Contents
Part I—Preliminary 1
1............................ Short title............................................................................ 1
2............................ Interpretation....................................................................... 1
2A......................... Application of the Criminal Code....................................... 3
2B.......................... Act binds the Crown........................................................... 3
3............................ Application......................................................................... 4
3AA...................... Schedule 1.......................................................................... 4
Part IA—Administration 5
3A......................... General administration of Act............................................. 5
3B.......................... Annual report...................................................................... 5
3C.......................... Reporting of information about corporate tax entity with reported total income of $100 million or more............................................................................................ 6
3CA....................... Reporting of information by corporate country by country reporting entities 8
3E.......................... Reporting of information about entity with PRRT payable 10
3F.......................... Reporting of information about junior minerals exploration incentive offset 11
3G......................... Electronic invoicing.......................................................... 11
Part II—Commissioner of Taxation, Second Commissioner of Taxation and Deputy Commissioner of Taxation 13
4............................ Commissioner and Second Commissioners of Taxation... 13
4A......................... Statutory Agency etc. for purposes of Public Service Act 13
5............................ Tenure of Commissioner and Second Commissioners..... 13
5A......................... Remuneration and allowances of Commissioner and Second Commissioners 13
6............................ Leave of absence............................................................... 14
6A......................... Resignation....................................................................... 14
6B.......................... Acting appointments......................................................... 14
6C.......................... Suspension and removal from office of Commissioner or Second Commissioner 15
6D......................... Powers of Second Commissioner..................................... 17
7............................ Deputy Commissioners of Taxation................................. 17
8............................ Delegation......................................................................... 18
Part IIA—The general interest charge 19
8AAA................... Overview.......................................................................... 19
8AAB.................... When the general interest charge applies........................... 19
8AAC.................... Amount of the general interest charge............................... 25
8AAD................... What is the general interest charge rate?......................... 26
8AAE.................... When the charge is due and payable................................. 27
8AAF.................... Notification by Commissioner.......................................... 27
8AAG................... Remission of the charge.................................................... 27
8AAGA................ Rounding of the charge..................................................... 28
8AAH................... Judgment for payment of an unpaid amount..................... 28
Part IIB—Running balance accounts, application of payments and credits, and related matters 30
Division 1—Preliminary 30
8AAZA................. Definitions........................................................................ 30
8AAZAA.............. Amounts relating to Coronavirus economic response payments 33
8AAZB................. Trustee to be treated as separate entity for each capacity... 33
Division 2—Running Balance Accounts (or RBAs) 34
8AAZC................. Establishment of RBAs.................................................... 34
8AAZD................. Allocation of tax debts to RBAs....................................... 34
8AAZF.................. General interest charge on RBA deficit debt..................... 35
8AAZG................. RBA statements................................................................ 35
8AAZH................. Liability for RBA deficit debt........................................... 35
8AAZI................... RBA statement to be evidence.......................................... 36
8AAZJ.................. Evidentiary certificate about RBA transactions etc............ 36
Division 3—Treatment of payments, credits and RBA surpluses 38
8AAZL.................. Amounts covered by this Division................................... 38
8AAZLA............... Method 1—allocating the amount first to an RBA............ 39
8AAZLB............... Method 2—applying the amount first against a non‑RBA tax debt 39
8AAZLC............... RBA surplus and related credits must remain equivalent if one or the other is applied 40
8AAZLD............... Special priority credits...................................................... 40
8AAZLE............... Instructions to Commissioner not binding........................ 41
Division 3A—Refunds of RBA surpluses and credits 42
8AAZLF............... Commissioner must refund RBA surpluses and credits... 42
8AAZLG............... Retaining refunds until information or notification given.. 43
8AAZLGA............ Retaining refunds while Commissioner verifies information 43
8AAZLGB............ Retaining refunds until notification under Division 389 or ascertainment of liability 46
8AAZLH............... How refunds are made...................................................... 48
Division 4—Miscellaneous provisions about tax debts 49
8AAZM................ When payments are treated as received............................. 49
8AAZMA............. Electronic payment of tax debts........................................ 49
8AAZMB.............. Saturdays, Sundays and public holidays........................... 49
8AAZN................. Overpayments made by the Commissioner under taxation laws 50
Part III—Prosecutions and offences 51
Division 1—Preliminary 51
8A......................... Interpretation..................................................................... 51
8AC....................... Application of Part to the Tax Agent Services Act 2009.... 52
Division 2—Offences 53
Subdivision A—Failure to comply with taxation requirements 53
8B.......................... Interpretation..................................................................... 53
8C.......................... Failure to comply with requirements under taxation law... 54
8D......................... Failure to answer questions when attending before the Commissioner etc. 55
8E.......................... Penalties for failure to comply with requirements under taxation law 55
8F.......................... Election to treat offence otherwise than as prescribed taxation offence 56
8G......................... Order to comply with requirement.................................... 56
8H......................... Penalty for failure to comply with order to comply........... 57
8HA...................... Court may order payment of amount in addition to penalty 58
Subdivision B—Offences relating to statements, records and certain other Acts 58
8J........................... Interpretation..................................................................... 58
8K.......................... False or misleading statements.......................................... 64
8L.......................... Incorrectly keeping records etc......................................... 66
8M......................... Penalties for offences against subsections 8K(1) and (1B) and 8L(1) and (1A) 68
8N......................... Recklessly making false or misleading statements............ 68
8Q......................... Recklessly incorrectly keeping records etc........................ 69
