)

schemes

 

see avoidance of tax

 

scientific research

 

consideration for disposal or destruction of buildings acquired for scientific research .........................................................


73A(4)

securities

 

see investments

 

services

 

see co-operative companies, employment, loans and trusts

 

shareholders

 

excessive remuneration or retirement payment from company ..............................................................................


109

loans, payments and credits from company .......................

108

see also dividends

 

shares

 

acquired in a debt/equity swap, profit on the disposal cancellation or redemption of ..........................................


63E(4)

bonus shares, cost of ................................................................

6BA

buy-backs ...................................................................................

159GZZZJ to 159GZZZT

employee share acquisition schemes .....................................

26AAC, 139 to 139GH

holding company shares held by a subsidiary, cancellation of .................................................................................................


159GZZZC to 159GZZZI

see also dividends

 

shipping

 

goods shipped in Australia, amounts paid to foreign shipowners and charterers for ...........................................


129

subsidies

 

.......................................................................................................

26(g)

superannuation

 

benefits received from older superannuation funds ...........

26AF, 26AFA, 26AFB

complying fund becomes non-complying, effect of ..........

288A

contributions to a superannuation fund ...............................

278, 281, 286, 288

contributions to an approved deposit fund ..........................

289, 290, 294, 295

non-resident fund becoming resident, effect of ...................

288B

payments and benefits from a fund ......................................

82AAQ

trustee’s liability to pay tax .....................................................

278, 286, 289, 294, 296

see also insurance

 

tax avoidance

 

see avoidance of tax and transfers of income

 

taxes

 

refund of .....................................................................................

72(2)

tax related expenses, recovery of ...........................................

69(8)

see also dividends, foreign investment funds and interest

 

termination of employment

 

see directors, eligible termination payments, leave payments and shareholders

 

timber

 

access road, balancing adjustment on the disposal of .......

124G

mill, balancing adjustment on the disposal of .....................

124JB

trading stock

 

change in interests in .................................................................

36A

death of trader and ...................................................................

37

difference between opening and closing value of ...............

28

disposal of for more than an arm’s length price ..................

31C

disposal of outside ordinary course of business ..................

36(1)

see also compensation

 

transfers of income

 

consideration for transfer of right to income .......................

102CA

payments for transfer or disposal of property .....................

262

transferee, effect on of transfer of right to income .............

102C

transferor, effect on of transfer of right to income .............

102B

travel expenses

 

see car expenses

 

trusts

 

beneficiary under legal disability or with a vested and indefeasible interest in trust income ................................


100

deceased estates, income of ....................................................

101A

deceased estates, your interest in income of ........................

26(b)

discretionary trusts ....................................................................

101

net income of a trust estate, your present entitlement to ...

26(b), 97, 101

non-resident beneficiaries, liability to tax of ........................

98A

non-resident trust estates to which you have transferred property or services, income of ........................................


102AAZD

property of applied for benefit of beneficiaries ...................

99B

trust estate includes income from another trust estate .......

94(5)

trustees’ liability to tax..............................................................

98, 99, 99A, 102, 102K, 102S

see also avoidance of tax and superannuation

 

unearned income

 

see child

 

units

 

acquired in a debt/equity swap, profit on the disposal, cancellation or redemption of ..........................................


63E(4)

winding-up

 

see insurance and liquidation

 

wool clips

 

double wool clips, treatment of ..............................................

26BA

 


 

Division 11Lists of classes of exempt income

Table of sections

11-1......... Overview

11-5......... Entities that are exempt, no matter what kind of ordinary or statutory income they have

11-10....... Ordinary or statutory income which is exempt, no matter whose it is

11-15....... Ordinary or statutory income which is exempt only if it is derived by certain entities

11-1  Overview

                   *Ordinary income or *statutory income which is exempt from income tax can be divided into 3 main classes:

                     (a)  ordinary or statutory income of entities that are exempt, no matter what kind of ordinary or statutory income they have (see table in section 11-5);

                     (b)  ordinary or statutory income which is exempt, no matter whose it is (see table in section 11-10);

                     (c)  ordinary or statutory income which is exempt only if it is *derived by certain entities (see table in section 11-15).

11-5  Entities that are exempt, no matter what kind of ordinary or statutory income they have

                   Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 


 

charity, education, religion or science

 

charitable fund, public .............................................................

23(j)

charitable institution .................................................................

23(e)

educational institution, public .................................................

23(e)

religious institution ....................................................................

23(e)

scientific institution ...................................................................

23(e)

scientific research fund ............................................................

23(j)

scientific society etc. .................................................................

23(g)(ii)

community service

 

community service society etc. ...............................................

