Contents
Part I—Preliminary 1
1............................ Short title............................................................................ 1
2............................ Interpretation....................................................................... 1
2A......................... Application of the Criminal Code....................................... 3
2B.......................... Act binds the Crown........................................................... 4
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
3H......................... Reporting of information about research and development tax offset 12
Part II—Commissioner of Taxation, Second Commissioner of Taxation and Deputy Commissioner of Taxation 14
4............................ Commissioner and Second Commissioners of Taxation... 14
4A......................... Statutory Agency etc. for purposes of Public Service Act 14
5............................ Tenure of Commissioner and Second Commissioners..... 14
5A......................... Remuneration and allowances of Commissioner and Second Commissioners 14
6............................ Leave of absence............................................................... 15
6A......................... Resignation....................................................................... 15
6B.......................... Acting appointments......................................................... 15
6C.......................... Suspension and removal from office of Commissioner or Second Commissioner 16
6D......................... Powers of Second Commissioner..................................... 18
7............................ Deputy Commissioners of Taxation................................. 18
8............................ Delegation......................................................................... 19
Part IIA—The general interest charge 20
8AAA................... Overview.......................................................................... 20
8AAB.................... When the general interest charge applies........................... 20
8AAC.................... Amount of the general interest charge............................... 27
8AAD................... What is the general interest charge rate?......................... 27
8AAE.................... When the charge is due and payable................................. 28
8AAF.................... Notification by Commissioner.......................................... 28
8AAG................... Remission of the charge.................................................... 29
8AAGA................ Rounding of the charge..................................................... 30
8AAH................... Judgment for payment of an unpaid amount..................... 30
Part IIB—Running balance accounts, application of payments and credits, and related matters 31
Division 1—Preliminary 31
8AAZA................. Definitions........................................................................ 31
8AAZAA.............. Amounts relating to Coronavirus economic response payments 34
8AAZB................. Trustee to be treated as separate entity for each capacity... 34
Division 2—Running Balance Accounts (or RBAs) 35
8AAZC................. Establishment of RBAs.................................................... 35
8AAZD................. Allocation of tax debts to RBAs....................................... 35
8AAZF.................. General interest charge on RBA deficit debt..................... 36
8AAZG................. RBA statements................................................................ 36
8AAZH................. Liability for RBA deficit debt........................................... 36
8AAZI................... RBA statement to be evidence.......................................... 37
8AAZJ.................. Evidentiary certificate about RBA transactions etc............ 37
Division 3—Treatment of payments, credits and RBA surpluses 39
8AAZL.................. Amounts covered by this Division................................... 39
8AAZLA............... Method 1—allocating the amount first to an RBA............ 40
8AAZLB............... Method 2—applying the amount first against a non‑RBA tax debt 40
8AAZLC............... RBA surplus and related credits must remain equivalent if one or the other is applied 41
8AAZLD............... Special priority credits...................................................... 41
8AAZLE............... Instructions to Commissioner not binding........................ 42
Division 3A—Refunds of RBA surpluses and credits 43
8AAZLF............... Commissioner must refund RBA surpluses and credits... 43
8AAZLG............... Retaining refunds until information or notification given.. 44
8AAZLGA............ Retaining refunds while Commissioner verifies information 44
8AAZLGB............ Retaining refunds until notification under Division 389 or ascertainment of liability 47
8AAZLH............... How refunds are made...................................................... 49
Division 4—Miscellaneous provisions about tax debts 50
8AAZM................ When payments are treated as received............................. 50
8AAZMA............. Electronic payment of tax debts........................................ 50
8AAZMB.............. Saturdays, Sundays and public holidays........................... 50
8AAZN................. Overpayments made by the Commissioner under taxation laws 51
Part III—Prosecutions and offences 52
Division 1—Preliminary 52
8A......................... Interpretation..................................................................... 52
8AC....................... Application of Part to the Tax Agent Services Act 2009.... 53
Division 2—Offences 54
Subdivision A—Failure to comply with taxation requirements 54