8R.......................... Penalties for offences against sections 8N and 8Q........... 70
8S.......................... Election to treat offence otherwise than as prescribed taxation offence 71
8T.......................... Incorrectly keeping records with intention of deceiving or misleading etc. 71
8U......................... Falsifying or concealing identity with intention of deceiving or misleading etc. 72
8V......................... Penalties for offences against sections 8T and 8U............ 73
8W......................... Court may order payment of amount in addition to penalty 73
Subdivision BAA—Offences relating to electronic sales suppression tools 77
8WAA................... Object of this Subdivision................................................ 77
8WAB................... Interpretation..................................................................... 77
8WAC................... Producing or supplying electronic sales suppression tools 78
8WAD................... Possessing electronic sales suppression tools................... 79
8WAE................... Incorrectly keeping records using electronic sales suppression tools 79
Subdivision BA—Offences relating to tax file numbers 80
8WA...................... Unauthorised requirement etc. that tax file number be quoted 80
8WB...................... Unauthorised recording etc. of tax file number................. 81
8WC...................... Conducting affairs so as to avoid tax file number requirements 82
Subdivision C—Miscellaneous 84
8XA...................... Unauthorised access to taxation records........................... 84
8Y......................... Liability of officers etc. of corporations............................ 84
8Z.......................... Evidentiary certificate relating to previous convictions..... 85
Division 3—Prosecution of taxation offences 87
8ZA....................... Prosecution of taxation offences....................................... 87
8ZB....................... Prosecution may be commenced at any time..................... 88
8ZC....................... Place where offence committed......................................... 88
8ZD....................... Conduct by employees or agents of corporations............. 89
8ZE........................ Civil penalty not payable if prosecution instituted............. 89
8ZF........................ Penalties for corporations................................................. 90
8ZG....................... Enforcement of orders for payment.................................. 90
8ZH....................... Penalties not to relieve from tax........................................ 91
Division 4—Prescribed taxation offences 92
8ZJ........................ Prosecution of prescribed taxation offences...................... 92
8ZK....................... Protection of witnesses..................................................... 93
8ZL........................ Averment.......................................................................... 94
8ZM...................... Evidence of authority to institute proceedings................... 94
8ZN....................... Costs................................................................................. 95
Division 5—Service of summons for prescribed taxation offences 96
9............................ Interpretation..................................................................... 96
10.......................... Service of summons by post............................................. 96
11.......................... Notice of conviction in absentia....................................... 97
12.......................... Notice of intention to issue warrant in default of payment 97
13.......................... Limitation of action to enforce payment of fine................. 98
13A....................... Setting aside of conviction or order.................................. 98
13B........................ Proof of service of summons or notice........................... 101
13C........................ Application of other laws................................................ 101
Division 6—Setting aside etc. of conviction or order on application of Commissioner 102
13CA..................... Setting aside etc. of conviction or order on application of Commissioner 102
Part IIIA—Co‑operation between Commonwealth and State taxation authorities 104
Division 1—Interpretation 104
13D....................... Interpretation................................................................... 104
Division 2—Trans‑border investigations 106
13E........................ State taxation officers may refer matters to Commissioner for investigation 106
13F........................ Access to documents etc................................................. 106
13G....................... Commissioner may obtain information and evidence...... 107
Division 4—Certification by State taxation officer of copies of, and extracts from, documents 108
13K........................ Certification by State taxation officer of copies of, and extracts from, documents 108
Division 5—Australian Taxation Office may perform functions under State/Territory debits tax laws 110
13L........................ Australian Taxation Office may perform functions under State/Territory debits tax laws 110
Part IVA—Departure from Australia of certain tax debtors 112
Division 1—Interpretation 112
14Q....................... Interpretation................................................................... 112
Division 2—Prohibition and authorisation of departure of certain tax debtors 113
14R........................ Departure from Australia of certain tax debtors prohibited 113
14S........................ Departure prohibition orders........................................... 113
14T........................ Revocation and variation of departure prohibition orders 114
14U....................... Departure authorisation certificates................................. 115
Division 3—Appeals from, and review of, decisions of the Commissioner 118
14V....................... Appeals to courts against making of departure prohibition orders 118
14W....................... Jurisdiction of courts...................................................... 118
14X....................... Orders of court on appeal............................................... 118
14Y....................... Applications for review of certain decisions................... 119
Division 4—Enforcement 120
14Z........................ Powers of authorised officers......................................... 120
14ZA..................... Certain tax debtors to produce authority to depart etc..... 121
Part IVC—Taxation objections, reviews and appeals 122
Division 1—Introduction 122
14ZL...................... Part applies to taxation objections................................... 122
14ZM.................... Division 2—Interpretive................................................. 122
14ZN..................... Division 3—Taxation objections.................................... 122
14ZO..................... Division 4—Tribunal review.......................................... 122
14ZP...................... Division 5—Federal Court appeals................................. 122
Division 2—Interpretive provisions 123
14ZQ..................... General interpretation provisions.................................... 123
14ZR..................... Taxation decisions covered by single notice to be treated as single decision 124
14ZS...................... Ineligible income tax remission decisions....................... 125
Division 3—Taxation objections 126
14ZU..................... How taxation objections are to be made.......................... 126
14ZV..................... Limited objection rights in the case of certain amended taxation decisions 126
14ZVA.................. Limited objection rights because of other objections....... 126
14ZVB.................. Objections relating to excess concessional contributions 127
14ZVC.................. Objections relating to non‑concessional contributions.... 128
14ZW.................... When taxation objections are to be made........................ 129
