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This is a Bill, not an Act. For current law, see the Acts databases.
2010-2011-2012-2013
The Parliament of the
Commonwealth of Australia
HOUSE OF REPRESENTATIVES
Presented and read a first time
Tax and Superannuation Laws
Amendment (2013 Measures No. 2) Bill
2013
No. , 2013
(Treasury)
A Bill for an Act to amend the law relating to
taxation and superannuation, and for related
purposes
i Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. ,
2013
Contents
1
Short title ........................................................................................... 1
2
Commencement ................................................................................. 1
3
Schedule(s) ........................................................................................ 3
4
Amendment of assessments ............................................................... 3
Schedule 1--Definition of documentary
4
Income Tax Assessment Act 1997
4
Schedule 2--Ex-gratia payments for natural disasters
6
Part 1--Amendments commencing on Royal Assent
6
Income Tax Assessment Act 1997
6
Tax Laws Amendment (2011 Measures No. 1) Act 2011
8
Tax Laws Amendment (2012 Measures No. 1) Act 2012
8
Part 2--Sunsetting
9
Division 1--Repeal on 1 July 2016
9
Income Tax Assessment Act 1997
9
Division 2--Repeal on 1 July 2017
9
Income Tax Assessment Act 1997
9
Schedule 3--GST instalment system
10
A New Tax System (Goods and Services Tax) Act 1999
10
Schedule 4--Deductible gift recipients
11
Part 1--Amendments commencing on Royal Assent
11
Income Tax Assessment Act 1997
11
Part 2--Sunsetting
13
Division 1--Repeal on 1 July 2019
13
Income Tax Assessment Act 1997
13
Division 2--Repeal on 1 July 2023
13
Income Tax Assessment Act 1997
13
Schedule 5--Merging multiple accounts in a superannuation
entity
14
Superannuation Industry (Supervision) Act 1993
14
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
ii
Schedule 6--Government co-contribution for low income
earners
17
Superannuation (Government Co-contribution for Low Income
Earners) Act 2003
17
Schedule 7--Consolidating the dependency tax offsets
19
Part 1--Main amendments
19
Income Tax Assessment Act 1997
19
Part 2--Other amendments
27
Income Tax Assessment Act 1936
27
Income Tax Assessment Act 1997
28
Part 3--Application of amendments
30
Schedule 8--Taxation of financial arrangements
31
Part 1--Core rules
31
Division 1--Attribution of costs
31
Income Tax Assessment Act 1997
31
Division 2--Interest
31
Income Tax Assessment Act 1997
31
Division 3--Consistency in working out gains or losses
32
Income Tax Assessment Act 1997
32
Part 2--Accruals/realisation methods
33
Division 1--Sufficiently certain particular gains or losses
33
Income Tax Assessment Act 1997
33
Division 2--Precedence of particular gains or losses
33
Income Tax Assessment Act 1997
33
Division 3--Spreading prepayments
34
Income Tax Assessment Act 1997
34
Division 4--Spreading single payment
35
Income Tax Assessment Act 1997
35
Division 5--Re-estimations
36
Income Tax Assessment Act 1997
36
Division 6--Impairments and reversals
37
iii Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. ,
2013
Income Tax Assessment Act 1997
37
Division 7--Running balancing adjustments
39
Income Tax Assessment Act 1997
39
Division 8--Ceasing of rights or obligations
40
Income Tax Assessment Act 1997
40
Part 3--Fair value method
42
Income Tax Assessment Act 1997
42
Part 4--Hedging financial arrangements method
44
Division 1--One in all in principle
44
Income Tax Assessment Act 1997
44
Division 2--Hedging net investments in foreign operations
47
Income Tax Assessment Act 1997
47
Part 5--Transitional balancing adjustments
49
Tax Laws Amendment (Taxation of Financial Arrangements) Act 2009
49
Part 6--Elective requirements
51
Income Tax Assessment Act 1997
51
Part 7--Miscellaneous amendments
52
Division 1--Consistency of language
52
Income Tax Assessment Act 1997
52
Division 2--Other amendments
52
Income Tax Assessment Act 1997
52
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
1
A Bill for an Act to amend the law relating to
1
taxation and superannuation, and for related
2
purposes
3
The Parliament of Australia enacts:
4
1 Short title
5
This Act may be cited as the Tax and Superannuation Laws
6
Amendment (2013 Measures No. 2) Act 2013.
7
2 Commencement
8
(1) Each provision of this Act specified in column 1 of the table
9
commences, or is taken to have commenced, in accordance with
10
column 2 of the table. Any other statement in column 2 has effect
11
according to its terms.
12
13
2 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. ,
2013
Commencement information
Column 1
Column 2
Column 3
Provision(s)
Commencement
Date/Details
1. Sections 1 to 4
and anything in
this Act not
elsewhere covered
by this table
The day this Act receives the Royal Assent.
2. Schedule 1
The day this Act receives the Royal Assent.
3. Schedule 2,
Part 1
The day this Act receives the Royal Assent.
4. Schedule 2,
Part 2, Division 1
1 July 2016.
1 July 2016
5. Schedule 2,
Part 2, Division 2
1 July 2017.
1 July 2017
6. Schedule 3
The day this Act receives the Royal Assent.
7. Schedule 4,
Part 1
The day this Act receives the Royal Assent.
8. Schedule 4,
Part 2, Division 1
1 July 2019.
1 July 2019
9. Schedule 4,
Part 2, Division 2
1 July 2023.
1 July 2023
10. Schedules 5
to 7
The day this Act receives the Royal Assent.
11. Schedule 8
Immediately after the commencement of
item 1 of Schedule 3 to the Tax Laws
Amendment (2010 Measures No. 4) Act
2010.
26 March 2009
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
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
3
3 Schedule(s)
1
Each Act that is specified in a Schedule to this Act is amended or
2
repealed as set out in the applicable items in the Schedule
3
concerned, and any other item in a Schedule to this Act has effect
4
according to its terms.
5
4 Amendment of assessments
6
Section 170 of the Income Tax Assessment Act 1936 does not
7
prevent the amendment of an assessment if:
8
(a) the assessment was made on or before the day this section
9
commences; and
10
(b) the amendment is made within 2 years after that day; and
11
(c) the amendment is made for the purpose of giving effect to
12
Schedule 8 to this Act (Taxation of financial arrangements).
13
Schedule 1 Definition of documentary
4 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. ,
2013
Schedule 1
--
Definition of documentary
1
2
Income Tax Assessment Act 1997
3
1 Subparagraph 376-20(2)(c)(i)
4
Omit "documentary", substitute "
*
documentary".
5
2 Subparagraph 376-20(2)(c)(iii)
6
Omit "quiz program", substitute "quiz program, game show".
7
3 After section 376-20
8
Insert:
9
376-25 Meaning of documentary
10
Meaning of documentary
11
(1) A
*
film is a documentary if the film is a creative treatment of
12
actuality, having regard to:
13
(a) the extent and purpose of any contrived situation featured in
14
the film; and
15
(b) the extent to which the film explores an idea or a theme; and
16
(c) the extent to which the film has an overall narrative structure;
17
and
18
(d) any other relevant matters.
19
Exclusion of infotainment or lifestyle programs and magazine
20
programs
21
(2) However, a
*
film is not a documentary if it is:
22
(a) an infotainment or lifestyle program (within the meaning of
23
Schedule 6 to the Broadcasting Services Act 1992); or
24
(b) a film that:
25
(i) presents factual information; and
26
(ii) has 2 or more discrete parts, each dealing with a
27
different subject or a different aspect of the same
28
subject; and
29
Definition of documentary Schedule 1
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
5
(iii) does not contain an over-arching narrative structure or
1
thesis.
2
4 Subparagraph 376-45(2)(c)(i)
3
Omit "documentary", substitute "
*
documentary".
4
5 Subparagraph 376-45(2)(c)(iii)
5
Omit "quiz program", substitute "quiz program, game show".
6
6 Subparagraph 376-65(2)(d)(ii)
7
Omit "quiz program", substitute "quiz program, game show".
8
7 Subparagraph 376-65(2)(d)(iii)
9
Omit "documentary", substitute "
*
documentary".
10
8 Paragraph 376-65(3)(c)
11
Omit "documentary", substitute "
*
documentary".
12
9 Subsection 376-65(6) (cells at table items 2, 3, 5, 6, 7 and 8,
13
column headed "For this type of film ... ")
14
Omit "documentary", substitute "
*
documentary".