23(g)(v)

employees and employers

 

employee association ...............................................................

23(f)

employer association ................................................................

23(f)

trade union .................................................................................

23(f)

film

 

Australian Film Finance Corporation ....................................

23(k)

finance

 

friendly society ..........................................................................

23(g)(i)

government

 

local governing body ................................................................

23(d)

municipal corporation ..............................................................

23(d)

public authority .........................................................................

23(d)

state/territory bodies .................................................................

24AK to 24AZ

health

 

health benefits organisation ....................................................

23(eb)

hospital ........................................................................................

23(ea)

medical benefits organisation .................................................

23(eb)


 

mining

 

British Phosphate Commissioner Banaba
Contingency Fund ..............................................................


23(jf)

Phosphate Mining Company of Christmas Island .............

23(je)

primary or secondary resources and tourism

 

agricultural society etc. .............................................................

23(h)

aviation society etc. ..................................................................

23(h)

horticultural society etc. ...........................................................

23(h)

industrial society etc. ................................................................

23(h)

manufacturing society etc. ......................................................

23(h)

pastoral society etc. ..................................................................

23(h)

tourism society etc. ...................................................................

23(h)

viticultural society etc. ..............................................................

23(h)

sports, culture or recreation

 

animal racing society etc. ........................................................

23(g)(iv)

art society etc.  ...........................................................................

23(g)(ii)

game society etc. .......................................................................

23(g)(iii)

literature society etc. .................................................................

23(g)(ii)

music society etc. ......................................................................

23(g)(ii)

sport society etc. ........................................................................

23(g)(iii)

superannuation and related business

 

constitutionally protected funds .............................................

271A

 


 

11-10  Ordinary or statutory income which is exempt, no matter whose it is

                   Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 

dividends or shares

 

pooled development fund company dividend ....................

124ZM

pooled development fund company shares, income from sale of ....................................................................................


124ZN

financial transactions

 

infrastructure borrowings, income in relation to ..................

159GZZZZE

pooled development fund company dividends....................

124ZM

pooled development fund company shares, income from sale of ....................................................................................


124ZN

foreign aspects of income taxation

 

attributed foreign investment fund income ..........................

23AK

attributed income ......................................................................

23AI

Australian-American Education Foundation, grant from .

23(za)

withholding tax, income subject to ........................................

128D

non-cash benefits

 

business benefit .........................................................................

23L(2)

fringe benefit ..............................................................................

23L(1)

 

 

11-15  Ordinary or statutory income which is exempt only if it is derived by certain entities

                   Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 

defence

 

Defence Force member, allowances ......................................

23(t)

Emergency Defence Force member, pay and allowances .

23(sa)

Reserve Defence Force member, pay and allowances .......

23(s)

education

 

bursary, educational allowance etc. ......................................

23(z)

CRAFT scheme, employer’s income from ...........................

23(jc)

foreign student, scholarship and bursary to .........................

23(ya)

full time student, income from a scholarship, bursary, other educational allowance or educational assistance .........


23(z)

isolated child, income for the provision of education of ...

23(zaa)

secondary student, income for the provision of education
of ............................................................................................


23(zaa)

foreign aspects of income taxation

 

approved overseas project, income from .............................

23AF

Australian Federal Police member in Cambodia, pay and allowance .............................................................................


23ADA

Commonwealth Government Officer, official salary and foreign income .....................................................................


23(a)(vi)

Commonwealth sporting club or association, income of ..

23(c)(ii)

consul and official staff member, official salary and foreign income ..................................................................................


23(a)(ii)

Defence Force member, pay and allowances from being on eligible duty ..........................................................................


23AD


Defence Force member, non-resident, pay
and  allowances of ..............................................................


23(u)

Defence Force member, pay and allowances from performing duties in operational areas ................................................


23AC

defence of Australia, overseas person’s income from assisting in Australia’s defence..........................................................


23(v)

diplomat and official staff member, official salary and foreign income .....................................................................


23(a)(ii)

dividend from a foreign country, non-portfolio ..................

23AJ

educational, scientific, religious or philanthropic society, income of a visiting representive of .................................


23(c)(iv)

expert, non-resident, remuneration of ...................................

23(b)

foreign branch profits by an Australian company ..............

23AH

foreign society or association representative, income of ...

23(c)(iv)

government representative and members of the entourage, non-resident, income of .....................................................


23(c)(iii)

persecution victim, pensions etc. ............................................

23(kc)

non-resident, foreign sourced income ....................................

23(r)

OBU off-shore investment trusts, income to which subsection 121D(6) applies ...................................................................