14ZX..................... Commissioner to consider applications for extension of time 135
14ZY..................... Commissioner to decide taxation objections................... 135
14ZYA.................. Person may require Commissioner to make an objection decision 136
14ZYB.................. Requiring Commissioner to make a private ruling.......... 137
14ZZ...................... Person may seek review of, or appeal against, Commissioner’s decision 137
Division 4—AAT review of objection decisions and extension of time refusal decisions 139
14ZZA................... Modified AAT Act to apply........................................... 139
14ZZB................... Sections 27, 28, 41 and 44A of the AAT Act not to apply to certain decisions 139
14ZZC................... Modification of section 29 of the AAT Act.................... 139
14ZZD................... Modification of section 30 of the AAT Act.................... 140
14ZZE................... Hearings before Tribunal to be held in private if applicant so requests 140
14ZZF................... Modification of section 37 of the AAT Act.................... 140
14ZZG................... Modification of section 38 of the AAT Act.................... 141
14ZZJ.................... Modification of section 43 of the AAT Act.................... 142
14ZZK................... Grounds of objection and burden of proof..................... 142
14ZZL................... Implementation of Tribunal decisions............................. 143
14ZZM.................. Pending review not to affect implementation of taxation decisions 143
Division 5—Court appeals against objection decisions 144
14ZZN................... Time limit for appeals..................................................... 144
14ZZO................... Grounds of objection and burden of proof..................... 144
14ZZP................... Order of court on objection decision............................... 144
14ZZQ................... Implementation of court order in respect of objection decision 144
14ZZR................... Pending appeal not to affect implementation of taxation decisions 145
14ZZS................... Transfer of certain proceedings to Family Court............. 145
Part IVD—Protection for whistleblowers 148
14ZZT................... Disclosures qualifying for protection under this Part...... 148
14ZZU................... Eligible whistleblowers................................................... 149
14ZZV................... Eligible recipients............................................................ 149
14ZZW.................. Confidentiality of whistleblower’s identity..................... 150
14ZZX................... Disclosure that qualifies for protection not actionable etc. 152
14ZZY................... Victimisation prohibited.................................................. 152
14ZZZ................... Compensation and other remedies—circumstances in which an order may be made 154
14ZZZAA............. Detriment........................................................................ 156
14ZZZA................ Compensation and other remedies—orders that may be made 157
14ZZZB................. Identifying information not to be disclosed etc. to courts or tribunals 159
14ZZZC................. Costs only if proceedings instituted vexatiously etc........ 159
14ZZZD................ Interaction between civil proceedings and criminal offences 160
14ZZZE................. Compensation for acquisition of property....................... 160
Part V—Miscellaneous 161
15.......................... Appearance by Commissioner etc................................... 161
15A....................... Certification by Commissioner of copies of, and extracts from, documents 162
15B........................ Recoverable advances..................................................... 164
15C........................ Recoverable payments.................................................... 165
15D....................... Reports about recoverable advances and recoverable payments 167
16.......................... Payments out of Consolidated Revenue Fund................ 169
16A....................... Regulations may provide for methods of payment of tax liabilities etc. 170
16B........................ Certain liabilities to be reduced to nearest multiple of 5 cents.. 171
17.......................... Powers of taxation officers in relation to references to currency etc. 171
17A....................... Powers of Federal Court and Federal Circuit Court in respect of taxation matters 172
18.......................... Regulations..................................................................... 173
Schedule 1—Collection and recovery of income tax and other liabilities 174
Chapter 2—Collection, recovery and administration of income tax 174
Part 2‑1—Introduction to the Pay as you go (PAYG) system 174
Division 6—Guide to Parts 2‑5 and 2‑10 174
6‑1......................... What Parts 2‑5 and 2‑10 are about.................................. 174
6‑5......................... The Pay as you go (PAYG) system............................... 174
6‑10....................... How the amounts collected are dealt with....................... 175
Part 2‑5—Pay as you go (PAYG) withholding 176
Division 10—Guide to Part 2‑5 176
10‑1....................... What this Part is about.................................................... 176
10‑5....................... Summary of withholding payments................................ 176
Division 11—Preliminary matters 179
11‑1....................... Object of this Part........................................................... 179
11‑5....................... Constructive payment..................................................... 179
Division 12—Payments from which amounts must be withheld 181
Subdivision 12‑A—General rules 181
12‑1....................... General exceptions.......................................................... 182
12‑5....................... What to do if more than one provision requires a withholding 183
12‑7....................... Division does not apply to alienated personal services payments 185
12‑10..................... Division does not apply to non‑cash benefits................. 185
12‑20..................... Application of Division and regulations to non‑share dividends 185
Subdivision 12‑B—Payments for work and services 186
12‑35..................... Payment to employee...................................................... 186
12‑40..................... Payment to company director.......................................... 186
12‑45..................... Payment to office holder................................................. 186
12‑47..................... Payment to religious practitioners................................... 187
12‑50..................... Return to work payment................................................. 187
12‑55..................... Voluntary agreement to withhold.................................... 188
12‑60..................... Payment under labour hire arrangement, or specified by regulations 189
Subdivision 12‑C—Payments for retirement or because of termination of employment 190
12‑80..................... Superannuation income streams and annuities................ 190
12‑85..................... Superannuation lump sums and payments for termination of employment 190
12‑90..................... Unused leave payments.................................................. 190
Subdivision 12‑D—Benefit and compensation payments 190
12‑110................... Social Security or other benefit payment......................... 191
12‑115................... Commonwealth education or training payment............... 191
12‑120................... Compensation, sickness or accident payment................. 192
Subdivision 12‑E—Payments where TFN or ABN not quoted 192
Payment in respect of investment 193
12‑140................... Recipient does not quote tax file number........................ 193
12‑145................... Investor becoming presently entitled to income of a unit trust 194
12‑150................... Limited application of section 12‑140 to payment under financial arrangement 195
12‑152................... Limited application of section 12‑140 to payment covered by section 12A‑205 196