15
10 Subsection 376-170(4A)
16
Omit "documentary", substitute "
*
documentary".
17
11 Subsection 995-1(1)
18
documentary has the meaning given by section 376-25.
19
12 Application of amendments
20
(1)
The amendments made by items 1, 3, 4, 7, 8, 9, 10 and 11 apply in
21
relation to films commencing principal photography on or after 1 July
22
2012.
23
(2)
The amendments made by items 2, 5 and 6 apply in relation to films
24
commencing principal photography on or after the day this Schedule
25
commences.
26
Schedule 2 Ex-gratia payments for natural disasters
Part 1 Amendments commencing on Royal Assent
6 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. ,
2013
Schedule 2
--
Ex-gratia payments for natural
1
disasters
2
Part 1
--
Amendments commencing on Royal Assent
3
Income Tax Assessment Act 1997
4
1 Section 11-
15 (table item headed "welfare")
5
Omit:
6
Assistance for New Zealand non-protected special
category visa holders for a disaster that occurred in
Australia during the 2010-11 financial year ..................
51-30
Assistance for New Zealand non-protected special
category visa holders for the floods that occurred in
New South Wales and Queensland in January,
February and March 2012 .............................................
51-30
Disaster Income Recovery Subsidy for the floods that
occurred in Australia during the period starting on
29 November 2010, or for Cyclone Yasi ......................
51-30
substitute:
7
Disaster assistance for New Zealand non-protected
special category visa holders .........................................
51-30
Disaster Income Recovery Subsidy .................................... 51-30
2 Section 51-30 (table item 5.1C)
8
Repeal the item, substitute:
9
Ex-gratia payments for natural disasters Schedule 2
Amendments commencing on Royal Assent Part 1
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
7
5.2
an individual in
receipt of an ex-gratia
payment from the
Commonwealth
known as assistance
for New Zealand
non-protected special
category visa holders
for a disaster:
(a) that occurred in
Australia during
the 2011-12
*
financial year;
and
(b) that the
*
Emergency
Management
Minister has
declared to be a
major disaster for
the purposes of
the Australian
Government
Disaster Recovery
Payment
the payment
the payment must
be claimed:
(a) after
5 February
2012; and
(b) before
1 December
2012;
and the Minister
must make the
declaration before
1 June 2012
5.3
an individual in
receipt of an ex-gratia
payment from the
Commonwealth
known as assistance
for New Zealand
non-protected special
category visa holders
for a disaster:
(a) that occurred in
Australia during
the 2012-13
*
financial year;
and
(b) that the
*
Emergency
Management
Minister has
the payment
the payment must
be claimed:
(a) after
24 August
2012; and
(b) before
1 January
2014;
and the Minister
must make the
declaration before
1 July 2013
Schedule 2 Ex-gratia payments for natural disasters
Part 1 Amendments commencing on Royal Assent
8 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. ,
2013
declared to be a
major disaster for
the purposes of
the Australian
Government
Disaster Recovery
Payment
5.4
an individual in
receipt of an ex-gratia
payment from the
Commonwealth
known as Disaster
Income Recovery
Subsidy for the floods
that occurred in
Queensland during
the period starting on
21 January 2013
the payment
the payment must
be claimed:
(a) after
20 January
2013; and
(b) before
5 August 2013
3 Subsection 995-1(1)
1
Insert:
2
Emergency Management Minister means the Minister who
3
administers the Social Security Act 1991, insofar as it relates to
4
Australian Government Disaster Recovery Payment.
5
Tax Laws Amendment (2011 Measures No. 1) Act 2011
6
4 Item 3 of Schedule 1
7
Repeal the item.
8
Tax Laws Amendment (2012 Measures No. 1) Act 2012
9
5 Part 2 of Schedule 3
10
Repeal the Part.
11
Ex-gratia payments for natural disasters Schedule 2
Sunsetting Part 2
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
9
Part 2
--
Sunsetting
1
Division 1
--
Repeal on 1 July 2016
2
Income Tax Assessment Act 1997
3
6 Section 51-30 (table item 5.2)
4
Repeal the item.
5
Division 2
--
Repeal on 1 July 2017
6
Income Tax Assessment Act 1997
7
7 Section 11-
15 (table item headed "welfare")
8
Omit:
9
Disaster assistance for New Zealand non-protected
special category visa holders .........................................
51-30
Disaster Income Recovery Subsidy .................................... 51-30
8 Section 51-30 (table items 5.3 and 5.4)
10
Repeal the items.
11
9 Subsection 995-1(1) (definition of Emergency Management
12
Minister)
13
Repeal the definition.
14
Schedule 3 GST instalment system
10 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
Schedule 3
--
GST instalment system
1
2
A New Tax System (Goods and Services Tax) Act 1999
3
1 Paragraph 162-30(1)(d)
4
Repeal the paragraph.
5
2 Subsection 162-30(6)
6
Repeal the subsection.
7
3 At the end of subsection 162-135(1)
8
Add:
9
The amount must not be less than zero.
10
4 Subsection 162-140(4) (note)
11
Omit "Note", substitute "Note 1".
12
5 At the end of subsection 162-140(4)
13
Add:
14
Note 2:
Your estimated annual GST amount is taken to be zero if it would
15
otherwise be less than zero (see subsection (6)).
16
6 At the end of section 162-140
17
Add:
18
(6) Your estimated annual GST amount relating to the
*
GST
19
instalment quarter is zero if, apart from this subsection, this
20
estimate would be less than zero.
21
7 Section 195-1 (definition of estimated annual GST amount)
22
Omit "subsection 162-140(4) and paragraph 162-140(5)(b)", substitute
23
"section 162-140".
24
8 Application of amendments
25
The amendments made by this Schedule apply in relation to GST
26
instalment quarters starting on or after the first 1 July that is on or after
27
the commencement of this Schedule.
28
Deductible gift recipients Schedule 4
Amendments commencing on Royal Assent Part 1
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
11
Schedule 4
--
Deductible gift recipients
1
Part 1
--
Amendments commencing on Royal Assent
2
Income Tax Assessment Act 1997
3
1 Subsection 30-25(2) (at the end of the table)
4
Add:
5
2.2.42
The Conversation Trust
the gift must be made
after 21 November 2012
2 Subsection 30-45(2) (at the end of the table)
6
Add:
7
4.2.42
National Congress of Australia's First
Peoples Limited
the gift must be made
after 30 June 2013
3 Subsection 30-50(2) (at the end of the table)
8
Add:
9
5.2.31
the Anzac Centenary Public Fund
the gift must be made
after 30 November 2012
and before 1 May 2019
5.2.32
the Australian Peacekeeping Memorial
Project Incorporated
the gift must be made
after 31 December 2012
and before 1 January
2015
5.2.33
National Boer War Memorial Association
Incorporated
the gift must be made
after 31 December 2012
and before 1 January
2015
4 Section 30-105 (table item 13.2.15)
10
Repeal the item.
11
5 Section 30-105 (at the end of the table)
12
Add:
13
13.2.19
Philanthropy Australia Inc.
the gift must be made
after 27 February
2013
Schedule 4 Deductible gift recipients
Part 1 Amendments commencing on Royal Assent
12 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
6 Section 30-315 (after table item 4A)
1
Insert:
2
5
Anzac Centenary Public Fund
item 5.2.31
7 Section 30-315 (cell at table item 24B, column headed
3
"Provision")
4
Repeal the cell, substitute:
5
item 5.2.32
8 Section 30-315 (after table item 37)
6
Insert:
7
38
Conversation Trust
item 2.2.42
9 Section 30-315 (after table item 73)
8
Insert:
9
73AA
National Boer War Memorial Association
Incorporated
item 5.2.33
10 Section 30-315 (after table item 73A)
10
Insert:
11
73B
National Congress of Australia's First
Peoples Limited
item 4.2.42
11 Section 30-315 (after table item 85)
12
Insert:
13
85A
Philanthropy Australia Inc.
item 13.2.19
Deductible gift recipients Schedule 4
Sunsetting Part 2
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
13
Part 2
--
Sunsetting
1
Division 1
--
Repeal on 1 July 2019
2
Income Tax Assessment Act 1997
3
12 Subsection 30-50(2) (table items 5.2.32 and 5.2.33)
4
Repeal the items.
5
13 Section 30-315 (table items 24B and 73AA)
6
Repeal the items.