121EL

overseas employment income, resident, income of ............

23AG

Papua New Guinea pension, Papua New
Guinea resident ....................................................................


23(kd)

press representative, foreign, income of ................................

23(c)(v)

resistance fighter and victim of wartime persecution, pension and etc.  of............................................................................


23(kca)

sporting club, British Commonwealth, income of ...............

23(c)(ii)

sports person, non-resident, income of ..................................

23(c)(i)

superannuation fund, non-resident, interest and dividend income of .............................................................................


23(jb)

Territory resident, income from sources in a prescribed Territory ................................................................................


24G

Territory resident company or trust, income from sources outside Australia .................................................................


24F

United Nations, income from service with ............................

23AB

United States projects, income from approved overseas projects .................................................................................


23AA

health

 

Thalidomide Foundation, trustee, income of .......................

23(ec)

life assurance

 

constitutionally protected fund, income attributable to ....

110CA

constitutionally protected fund, registered organisation, income attributable to ........................................................


116FC

CS/RA, percentage of notional amount ...............................

110C

CS/RA class of assessable income, registered organisation

116FA

CS/RA class of assessable income .........................................

110B

current pension liabilities, registered organisation ...............

116FB

foreign permanent establishment, income attributable to policy issued by ...................................................................


112C

life insurance company, grant from the Protection Fund ..

116DG

policies, income in relation to ..................................................

112A

pooled superannuation trust, disposal of units in ................

111B

pooled superannuation trust, registered organisation, disposal of units in ..............................................................................


116GC

reinsurance recovery and refund of premium, registered organisation, income from ................................................


116GE

mining

 

Aboriginal and Torres Strait Islander, mining payment .....

23AE

distributing body, mining payment ........................................

23AE

rights to mine, sale of ................................................................

330-60

social security or like payments

 

disability services payment .....................................................

24AF

domiciliary nursing care benefit .............................................

24AG

drought relief, payment for .....................................................

24AIA to 24AIB

persecution victim, pension etc.  for ......................................

23(kc)

resistance fighter and victim of wartime persecution, pension and etc. for ...........................................................................


23(kca)

social security, payment from ................................................

24AB to 24ABZD

student and youth, assistance payment to ...........................

24ABZE to 24ABZF

veteran, Australian and United Kingdom, payment to ......

24AH

veteran, payment to .................................................................

24AC to 24ACWA, 24AE

wounds and disability pension ................................................

24AI

student

 

see education

 

superannuation or related business

 

Approved Deposit Fund, continuously complying fixed interest, income from 25 May 1988 deposits ................


290A

Approved Deposit Fund, income from a grant of financial assistance under Part 23 of the Superannuation Industry (Supervision) Act 1993 ......................................................



315C

Approved Deposit Fund, non-reversionary bonuses on policies of life assurance ..................................................................


291A

Approved Deposit Fund, pre-1 July 1988 income ...............

291

pooled superannuation trust, income from constitutionally protected funds ...................................................................


297C

pooled superannuation trust, income from current pension liabilities of complying superannuation funds ..............


297B

pooled superannuation trust, non-reversionary bonuses on policies of life assurance ....................................................


297A

pooled superannuation trust, pre-1 July 1988 income .......

297

superannuation fund, income from current pension
liabilities ................................................................................


283

superannuation fund, income from segregated current pensions assets ....................................................................


282B

superannuation fund, non-reversionary bonuses on policies of life assurance .......................................................................


282A

superannuation fund, pre-1 July 1988 income ....................

282

superannuation fund, regulated, income from a grant of financial assistance under Part 23 of the Superannuation Industry (Supervision) Act 1993 ......................................



315C

United Nations

 

Australian Federal Police member in Cambodia, pay and allowance .............................................................................


23ADA

United Nations Service, income from ....................................

23AB

vice regal

 

Governor-General, official salary and foreign income .......

23(a)(i)

State Governor, official salary and foreign income ............

23(a)(i)

welfare

 

Handicapped Persons Assistance Act 1974, bonus from ..

23(kba)

maintenance payment .............................................................

23(l)

rent subsidy ................................................................................

23(ke)

Note:          The following provisions of the Income Tax Assessment Act 1936 give rise to notional exempt income and not exempt income. For this reason the provisions do not appear in the lists of kinds of exempt income.

                   The provisions are: paragraphs 384(1)(b) and 385(1)(b), subsection 402(2) and sections 403 and 404.


 

Division 12Particular kinds of deductions

  

12-5  List of provisions about deductions

                   The provisions set out in the table contain rules about specific types of deduction.

                   Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 

accrued leave transfer payments

 

.......................................................................................................

