Commonwealth Coat of Arms of Australia

Statutory Rules 1984 No. 1721

Income Tax Regulations2 (Amendment)

I, THE GOVERNOR-GENERAL of the Commonwealth of Australia, acting with the advice of the Federal Executive Council, hereby make the following Regulations under the Income Tax Assessment Act 1936.

Dated 26 July 1984.

N. M. STEPHEN

Governor-General

By His Excellency’s Command,

Treasurer

Commencement

1. These Regulations shall come into operation on 1 August 1984.

2. (1) Regulation 4a of the Income Tax Regulations is repealed and the following regulation substituted:

Prescribed Life Tables—sub-section 27h (4)

“4ae. For the purposes of the definition of ‘life expectation factor’ in sub-section 27h (4) of the Act, the prescribed Life Tables are the Australian Life Tables 1975-1977 prepared by the Australian Government Actuary.”.

(2) For the purposes of the continued application, by virtue of sub-section 61 (1) of the Income Tax Assessment Amendment Act (No. 3) 1984, of section 26aa of the Income Tax Assessment Act 1936 (as in force immediately before the commencement of the first-mentioned Act), regulation 4a of the Income Tax Regulations continues to have effect as if it had not been repealed.

S.R..213/84 Cat. No. Recommended retail price 60c 10/25.7.1984

3. After regulation 33 of the Income Tax Regulations the following regulation is inserted in Part IV:

Eligible termination payments—roll-over

“33a. (1) In this regulation—

‘concessional component’ has the same meaning as in sub-section 27a (1) of the Act;

‘eligible termination payment’ has the same meaning as in sub-section 27a (l) of the Act;”

‘post 30 June 1983 component’, in relation to an eligible termination payment, means so much (if any) of that payment as is equal to the relevant amount referred to in sub-section 27b (1) of the Act in relation to that eligible termination payment;

‘pre 1 July 1983 component’, in relation to an eligible termination payment, means so much (if any) of that payment as is equal to the amount represented by the component X in the formula in paragraph 27c (1) (c) of the Act in relation to that eligible termination payment;

‘roll-over payment’, in relation to an eligible termination payment, means the payment of an amount in the manner described in sub-section 27a (12) of the Act;

‘undeducted contributions’ has the same meaning as in sub-section 27a (1) of the Act.

“(2) At or before the time of the making of a roll-over payment in relation to which a taxpayer wishes that an eligible termination payment be taken, in accordance with an election to be made under section 27d of the Act, to have been expended in making the roll-over payment, the taxpayer shall make application in that behalf to the person administering the fund to which, or the person to whom, it is proposed that the roll-over payment be made.

“(3) An application under sub-regulation (2) shall—

(a) be made in writing, in triplicate, on a form approved by the Commissioner for the purpose;

(b) specify, in relation to the roll-over payment, so much of each of the following parts (if any) of the eligible termination payment as the taxpayer wishes to be taken, in accordance with the proposed election, to have been expended in making the roll-over payment, that is to say:

(i) the concessional component;

(ii) the pre 1 July 1983 component;

(iii) the post 30 June 1983 component; and

(iv) where the eligible termination payment is of a kind referred to in paragraph (b) or (c) of the definition of ‘eligible termination payment’ in sub-section 27a (1) of the Act, the undeducted contributions; and

“(4) Where—

(a) an application has been made in accordance with sub-regulation (2); and

(b) the roll-over payment to which the application relates has been made to the fund or person specified in the application,

the person to whom the application was made shall—

(c) on the form referred to in sub-regulation (3), make, in triplicate, a declaration to the effect that that payment has been so made;

(d) sign the declaration and date it on the day on which it is made; and

(e) cause the original and a copy of the form on which the application and the declaration have been made to be given to the taxpayer not later than 14 days after the roll-over payment is made.