12‑155................... When investor may quote ABN as alternative................ 196
12‑160................... Investment body unaware that exemption from quoting TFN has stopped applying 196
12‑165................... Exception for fully franked dividend.............................. 197
12‑170................... Exception for payments below thresholds set by regulations 197
Payment of income of closely held trust where TFN not quoted 197
12‑175................... Trustee distributes income of closely held trust.............. 197
12‑180................... Beneficiary becomes presently entitled to income of closely held trust 199
12‑185................... Exception for payments below thresholds set by regulations 200
Payment for a supply 201
12‑190................... Recipient does not quote ABN....................................... 201
Subdivision 12‑F—Dividend, interest and royalty payments 204
Dividends 205
12‑210................... Dividend payment to overseas person............................ 205
12‑215................... Dividend payment received for foreign resident............. 205
12‑220................... Application to part of a dividend..................................... 206
12‑225................... Application to distribution by a liquidator or other person 206
Interest 206
12‑245................... Interest payment to overseas person............................... 206
12‑250................... Interest payment received for foreign resident................ 207
12‑255................... Interest payment derived by lender in carrying on business through overseas permanent establishment 207
12‑260................... Lender to notify borrower if interest derived through overseas permanent establishment 208
Royalties 208
12‑280................... Royalty payment to overseas person............................... 208
12‑285................... Royalty payment received for foreign resident................ 209
General 210
12‑300................... Limits on amount withheld under this Subdivision......... 210
Subdivision 12‑FA—Departing Australia superannuation payments 210
12‑305................... Departing Australia superannuation payment................. 210
12‑310................... Limits on amount withheld under this Subdivision......... 210
Subdivision 12‑FAA—Excess untaxed roll‑over amount 211
12‑312................... Untaxed roll‑over superannuation benefits..................... 211
12‑313................... Limits on amount withheld under this Subdivision......... 211
Subdivision 12‑FB—Payments to foreign residents etc. 212
12‑315................... Payment to foreign resident etc....................................... 212
12‑317................... Payment received for foreign resident etc....................... 213
12‑319................... Exemptions from withholding obligations under this Subdivision 214
Subdivision 12‑FC—Seasonal Labour Mobility Program 215
12‑319A................ Payment to employee...................................................... 216
Subdivision 12‑G—Payments in respect of mining on Aboriginal land, and natural resources 216
Mining on Aboriginal land 216
12‑320................... Mining payment.............................................................. 216
Natural resources 217
12‑325................... Natural resource payment............................................... 217
12‑330................... Payer must ask Commissioner how much to withhold... 217
12‑335................... Commissioner may exempt from section 12‑330, subject to conditions 218
Subdivision 12‑H—Distributions of withholding MIT income 219
Guide to Subdivision 12‑H 219
12‑375................... What this Subdivision is about....................................... 219
Operative provisions 221
12‑383................... Meaning of withholding MIT.......................................... 221
12‑385................... Withholding by withholding MITs................................. 221
12‑390................... Withholding by custodians and other entities.................. 223
12‑395................... Requirement to give notice or make information available 226
12‑405................... Meaning of fund payment—general case........................ 229
12‑410................... Entity to whom payment is made.................................... 232
12‑415................... Failure to give notice or make information available: administrative penalty 232
12‑420................... Agency rules................................................................... 233
12‑425................... Meaning of clean building managed investment trust.... 233
12‑430................... Meaning of clean building.............................................. 234
12‑435................... Meaning of non‑concessional MIT income.................... 235
12‑436................... Meaning of asset entity, operating entity, cross staple arrangement and stapled entity 235
12‑437................... Meaning of MIT cross staple arrangement income....... 237
12‑438................... MIT cross staple arrangement income—de minimis exception 239
12‑439................... MIT cross staple arrangement income—approved economic infrastructure facility exception 240
12‑440................... Transitional—MIT cross staple arrangement income...... 242
12‑441................... Integrity rule—concessional cross staple rent cap........... 245
12‑442................... Meaning of excepted MIT CSA income........................... 246
12‑443................... Concessional cross staple rent cap—existing lease with specified rent or rent method 246
12‑444................... Concessional cross staple rent cap—general................... 247
12‑445................... Asset entity to allocate deductions first against rental income that is not MIT cross staple arrangement income........................................................................................ 248
12‑446................... Meaning of MIT trading trust income............................ 249
12‑447................... Transitional—MIT trading trust income......................... 250
12‑448................... Meaning of MIT agricultural income, Australian agricultural land for rent and Division 6C land 251
12‑449................... Transitional—MIT agricultural income........................... 252
12‑450................... Meaning of MIT residential housing income.................. 254
12‑451................... Transitional—MIT residential housing income............... 255
12‑452................... Meaning of residential dwelling asset............................ 256
12‑453................... MIT agricultural income and MIT residential housing income—capital gains in relation to membership interests........................................................................... 257
Subdivision 12‑J—FHSS released amounts 259
12‑460................... FHSS released amounts.................................................. 259
Division 12A—Distributions by AMITs (including deemed payments) 260
Guide to Division 12A 260
12A‑1.................... What this Division is about............................................. 260
Subdivision 12A‑A—Distributions by AMITs relating to dividend, interest and royalties 261
Guide to Subdivision 12A‑A 261
12A‑5.................... What this Subdivision is about....................................... 261
Operative provisions 261
12A‑10.................. Deemed payments—no obligation to withhold under Subdivision 12‑F (dividend, interest and royalty payments)....................................................................... 261
12A‑15.................. Dividend, interest or royalty payments relating to AMIT—requirement to give notice or make information available.......................................................................... 262
12A‑20.................. Failure to give notice or make information available under section 12A‑15: administrative penalty 265
12A‑25.................. Meaning of AMIT DIR payment..................................... 265
12A‑30.................. Meaning of AMIT dividend payment.............................. 266