51(3)

advance expenditure

 

generally ......................................................................................

82KZL to 82KZO

avoidance arrangements .........................................................

82KJ

when deductible .........................................................................

82KZM

associated persons

 

associated persons and relatives, amounts paid to, reduction of deduction .........................................................................


65(1) to 65(1F)

family members, expenses incurred in maintaining, no deduction for .......................................................................


65(2)

averaging of incomes

 

generally ......................................................................................

149 to 158A

excess of allowable deductions ..............................................

154

bad debts

 

general .........................................................................................

63, 63F

companies ..................................................................................

63A to 63CA

debt/equity swaps .....................................................................

63E, 63F

money lenders, listed country branches, no deduction
for ..........................................................................................


63D

see also losses

 

banks

 

Commonwealth Savings Bank of Australia ........................

160ABB

foreign banks, Australian branches of ..................................

160ZZVA to 160ZZZJ

boats

 

no deduction for ........................................................................

51AB

see also depreciation

 

borrowing expenses

 

.......................................................................................................

67

buildings

 

capital allowances .....................................................................

Division 40

income producing buildings, capital allowances .................

Division 43

see also heritage conservation work

 

capital allowances

 

.......................................................................................................

Division 40

see also depreciation and development allowance

 

capital gains

 

no deduction for an amount that would otherwise be deductible only because a net capital gain is included in assessable income ...............................................................



51AAA

capital loss

 

net capital loss, no deduction for ...........................................

160ZO

net capital loss, transfer within company group ..................

160ZP

car disposal

 

see depreciation

 


 

car expenses

 

generally ......................................................................................

Division 28

“cents per kilometre” method .................................................

Subdivision 28-C

“log book” method ...................................................................

Subdivisions 28-F and 28-G

“one-third of actual expenses” method ................................

Subdivision 28-E

substantiation of car expenses ...............................................

Division 900

“12% of original value” method ............................................

Subdivision 28-D

car expenses of employee

 

employee’s car expenses where car provided by employer can be used for private purposes, no deduction for .....


51AF

car parking

 

employee’s car parking expenses, no deduction for ...........

51AGA

self-employed persons, partnerships and trusts car parking expenses, no deduction for ...............................................


51AGB

self-employed persons, partnerships and trusts car parking expenses, reduced deduction approved using allowed method ..................................................................................



89A to 89JC

children’s income

 

generally ......................................................................................

102AA to 102AJ

taxable income of a child, deductions taken into consideration in calculating ..............................................


102AD

club fees

 

club fees, no deduction for ......................................................

51AB

see also subscriptions to associations

 

companies, co-operative and mutual

 

generally ......................................................................................

117 to 121

distributions of assessable income .........................................

120

companies, private

 

excessive payments to shareholders directors and associates, reduced deduction ..........................................


109

composite incomes

 

more than one class of income, order in which deductions must be claimed if entity in receipt of .............................


50

controlled foreign companies

 

generally ......................................................................................

316 to 468

bad debts ....................................................................................

399A

depreciation ................................................................................

398

finance share dividends ...........................................................

394

taxes paid ...................................................................................

393

convertible notes

 

see interest

 

copyrights

 

expenditure in obtaining registration .....................................

68A

currency exchange gains and losses

 

see foreign exchange

 

depreciation

 

generally ......................................................................................

54 to 62AAV

calculation of depreciation ......................................................

56

car disposal, balancing adjustment under section 59 may be reduced by Commissioner ...........................................


59AAA

deduction for ..............................................................................

54

disposal, loss or destruction of depreciated property, balancing adjustment ........................................................


59

iron and steel production, special depreciation ....................

57AK

motor vehicle, limit on cost price ............................................

57AF

partial use of property, only partial deduction ....................

61

roll-over relief, unpooled property ..........................................

58

trading ships, special depreciation ..........................................

57AM


 

designs

 

expenditure in obtaining or extending registration ..............

68A

development allowance

 

generally ......................................................................................

82AAAA to 82AQ

disposal of property after 12 months.....................................

82AH

leased property, limit on deduction for .................................

26-55

lessor may transfer benefit of deduction to lessee ..............

82AD

new property, capital expenditure incurred after 26 February 1992, additional deduction ...............................................


82AB, 82AM

disposal of depreciated property

 

see depreciation

 

dividends

 

debt dividends ............................................................................

67AA

franking credits, companies and non-residents ...................

160AR, 160ARD

franking credits, pooled development funds (PDFs) ...........

124ZM

drought investment allowance

 

see primary production

 

education expenses

 

Higher Education Contribution Scheme, no deduction unless provided as fringe benefit ..................................................