7
Division 2
--
Repeal on 1 July 2023
8
Income Tax Assessment Act 1997
9
14 Subsection 30-50(2) (table item 5.2.31)
10
Repeal the item.
11
15 Section 30-315 (table item 5)
12
Repeal the item.
13
Schedule 5 Merging multiple accounts in a superannuation entity
14 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
Schedule 5
--
Merging multiple accounts in a
1
superannuation entity
2
3
Superannuation Industry (Supervision) Act 1993
4
1 Subsection 10(1)
5
Insert:
6
buy-sell spread has the meaning given by subsection 29V(4).
7
2 Subsection 10(1)
8
Insert:
9
superannuation account has the meaning given by
10
subsection 108A(3).
11
3 Before subsection 29E(7)
12
Insert:
13
Complying with rules relating to merging multiple accounts in a
14
superannuation entity
15
(6E) The following additional condition is imposed on each RSE licence
16
that relates to a superannuation entity for which the RSE licensee
17
has obligations under section 108A. The condition is that the RSE
18
licensee must ensure that the rules that that section requires in
19
relation to the superannuation entity are complied with.
20
4 After section 108
21
Insert:
22
108A Trustee's duty to identify etc. multiple superannuation
23
accounts of members
24
(1) Each trustee of a superannuation entity (other than the trustee of a
25
pooled superannuation trust or a self managed superannuation
26
fund) must ensure that rules are established, which:
27
Merging multiple accounts in a superannuation entity Schedule 5
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
15
(a) set out a procedure for identifying when a member of the
1
superannuation entity has more than one superannuation
2
account in the superannuation entity; and
3
(b) require the trustee to carry out the procedure to identify such
4
members at least once each financial year; and
5
(c) if the member has 2 or more superannuation accounts in the
6
superannuation entity--require the trustee to merge the
7
accounts so that the member has only one account balance in
8
respect of those accounts, if the trustee reasonably believes
9
that it is in the best interests of the member to do so; and
10
(d) provide that fees are not payable (other than a buy-sell
11
spread) for any merger of superannuation accounts that
12
occurs as a result of paragraphs (a) to (c).
13
(2) The requirement in paragraph (1)(c) does not apply if:
14
(a) it is not practicable in the circumstances to merge the
15
member's superannuation accounts; or
16
(b) one or more of the superannuation accounts is a defined
17
benefit interest or income stream.
18
(3) A superannuation account is a record of the member's benefits, in
19
relation to a superannuation entity in which the member has an
20
interest, which is recorded separately:
21
(a) from other benefits of the member in relation to the entity (if
22
any); and
23
(b) from other benefits of any other member in relation to the
24
entity.
25
To avoid doubt, an FHSA (within the meaning of the First Home
26
Saver Accounts Act 2008) is not a superannuation account.
27
Note:
FHSA is short for first home saver account
28
(4) In determining, for the purpose of paragraph (1)(c), whether it is in
29
the best interests of a member to merge his or her superannuation
30
accounts, the trustee must consider the total amount of fees and
31
charges payable by the member in respect of all of his or her
32
accounts in the superannuation entity (including any fees and
33
charges payable by the member for insurance provided in respect
34
of all of his or her accounts).
35
(5) A trustee commits an offence if the trustee contravenes
36
subsection (1). This is an offence of strict liability.
37
Schedule 5 Merging multiple accounts in a superannuation entity
16 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
Penalty: 50 penalty units.
1
Note 1:
Chapter 2 of the Criminal Code sets out the general principles of
2
criminal responsibility.
3
Note 2:
For strict liability, see section 6.1 of the Criminal Code.
4
5 Application of amendments
5
The amendments made by this Schedule apply from 1 July 2013.
6
Government co-contribution for low income earners Schedule 6
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
17
Schedule 6
--
Government co-contribution for
1
low income earners
2
3
Superannuation (Government Co-contribution for Low
4
Income Earners) Act 2003
5
1 Paragraph 9(1)(c)
6
Omit "2009-10 income year or a later income year", substitute
7
"2009-10, 2010-11 and 2011-12 income years".
8
2 At the end of subsection 9(1)
9
Add:
10
; and (d) for the 2012-13 income year or a later income year--an
11
amount equal to 50% of the sum of the eligible personal
12
superannuation contributions the person makes during the
13
income year.
14
3 Subsection 10(1B)
15
Omit "2009-10 income year or a later income year", substitute
16
"2009-10 income year, 2010-11 income year or 2011-12 income year".
17
4 After subsection 10(1B)
18
Add:
19
(1C) The amount of the Government co-contribution in respect of a
20
person for the 2012-13 income year or a later income year must not
21
exceed the maximum amount worked out using the following
22
table:
23
24
Maximum Government co-contribution
Item
Person's total income for the
income year
Maximum amount
1
the lower income threshold or
less
$500
Schedule 6 Government co-contribution for low income earners
18 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
Maximum Government co-contribution
Item
Person's total income for the
income year
Maximum amount
2
more than the lower income
threshold but less than the
higher income threshold
$500 reduced by 3.333 cents for
each dollar by which the person's
total income for the income year
exceeds the lower income
threshold
5 Subsection 10(2)
1
Omit "and (1B)", substitute ", (1B) and (1C)".
2
6 Paragraph 10A(1)
3
Omit "and 2011-12" (wherever occurring), substitute ", 2011-12 and
4
2012-13".
5
7 Paragraph 10A(3)(c)
6
Omit "2007-08 income year or a later income year", substitute
7
"2007-08 income year or a later income year before the 2012-13 income
8
year".
9
8 At the end of subsection 10A(3)
10
Add:
11
; or (d) for the 2012-13 income year or a later income year--the sum
12
of:
13
(i) the lower income threshold for that income year; and
14
(ii) $15,000.
15
9 Subsection 10A(5A)
16
Omit "and 2011-12", substitute ", 2011-12 and 2012-13".
17
10 Application of amendments
18
The amendments made by this Schedule apply to the 2012-13 income
19
year and later income years.
20
Consolidating the dependency tax offsets Schedule 7
Main amendments Part 1
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
19
Schedule 7
--
Consolidating the dependency
1
tax offsets
2
Part 1
--
Main amendments
3
Income Tax Assessment Act 1997
4
1 Before Subdivision 61-G
5
Insert:
6
Subdivision 61-A--Dependant (invalid and carer) tax offset
7
Guide to Subdivision 61-A
8
61-1 What this Subdivision is about
9
You are entitled to a tax offset for an income year if you maintain
10
certain dependants who are unable to work.
11
Table of sections
12
Object of this Subdivision
13
61-5
Object of this Subdivision
14
Entitlement to the dependant (invalid and carer) tax offset
15
61-10
Who is entitled to the tax offset
16
61-15
Cases involving more than one spouse
17
61-20
Exceeding the income limit for family tax benefit (Part B)
18
61-25
Eligibility for family tax benefit (Part B) without shared care
19
Amount of the dependant (invalid and carer) tax offset
20
61-30
Amount of the dependant (invalid and carer) tax offset
21
61-35
Families with shared care percentages
22
61-40
Reduced amounts of dependant (invalid and carer) tax offset
23
61-45
Reductions to take account of the other individual's income
24
Schedule 7 Consolidating the dependency tax offsets
Part 1 Main amendments
20 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
Object of this Subdivision
1
61-5 Object of this Subdivision
2
The object of this Subdivision is to provide a
*
tax offset to assist
3
with the maintenance of certain types of dependants who are
4
genuinely unable to work because of invalidity, or because of their
5
care obligations.
6
Entitlement to the dependant (invalid and carer) tax offset
7
61-10 Who is entitled to the tax offset
8
(1) You are entitled to a
*
tax offset for an income year if:
9
(a) during the year you contribute to the maintenance of another
10
individual who:
11
(i) is your
*
spouse; or
12
(ii) is your
*
parent or your spouse's parent; or
13
(iii) is aged 16 years or over, and is your
*
child, brother or
14
sister or a brother or sister of your spouse; and
15
(b) during the year, the other individual meets the requirements
16
of one or more of subsections (2), (3) and (4); and
17
(c) during the year:
18
(i) the other individual is an Australian resident; or
19
(ii) if the other individual is your spouse or your child--you
20
had a domicile in Australia; and
21
(d) you are not entitled to a rebate of tax under section 159J
22
(rebates for dependants) of the Income Tax Assessment Act
23
1936 in respect of the other individual for the year; and
24
(e) you are not entitled to a rebate of tax under section 159L
25
(rebates for housekeepers) of the Income Tax Assessment Act
26
1936 in respect of the other individual for the year.