12A‑35.................. Meaning of AMIT interest payment................................ 267
12A‑40.................. Meaning of AMIT royalty payment................................. 268
Subdivision 12A‑B—Distributions by AMITs relating to Subdivision 12‑H fund payments 269
Guide to Subdivision 12A‑B 269
12A‑100................ What this Subdivision is about....................................... 269
Operative provisions 269
12A‑105................ Deemed payments—no obligation to withhold under Subdivision 12‑H 269
12A‑110................ Meaning of fund payment—AMITs............................... 270
Subdivision 12A‑C—Deemed payments by AMITs etc. 274
Guide to Subdivision 12A‑C 274
12A‑200................ What this Subdivision is about....................................... 274
Operative provisions 275
12A‑205................ Issue of AMMA statement etc. deemed to be payment... 275
12A‑210................ Post‑AMMA actual payment and pre‑AMMA actual payment in respect of deemed payment 277
12A‑215................ AMIT payment to the Commissioner in respect of deemed payments to offshore entities etc. 278
12A‑220................ Custodian payment to the Commissioner in respect of deemed payments to offshore entities etc. 279
Division 13—Alienated personal services payments 282
13‑1....................... Object of this Division.................................................... 282
13‑5....................... Payment to the Commissioner in respect of alienated personal services payments 282
13‑10..................... Alienated personal services payments............................. 285
13‑15..................... Personal services payment remitters............................... 286
13‑20..................... Time for payments to Commissioner for alienated personal services payments made during 2000‑01 287
Division 14—Benefits, gains and taxable supplies for which amounts must be paid to the Commissioner 288
Subdivision 14‑A—Non‑cash benefits 288
14‑1....................... Object of this Subdivision.............................................. 288
14‑5....................... Provider of non‑cash benefit must pay amount to the Commissioner if payment would be subject to withholding..................................................................... 288
14‑10..................... Dividend, interest or royalty received, for a foreign resident, in the form of a non‑cash benefit 289
14‑15..................... Payer can recover amount paid to the Commissioner...... 290
Subdivision 14‑B—Accruing gains 290
14‑50..................... Object of this Subdivision.............................................. 290
14‑55..................... Liability for TFN withholding tax................................... 291
14‑60..................... Investment body may recover TFN withholding tax from investor 292
14‑65..................... Application of rules in Division 18................................. 292
14‑75..................... Overpayment of TFN withholding tax............................ 293
14‑85..................... Other laws do not exempt from TFN withholding tax.... 293
Subdivision 14‑C—Shares and rights under employee share schemes 294
14‑155................... Liability for TFN withholding tax (ESS)........................ 294
14‑160................... Employer may give individual tax file numbers to provider 295
14‑165................... Provider may recover TFN withholding tax (ESS) from individual 295
14‑170................... Application of rules in Division 18................................. 296
14‑175................... Overpayment of TFN withholding tax (ESS)................. 296
14‑180................... Application of certain provisions of Division 83A of the Income Tax Assessment Act 1997 296
Subdivision 14‑D—Capital proceeds involving foreign residents and taxable Australian property 297
14‑200................... Certain acquisitions of taxable Australian property from foreign residents 297
14‑205................... Effect of look‑through earnout rights.............................. 298
14‑210................... Whether an entity is a relevant foreign resident............... 299
14‑215................... Excluded transactions..................................................... 301
14‑220................... Commissioner clearance certificates................................ 303
14‑225................... Entity declarations........................................................... 303
14‑230................... Administrative penalties for false or misleading declarations 304
14‑235................... Varying amounts to be paid to the Commissioner.......... 305
Subdivision 14‑E—GST payable on taxable supplies of certain real property 306
14‑250................... Recipients of certain taxable supplies of real property must pay amounts to Commissioner 307
14‑255................... Notification by suppliers of residential premises etc....... 309
Division 15—Working out the amount to withhold 312
Guide to Division 15 312
15‑1....................... What this Division is about............................................. 312
Subdivision 15‑A—Working out how much to withhold 312
15‑10..................... How much to withhold................................................... 313
15‑15..................... Variation of amounts required to be withheld................. 313
Subdivision 15‑B—Withholding schedules and regulations 314
15‑25..................... Commissioner’s power to make withholding schedules. 314
15‑30..................... Matters to be considered when making withholding schedules 315
15‑35..................... Regulations about withholding....................................... 317
Subdivision 15‑C—Declarations 317
15‑50..................... Declarations.................................................................... 317
Division 16—Payer’s obligations and rights 320
Guide to Division 16 320
16‑1....................... What this Division is about............................................. 320
Subdivision 16‑A—To withhold 320
When to withhold 321
16‑5....................... When to withhold an amount.......................................... 321
16‑7....................... Treat entity obliged to pay under Subdivision 12A‑C as having withheld amount under Division 12 321
16‑20..................... Payer discharged from liability to recipient for amount withheld 322
Penalties for not withholding 322
16‑25..................... Failure to withhold: offence............................................ 322
16‑30..................... Failure to withhold: administrative penalty for entity other than exempt Australian government agency 323
16‑35..................... Failure to withhold: administrative penalty for exempt Australian government agency in relation to payment other than dividend, interest or royalty............................ 324
16‑40..................... Failure to withhold: administrative penalty for exempt Australian government agency in relation to dividend, interest or royalty payment.............................................. 325
16‑43..................... Failure to withhold: administrative penalty for exempt Australian government agency in relation to payment to foreign resident etc.......................................................... 325
Subdivision 16‑B—To pay withheld amounts to the Commissioner 326
When and how to pay amounts to the Commissioner 326
16‑70..................... Entity to pay amounts to Commissioner......................... 326
16‑75..................... When amounts must be paid to Commissioner............... 327
16‑80..................... Penalty for failure to pay within time.............................. 329
16‑85..................... How amounts are to be paid........................................... 329
Who is a large, medium or small withholder 330
16‑95..................... Meaning of large withholder.......................................... 330
16‑100................... Meaning of medium withholder...................................... 331
16‑105................... Meaning of small withholder.......................................... 331
16‑110................... Commissioner may vary withholder’s status downwards 331