8B.......................... Interpretation..................................................................... 54
8C.......................... Failure to comply with requirements under taxation law... 55
8D......................... Failure to answer questions when attending before the Commissioner etc. 56
8E.......................... Penalties for failure to comply with requirements under taxation law 56
8F.......................... Election to treat offence otherwise than as prescribed taxation offence 57
8G......................... Order to comply with requirement.................................... 57
8H......................... Penalty for failure to comply with order to comply........... 58
8HA...................... Court may order payment of amount in addition to penalty 59
Subdivision B—Offences relating to statements, records and certain other Acts 59
8J........................... Interpretation..................................................................... 59
8K.......................... False or misleading statements.......................................... 65
8L.......................... Incorrectly keeping records etc......................................... 67
8M......................... Penalties for offences against subsections 8K(1) and (1B) and 8L(1) and (1A) 69
8N......................... Recklessly making false or misleading statements............ 69
8Q......................... Recklessly incorrectly keeping records etc........................ 70
8R.......................... Penalties for offences against sections 8N and 8Q........... 71
8S.......................... Election to treat offence otherwise than as prescribed taxation offence 72
8T.......................... Incorrectly keeping records with intention of deceiving or misleading etc. 72
8U......................... Falsifying or concealing identity with intention of deceiving or misleading etc. 73
8V......................... Penalties for offences against sections 8T and 8U............ 74
8W......................... Court may order payment of amount in addition to penalty 74
Subdivision BAA—Offences relating to electronic sales suppression tools 78
8WAA................... Object of this Subdivision................................................ 78
8WAB................... Interpretation..................................................................... 78
8WAC................... Producing or supplying electronic sales suppression tools 79
8WAD................... Possessing electronic sales suppression tools................... 80
8WAE................... Incorrectly keeping records using electronic sales suppression tools 80
Subdivision BA—Offences relating to tax file numbers 81
8WA...................... Unauthorised requirement etc. that tax file number be quoted 81
8WB...................... Unauthorised recording etc. of tax file number................. 82
8WC...................... Conducting affairs so as to avoid tax file number requirements 83
Subdivision C—Miscellaneous 85
8XA...................... Unauthorised access to taxation records........................... 85
8Y......................... Liability of officers etc. of corporations............................ 85
8Z.......................... Evidentiary certificate relating to previous convictions..... 86
Division 3—Prosecution of taxation offences 88
8ZA....................... Prosecution of taxation offences....................................... 88
8ZB....................... Prosecution may be commenced at any time..................... 89
8ZC....................... Place where offence committed......................................... 89
8ZD....................... Conduct by employees or agents of corporations............. 90
8ZE........................ Civil penalty not payable if prosecution instituted............. 90
8ZF........................ Penalties for corporations................................................. 91
8ZG....................... Enforcement of orders for payment.................................. 91
8ZH....................... Penalties not to relieve from tax........................................ 92
Division 4—Prescribed taxation offences 93
8ZJ........................ Prosecution of prescribed taxation offences...................... 93
8ZK....................... Protection of witnesses..................................................... 94
8ZL........................ Averment.......................................................................... 95
8ZM...................... Evidence of authority to institute proceedings................... 95
8ZN....................... Costs................................................................................. 96
Division 5—Service of summons for prescribed taxation offences 97
9............................ Interpretation..................................................................... 97
10.......................... Service of summons by post............................................. 97
11.......................... Notice of conviction in absentia....................................... 98
12.......................... Notice of intention to issue warrant in default of payment 98
13.......................... Limitation of action to enforce payment of fine................. 99
13A....................... Setting aside of conviction or order.................................. 99
13B........................ Proof of service of summons or notice........................... 102
13C........................ Application of other laws................................................ 102
Division 6—Setting aside etc. of conviction or order on application of Commissioner 103
13CA..................... Setting aside etc. of conviction or order on application of Commissioner 103
Part IIIA—Co‑operation between Commonwealth and State taxation authorities 105