27
Note:
To be entitled to a rebate under section 159J or 159L of the Income
28
Tax Assessment Act 1936, you must also be entitled to either or both
29
of the following:
30
(a) a rebate under section 23AB (service with an armed force under
31
the control of the United Nations), section 79A (residents of
32
isolated areas) or section 79B (members of Defence Force
33
serving overseas) of that Act;
34
(b) a rebate under subsection 159J(2) of that Act in respect of a
35
spouse born before 1 July 1952.
36
Consolidating the dependency tax offsets Schedule 7
Main amendments Part 1
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
21
(2) The other individual meets the requirements of this subsection if he
1
or she is being paid:
2
(a) a disability support pension or a special needs disability
3
support pension under the Social Security Act 1991; or
4
(b) an invalidity service pension under the Veterans'
5
Entitlements Act 1986.
6
(3) The other individual meets the requirements of this subsection if he
7
or she:
8
(a) is your
*
spouse or parent, or your spouse's parent; and
9
(b) is being paid a carer allowance or carer payment under the
10
Social Security Act 1991 in relation to provision of care to a
11
person who:
12
(i) is your
*
child, brother or sister, or the brother or sister of
13
your spouse; and
14
(ii) is aged 16 years or over.
15
(4) The other individual meets the requirements of this subsection if he
16
or she is your
*
spouse or parent, or your spouse's parent, and is
17
wholly engaged in providing care to an individual who:
18
(a) is your
*
child, brother or sister, or the brother or sister of your
19
spouse; and
20
(b) is aged 16 years or over; and
21
(c) is being paid:
22
(i) a disability support pension or a special needs disability
23
support pension under the Social Security Act 1991; or
24
(ii) an invalidity service pension under the Veterans'
25
Entitlements Act 1986.
26
(5) You may be entitled to more than one
*
tax offset for the year under
27
subsection (1) if:
28
(a) you contributed to the maintenance of more than one other
29
individual (none of whom are your
*
spouse) during the year;
30
or
31
(b) you had different
*
spouses at different times during the year.
32
Note 1:
If paragraph (b) applies, the amount of the tax offset in relation to
33
each spouse would be only part of the full amount: see section 61-40.
34
Note 2:
Section 960-255 may be relevant to determining relationships for the
35
purposes of this section.
36
Schedule 7 Consolidating the dependency tax offsets
Part 1 Main amendments
22 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
61-15 Cases involving more than one spouse
1
(1) Despite paragraph 61-10(1)(a), if, during a period comprising some
2
or all of the year, there are 2 or more individuals who are your
3
*
spouse, you are taken, for the purposes of section 61-10, only to
4
contribute to the maintenance of the spouse with whom you reside
5
during that period.
6
(2) Despite paragraph 61-10(1)(a) and subsection (1) of this section, if,
7
during a period comprising some or all of the year:
8
(a) you reside with 2 or more individuals who are your
*
spouse;
9
or
10
(b) 2 or more individuals are your
*
spouse but you reside with
11
none of them;
12
you are taken, for the purposes of section 61-10, only to contribute
13
to the maintenance of whichever of those individuals in relation to
14
whom you are entitled to the smaller, or smallest, amount
15
(including a nil amount) of tax offset under this Subdivision in
16
relation to that period.
17
(3) If, but for this subsection, subsection (2) would apply in relation to
18
more than one other individual, that paragraph is taken to apply
19
only in relation to one of those other individuals.
20
61-20 Exceeding the income limit for family tax benefit (Part B)
21
(1) Despite section 61-10, you are not entitled to a
*
tax offset for an
22
income year if the sum of:
23
(a) your
*
adjusted taxable income for offsets for the year; and
24
(b) if you had a
*
spouse for the whole or part of the year, and
25
your spouse was not the other individual referred to in
26
subsection 61-10(1)--the spouse's adjusted taxable income
27
for offsets for the year;
28
is more than the amount specified in subclause 28B(1) of
29
Schedule 1 to the A New Tax System (Family Assistance) Act 1999,
30
as indexed under Part 2 of Schedule 4 to that Act.
31
(2) However, if you had a
*
spouse for only part of the year, the
32
spouse's
*
adjusted taxable income for offsets for the year is taken,
33
for the purposes of paragraph (1)(b), to be this amount:
34
Consolidating the dependency tax offsets Schedule 7
Main amendments Part 1
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
23
Number of days on which you
had a spouse during the year
Spouse's adjusted taxable
income for offsets
Number of days in the year
1
(3) If you had a different
*
spouse during different parts of the year,
2
include the
*
adjusted taxable income for offsets of each spouse
3
under paragraph (1)(b) and subsection (2).
4
61-25 Eligibility for family tax benefit (Part B) without shared care
5
Despite section 61-10, you are not entitled to a
*
tax offset in
6
relation to another individual for an income year if:
7
(a) your entitlement to the tax offset would, apart from this
8
section, be based on the other individual being your spouse
9
during the year; and
10
(b) during the whole of the year:
11
(i) you, or your
*
spouse while being your partner (within
12
the meaning of the A New Tax System (Family
13
Assistance) Act 1999), is eligible for family tax benefit
14
at the Part B rate (within the meaning of that Act); and
15
(ii) clause 31 of Schedule 1 to that Act does not apply in
16
respect of the Part B rate.
17
Amount of the dependant (invalid and carer) tax offset
18
61-30 Amount of the dependant (invalid and carer) tax offset
19
The amount of the
*
tax offset to which you are entitled in relation
20
to another individual under section 61-10 for an income year is
21
$2,423. The amount is indexed annually.
22
Note 1:
Subdivision 960-M shows you how to index amounts.
23
Note 2:
The amount of the tax offset may be reduced by the application, in
24
order, of sections 61-35 to 61-45.
25
61-35 Families with shared care percentages
26
(1) The amount of the
*
tax offset under section 61-30 in relation to the
27
other individual for the year is reduced by the amount worked out
28
under subsection (2) of this section if:
29
Schedule 7 Consolidating the dependency tax offsets
Part 1 Main amendments
24 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
(a) your entitlement to the tax offset is based on the other
1
individual being your spouse during the year; and
2
(b) during a period (the shared care period) comprising the
3
whole or part of the year:
4
(i) you, or your
*
spouse while being your partner (within
5
the meaning of the A New Tax System (Family
6
Assistance) Act 1999), was eligible for family tax
7
benefit at the Part B rate within the meaning of that Act;
8
and
9
(ii) clause 31 of Schedule 1 to that Act applied in respect of
10
that Part B rate because you, or your spouse, had a
11
shared care percentage for an FTB child (within the
12
meaning of that Act).
13
(2) The reduction is worked out as follows:
14
Number of days in
Shared care rate
the shared care period
Unaltered
offset amount
Number of days in
Non-shared care rate
the year
15
where:
16
non-shared care rate is the rate that would be the standard rate in
17
relation to you or your
*
spouse under clause 30 of Schedule 1 to
18
the A New Tax System (Family Assistance) Act 1999 if:
19
(a) clause 31 of that Schedule did not apply; and
20
(b) the FTB child in relation to whom the standard rate was
21
determined under clause 31 of that Schedule was the only
22
FTB child of you or your spouse, as the case requires.
23
shared care rate is the standard rate in relation to you or your
24
*
spouse worked out under clause 31 of Schedule 1 to the A New
25
Tax System (Family Assistance) Act 1999.
26
unaltered offset amount is what would, but for this section, be the
27
amount of your
*
tax offset in relation to the other individual under
28
section 61-10 for the year.
29
61-40 Reduced amounts of dependant (invalid and carer) tax offset
30
(1) The amount of the
*
tax offset under sections 61-30 and 61-35 in
31
relation to the other individual for the year is reduced by the
32
Consolidating the dependency tax offsets Schedule 7
Main amendments Part 1
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
25
amount in accordance with subsection (2) of this section if one or
1
more of the following applies:
2
(a) you contribute to the maintenance of the other individual
3
during part only of the year;
4
(b) during the whole or part of the year, 2 or more individuals
5
contribute to the maintenance of the other individual;
6
(c) the other individual is an individual of a kind referred to in
7
subparagraph 61-10(1)(a)(i), (ii) or (iii) during part only of
8
the year;
9
(d) paragraph 61-10(1)(b) applies to the other individual during
10
part only of the year;
11
(e) paragraph 61-10(1)(c) applies during part only of the year;
12
(f) during part of the year:
13
(i) you, or your
*
spouse while being your partner (within
14
the meaning of the A New Tax System (Family
15
Assistance) Act 1999), is eligible for family tax benefit
16
at the Part B rate (within the meaning of that Act); and
17
(ii) clause 31 of Schedule 1 to that Act does not apply in
18
respect of the Part B rate;
19
(g) the other individual is your spouse, and, during part of the
20
year, parental leave pay is payable under the Paid Parental
21
Leave Act 2010 to you, or to your spouse while being your
22
partner (within the meaning of that Act).