16‑115................... Commissioner may vary withholder’s status upwards... 332
Subdivision 16‑BA—To be registered 333
Registration of withholders 334
16‑140................... Withholders must be registered....................................... 334
16‑141................... Registration and cancellation........................................... 335
Branch registration 335
16‑142................... Branches may be registered............................................ 335
16‑143................... Separate amounts for entities and branches..................... 336
16‑144................... Cancellation of branch registration.................................. 336
16‑145................... Effect on branches of cancelling the entity’s registration 336
Registration of employers of working holiday makers 337
16‑146................... Employers of working holiday makers must be registered 337
16‑147................... Registering employers of working holiday makers......... 337
16‑148................... Cancelling the registration of employers of working holiday makers 339
Subdivision 16‑C—To provide information 341
To the Commissioner 341
16‑150................... Commissioner must be notified of amounts.................... 341
16‑152................... Annual reports—Withholding payments covered by section 12‑175 342
16‑153................... Annual reports—other payments.................................... 343
To recipients of withholding payments 346
16‑155................... Annual payment summary.............................................. 346
16‑156................... Annual payment summary for sections 12‑175 and 12‑180 348
16‑157................... Payment summary for Subdivision 12‑H....................... 348
16‑160................... Part‑year payment summary........................................... 349
16‑165................... Payment summaries for superannuation lump sums and payments for termination of employment 350
16‑166................... Payment summary for a departing Australia superannuation payment 351
16‑167................... Payment summary for payment to recipient who does not quote ABN 351
16‑170................... Form and content of payment summary.......................... 352
16‑175................... Penalty for not providing payment summary.................. 353
16‑180................... Commissioner may exempt entity from giving payment summary 354
16‑182................... Definition of reportable employer superannuation contribution 354
Subdivision 16‑D—Additional rights and obligations of entity that makes a payment 355
16‑195................... Payer’s right to recover amounts of penalty: certain withholding taxes 355
Division 18—Recipient’s entitlements and obligations 357
Subdivision 18‑A—Crediting withheld amounts 357
Guide to Subdivision 18‑A 357
18‑1....................... What this Subdivision is about....................................... 357
General exception 359
18‑5....................... No credit for refunded amount........................................ 359
Entitlement to credits: income tax liability 359
18‑10..................... Application of sections 18‑15, 18‑20 and 18‑25............. 359
18‑15..................... Tax credit for recipient of withholding payments............ 360
18‑20..................... Tax credit where recipient is a partnership...................... 360
18‑25..................... Tax credit where recipient is a trust................................. 361
18‑27..................... Tax credit for alienated personal services payments........ 363
Entitlement to credits: dividend, interest or royalty, amount attributable to fund payment or Seasonal Labour Mobility Program 363
18‑30..................... Credit: dividend, interest or royalty................................. 363
18‑32..................... Credit: amount attributable to fund payment................... 364
18‑33..................... Credit: Seasonal Labour Mobility Program.................... 365
18‑35..................... Credit: penalty under section 12‑415, 16‑30, 16‑35 or 16‑40 or related general interest charge 365
18‑40..................... Credit: liability under Part 4‑25....................................... 367
Entitlement to credit: departing Australia superannuation payment 369
18‑42..................... Credit—departing Australia superannuation payment..... 369
Entitlement to credit: mining payment 370
18‑45..................... Credit—mining payment................................................. 370
Entitlement to credit: Petroleum resource rent tax 371
18‑55..................... Credit—Natural resource payments................................ 371
Entitlement to credit: taxable supply of real property 371
18‑60..................... Credit—payment relating to taxable supply of real property 371
Subdivision 18‑B—Refund of certain withheld amounts 372
18‑65..................... Refund of withheld amounts by the payer to the recipient 372
18‑70..................... Refund of withheld amounts by the Commissioner to the recipient 375
18‑80..................... Refund by Commissioner of amount withheld from payment in respect of investment 377
18‑85..................... Refund by Commissioner of amount withheld from payment in respect of supply of real property 378
Subdivision 18‑C—Recipient’s obligations 378
18‑100................... Obligation to keep payment summary............................. 378
Subdivision 18‑D—Directors etc. of non‑complying companies 379
Object of Subdivision 380
18‑120................... Object of Subdivision..................................................... 380
PAYG withholding non‑compliance tax 380
18‑125................... Directors of non‑complying companies.......................... 380
18‑130................... Directors of non‑complying companies—tax reduced in certain circumstances 382
18‑135................... Associates of directors of non‑complying companies..... 383
18‑140................... Notices............................................................................ 387
18‑145................... When PAYG withholding non‑compliance tax must be paid.. 388
18‑150................... General interest charge payable on unpaid PAYG withholding non‑compliance tax 389
18‑155................... Validity of decisions and evidence.................................. 389
18‑160................... Rights of indemnity and contribution.............................. 390
Credits for later compliance 391
18‑165................... Credits for later compliance—scope............................... 391
18‑170................... Credits for later compliance—Commissioner must give notice in certain circumstances 391
18‑175................... Credits for later compliance—Commissioner may give notice 393
18‑180................... Effect of earlier credits.................................................... 394
Other provisions 395
18‑185................... When Commissioner may give notice............................. 395
18‑190................... Review of decisions........................................................ 396
Division 20—Other matters 397
Subdivision 20‑B—Offences 397
20‑35..................... Offences......................................................................... 397
20‑40..................... Joining of charges........................................................... 398
20‑45..................... Offences that would otherwise be committed by a partnership or unincorporated company 399
Subdivision 20‑D—Review of decisions 400
20‑80..................... Reviewable decisions...................................................... 400
Division 21—Entitlements relating to insolvent ADIs and general insurers 402
Guide to Division 21 402
21‑1....................... What this Division is about............................................. 402
Subdivision 21‑A—Treatment of some payments by APRA 402
21‑5....................... APRA treated like ADI or general insurance company.. 402
Part 2‑10—Pay as you go (PAYG) instalments 404
Division 45—Instalment payments 404
Guide to Division 45 405
45‑1....................... What this Division is about............................................. 405