Division 1—Interpretation 105
13D....................... Interpretation................................................................... 105
Division 2—Trans‑border investigations 107
13E........................ State taxation officers may refer matters to Commissioner for investigation 107
13F........................ Access to documents etc................................................. 107
13G....................... Commissioner may obtain information and evidence...... 108
Division 4—Certification by State taxation officer of copies of, and extracts from, documents 109
13K........................ Certification by State taxation officer of copies of, and extracts from, documents 109
Division 5—Australian Taxation Office may perform functions under State/Territory debits tax laws 111
13L........................ Australian Taxation Office may perform functions under State/Territory debits tax laws 111
Part IVA—Departure from Australia of certain tax debtors 113
Division 1—Interpretation 113
14Q....................... Interpretation................................................................... 113
Division 2—Prohibition and authorisation of departure of certain tax debtors 114
14R........................ Departure from Australia of certain tax debtors prohibited 114
14S........................ Departure prohibition orders........................................... 114
14T........................ Revocation and variation of departure prohibition orders 115
14U....................... Departure authorisation certificates................................. 116
Division 3—Appeals from, and review of, decisions of the Commissioner 119
14V....................... Appeals to courts against making of departure prohibition orders 119
14W....................... Jurisdiction of courts...................................................... 119
14X....................... Orders of court on appeal............................................... 119
14Y....................... Applications for review of certain decisions................... 120
Division 4—Enforcement 121
14Z........................ Powers of authorised officers......................................... 121
14ZA..................... Certain tax debtors to produce authority to depart etc..... 122
Part IVC—Taxation objections, reviews and appeals 123
Division 1—Introduction 123
14ZL...................... Part applies to taxation objections................................... 123
14ZM.................... Division 2—Interpretive................................................. 123
14ZN..................... Division 3—Taxation objections.................................... 123
14ZO..................... Division 4—Tribunal review.......................................... 123
14ZP...................... Division 5—Federal Court appeals................................. 123
Division 2—Interpretive provisions 124
14ZQ..................... General interpretation provisions.................................... 124
14ZR..................... Taxation decisions covered by single notice to be treated as single decision 125
14ZS...................... Ineligible income tax remission decisions....................... 125
Division 3—Taxation objections 127
14ZU..................... How taxation objections are to be made.......................... 127
14ZV..................... Limited objection rights in the case of certain amended taxation decisions 127
14ZVA.................. Limited objection rights because of other objections....... 127
14ZVB.................. Objections relating to excess concessional contributions 128
14ZVC.................. Objections relating to non‑concessional contributions.... 129
14ZW.................... When taxation objections are to be made........................ 130
14ZX..................... Commissioner to consider applications for extension of time 136
14ZY..................... Commissioner to decide taxation objections................... 136
14ZYA.................. Person may require Commissioner to make an objection decision 137
14ZYB.................. Requiring Commissioner to make a private ruling.......... 138
14ZZ...................... Person may seek review of, or appeal against, Commissioner’s decision 139
Division 4—AAT review of objection decisions and extension of time refusal decisions 140
14ZZA................... Modified AAT Act to apply........................................... 140
14ZZB................... Sections 27, 28, 41 and 44A of the AAT Act not to apply to certain decisions 140
14ZZC................... Modification of section 29 of the AAT Act.................... 140
14ZZD................... Modification of section 30 of the AAT Act.................... 141
14ZZE................... Hearings before Tribunal to be held in private if applicant so requests 141
14ZZF................... Modification of section 37 of the AAT Act.................... 141
14ZZG................... Modification of section 38 of the AAT Act.................... 142
14ZZJ.................... Modification of section 43 of the AAT Act.................... 143
14ZZK................... Grounds of objection and burden of proof..................... 143
14ZZL................... Implementation of Tribunal decisions............................. 144
14ZZM.................. Pending review not to affect implementation of taxation decisions 144
Division 5—Court appeals against objection decisions 145
14ZZN................... Time limit for appeals..................................................... 145
14ZZO................... Grounds of objection and burden of proof..................... 145
14ZZP................... Order of court on objection decision............................... 145
14ZZQ................... Implementation of court order in respect of objection decision 145