23
(2) The amount of the tax offset under sections 61-30 and 61-35 is
24
reduced to an amount that, in the Commissioner's opinion, is
25
reasonable in the circumstances, having regard to the applicable
26
matters referred to in paragraphs (1)(a) to (g).
27
(3) If paragraph (1)(f) or (g) applies, the Commissioner is not to
28
consider the part of the year covered by that paragraph.
29
61-45 Reductions to take account of the other individual's income
30
The amount of the
*
tax offset under sections 61-30 to 61-40 in
31
relation to the other individual for the year is reduced by $1 for
32
every $4 by which the following exceeds $282:
33
(a) if you contribute to the maintenance of the other individual
34
for the whole of the year--the other individual's
*
adjusted
35
taxable income for offsets for the year;
36
Schedule 7 Consolidating the dependency tax offsets
Part 1 Main amendments
26 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
(b) if paragraph (a) does not apply--the other individual's
1
*
adjusted taxable income for offsets for that part of the year
2
during which you contribute to the maintenance of the other
3
individual.
4
Consolidating the dependency tax offsets Schedule 7
Other amendments Part 2
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
27
Part 2
--
Other amendments
1
Income Tax Assessment Act 1936
2
2 After subsection 159J(1E)
3
Insert:
4
(1F) A taxpayer is not entitled, in his or her assessment in respect of a
5
year of income, to a rebate under this section in respect of a
6
dependant included in class 2, 3, 4, 5 or 6 in the table in
7
subsection (2) unless the taxpayer is entitled, in his or her
8
assessment in respect of that year of income, to a rebate under:
9
(a) section 23AB (certain persons serving with an armed force
10
under the control of the United Nations); or
11
(b) section 79A (residents of isolated areas); or
12
(c) section 79B (members of Defence Force serving overseas).
13
(1G) Subsection (1F) does not affect a taxpayer's entitlement to a rebate
14
in respect of a dependant who is also a dependant included in class
15
1 in the table in subsection (2).
16
3 Subsection 159J(6) (definition of invalid relative)
17
Repeal the definition, substitute:
18
invalid relative means a person who:
19
(a) is not less than 16 years of age and is a child, brother or sister
20
of the taxpayer or of the taxpayer's spouse; and
21
(b) is being paid a disability support pension or a special needs
22
disability support pension under the Social Security Act 1991.
23
Note:
Section 960-255 of the Income Tax Assessment Act 1997 may be
24
relevant to determining relationships for the purposes of this
25
definition.
26
4 Subsection 159J(6) (definition of invalid spouse)
27
Repeal the definition, substitute:
28
invalid spouse means a person who:
29
(a) is a spouse of the taxpayer; and
30
Schedule 7 Consolidating the dependency tax offsets
Part 2 Other amendments
28 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
(b) is being paid a disability support pension or a special needs
1
disability support pension under the Social Security Act 1991.
2
5 After subsection 159L(3B)
3
Insert:
4
(3C) A taxpayer is not entitled, in his or her assessment in respect of a
5
year of income, to a rebate under this section unless the taxpayer is
6
entitled, in his or her assessment in respect of that year of income,
7
to a rebate under:
8
(a) section 23AB (certain persons serving with an armed force
9
under the control of the United Nations); or
10
(b) section 79A (residents of isolated areas); or
11
(c) section 79B (members of Defence Force serving overseas).
12
6 Subsection 159P(4) (at the end of the definition of
13
dependant)
14
Add:
15
; or (e) a person in respect of whom the taxpayer is entitled to a tax
16
offset under Subdivision 61-A of the Income Tax Assessment
17
Act 1997; or
18
(f) a person in respect of whom the taxpayer would be entitled to
19
a tax offset under Subdivision 61-A of the Income Tax
20
Assessment Act 1997 but for section 61-20 of that Act.
21
Income Tax Assessment Act 1997
22
7 Section 13-
1 (table item headed "dependants")
23
Omit:
24
invalid relative, invalid spouse or carer spouse .................. 159J
substitute:
25
invalid relative, invalid spouse or carer in
receipt of carer benefit ........................................................
159J,
Subdivision 61-A
8 After section 960-265 (table item 3)
26
Insert:
27
3A
Dependant (invalid and carer) tax offset
section 61-30
Consolidating the dependency tax offsets Schedule 7
Other amendments Part 2
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
29
9 Subsection 995-1(1)
1
Insert:
2
adjusted taxable income for offsets means adjusted taxable income
3
for rebates within the meaning of subsection 6(1) of the Income
4
Tax Assessment Act 1936.
5
Schedule 7 Consolidating the dependency tax offsets
Part 3 Application of amendments
30 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
Part 3
--
Application of amendments
1
10 Application of amendments
2
The amendments made by this Schedule apply to assessments for the
3
2012-13 income year and later income years.
4
Taxation of financial arrangements Schedule 8
Core rules Part 1
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
31
Schedule 8
--
Taxation of financial
1
arrangements
2
Part 1
--
Core rules
3
Division 1
--
Attribution of costs
4
Income Tax Assessment Act 1997
5
1 Subsection 230-70(2)
6
After "are to provide", insert "or might provide".
7
2 Subsection 230-75(2)
8
After "are to receive", insert "or might receive".
9
Division 2
--
Interest
10
Income Tax Assessment Act 1997
11
3 Subsection 230-70(4)
12
Repeal the subsection.
13
4 At the end of section 230-70
14
Add:
15
Note:
Generally, no financial benefit you have provided, or are to provide or
16
might provide, under a financial arrangement is reasonably
17
attributable to an amount you receive that is in the nature of interest.
18
5 Subsection 230-75(4)
19
Repeal the subsection.
20
6 At the end of section 230-75
21
Add:
22
Note:
Generally, no financial benefit you have received, or are to receive or
23
might receive, under a financial arrangement is reasonably attributable
24
to an amount you provide that is in the nature of interest.
25
Schedule 8 Taxation of financial arrangements
Part 1 Core rules
32 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
7 Subsection 230-200(2)
1
Omit all the words after paragraph (b).
2
Division 3
--
Consistency in working out gains or losses
3
Income Tax Assessment Act 1997
4
8 At the end of section 230-80
5
Add:
6
(4) Subsection (3) does not require you to use that same manner
7
consistently for:
8
(a) a
*
financial arrangement that you start to have on or after the
9
time a
*
Commonwealth law that amends the method is made;
10
and
11
(b) a financial arrangement that you start to have before that
12
time;
13
if:
14
(c) the Commonwealth law allows you to choose to apply the
15
method in a particular manner (being a manner in which you
16
are not, apart from the Commonwealth law, allowed to apply
17
the method); and
18
(d) the inconsistency is entirely due to you choosing to apply the
19
method in that manner to the financial arrangement
20
mentioned in paragraph (a).
21
9 Application of amendment
22
The amendment made by this Division applies in relation to the
23
following Commonwealth laws:
24
(a) this Schedule;
25
(b) other Commonwealth laws made on or after the day this Act
26
receives the Royal Assent.
27
Taxation of financial arrangements Schedule 8
Accruals/realisation methods Part 2
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
33
Part 2
--
Accruals/realisation methods
1
Division 1
--
Sufficiently certain particular gains or losses
2
Income Tax Assessment Act 1997
3
10 Paragraph 230-110(2)(a)
4
After "gain or loss", insert ", and the extent to which such a financial
5
benefit is, for the purposes of subsection 230-70(2) or 230-75(2),
6
reasonably attributable to the benefit, right or obligation mentioned in
7
paragraph (1)(c) or (d) of this section at the time mentioned in
8
subsection (1)".
9
Division 2
--
Precedence of particular gains or losses
10
Income Tax Assessment Act 1997
11
11 At the end of subsection 230-100(2) (before the note)
12
Add:
13
; and (c) you choose to apply the accruals method to the gain or loss,
14
or subsection (4) applies to the gain or loss.