Subdivision 45‑A—Basic rules 406
45‑5....................... Object of this Part........................................................... 406
45‑10..................... Application of Part.......................................................... 408
45‑15..................... Liability for instalments.................................................. 408
45‑20..................... Information to be given to the Commissioner by certain payers 409
45‑25..................... Penalty for failure to notify Commissioner..................... 410
45‑30..................... Credit for instalments payable......................................... 410
Subdivision 45‑B—When instalments are due 411
45‑50..................... Liability to pay instalments............................................. 411
45‑60..................... Meaning of instalment quarter....................................... 412
45‑61..................... When quarterly instalments are due—payers of quarterly instalments 413
45‑65..................... Meaning of instalment month......................................... 414
45‑67..................... When monthly instalments are due—payers of monthly instalments 414
45‑70..................... When annual instalments are due.................................... 415
45‑72..................... Means of payment of instalment..................................... 415
45‑75..................... Instalments recoverable in same way as income tax........ 415
45‑80..................... General interest charge on late payment.......................... 415
45‑90..................... Commissioner may withdraw instalment rate................. 415
Subdivision 45‑C—Working out instalment amounts 416
45‑110................... How to work out amount of quarterly instalment on instalment income basis 416
45‑112................... Amount of instalment for quarterly payer who pays on basis of GDP‑adjusted notional tax 417
45‑114................... How to work out amount of monthly instalment............ 418
45‑115................... How to work out amount of annual instalment............... 419
45‑120................... Meaning of instalment income........................................ 420
Subdivision 45‑D—Quarterly payers 424
45‑125................... Quarterly payer who pays instalments on the basis of instalment income 424
45‑130................... Quarterly payer who pays on the basis of GDP‑adjusted notional tax 426
45‑132................... Quarterly payer who pays 4 instalments annually on the basis of GDP‑adjusted notional tax 428
45‑134................... Quarterly payer who pays 2 instalments annually on the basis of GDP‑adjusted notional tax 429
Subdivision 45‑DA—Monthly payers 431
45‑136................... Monthly payer................................................................ 431
45‑138................... Monthly payer requirement............................................. 432
Subdivision 45‑E—Annual payers 434
When you start and stop being an annual payer 434
45‑140................... Choosing to pay annual instalments................................ 434
45‑145................... Meaning of instalment group......................................... 436
45‑150................... Entity stops being annual payer if involved with GST registration or instalment group 436
45‑155................... Entity stops being annual payer if notional tax is $8,000 or more, or entity chooses to pay quarterly 437
45‑160................... Head company of a consolidated group stops being annual payer 438
Subdivision 45‑F—Varying the instalment rate for quarterly or monthly payers who pay on the basis of instalment income 439
45‑200................... Application..................................................................... 439
45‑205................... Choosing a varied instalment rate................................... 439
45‑210................... Notifying Commissioner of varied instalment rate.......... 440
45‑215................... Credit on using varied rate in certain cases..................... 440
Subdivision 45‑G—General interest charge payable in certain cases if instalments are too low 441
45‑225................... Effect of Subdivision in relation to monthly payers........ 442
45‑230................... Liability to GIC on shortfall in quarterly instalment worked out on the basis of varied rate 442
45‑232................... Liability to GIC on shortfall in quarterly instalment worked out on the basis of estimated benchmark tax........................................................................................ 444
45‑233................... Reduction in GIC liability under section 45‑232 if shortfall is made up in later instalment 452
45‑235................... Liability to GIC on shortfall in annual instalment........... 453
45‑240................... Commissioner may remit general interest charge............ 455
Subdivision 45‑H—Partnership income 455
45‑260................... Instalment income for a period in which you are in a partnership 455
Subdivision 45‑I—Trust income included in instalment income of beneficiary 456
45‑280................... Instalment income for a period in which you are a beneficiary of a trust 457
45‑285................... Instalment income includes distributions by certain resident unit trusts 459
45‑286................... Instalment income includes distributions by certain managed investment trusts 461
45‑287................... When trusts are disqualified due to concentrated ownership 461
45‑288................... Resident investment trusts for beneficiaries who are absolutely entitled 463
45‑290................... Exceptions to exclusion of trust capital gains from beneficiary’s instalment income 464
Subdivision 45‑J—How Commissioner works out your instalment rate and notional tax 464
45‑320................... Working out instalment rate............................................ 464
45‑325................... Working out your notional tax........................................ 465
45‑330................... Working out your adjusted taxable income.................... 467
45‑335................... Working out your adjusted withholding income............. 469
45‑340................... Adjusted tax on adjusted taxable income or on adjusted withholding income 469
Subdivision 45‑K—How Commissioner works out your benchmark instalment rate and benchmark tax 472
45‑355................... When Commissioner works out benchmark instalment rate and benchmark tax 472
45‑360................... How Commissioner works out benchmark instalment rate 473
45‑365................... Working out your benchmark tax................................... 473
45‑370................... Working out your adjusted assessed taxable income for the variation year 474
45‑375................... Adjusted assessed tax on adjusted assessed taxable income 475
Subdivision 45‑L—How Commissioner works out amount of quarterly instalment on basis of GDP‑adjusted notional tax 477
45‑400................... Working out amount of instalment—payers of 4 quarterly instalments 478
45‑402................... Working out amount of instalment—payers of 2 quarterly instalments 479
45‑405................... Working out your GDP‑adjusted notional tax................ 481
Subdivision 45‑M—How amount of quarterly instalment is worked out on basis of your estimate of your benchmark tax 483
45‑410................... Working out amount of instalment—payers of 4 quarterly instalments 483
45‑412................... Working out amount of instalment—payers of 2 quarterly instalments 485
45‑415................... Estimating your benchmark tax....................................... 487
45‑420................... Credit in certain cases where amount of instalment is nil 488
Subdivision 45‑N—How this Part applies to the trustee of a trust 488
Trustees to whom this Part applies 489
45‑450................... Trustees to whom a single instalment rate is given......... 489
45‑455................... Trustees to whom several instalment rates are given....... 489
45‑460................... Rest of Subdivision applies only to multi‑rate trustees... 491
45‑465................... Meaning of instalment income........................................ 491