14ZZR................... Pending appeal not to affect implementation of taxation decisions 146
14ZZS................... Transfer of certain proceedings to Federal Circuit and Family Court of Australia (Division 1) 146
Part IVD—Protection for whistleblowers 149
14ZZT................... Disclosures qualifying for protection under this Part...... 149
14ZZU................... Eligible whistleblowers................................................... 150
14ZZV................... Eligible recipients............................................................ 150
14ZZW.................. Confidentiality of whistleblower’s identity..................... 151
14ZZX................... Disclosure that qualifies for protection not actionable etc. 153
14ZZY................... Victimisation prohibited.................................................. 153
14ZZZ................... Compensation and other remedies—circumstances in which an order may be made 155
14ZZZAA............. Detriment........................................................................ 157
14ZZZA................ Compensation and other remedies—orders that may be made 158
14ZZZB................. Identifying information not to be disclosed etc. to courts or tribunals 160
14ZZZC................. Costs only if proceedings instituted vexatiously etc........ 160
14ZZZD................ Interaction between civil proceedings and criminal offences 161
14ZZZE................. Compensation for acquisition of property....................... 161
Part V—Miscellaneous 162
15.......................... Appearance by Commissioner etc................................... 162
15A....................... Certification by Commissioner of copies of, and extracts from, documents 163
15B........................ Recoverable advances..................................................... 165
15C........................ Recoverable payments.................................................... 166
15D....................... Reports about recoverable advances and recoverable payments 168
16.......................... Payments out of Consolidated Revenue Fund................ 170
16A....................... Regulations may provide for methods of payment of tax liabilities etc. 171
16B........................ Certain liabilities to be reduced to nearest multiple of 5 cents.. 172
17.......................... Powers of taxation officers in relation to references to currency etc. 172
17A....................... Powers of Federal Court and Federal Circuit and Family Court of Australia (Division 2) in respect of taxation matters............................................................................ 173
18.......................... Regulations..................................................................... 174
Schedule 1—Collection and recovery of income tax and other liabilities 175
Chapter 2—Collection, recovery and administration of income tax 175
Part 2‑1—Introduction to the Pay as you go (PAYG) system 175
Division 6—Guide to Parts 2‑5 and 2‑10 175
6‑1......................... What Parts 2‑5 and 2‑10 are about.................................. 175
6‑5......................... The Pay as you go (PAYG) system............................... 175
6‑10....................... How the amounts collected are dealt with....................... 176
Part 2‑5—Pay as you go (PAYG) withholding 177
Division 10—Guide to Part 2‑5 177
10‑1....................... What this Part is about.................................................... 177
10‑5....................... Summary of withholding payments................................ 177
Division 11—Preliminary matters 180
11‑1....................... Object of this Part........................................................... 180
11‑5....................... Constructive payment..................................................... 180
Division 12—Payments from which amounts must be withheld 182
Subdivision 12‑A—General rules 182
12‑1....................... General exceptions.......................................................... 183
12‑5....................... What to do if more than one provision requires a withholding 184
12‑7....................... Division does not apply to alienated personal services payments 186
12‑10..................... Division does not apply to non‑cash benefits................. 186
12‑20..................... Application of Division and regulations to non‑share dividends 186
Subdivision 12‑B—Payments for work and services 187
12‑35..................... Payment to employee...................................................... 187
12‑40..................... Payment to company director.......................................... 187
12‑45..................... Payment to office holder................................................. 187
12‑47..................... Payment to religious practitioners................................... 188
12‑50..................... Return to work payment................................................. 188
12‑55..................... Voluntary agreement to withhold.................................... 189
12‑60..................... Payment under labour hire arrangement, or specified by regulations 190
Subdivision 12‑C—Payments for retirement or because of termination of employment 191
12‑80..................... Superannuation income streams and annuities................ 191
12‑85..................... Superannuation lump sums and payments for termination of employment 191
12‑90..................... Unused leave payments.................................................. 191
Subdivision 12‑D—Benefit and compensation payments 191
12‑110................... Social Security or other benefit payment......................... 192
12‑115................... Commonwealth education or training payment............... 192
12‑120................... Compensation, sickness or accident payment................. 193