“(5) For the purposes of paragraph 27d (3) (b) of the Act—

(a) the prescribed time within which an election under sub-section 27d (1) of the Act is to be lodged by a taxpayer with the Commissioner is—

(i) the time within which the return, or the first return, required by or under the Act to be furnished by that taxpayer to the Commissioner in respect of the year of income in which the eligible termination payment to which the election relates was made is so required to be furnished; or

(ii) where no such return is required to be furnished, within 4 months of the end of that year of income or within such further period as the Commissioner allows; and

(b) the prescribed manner in which such an election is to be lodged with the Commissioner is lodgment, together with—

(i) the originals of all forms given to the taxpayer in accordance with paragraph (4) (e) in respect of roll-over payments in relation to the eligible termination payment to which the election relates; and

(ii) the original of the form delivered to the taxpayer in accordance with paragraph 54daq (3) (b) in respect of that eligible termination payment,

with—

(iii) the return referred to in sub-paragraph (a) (i); or

(iv) a statement in writing, signed by or on behalf of the taxpayer, setting out the grounds on which the taxpayer claims not to be required to furnish such a return,

as the case requires.”.

Interpretation

4. Regulation 54a of the Income Tax Regulations is amended by inserting after sub-regulation (1) the following sub-regulation:

“(1aa) A reference in this Subdivision to a payment of salary or wages does not include a payment that is an eligible termination payment within the meaning of sub-section 221a (1) of the Act.”.

5. After Subdivision a of Division 2 of Part VI of the Income Tax Regulations the following Subdivision is inserted:

“Subdivision AAA—Deductions from Eligible Termination Payments

Interpretation

“54dao. (1) Expressions used in this Subdivision that are used in Division 2 of Part VI of the Act have in this Subdivision, unless the contrary intention appears, the same respective meanings as in that Division.

“(2) In this Subdivision—

‘concessional component’ has the same meaning as in sub-section 27a (1) of the Act;

‘undeducted contributions’ has the same meaning as in sub-section 27a (1) of the Act.

Rate of deductions

“54dap. (1) Where any salary or wages that an employee receives or is entitled to receive in respect of a week consists or consist of an eligible termination payment, the prescribed rate of deductions to be made for the purposes of section 221c of the Act from that payment is the amount (being a multiple of 5 cents) that is, or is nearest to—

(a) in the case of an eligible termination payment that is made on or after the fifty-fifth anniversary of the employee’s birth—the sum of—

(i) the amount ascertained by multiplying by 16 cents the number of whole dollars in so much of the net relevant amount as does not exceed $50,000; and

(ii) the amount (if any) ascertained by multiplying by 31 cents the number of whole dollars in so much (if any) of the net relevant amount as exceeds $50,000; or

(b) in any other case—the amount ascertained by multiplying by 31 cents the number of whole dollars in the net relevant amount.

“(2) In this regulation, ‘net relevant amount’, in relation to an eligible termination payment, means the amount (if any) remaining after deducting from the post 30 June 1983 component, as shown in the statement referred to in paragraph 54daq (1) (a) in relation to that eligible termination payment, the amount (if any) specified in accordance with sub-paragraph 54daq (2) (b) (iii) and paid in accordance with the declaration referred to in paragraph 54daq (3) (a) in relation to the eligible termination payment.

Statement of termination payment

“54daq.(1) Before an eligible termination payment is made in relation to an employee—

(a) the employer shall—

(i) on a form approved by the Commissioner for the purpose, prepare, in triplicate, to the best of the employer’s knowledge, a statement in relation to the eligible termination payment indicating, in particular—

(a) the concessional component (if any);

(b) the pre 1 July 1983 component (if any);

(d) where the eligible termination payment is of a kind referred to in paragraph (b) or (c) of the definition of ‘eligible termination payment’ in sub-section 27a (1) of the Act, the undeducted contributions (if any); and

(ii) cause the original and the copies of the statement to be given to the employee; and

(b) the employee shall—

(i) on the form referred to in sub-paragraph (a) (i), make, in triplicate, a roll-over nomination in accordance with sub-regulation (2); and

(ii) cause the original and the copies of the statement and roll-over nomination to be returned to the employer.