45‑468................... Multi‑rate trustee may pay quarterly instalments............. 491
How Commissioner works out instalment rate and notional tax for a multi‑rate trustee 492
45‑470................... Working out instalment rate............................................ 492
45‑473................... Commissioner must notify you of notional tax............... 493
45‑475................... Working out your notional tax........................................ 493
45‑480................... Working out your adjusted taxable income.................... 493
45‑483................... Meaning of reduced beneficiary’s share and reduced no beneficiary’s share 494
45‑485................... Working out your adjusted withholding income............. 495
How Commissioner works out benchmark instalment rate and benchmark tax for a multi‑rate trustee 495
45‑525................... When Commissioner works out benchmark instalment rate and benchmark tax 495
45‑530................... How Commissioner works out benchmark instalment rate 496
45‑535................... Working out your benchmark tax................................... 496
Subdivision 45‑P—Anti‑avoidance rules 497
45‑595................... Object of this Subdivision.............................................. 497
45‑597................... Effect of Subdivision in relation to instalment months.... 498
45‑600................... General interest charge on tax benefit relating to instalments 498
45‑605................... When do you get a tax benefit from a scheme?............... 500
45‑610................... What is your tax position for an income year?................ 500
45‑615................... What is your hypothetical tax position for an income year? 503
45‑620................... Amount on which GIC is payable, and period for which it is payable 503
45‑625................... Credit if you also got a tax detriment from the scheme... 504
45‑630................... When do you get a tax detriment from a scheme?........... 505
45‑635................... No tax benefit or detriment results from choice for which income tax law expressly provides 506
45‑640................... Commissioner may remit general interest charge in special cases 508
Subdivision 45‑Q—General rules for consolidated groups 508
Guide to Subdivision 45‑Q 508
45‑700................... What this Subdivision is about....................................... 508
Application of Subdivision 509
45‑703................... Effect of this Subdivision and Subdivision 45‑R in relation to monthly payers 509
45‑705................... Application of Subdivision to head company................. 510
Usual operation of this Part for consolidated group members 514
45‑710................... Single entity rule............................................................. 514
45‑715................... When instalments are due—modification of section 45‑61 515
45‑720................... Head company cannot be an annual payer—modification of section 45‑140 515
Membership changes 515
45‑740................... Change of head company................................................ 515
45‑755................... Entry rule (for an entity that becomes a subsidiary member of a consolidated group) 518
45‑760................... Exit rule (for an entity that ceases to be a subsidiary member of a consolidated group) 519
45‑775................... Commissioner’s power to work out different instalment rate or GDP‑adjusted notional tax 521
Subdivision 45‑R—Special rules for consolidated groups 523
Guide to Subdivision 45‑R 523
45‑850................... What this Subdivision is about....................................... 523
Operative provisions 524
45‑855................... Section 701‑1 disregarded for certain purposes.............. 524
45‑860................... Member having a different instalment period.................. 524
45‑865................... Credit rule....................................................................... 525
45‑870................... Head company’s liability to GIC on shortfall in quarterly instalment 527
45‑875................... Other rules about the general interest charge................... 530
45‑880................... Continued application of Subdivision 45‑Q to the head company of an acquired group 531
45‑885................... Early application of Subdivision 45‑Q to the head company of a new group 533
Subdivision 45‑S—MEC groups 534
Guide to Subdivision 45‑S 534
45‑900................... What this Subdivision is about....................................... 534
Preliminary 535
45‑905................... Objects of Subdivision................................................... 535
General modification rules 536
45‑910................... Extended operation of Part to cover MEC groups.......... 536
Extended operation of Subdivision 45‑Q 537
45‑913................... Sections 45‑705 and 45‑740 do not apply to members of MEC groups 537
45‑915................... Application of Subdivision 45‑Q to provisional head company 537
45‑917................... Assumption for applying section 45‑710 (single entity rule) 541
45‑920................... Change of provisional head company............................. 541
45‑922................... Life insurance company.................................................. 544
Extended operation of Subdivision 45‑R 545
45‑925................... Additional modifications of sections 45‑855 and 45‑860 545
45‑930................... Modifications of sections 45‑865 and 45‑870 and a related provision 545
45‑935................... Additional modifications of section 45‑885.................... 546
Part 2‑15—Returns and assessments 547
Division 70—Tax receipts 547
Guide to Division 70 547
70‑1....................... What this Division is about............................................. 547
Subdivision 70‑A—Tax receipts 547
70‑5....................... Tax receipt to be provided to certain individual taxpayers 547
Part 2‑30—Collecting Medicare levy with income tax 550
Division 90—Medicare levy and Medicare levy surcharge 550
Subdivision 90‑A—Treatment like income tax 550
90‑1....................... Laws apply in relation to Medicare levy and Medicare levy surcharge as they apply in relation to income tax........................................................................................ 550
Part 2‑35—Excess superannuation contributions 551
Division 95—Excess concessional contributions charge 551
Guide to Division 95 551
95‑1....................... What this Division is about............................................. 551
Subdivision 95‑A—Object of Division 551
95‑5....................... Object of Division.......................................................... 551
Subdivision 95‑B—Excess concessional contributions charge 552
95‑10..................... Liability to excess concessional contributions charge..... 552
95‑15..................... Amount of excess concessional contributions charge..... 553
95‑20..................... When excess concessional contributions charge is due and payable 553
95‑25..................... General interest charge.................................................... 554
Division 97—Excess contributions determinations 555
Subdivision 97‑A—Excess concessional contributions determinations 555
Guide to Subdivision 97‑A 555
97‑1....................... What this Subdivision is about....................................... 555
Operative provisions 555
97‑5....................... Determination of excess concessional contributions and charge 555
97‑10..................... Review............................................................................ 556
Subdivision 97‑B—Excess non‑concessional contributions determinations 556
Guide to Subdivision 97‑B 556
97‑20..................... What this Subdivision is about....................................... 556
Operative provisions 557
97‑25..................... Excess non‑concessional contributions determinations... 557
97‑30..................... Associated earnings........................................................ 557
97‑35..................... Review............................................................................ 558