Subdivision 12‑E—Payments where TFN or ABN not quoted 193
Payment in respect of investment 194
12‑140................... Recipient does not quote tax file number........................ 194
12‑145................... Investor becoming presently entitled to income of a unit trust 195
12‑150................... Limited application of section 12‑140 to payment under financial arrangement 196
12‑152................... Limited application of section 12‑140 to payment covered by section 12A‑205 197
12‑155................... When investor may quote ABN as alternative................ 197
12‑160................... Investment body unaware that exemption from quoting TFN has stopped applying 197
12‑165................... Exception for fully franked dividend.............................. 198
12‑170................... Exception for payments below thresholds set by regulations 198
Payment of income of closely held trust where TFN not quoted 198
12‑175................... Trustee distributes income of closely held trust.............. 198
12‑180................... Beneficiary becomes presently entitled to income of closely held trust 200
12‑185................... Exception for payments below thresholds set by regulations 201
Payment for a supply 202
12‑190................... Recipient does not quote ABN....................................... 202
Subdivision 12‑F—Dividend, interest and royalty payments 205
Dividends 206
12‑210................... Dividend payment to overseas person............................ 206
12‑215................... Dividend payment received for foreign resident............. 206
12‑220................... Application to part of a dividend..................................... 207
12‑225................... Application to distribution by a liquidator or other person 207
Interest 207
12‑245................... Interest payment to overseas person............................... 207
12‑250................... Interest payment received for foreign resident................ 208
12‑255................... Interest payment derived by lender in carrying on business through overseas permanent establishment 208
12‑260................... Lender to notify borrower if interest derived through overseas permanent establishment 209
Royalties 209
12‑280................... Royalty payment to overseas person............................... 209
12‑285................... Royalty payment received for foreign resident................ 210
General 211
12‑300................... Limits on amount withheld under this Subdivision......... 211
Subdivision 12‑FA—Departing Australia superannuation payments 211
12‑305................... Departing Australia superannuation payment................. 211
12‑310................... Limits on amount withheld under this Subdivision......... 211
Subdivision 12‑FAA—Excess untaxed roll‑over amount 212
12‑312................... Untaxed roll‑over superannuation benefits..................... 212
12‑313................... Limits on amount withheld under this Subdivision......... 212
Subdivision 12‑FB—Payments to foreign residents etc. 213
12‑315................... Payment to foreign resident etc....................................... 213
12‑317................... Payment received for foreign resident etc....................... 214
12‑319................... Exemptions from withholding obligations under this Subdivision 215
Subdivision 12‑FC—Seasonal Labour Mobility Program 216
12‑319A................ Payment to employee...................................................... 217
Subdivision 12‑G—Payments in respect of mining on Aboriginal land, and natural resources 217
Mining on Aboriginal land 217
12‑320................... Mining payment.............................................................. 217
Natural resources 218
12‑325................... Natural resource payment............................................... 218
12‑330................... Payer must ask Commissioner how much to withhold... 218
12‑335................... Commissioner may exempt from section 12‑330, subject to conditions 219
Subdivision 12‑H—Distributions of withholding MIT income 220
Guide to Subdivision 12‑H 220
12‑375................... What this Subdivision is about....................................... 220
Operative provisions 222
12‑383................... Meaning of withholding MIT.......................................... 222
12‑385................... Withholding by withholding MITs................................. 223
12‑390................... Withholding by custodians and other entities.................. 224
12‑395................... Requirement to give notice or make information available 227
12‑405................... Meaning of fund payment—general case........................ 230
12‑410................... Entity to whom payment is made.................................... 233
12‑415................... Failure to give notice or make information available: administrative penalty 233
12‑420................... Agency rules................................................................... 234
12‑425................... Meaning of clean building managed investment trust.... 234
12‑430................... Meaning of clean building.............................................. 235
12‑435................... Meaning of non‑concessional MIT income.................... 236
12‑436................... Meaning of asset entity, operating entity, cross staple arrangement and stapled entity 236
12‑437................... Meaning of MIT cross staple arrangement income....... 238
12‑438................... MIT cross staple arrangement income—de minimis exception 240
12‑439................... MIT cross staple arrangement income—approved economic infrastructure facility exception 241
12‑440................... Transitional—MIT cross staple arrangement income...... 243