“(2) A roll-over nomination referred to in paragraph (1) (b) shall—

(a) authorize the making by the employer of payments of the kinds referred to in paragraphs 27a (12) (a), (b) and (c) of the Act to such funds or persons, in such amounts and in respect of such components of the eligible termination payment as are specified in accordance with paragraph (b);

(b) specify, in relation to each fund or person to whom amounts are, in accordance with paragraph (a), authorized to be paid, the amount (if any) so authorized to be paid in respect of—

(i) the concessional component;

(ii) the pre 1 July 1983 component;

(iii) the post 30 June 1983 component; and

(iv) where the eligible termination payment is of a kind referred to in sub-sub-paragraph (1) (a) (i) (d), the undeducted contributions; and

“(3) Not later than 7 days after the making of an eligible termination payment, the employer shall—

(a) on the form referred to in sub-paragraph (1) (a) (i), make a declaration in accordance with sub-regulation (4); and

(b) cause the original and a copy of that form to be delivered to the employee.

“(4) A declaration referred to in paragraph (3) (a) shall—

(a) verify, to the best of the employer’s knowledge, the statement referred to in paragraph (1) (a);

(b) state whether the amounts authorized in terms of the roll-over nomination referred to in paragraph (1) (b) to be paid to the funds and persons there referred to have been so paid; and

“(5) Where, for the purposes of the application of the Act in relation to the eligible termination payment to which the statement referred to in paragraph (1) (a) relates, sub-section 27a (10) of the Act requires the deduction of a number of days from the beginning of the period referred to in that sub-section as the original eligible service period, that statement shall be prepared as if there were deducted from the beginning of that period—

(a) the number of whole days included in that period that is ascertained in accordance with the formula—

$Start formula start fraction A open bracket C minus D close bracket over C end fraction end formula$

where—

A and C have the same respective values as in the formula in that sub-section; and

D is the number of dollars in the aggregate of the amounts of roll-over payments that are known to the employer to have been declared, under paragraph 33a (4) (c), to have been made in relation to another eligible termination payment, being an eligible termination payment to which the first-mentioned eligible termination payment is attributable, and to have been specified under sub-paragraph 33a (3) (b) (ii) in relation to those roll-over payments; or

(b) such smaller number of whole days as is specified by the Commissioner in a notice given to the employee for the purposes of this paragraph and brought to the attention of the employer.”.

NOTES

1. Notified in the Commonwealth of Australia Gazette on 31 July 1984.

2. Statutory Rules 1936 No. 94 as amended by 1939 Nos. 6 and 42; 1940 Nos. 138 and 289; 1941 Nos. 120 and 327; 1942 Nos. 339 and 553; 1943 Nos. 80, 127 and 151; 1944 Nos. 90 and 124; 1945 Nos. 12, 85, 169 and 192; 1946 No. 135; 1947 Nos. 77 and 173; 1948 Nos. 115 and 162; 1949 Nos. 25 and 50; 1950 Nos. 63 and 101; 1951 Nos. 136 and 157; 1952 Nos. 89, 90 and 102; 1953 Nos. 55 and 88; 1954 Nos. 11, 99 and 112; 1955 No. 23; 1956 Nos. 34, 35 and 96; 1957 Nos. 39 and 74; 1958 Nos. 27, and 70, 1959, Nos. 25 and 81; 1960 Nos. 44 and 74; 1962 Nos. 15, 44 and 112; 1963 Nos. 53 and 92; 1964 Nos. 74, 121 and 134; 1965 Nos. 133 and 187; 1966 No. 156; 1967 Nos. 112 and 126; 1968 No. 1; 1969 No. 68; 1970 Nos. 43, 126, 168 and 213; 1971 Nos. 120 and 148; 1972 Nos. 48, 50 and 137; 1973 No. 266; 1974 Nos. 193, 226 and 267; 1975 Nos. 88, 89, 99, 101 and 213; 1976 Nos. 115, 188 and 212; 1977 Nos. 77, 107 and 248; 1978 Nos. 85 and 193; 1979 Nos. 126 and 239; 1980 Nos. 86, 137 and 149; 1981 Nos. 116 and 360; 1982 Nos. 115, 128, 267 and 280; 1983 Nos. 79, 87, 111, 213 and 319.

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