15
12 Subparagraph 230-100(3)(b)(i)
16
Before "at the time", insert "before or".
17
13 Paragraph 230-110(2)(b)
18
Repeal the paragraph, substitute:
19
(b) disregard any financial benefit that has already been taken
20
into account, under subsection 230-105(1), in working out, at
21
the time when you started to have the arrangement, the
22
amount of a sufficiently certain overall gain or loss from the
23
*
financial arrangement to which the accruals method applies;
24
and
25
14 Subsection 230-130(2)
26
Repeal the subsection.
27
Schedule 8 Taxation of financial arrangements
Part 2 Accruals/realisation methods
34 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
Division 3
--
Spreading prepayments
1
Income Tax Assessment Act 1997
2
15 After subsection 230-100(3)
3
Insert:
4
Accruals method--particular gain or loss becomes sufficiently
5
certain
6
(3A) The accruals method provided for in this Subdivision also applies
7
to a gain or loss you have from a
*
financial arrangement if:
8
(a) the gain or loss arises from a
*
financial benefit that you are to
9
receive or are to provide under the arrangement; and
10
(b) the gain or loss becomes sufficiently certain at the time you
11
receive or provide the benefit; and
12
(c) at least part of the period over which the gain or loss would
13
be spread under that method (assuming that method applied)
14
occurs after the time you receive or provide the benefit.
15
This subsection has effect subject to subsection (4).
16
Note 1: Subsection 230-110(1) tells you when you have a sufficiently
17
certain gain or loss at a particular time.
18
Note 2: For the period over which the gain or loss would be spread, see
19
subsections 230-130(3) to (5).
20
Accruals method--particular gain or loss from qualifying security
21
16 Subsection 230-100(4)
22
After "Subsection (3)", insert "or (3A)".
23
17 Subsection 230-110(1)
24
Omit "will make", substitute "make, or will make,".
25
18 Subsection 230-115(1)
26
Omit "will make", substitute "make, or will make,".
27
Taxation of financial arrangements Schedule 8
Accruals/realisation methods Part 2
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
35
19 Paragraph 230-130(4)(b)
1
Before "not start", insert "other than in the case of a gain or loss to
2
which subsection 230-100(3A) or subsection (4A) of this section
3
applies--".
4
20 Subsection 230-130(5)
5
Repeal the subsection, substitute:
6
(5) The end of the period over which a gain or loss to which
7
subsection (3) applies is to be spread must not end later than the
8
time when you will cease to have the
*
financial arrangement.
9
21 After subsection 230-170(2)
10
Insert:
11
(2A) Subsections (1) and (2) do not apply to a part of a gain or loss if:
12
(a) subsection 230-100(3A) or 230-130(4A) applies to the gain
13
or loss; and
14
(b) that part of the gain or loss is allocated to an interval under
15
section 230-135; and
16
(c) that interval ends before or during the income year during
17
which the gain or loss becomes sufficiently certain (as
18
mentioned in paragraph 230-100(3A)(b) or 230-130(4A)(f),
19
whichever is applicable).
20
Instead, you are taken, for the purposes of section 230-15, to make,
21
for that income year, a gain or loss equal to that part of that gain or
22
loss.
23
Division 4
--
Spreading single payment
24
Income Tax Assessment Act 1997
25
22 After subsection 230-135(6)
26
Insert:
27
(6A) However, if there is only one
*
financial benefit that is to be taken
28
into account in working out the amount of the gain or loss, then,
29
for the purposes of paragraph (5)(b), in determining the amount to
30
which you apply the rate of return, have regard to a notional
31
principal:
32
Schedule 8 Taxation of financial arrangements
Part 2 Accruals/realisation methods
36 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
(a) by reference to which the financial benefit is calculated; or
1
(b) which is reasonably related to the financial benefit.
2
Division 5
--
Re-estimations
3
Income Tax Assessment Act 1997
4
23 Paragraph 230-190(1)(c)
5
Omit "section 230-200; and", substitute "section 230-200.".
6
24 Paragraph 230-190(1)(d)
7
Repeal the paragraph.
8
25 Subsection 230-190(2)
9
Repeal the subsection, substitute:
10
(2) You must re-estimate the gain or loss as soon as reasonably
11
practicable after you become aware of the circumstances referred
12
to in paragraph (1)(b), if subsection (1) applies.
13
26 After subsection 230-190(3)
14
Insert:
15
(3A) You also re-estimate a gain or loss from a
*
financial arrangement
16
under subsection (5) if:
17
(a) the gain or loss is spread using the method referred to in
18
paragraph 230-135(2)(b) in accordance with section 230-140
19
(effective interest method); and
20
(b) you recalculate the effective interest rate in accordance with
21
that method; and
22
(c) the terms and conditions of the arrangement provide for reset
23
dates to occur no more than 12 months apart; and
24
(d) the maximum life of the arrangement (as determined under
25
the terms and conditions of the arrangement) is more than 12
26
months.
27
(3B) You must re-estimate the gain or loss at the relevant reset date if
28
subsection (3A) applies.
29
Taxation of financial arrangements Schedule 8
Accruals/realisation methods Part 2
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
37
Division 6
--
Impairments and reversals
1
Income Tax Assessment Act 1997
2
27 After subsection 230-130(4)
3
Insert:
4
(4A) This subsection applies to a gain or loss to which subsection (3)
5
applies, if:
6
(a) there is an impairment (within the meaning of the
7
*
accounting principles) of:
8
(i) the
*
financial arrangement; or
9
(ii) a financial asset or financial liability that forms part of
10
the arrangement; and
11
(b) because of the impairment, you make a reassessment under
12
section 230-185 in relation to the arrangement; and
13
(c) you determine on the reassessment that the gain or loss is not
14
sufficiently certain (whether or not the gain or loss was
15
sufficiently certain before the reassessment); and
16
(d) there is a reversal of the impairment loss (within the meaning
17
of the accounting principles) that resulted from the
18
impairment; and
19
(e) because of the reversal, you make a reassessment under
20
section 230-185 in relation to the arrangement; and
21
(f) you determine on the reassessment that the gain or loss has
22
become sufficiently certain.
23
Note:
For the income years to which the gain or loss is allocated, see
24
section 230-170.
25
28 After section 230-170
26
Insert:
27
230-172 Applying accruals method to loss resulting from
28
impairment
29
(1) This section applies if:
30
(a) there is an impairment (within the meaning of the
31
*
accounting principles) of:
32
(i) a
*
financial arrangement; or
33
Schedule 8 Taxation of financial arrangements
Part 2 Accruals/realisation methods
38 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
(ii) a financial asset or financial liability that forms part of a
1
financial arrangement; and
2
(b) you make a loss from the financial arrangement as a result of
3
the impairment; and
4
(c) the accruals method applies to the loss.
5
(2) You cannot deduct a loss you make for an income year under
6
section 230-15, to the extent that the loss results from the
7
impairment (including as affected by any later reversal of the
8
impairment loss (within the meaning of the
*
accounting principles)
9
that resulted from the impairment).
10
(3) Disregard subsection (2) for the purposes of paragraph (c) of step 1
11
of the method statement in subsection 230-445(1).
12
29 Subsections 230-190(8) to (10)
13
Repeal the subsections.
14
30 After section 230-190
15
Insert:
16
230-192 Re-estimation--impairments and reversals
17
(1) This section applies if the re-estimation mentioned in
18
section 230-190 arises because of:
19
(a) an impairment (within the meaning of the
*
accounting
20
principles) of:
21
(i) the
*
financial arrangement; or
22
(ii) a financial asset or financial liability that forms part of
23
the arrangement; or
24
(b) a reversal of an impairment loss (within the meaning of the
25
accounting principles) that resulted from such an impairment.
26
(2) Despite paragraph 230-190(6)(a), you must make the fresh
27
allocation in accordance with paragraph 230-190(6)(b).
28
Losses non-deductible
29
(3) You cannot deduct a loss you make for an income year under
30
section 230-15, to the extent that the loss results from:
31
Taxation of financial arrangements Schedule 8
Accruals/realisation methods Part 2
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
39
(a) the impairment (including as affected by any later reversal of
1
the impairment loss that resulted from the impairment); or
2
(b) the operation of subsection (7).
3
(4) Disregard subsection (3) for the purposes of paragraph (c) of step 1
4
of the method statement in subsection 230-445(1).