51(6), 51(6A)

limit on deduction .....................................................................

82A

election expenses

 

Federal and State Parliament election expenses .................

74, 74B

local government election expenses, limited deduction
for...........................................................................................


74A, 74B

electricity connections

 

capital cost of ............................................................................

70A


 

embezzlement

 

embezzlement, defalcation, larceny, misappropriation, losses caused by ..................................................................


71

employees

 

pensions, gratuities or retiring allowances for ex‑employees .................................................................................................


78

see also shares

 

entertainment

 

expenditure, no deduction for some ......................................

51AE

meal entertainment, calculation of deductible amount .....

51AEA to 51AEC

environment

 

environmental impact studies .................................................

82B to 82BG

environment protection expenditure .....................................

82BH to 82BR

exploration and prospecting

 

.......................................................................................................

Subdivision 330-A

film income

 

Australian films .........................................................................

124ZAA to 124ZAP

exempt film income ..................................................................

23H

see also losses

 

financial arrangements

 

see borrowing expenses, infrastructure borrowings, interest, leases and securities

 

foreign exchange

 

losses ............................................................................................

82U to 82ZB

foreign income

 

limit on deduction .....................................................................

79D


 

foreign investment funds (FIFs)

 

generally ......................................................................................

469 to 624

loss under cash surrender values method .............................

533

loss under market value method ............................................

532

notional deductions ..................................................................

567 to 574

foreign life assurance policies

 

see foreign investment funds

 

foreign tax credits

 

generally ......................................................................................

160AE to 160AFF

Australian branch of a foreign bank, foreign tax paid on interest received by the branch from a place outside Australia ...............................................................................



160ZZY

freight

 

freight for shipped goods .........................................................

135A

fringe benefits

 

contributions for private component, no deduction for .....

51AJ

employee’s car expenses where car provided by employer can be used for private purposes, no deduction for .....

 

51AF

employee’s car parking expenses, no deduction for ...........

51AGA

expense payment fringe benefits, reduced deduction ........

51AH

gifts

 

general .........................................................................................

78

cultural organisations, eligibility criteria ................................

78AA

environmental organisations, eligibility criteria ...................

78AB

limit on deduction .....................................................................

26-55

see also tax avoidance schemes

 

grape vines

 

see primary production

 

horticultural plants

 

see primary production

 

heritage conservation work

 

generally ......................................................................................

159U to 159UY

rebate, no deduction if entitled to a  ......................................

159UU

Higher Education Contribution Scheme (HECS)

 

no deduction for unless fringe benefit ...................................

51(6), 51(6A)

income equalisation deposits

 

see primary production

 

industrial property

 

generally ......................................................................................

124K to 124Z

deduction for ...........................................................

124M

disposal or lapse of a unit of industrial property

124N, 124PA, 124Q

copyright design and patents, expenditure in obtaining grant or registration .............................................................


68A

infrastructure borrowings

 

generally ......................................................................................

159GZZZZD to 159GZZZZH

no deduction for ........................................................................

159GZZZZE

insurance and annuity business

 

generally ......................................................................................

116E to 116J

assets, notional Part IIIA disposal of ....................................

116GA

benefits or reinsurance premiums, no deduction for ..........

116HAD

deductions for ............................................................................

116H

investment component, cost of obtaining ............................

116HAC

superannuation premiums, expenditure incurred in obtaining ...............................................................................


116HAB

insurance with non-residents

 

generally ......................................................................................

141 to 148

insurance premiums, no deduction unless arrangement to pay tax ..................................................................................


145

reinsurance, no deduction for resident carrying on insurance business in Australia for reinsurance premiums paid to a non-resident .....................................



148

interest

 

convertible notes, interest on, generally ................................

82L to 82T

interest for underpayment or late payment of tax .............

51(5)

interest, no deduction for interest paid by a non-resident until the withholding tax payable has been paid ..........


221YRA(1)

life assurance premiums, interest etc.  on loans to finance, no deduction for ..................................................................


67AAA

non-residents, debt creation involving, generally ................

159GZY to 159GZZF

superannuation contributions, interest etc.  on loans to finance, no deduction for ..................................................


67AAA

thin capitalisation by non-residents, generally .....................

159GZA to 159GZX

see also infrastructure borrowings

 

international agreements

 

see transfer pricing

 

international profit shifting

 

see transfer pricing

 

investment company

 

see shares

 

iron and steel production

 

special depreciation for property used in basic iron and steel production ...................................................................


57AK

land degradation

 

see primary production

 

larceny

 

see embezzlement

 

lease document expenses

 

.......................................................................................................