12‑441................... Integrity rule—concessional cross staple rent cap........... 246
12‑442................... Meaning of excepted MIT CSA income........................... 247
12‑443................... Concessional cross staple rent cap—existing lease with specified rent or rent method 247
12‑444................... Concessional cross staple rent cap—general................... 248
12‑445................... Asset entity to allocate deductions first against rental income that is not MIT cross staple arrangement income........................................................................................ 249
12‑446................... Meaning of MIT trading trust income............................ 250
12‑447................... Transitional—MIT trading trust income......................... 251
12‑448................... Meaning of MIT agricultural income, Australian agricultural land for rent and Division 6C land 252
12‑449................... Transitional—MIT agricultural income........................... 253
12‑450................... Meaning of MIT residential housing income.................. 255
12‑451................... Transitional—MIT residential housing income............... 256
12‑452................... Meaning of residential dwelling asset............................ 257
12‑453................... MIT agricultural income and MIT residential housing income—capital gains in relation to membership interests........................................................................... 258
Subdivision 12‑J—FHSS released amounts 260
12‑460................... FHSS released amounts.................................................. 260
Division 12A—Distributions by AMITs (including deemed payments) 261
Guide to Division 12A 261
12A‑1.................... What this Division is about............................................. 261
Subdivision 12A‑A—Distributions by AMITs relating to dividend, interest and royalties 262
Guide to Subdivision 12A‑A 262
12A‑5.................... What this Subdivision is about....................................... 262
Operative provisions 262
12A‑10.................. Deemed payments—no obligation to withhold under Subdivision 12‑F (dividend, interest and royalty payments)....................................................................... 262
12A‑15.................. Dividend, interest or royalty payments relating to AMIT—requirement to give notice or make information available.......................................................................... 263
12A‑20.................. Failure to give notice or make information available under section 12A‑15: administrative penalty 266
12A‑25.................. Meaning of AMIT DIR payment..................................... 266
12A‑30.................. Meaning of AMIT dividend payment.............................. 267
12A‑35.................. Meaning of AMIT interest payment................................ 268
12A‑40.................. Meaning of AMIT royalty payment................................. 269
Subdivision 12A‑B—Distributions by AMITs relating to Subdivision 12‑H fund payments 270
Guide to Subdivision 12A‑B 270
12A‑100................ What this Subdivision is about....................................... 270
Operative provisions 270
12A‑105................ Deemed payments—no obligation to withhold under Subdivision 12‑H 270
12A‑110................ Meaning of fund payment—AMITs............................... 271
Subdivision 12A‑C—Deemed payments by AMITs etc. 275
Guide to Subdivision 12A‑C 275
12A‑200................ What this Subdivision is about....................................... 275
Operative provisions 276
12A‑205................ Issue of AMMA statement etc. deemed to be payment... 276
12A‑210................ Post‑AMMA actual payment and pre‑AMMA actual payment in respect of deemed payment 278
12A‑215................ AMIT payment to the Commissioner in respect of deemed payments to offshore entities etc. 279
12A‑220................ Custodian payment to the Commissioner in respect of deemed payments to offshore entities etc. 280
Division 13—Alienated personal services payments 283
13‑1....................... Object of this Division.................................................... 283
13‑5....................... Payment to the Commissioner in respect of alienated personal services payments 283
13‑10..................... Alienated personal services payments............................. 286
13‑15..................... Personal services payment remitters............................... 287
13‑20..................... Time for payments to Commissioner for alienated personal services payments made during 2000‑01 288
Division 14—Benefits, gains and taxable supplies for which amounts must be paid to the Commissioner 289
Subdivision 14‑A—Non‑cash benefits 289
14‑1....................... Object of this Subdivision.............................................. 289
14‑5....................... Provider of non‑cash benefit must pay amount to the Commissioner if payment would be subject to withholding..................................................................... 289
14‑10..................... Dividend, interest or royalty received, for a foreign resident, in the form of a non‑cash benefit 290
14‑15..................... Payer can recover amount paid to the Commissioner...... 291
Subdivision 14‑B—Accruing gains 291
14‑50..................... Object of this Subdivision.............................................. 291
14‑55..................... Liability for TFN withholding tax................................... 292
14‑60..................... Investment body may recover TFN withholding tax from investor 293
14‑65..................... Application of rules in Division 18................................. 293
14‑75..................... Overpayment of TFN withholding tax............................ 294