5
Reversals
6
(5) Subsections (7) and (8) apply to the part of the gain or loss that is
7
to be reallocated in accordance with paragraph 230-190(6)(b), if:
8
(a) the fresh determination under paragraph 230-190(5)(a) that
9
arose because of the reversal resulted in that part being a
10
gain; and
11
(b) there are losses that:
12
(i) resulted from the impairment; and
13
(ii) you could have deducted apart from
14
subsection 230-172(2) or subsection (3) of this section.
15
(6) Paragraph (5)(b) does not apply to a loss to the extent that:
16
(a) the loss reflects the amount of a loss you make under
17
paragraph 230-195(1)(b) or (c); and
18
(b) the loss you make under paragraph 230-195(1)(b) or (c)
19
relates to you writing off, as a bad debt, a right to receive a
20
*
financial benefit (or a part of a financial benefit).
21
(7) Treat the fresh determination as having resulted in that part being a
22
loss, if the total of the losses mentioned in paragraph (5)(b) of this
23
section exceeds the amount of the gain mentioned in
24
paragraph (5)(a). The amount of the loss is equal to the amount of
25
the excess.
26
(8) Otherwise, reduce the amount of that gain by the total of those
27
losses.
28
Division 7
--
Running balancing adjustments
29
Income Tax Assessment Act 1997
30
31 After subsection 230-175(1)
31
Insert:
32
Schedule 8 Taxation of financial arrangements
Part 2 Accruals/realisation methods
40 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
(1A) Subsection (1) does not apply to the extent that the difference
1
results from:
2
(a) an impairment (within the meaning of the
*
accounting
3
principles) of:
4
(i) the
*
financial arrangement; or
5
(ii) a financial asset or financial liability that forms part of
6
the arrangement; or
7
(b) you writing off, as a bad debt, a right to a
*
financial benefit
8
(or a part of a financial benefit).
9
32 After subsection 230-175(2)
10
Insert:
11
(2A) Subsection (2) does not apply to the extent that the difference
12
results from the reversal of an impairment loss (within the meaning
13
of the
*
accounting principles) that resulted from an impairment
14
(within the meaning of the accounting principles) of:
15
(a) the
*
financial arrangement; or
16
(b) a financial asset or financial liability that forms part of the
17
arrangement.
18
Division 8
--
Ceasing of rights or obligations
19
Income Tax Assessment Act 1997
20
33 Subsection 230-180(2)
21
Repeal the subsection, substitute:
22
(2) For the purposes of subsection (1), a gain or loss from a
*
financial
23
arrangement is taken to occur at:
24
(a) if the last of the
*
financial benefits, rights and obligations
25
taken into account in determining the amount of the gain or
26
loss is a financial benefit--the time the financial benefit:
27
(i) is provided; or
28
(ii) if the financial benefit is not provided at the time when
29
it is due to be provided under the arrangement and it is
30
reasonable to expect that the financial benefit will be
31
provided--is due to be provided; or
32
Taxation of financial arrangements Schedule 8
Accruals/realisation methods Part 2
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
41
(b) if the last of the financial benefits, rights and obligations
1
taken into account in determining the amount of the gain or
2
loss is a right to receive a financial benefit or an obligation to
3
provide a financial benefit--the time:
4
(i) if the right or obligation ceases before the financial
5
benefit is provided--the right or obligation ceases; or
6
(ii) otherwise--the financial benefit is provided.
7
This subsection has effect subject to subsection (3).
8
Schedule 8 Taxation of financial arrangements
Part 3 Fair value method
42 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
Part 3
--
Fair value method
1
Income Tax Assessment Act 1997
2
34 Paragraph 230-40(4)(a)
3
Repeal the paragraph, substitute:
4
(a) to the extent that Subdivision 230-C (fair value method)
5
applies to the gain or loss; or
6
Note:
See subsection (5) of this section and subsection 230-230(4).
7
35 Paragraph 230-220(1)(c)
8
Omit "to classify or designate", substitute "to classify, designate or (in
9
whole or in part) otherwise treat".
10
36 Subsection 230-230(1)
11
Repeal the subsection, substitute:
12
(1) You make a gain or loss for an income year from a
*
financial
13
arrangement to which a
*
fair value election applies if:
14
(a) the principles or standards mentioned in
15
paragraph 230-210(2)(a) require you to recognise a gain or
16
loss in profit or loss for the income year from the asset or
17
liability mentioned in paragraph 230-220(1)(c); or
18
(b) in the case of an arrangement to which subsection 230-220(2)
19
applies--the principles or standards referred to in
20
paragraph 230-220(1)(c) would have required you to
21
recognise a gain or loss in profit or loss for the year from the
22
asset or liability mentioned in paragraph 230-220(1)(c) if the
23
arrangement had not been an intra-group transaction for the
24
purposes of the standard referred to in
25
paragraph 230-220(2)(b); or
26
(c) in the case of an arrangement to which subsection 230-220(3)
27
applies--the principles or standards referred to in
28
paragraph 230-220(1)(c) would have required you to
29
recognise a gain or loss in profit or loss for the year from the
30
asset or liability mentioned in paragraph 230-220(1)(c) if the
31
arrangement had been between 2 separate entities.
32
Taxation of financial arrangements Schedule 8
Fair value method Part 3
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
43
Note:
Subsection 230-40(7) provides that an election under
1
Subdivision 230-E (hedging financial arrangements method) or
2
Subdivision 230-F (method of relying on financial reports) may
3
override a fair value election.
4
(1A) The gain or loss you make is the gain or loss the principles or
5
standards require, or would have required, you to recognise in
6
profit or loss as mentioned in subsection (1).
7
37 At the end of section 230-230
8
Add:
9
Subdivision does not apply to extent gains or losses not recognised
10
as at fair value
11
(4) This Subdivision does not apply to a gain or loss you make from
12
the
*
financial arrangement, to the extent:
13
(a) you are required, as mentioned in paragraph 230-220(1)(c),
14
to otherwise treat as at fair value through profit and loss the
15
assets or liabilities that the financial arrangement is; and
16
(b) the principles or standards referred to in
17
paragraph 230-210(2)(a) do not require you to recognise the
18
gain or loss as at fair value through profit or loss.
19
Note:
See also subsection 230-40(5).
20
38 At the end of section 230-245
21
Add:
22
(6) In determining, for the purposes of the balancing adjustment under
23
subsection (2) or (4) or for the purposes of subsection (5), the fair
24
value of the
*
financial arrangement at a time, disregard any
25
changes in the fair value to the extent that:
26
(a) you are required, as mentioned in paragraph 230-220(1)(c),
27
to otherwise treat the financial arrangement as at fair value
28
through profit and loss; and
29
(b) the principles or standards referred to in
30
paragraph 230-210(2)(a) do not require you to recognise the
31
changes as at fair value through profit or loss.
32
Schedule 8 Taxation of financial arrangements
Part 4 Hedging financial arrangements method
44 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
Part 4
--
Hedging financial arrangements method
1
Division 1
--
One in all in principle
2
Income Tax Assessment Act 1997
3
39 Section 230-325
4
Repeal the section, substitute:
5
230-325 Hedging financial arrangements to which election applies
6
A
*
hedging financial arrangement election applies to a
*
hedging
7
financial arrangement:
8
(a) that you start to have in the income year in which you make
9
the election or in a later income year; and
10
(b) that is not excluded from the application of the election by
11
section 230-330.
12
Note:
Subject to a determination by the Commissioner, the hedging financial
13
arrangement election does not apply to a financial arrangement you
14
start to have after you fail to comply with the requirements in
15
sections 230-355 and 230-360 and paragraph 230-365(c) in relation to
16
a hedging financial arrangement to which the election does apply: see
17
section 230-385. See also subsection 230-305(1).
18
40 Paragraph 230-335(3)(d)
19
Before "you satisfy", insert "in a case in which none of subsections (5),
20
(6) and (7) are satisfied--".
21
41 Paragraph 230-335(3)(e)
22
Before "you satisfy", insert "in any case--".
23
42 After subsection 230-335(3)
24
Insert:
25
(3A) Disregard paragraph (3)(d) if subsection (4) is satisfied and:
26
(a) a
*
hedging financial arrangement election applies to the
27
*
financial arrangement (because you previously satisfied the
28
additional recording requirements mentioned in that
29
paragraph at a time when the election applied); or
30
Taxation of financial arrangements Schedule 8
Hedging financial arrangements method Part 4
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
45
(b) all of the following subparagraphs apply:
1
(i) a hedging financial arrangement election would apply to
2
the financial arrangement if you satisfied the additional
3
recording requirements mentioned in paragraph (3)(d);
4
(ii) the election and subsection (3) apply to another
5
financial arrangement;
6
(iii) subsection (4) is or was satisfied in relation to that other
7
arrangement at a time when the election applied to that
8
other arrangement.