68


 

leases

 

finance leases and arrangements, use of property if end‑user an exempt public body or use outside Australia to produce exempt income ..............................



159GE to 159GO

improvements on leased land and premiums, leases assigned or surrendered before 23 October 1964 and for mining leases assigned or surrendered before 10 May 1968 .......................................................................




83 to 89, 88A(3)

leveraged arrangements, property used:

 

      •  other than to produce assessable income; or

 

      •  by a non-resident outside Australia; or

 

      •  by a previous owner

 

.........................................................................................................

51AD

leave payments

 

accrued leave transfer payments ...........................................

51(3)

no deduction for leave payments until paid ........................

51(3)

legal expenses

 

capital legal expenses, limited deduction for .......................

64A

leisure facilities

 

no deduction for ........................................................................

51AB

life assurance companies

 

.......................................................................................................

110 to 116DK

loans

 

see borrowing expenses, interest and securities

 


 

losses

 

foreign exchange .......................................................................

82U to 82ZB

profit-making undertaking or scheme ...................................

52

property sale ...............................................................................

52

traditional securities, loss on disposal or redemption of .....

70B

see also tax losses

 

management and investment company shares

 

see shares

 

membership of associations

 

see subscriptions to associations

 

mining

 

generally ......................................................................................

Division 330

gold mining .................................................................................

159GZZG to 159GZZZBI

uranium mining .........................................................................

23D

mortgage

 

expenses of discharging a mortgage ......................................

67A

motor vehicles

 

see car expenses and leases

 

non-cash transactions

 

non-cash business benefits ......................................................

51AK

non-cash consideration, money value deemed to have been paid or given ...............................................................


21

non-resident trust estates

 

generally ......................................................................................

102AAA to 102AAZG

modified application of depreciation provisions .................

102AAY

modified application of trading stock provisions ................

102AAZ

no deductions allowable under section 79E, 79F, 80, 80AAA or 80AA ..................................................................


102AAZC


 

offshore banking units

 

generally ......................................................................................

121A to 121EL

deductions for ............................................................................

121EG

foreign tax deduction ...............................................................

121EI

partnerships

 

losses, partner’s share of partnership loss .............................

90, 92

patents

 

expenditure relating to grant of patents, etc. ........................

68A

penalties

 

no deduction for penalties .......................................................

51(4)

petroleum prospecting and mining

 

generally ......................................................................................

Division 330

petroleum resource rent tax payments ..................................

Subdivision 330-G

plant and articles

 

see capital allowances and depreciation

 

pooled development funds (PDFs)

 

.......................................................................................................

124ZM to 124ZZD

prepaid expenditure

 

see advance expenditure

 

primary production

 

drought investment allowance, generally .............................

625 to 684

grape vines, expenditure incurred in establishing ................

75AA

horticultural plants, establishment costs of ..........................

124ZZD to 124ZZR

income equalisation deposits ..................................................

159GA to 159GDA

land, preparing clearing ploughing or draining land for use in primary production and other activities .....................


75A

land degradation, expenses incurred in preventing .............

75D

telephone lines, cost of extending ..........................................

70

water, expenditure on conserving or conveying ..................

75B

see also electricity connections

 

promoters recoupment tax

 

general .........................................................................................

78B

limit on deduction .....................................................................

26-55

property

 

arrangements relating to use of property if end-user an exempt public body or use outside Australia to produce exempt income ....................................................................



159GE to 159GO

leveraged arrangements, property used:

 

      •  other than to produce assessable income; or

 

      •  by a non-resident outside Australia; or

 

      •  by a previous owner

 

.........................................................................................................

51AD

sale of property, profit or loss .................................................

82(2)

see also capital allowances, depreciation and losses

 

public trading trusts

 

generally ......................................................................................

102M to 102T

debt dividends, application of section 67AA .......................

102T(4A)

qualifying securities

 

see securities

 

quarrying

 

.......................................................................................................

Division 330

regional headquarters (RHQs)

 

.......................................................................................................

82C to 82CE

reimbursements

 

expense payment fringe benefits, reduced deduction ........

51AH


 

reinsurance

 

see insurance with non-residents

 

relatives, payments to

 

see associated persons

 

repairs

 

general .........................................................................................

53

repair covenants, payment for non-compliance with covenant to repair under lease .........................................


53AA

research & development

 

generally ......................................................................................

73B to 73G

scientific research ......................................................................

73A

roads

 

see timber

 

royalties

 

royalty paid where tax instalment deductions have not been made by the payer, no deduction for ....................


221YRA

scientific research

 

see research & development

 

securities

 

qualifying securities ..................................................................

