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This is a Bill, not an Act. For current law, see the Acts databases.
2016
The Parliament of the
Commonwealth of Australia
HOUSE OF REPRESENTATIVES
Presented and read a first time
Income Tax Rates Amendment (Working
Holiday Maker Reform) Bill 2016
No. , 2016
(Treasury)
A Bill for an Act to amend the Income Tax Rates
Act 1986, and for related purposes
No. , 2016
Income Tax Rates Amendment (Working Holiday Maker Reform) Bill
2016
i
Contents
1
Short title ........................................................................................... 1
2
Commencement ................................................................................. 1
3
Schedules ........................................................................................... 2
Schedule 1--Amendments
3
Part 1--Amendments
3
Income Tax Rates Act 1986
3
Part 2--Application of amendments
6
No. , 2016
Income Tax Rates Amendment (Working Holiday Maker Reform) Bill
2016
1
A Bill for an Act to amend the Income Tax Rates
1
Act 1986, and for related purposes
2
The Parliament of Australia enacts:
3
1 Short title
4
This Act is the Income Tax Rates Amendment (Working Holiday
5
Maker Reform) Act 2016.
6
2 Commencement
7
(1) Each provision of this Act specified in column 1 of the table
8
commences, or is taken to have commenced, in accordance with
9
column 2 of the table. Any other statement in column 2 has effect
10
according to its terms.
11
12
2
Income Tax Rates Amendment (Working Holiday Maker Reform) Bill
2016
No. , 2016
Commencement information
Column 1
Column 2
Column 3
Provisions
Commencement
Date/Details
1. The whole of
this Act
The day this Act receives the Royal Assent.
Note:
This table relates only to the provisions of this Act as originally
1
enacted. It will not be amended to deal with any later amendments of
2
this Act.
3
(2) Any information in column 3 of the table is not part of this Act.
4
Information may be inserted in this column, or information in it
5
may be edited, in any published version of this Act.
6
3 Schedules
7
Legislation that is specified in a Schedule to this Act is amended or
8
repealed as set out in the applicable items in the Schedule
9
concerned, and any other item in a Schedule to this Act has effect
10
according to its terms.
11
Amendments Schedule 1
Amendments Part 1
No. , 2016
Income Tax Rates Amendment (Working Holiday Maker Reform) Bill
2016
3
Schedule 1--Amendments
1
Part 1--Amendments
2
Income Tax Rates Act 1986
3
1 Subsection 3(1)
4
Insert:
5
working holiday maker has the meaning given by
6
subsection 3A(1).
7
working holiday taxable income has the meaning given by
8
subsections 3A(2) and (3).
9
2 After section 3
10
Insert:
11
3A Working holiday makers and working holiday taxable income
12
(1) An individual is a working holiday maker at a particular time if the
13
individual holds at that time:
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(a) a Subclass 417 (Working Holiday) visa; or
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(b) a Subclass 462 (Work and Holiday) visa; or
16
(c) a bridging visa permitting the individual to work in Australia
17
if:
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(i) the bridging visa was granted under the Migration Act
19
1958 in relation to an application for a visa of a kind
20
described in paragraph (a) or (b); and
21
(ii) the Minister administering that Act is still to make a
22
decision in relation to the application; and
23
(iii) the most recent visa, other than a bridging visa, granted
24
under that Act to the individual was a visa of a kind
25
described in paragraph (a) or (b).
26
(2) An individual's working holiday taxable income for a year of
27
income is the individual's assessable income for the year of income
28
derived:
29
(a) from sources in Australia; and
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Schedule 1 Amendments
Part 1 Amendments
4
Income Tax Rates Amendment (Working Holiday Maker Reform) Bill
2016
No. , 2016
(b) while the individual is a working holiday maker;
1
less so much of any amount the individual can deduct for the year
2
of income as relates to that assessable income.
3
(3) However, the individual's working holiday taxable income does
4
not include any superannuation remainder, or employment
5
termination remainder, of the individual's taxable income for the
6
year of income.
7
3 Clause 1 of Part I of Schedule 7
8
Omit "and 3", substitute ", 3 and 4".
9
4 At the end of Part I of Schedule 7
10
Add:
11
4. If the resident taxpayer is a working holiday maker at any time
12
during the year of income:
13
(a) count the taxpayer's working holiday taxable income for the
14
year of income as the first parts (starting from $0) of the
15
taxpayer's ordinary taxable income for the purposes of the
16
table in clause 1; and
17
(b) do not apply the rates in that table to that working holiday
18
taxable income; and
19
(c) do not count that working holiday taxable income when
20
working out the taxpayer's taxable income for the purposes
21
of clause 2 or 3.
22
Note:
The rates for the taxpayer's working holiday taxable income for the
23
year of income are set out in Part III.
24
5 Clause 1 of Part II of Schedule 7
25
Omit "and 3", substitute ", 3 and 4".
26
6 At the end of Part II of Schedule 7
27
Add:
28
4. If the non-resident taxpayer is a working holiday maker at any time
29
during the year of income:
30
(a) count the taxpayer's working holiday taxable income for the
31
year of income as the first parts (starting from $0) of the
32
Amendments Schedule 1
Amendments Part 1
No. , 2016
Income Tax Rates Amendment (Working Holiday Maker Reform) Bill
2016
5
taxpayer's ordinary taxable income for the purposes of the
1
table in clause 1; and
2
(b) do not apply the rates in that table to that working holiday
3
taxable income; and
4
(c) do not count that working holiday taxable income when
5
working out the taxpayer's taxable income for the purposes
6
of clause 2 or 3.
7
Note:
The rates for the taxpayer's working holiday taxable income for the
8
year of income are set out in Part III.
9
Example: Rosie earns a $60,000 salary while a working holiday maker from
10
1 July 2017 to 31 March 2018. She also earns $29,000 while holding a
11
different class of visa from 1 April 2018 to 30 June 2018.
12
The $60,000 salary is Rosie's working holiday taxable income and is
13
the first part of her ordinary taxable income. Under Part III, she pays
14
tax at the rate of 15% on $37,000 of that salary, and tax at the rate of
15
32.5% on the remaining $23,000 of that salary.
16
The $29,000 income makes up the remaining parts of Rosie's ordinary
17
taxable income. Under clause 1 of this Part, she pays tax at the rate of
18
32.5% on $27,000 of that income, and tax at the rate of 37% on the
19
remaining $2,000 of that income.
20
7 At the end of Schedule 7
21
Add:
22
Part III--Working holiday makers
23
24
1. The rates of tax on a taxpayer's working holiday taxable income
25
for a year of income are as set out in the following table.
26
27
Tax rates for working holiday makers
Item
For the part of the taxpayer's working
holiday taxable income that:
The rate is:
1
does not exceed $37,000
15%
2
exceeds $37,000 but does not exceed
$87,000
32.5%
3
exceeds $87,000 but does not exceed
$180,000
37%
4
exceeds $180,000
45%
Schedule 1 Amendments
Part 2 Application of amendments
6
Income Tax Rates Amendment (Working Holiday Maker Reform) Bill
2016
No. , 2016
Part 2--Application of amendments
1
8 Application of amendments
2
The amendments made by this Schedule apply in relation to:
3
(a) assessable income derived on or after 1 January 2017; and
4
(b) so much of any amounts that can be deducted as relate to
5
such assessable income.
6