14‑85..................... Other laws do not exempt from TFN withholding tax.... 294
Subdivision 14‑C—Shares and rights under employee share schemes 295
14‑155................... Liability for TFN withholding tax (ESS)........................ 295
14‑160................... Employer may give individual tax file numbers to provider 296
14‑165................... Provider may recover TFN withholding tax (ESS) from individual 296
14‑170................... Application of rules in Division 18................................. 297
14‑175................... Overpayment of TFN withholding tax (ESS)................. 297
14‑180................... Application of certain provisions of Division 83A of the Income Tax Assessment Act 1997 297
Subdivision 14‑D—Capital proceeds involving foreign residents and taxable Australian property 298
14‑200................... Certain acquisitions of taxable Australian property from foreign residents 298
14‑205................... Effect of look‑through earnout rights.............................. 299
14‑210................... Whether an entity is a relevant foreign resident............... 300
14‑215................... Excluded transactions..................................................... 302
14‑220................... Commissioner clearance certificates................................ 304
14‑225................... Entity declarations........................................................... 304
14‑230................... Administrative penalties for false or misleading declarations 305
14‑235................... Varying amounts to be paid to the Commissioner.......... 306
Subdivision 14‑E—GST payable on taxable supplies of certain real property 307
14‑250................... Recipients of certain taxable supplies of real property must pay amounts to Commissioner 308
14‑255................... Notification by suppliers of residential premises etc....... 310
Division 15—Working out the amount to withhold 313
Guide to Division 15 314
15‑1....................... What this Division is about............................................. 313
Subdivision 15‑A—Working out how much to withhold 313
15‑10..................... How much to withhold................................................... 314
15‑15..................... Variation of amounts required to be withheld................. 314
Subdivision 15‑B—Withholding schedules and regulations 315
15‑25..................... Commissioner’s power to make withholding schedules. 315
15‑30..................... Matters to be considered when making withholding schedules 316
15‑35..................... Regulations about withholding....................................... 317
Subdivision 15‑C—Declarations 318
15‑50..................... Declarations.................................................................... 318
Division 16—Payer’s obligations and rights 320
Guide to Division 16 321
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..... 384
18‑140................... Notices............................................................................ 387
18‑145................... When PAYG withholding non‑compliance tax must be paid.. 389
18‑150................... General interest charge payable on unpaid PAYG withholding non‑compliance tax 389
18‑155................... Validity of decisions and evidence.................................. 390
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 392
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 21 403
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 45 406
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 429
45‑134................... Quarterly payer who pays 2 instalments annually on the basis of GDP‑adjusted notional tax 430
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 484
45‑412................... Working out amount of instalment—payers of 2 quarterly instalments 486
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 489
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....... 490
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............. 492
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.................... 494
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 496
45‑525................... When Commissioner works out benchmark instalment rate and benchmark tax 496
45‑530................... How Commissioner works out benchmark instalment rate 496
45‑535................... Working out your benchmark tax................................... 497
Subdivision 45‑P—Anti‑avoidance rules 497
45‑595................... Object of this Subdivision.............................................. 498
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?................ 501
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 70 548
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 97—Excess contributions determinations 551
Subdivision 97‑A—Excess concessional contributions determinations 551
Guide to Subdivision 97‑A 551
97‑1....................... What this Subdivision is about....................................... 551
Operative provisions 551
97‑5....................... Determination of excess concessional contributions....... 551
97‑10..................... Review............................................................................ 552
Subdivision 97‑B—Excess non‑concessional contributions determinations 552
Guide to Subdivision 97‑B 552
97‑20..................... What this Subdivision is about....................................... 552
Operative provisions 553
97‑25..................... Excess non‑concessional contributions determinations... 553
97‑30..................... Associated earnings........................................................ 553
97‑35..................... Review............................................................................ 554