159GP to 159GZ

substituted securities .................................................................

23K

traditional securities, loss on disposal or redemption of .....

70B

shares

 

buy-backs ...................................................................................

159GZZZJ to 159GZZZT

cancellation of subsidiary’s shares in holding company ...

159GZZZC to 159GZZZI

employee share acquisition schemes, deduction for provider of qualifying shares or rights .............................


139DC

see also dividends and securities

 

State Bank of NSW

 

no deduction under section 82AAC .......................................

121EP

State or Territory bodies (STBs)

 

body ceasing to be STB, some deductions not allowed .....

24AW to 24AYA

subscriptions to associations

 

.......................................................................................................

73

substantiation

 

work, travel and car expenses..................................................

Division 900

successive deductions

 

setting off deductions where more than one class of income ..................................................................................


49

superannuation

 

see insurance and annuity business and interest

 

superannuation and related business

 

generally ......................................................................................

267 to 315F

asset disposals ............................................................................

304

death or disability benefits, deduction for future service element .................................................................................


279B

death or disability cover, premiums for ................................

279

detriment payments ..................................................................

279D

financial assistance levy ..........................................................

315B, 315F

superannuation—eligible person contributions

 

general .........................................................................................

82AAS to 82AAT

limit on deduction .....................................................................

26-55


 

superannuation—employer contributions

 

generally ......................................................................................

82AAA to 82AAR

contributions to eligible superannuation fund for employees ............................................................................


82AAC

contributions to non-complying funds ..................................

82AAD,

82AAE

deposits under the Small Superannuation Accounts Act 1995 ......................................................................................


82AAF

no deduction for under any other provision of the Act ......

82AAR

superannuation guarantee charge

 

no deduction for ........................................................................

51(9)

superannuation levy

 

late lodgment amount, no deduction for ..............................

51(8)

tax agent’s fees

 

see tax related expenses

 

tax avoidance schemes

 

companies, use of tax losses or deductions to avoid tax ...

Division 175

diverted assessable income .....................................................

121F to 121L

dividend stripping ......................................................................

46A, 177E

gifts ..............................................................................................

78A

international profit shifting, transfer pricing .........................

136AA to 136AG

prepaid outgoings to avoid tax ...............................................

82KJ

recouped expenditure ...............................................................

82KH to 82KL

tax avoidance scheme, no deduction allowable where deduction the result of. ......................................................


177A to 177G

trading stock ...............................................................................

31C, 52A


 

tax file number (TFN) withholding tax

 

investor, no deduction for ........................................................

221YHZZA

tax losses

 

bad debts, companies ...............................................................

63CA

change of ownership or control of a company

 

generally ...................................................................

Division 165

for earlier income years .........................................

Subdivision 165-A

for income year of the change .............................

Subdivision 165-B

earlier income years ..................................................................

Division 36

film losses ...................................................................................

Subdivision 375-G

pooled development funds ......................................................

Subdivision 195‑A

transfer between companies in same wholly‑owned
group .....................................................................................


Subdivision 170-A

tax related expenses

 

.......................................................................................................

69

telephone lines

 

see primary production

 

timber

 

access roads for timber operations, expenditure on ...........

124F

land attributable to felled timber, part of purchase price ..

124J

mill buildings, expenditure on .................................................

124JA to 124JD

trading ships

 

see depreciation

 

trading stock

 

Commissioner may determine whether consideration paid for  chose in action is reasonable .....................................


52A

excess of opening stock over closing value ..........................

28(3)

expenditure deemed not to be of a capital nature ..............

51(2)

prepayments, when stock becomes trading stock on
hand ......................................................................................


51(2A)

see also tax avoidance schemes

 

traditional securities

 

see securities

 

training guarantee

 

training guarantee charge, no deduction for ........................

51(7)

transfer pricing

 

generally ......................................................................................

136AA to 136AG

adjustments to deductions ......................................................

136AF

travel expenses

 

accompanying relatives, no deduction for some travel expenses ...............................................................................


51AG

see also substantiation

 

trusts

 

trust income, deductions considered in calculating .............

95 to 102

unit trusts ....................................................................................

102D to 102L

see also non-resident trust estates and  public trading trusts

 

uniforms

 

non-compulsory uniforms .......................................................

51AL

uranium mining

 

see mining

 

water

 

see primary production

 

work expenses

 

see substantiation

 

 


 

Division 13Tax offsets

13-1  List of tax offsets

                   The provisions set out in the list allow you a *tax offset.

                   Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 

Aboriginal study assistance

 

see social security and other benefit payments

 

annual leave

 

see leave payments

 

annuity

 

see eligible termination payments

 

approved deposit funds (ADFs)

 

see dividends

 

averaging

 

see primary production

 

bonuses

 

see life assurance

 

child

 

hardship ......................................................................................

102AJ

increased tax payable under Part III Division 6AA, unreasonable .......................................................................


102AH

trust income ................................................................................

100(2)

child/housekeeper

 

see dependants

 

Commonwealth Savings Bank

 

payments by ..............................................................................

160ABB


 

corporate unit trusts

 

see dividends

 

defence force

 

members serving overseas .......................................................

79B

dependants

 

child of person keeping house for the person........................

159J

housekeeper, caring for child, invalid relative or disabled spouse ...................................................................................


159L

invalid relative ...........................................................................

159J

parents/parents in law ..............................................................

159J

sole parent ..................................................................................

159K

spouse ..........................................................................................

159J

see also medical expenses

 

dividends

 

franked, received by:

 

general .........................................................................................

160AQU

beneficiaries of a trust ..............................................................

160AQX

company through a partnership or trust ...............................

160APQ

life assurance companies .........................................................

160AQZA

partners .......................................................................................

160AQZ

superannuation funds, approved deposit funds (ADFs) and pooled superannuation trusts (PSTs) ...............................


160AQYA

trustees ........................................................................................

160AQY

received by:

 

company as shareholder ..........................................................

46(2)

company as shareholder, part of dividend stripping operation ..............................................................................


46A

company through a partnership or trust ...............................

45Z

corporate unit trusts ..................................................................

102L

public trading trust ....................................................................

102T


 

drought relief

 

see social security and other benefit payments

 

eligible termination payments (ETPs)

 

eligible termination payment annuity, rebatable ................

159SU

superannuation contributions .................................................

159SZ

superannuation pension, rebatable ........................................

159SM

termination payments ..............................................................

159SA

see also leave payments

 

films

 

see foreign tax

 

foreign tax

 

film income, credit for overseas tax paid .............................

160AGA(3)

foreign income, credit for overseas tax paid ........................

160AF

shipping income, credit for overseas tax paid ......................

160AGB(3)

franked dividends

 

see dividends

 

hardship

 

see child

 

heritage conservation

 

.......................................................................................................

159UQ to 159UT

housekeeper

 

see dependants

 

imputation

 

see dividends

 

inter-corporate dividends

 

see dividends

 

interest

 

tax paid on by company .........................................................

127

invalid relative

 

see dependants

 

leave payments

 

annual leave, unused ................................................................

159SA

long service leave, unused .......................................................

159SA

legal disability

 

see trusts

 

life assurance

 

bonus, receipt of ........................................................................

160AAB

loan interest

 

securities issued before 1 November 1968, received on......

160AB

long service leave

 

see leave payments

 

low income earner

 

.......................................................................................................

159N

lump sum income arrears

 

receipt of .....................................................................................

159ZRA, 159ZRB

medical expenses

 

payment of .................................................................................

159P

non-resident beneficiary

 

see trusts

 

non-resident trust estate

 

see trusts

 

overseas defence force service

 

see defence force

 

overseas tax

 

see foreign tax

 

parent/parent-in-law

 

see dependants

 

partnerships

 

see dividends

 


 

pension

 

see social security and other benefit payments

 

pooled superannuation trusts (PSTs)

 

see dividends

 

primary production

 

averaging of income .................................................................

156

drought relief payments see social security and other benefit payments

 

public trading trust

 

see dividends

 

public unit trust

 

see dividends

 

rebatable ETP annuity

 

see eligible termination payments

 

residents of isolated areas

 

see zone

 

shipping income

 

see foreign tax

 

sickness benefits

 

see social security and other benefit payments

 

social security and other benefit payments

 

Aboriginal study assistance scheme ......................................

160AAA(3)

children, assistance for isolated ..............................................

160AAA(3)

drought relief, farm household support .................................

160AAA(3)

pension, social security pension and veteran’s pension .....

160AAA(2)

textile, clothing and footwear allowance ..............................

160AAA(3)

unemployment, sickness and other benefit payments under the Social Security Act 1991 .................................


160AAA(3)

sole parent

 

see dependants

 


 

spouse

 

see dependants

 

superannuation

 

see eligible termination payments

 

superannuation funds

 

see dividends

 

tax credit

 

see foreign tax

 

termination payments

 

see eligible termination payments

 

trustee

 

see dividends and trusts

 

trusts

 

non-resident beneficiary ..........................................................

98A(2)

non-resident trust estate, winding-up .....................................

102AAN

trust income of beneficiary with legal disability ..................

100(2)