9
43 Paragraph 230-365(c)
10
Omit all the words after subparagraph (ii).
11
44 At the end of section 230-365
12
Add:
13
; and (d) your assessment must be that the hedging of the risk will be
14
highly effective (within the meaning of the principles or
15
standards referred to in paragraph 230-315(2)(a)) in reducing
16
your exposure to changes in the fair value of the hedged item
17
or items or cash flows attributable to the hedged risk
18
throughout the remainder of the period for which you expect
19
to have the arrangement.
20
45 Section 230-380 (heading)
21
Repeal the heading, substitute:
22
230-380 Commissioner may determine that requirement met
23
46 Subsection 230-380(6)
24
Omit "and the Commissioner's", substitute ", in a way that satisfies the
25
requirements of section 230-360. The Commissioner's".
26
47 Section 230-385
27
Repeal the section, substitute:
28
Schedule 8 Taxation of financial arrangements
Part 4 Hedging financial arrangements method
46 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
230-385 Consequences of failure to meet requirements
1
When this section applies
2
(1) This section applies if:
3
(a) your
*
hedging financial arrangement election applies to a
4
*
hedging financial arrangement; and
5
(b) you do not meet a requirement of section 230-355 or 230-360
6
or paragraph 230-365(c) in relation to the arrangement.
7
(2) For the purposes of paragraph (1)(b), treat the requirement in
8
paragraph 230-365(c) as being met even if you do not assess the
9
hedging of the risk mentioned in that paragraph, but you can
10
demonstrate that you intend to do so.
11
Commissioner may determine matter under section 230-360
12
(3) If:
13
(a) you fail to determine a matter in relation to the
*
hedging
14
financial arrangement under section 230-360; or
15
(b) you determine a matter in relation to the arrangement under
16
section 230-360 but the determination does not satisfy the
17
requirements of subsection 230-360(2);
18
the Commissioner may determine that matter, in a way that
19
satisfies the requirements of section 230-360. A reference in this
20
Division to a determination made under that section is treated as
21
including a reference to a determination under this subsection.
22
Election does not apply to hedging financial arrangements you
23
start to have after failing to comply with requirements
24
(4) Your
*
hedging financial arrangement election does not apply to a
25
*
hedging financial arrangement you start to have:
26
(a) after you fail to meet the requirement mentioned in
27
paragraph (1)(b) in relation to the arrangement mentioned in
28
that paragraph; and
29
(b) before a date (if any) determined by the Commissioner.
30
(5) The Commissioner may make a determination under
31
paragraph (4)(b) only if satisfied that you are unlikely to fail again
32
to meet a requirement of section 230-355 or 230-360 or
33
Taxation of financial arrangements Schedule 8
Hedging financial arrangements method Part 4
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
47
paragraph 230-365(c) in relation to a
*
hedging financial
1
arrangement.
2
(6) In deciding whether to make a determination under
3
paragraph (4)(b), the Commissioner must have regard to:
4
(a) your record keeping practices; and
5
(b) your compliance history; and
6
(c) any changes that have been made to:
7
(i) your accounting systems and controls; and
8
(ii) your internal governance processes;
9
to ensure that failures of the kind mentioned in
10
paragraph (1)(b) do not happen again; and
11
(d) any other relevant matter.
12
Commissioner may still exercise powers under section 230-380
13
(7) This section does not prevent the Commissioner from exercising
14
the Commissioner's powers under section 230-380 in relation to
15
the
*
hedging financial arrangement mentioned in subsection (1).
16
Division 2
--
Hedging net investments in foreign
17
operations
18
Income Tax Assessment Act 1997
19
48 Subsection 230-310(5)
20
Repeal the subsection, substitute:
21
(5) Subsection (6) applies if:
22
(a) a
*
hedged item is your net investment in a foreign operation
23
(within the meaning of the
*
accounting principles); and
24
(b) the foreign operation is carried on through:
25
(i) a company in which you hold
*
shares; or
26
(ii) a company that is a subsidiary of yours (within the
27
meaning of the Corporations Act 2001).
28
(6) The table in subsection (4) has effect as if:
29
(a) to the extent that the
*
hedging financial arrangement hedges a
30
risk or risks in relation to
*
shares you hold in the company--
31
Schedule 8 Taxation of financial arrangements
Part 4 Hedging financial arrangements method
48 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
the reference in that table to the
*
hedged item were a
1
reference to your interest in those shares; and
2
(b) to the extent that the hedging financial arrangement hedges a
3
risk or risks in relation to another interest you have in the
4
company--the reference in that table to the hedged item were
5
a reference to that interest.
6
Taxation of financial arrangements Schedule 8
Transitional balancing adjustments Part 5
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
49
Part 5
--
Transitional balancing adjustments
1
Tax Laws Amendment (Taxation of Financial Arrangements)
2
Act 2009
3
49 At the end of paragraph 104(14)(c) of Schedule 1
4
Add "and".
5
50 After paragraph 104(14)(c) of Schedule 1
6
Insert:
7
(ca) the attributable assessable amount represents the whole of the
8
deferred tax effect of a gain or loss from the financial
9
arrangement that has been recognised in profit or loss in
10
accordance with the accounting principles mentioned in
11
paragraph 230-395(2)(a) of the Income Tax Assessment Act
12
1997;
13
51 At the end of subitem 104(14) of Schedule 1
14
Add:
15
Note:
The deferred tax effect to be taken into account for the purposes of paragraph (ca) might
16
be affected by a later assessment, the amendment of an assessment or a law that applies
17
retrospectively.
18
52 At the end of paragraph 104(15)(c) of Schedule 1
19
Add "and".
20
53 After paragraph 104(15)(c) of Schedule 1
21
Insert:
22
(ca) the attributable deductible amount represents the whole of the
23
deferred tax effect of a gain or loss from the financial
24
arrangement that has been recognised in profit or loss in
25
accordance with the accounting principles mentioned in
26
paragraph 230-395(2)(a) of the Income Tax Assessment Act
27
1997;
28
54 At the end of subitem 104(15) of Schedule 1
29
Add:
30
Schedule 8 Taxation of financial arrangements
Part 5 Transitional balancing adjustments
50 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
Note:
The deferred tax effect to be taken into account for the purposes of paragraph (ca) might
1
be affected by a later assessment, the amendment of an assessment or a law that applies
2
retrospectively.
3
Taxation of financial arrangements Schedule 8
Elective requirements Part 6
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
51
Part 6
--
Elective requirements
1
Income Tax Assessment Act 1997
2
55 At the end of Subdivision 230-I
3
Add:
4
230-527 Elections--reporting documents of foreign ADIs
5
(1) So much of a Statement of Financial Performance and a Statement
6
of Financial Position, given to
*
APRA by a foreign ADI (within
7
the meaning of the Banking Act 1959) as required under section 13
8
of the Financial Sector (Collection of Data) Act 2001, as:
9
(a) cover the activities of an
*
Australian permanent
10
establishment of the foreign ADI for the year; and
11
(b) are prepared in accordance with the recognition and
12
measurement standards under the
*
accounting principles; and
13
(c) are audited in accordance with the
*
auditing principles;
14
are treated, for the purposes of the provisions mentioned in
15
subsection (2), as being a financial report for a year:
16
(d) prepared by the foreign ADI in accordance with the
17
accounting principles; and
18
(e) audited in accordance with the auditing principles.
19
(2) The provisions are as follows:
20
(a) sections 230-150 to 230-165 (election for portfolio treatment
21
of fees);
22
(b) sections 230-210 to 230-220 (fair value election);
23
(c) sections 230-255 to 230-265 (foreign exchange retranslation
24
election);
25
(d) sections 230-315 to 230-335 (hedging financial arrangement
26
election);
27
(e) sections 230-395, 230-400, 230-410 and 230-430 (election to
28
rely on financial reports).
29
Schedule 8 Taxation of financial arrangements
Part 7 Miscellaneous amendments
52 Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No.
, 2013
Part 7
--
Miscellaneous amendments
1
Division 1
--
Consistency of language
2
Income Tax Assessment Act 1997
3
56 Paragraphs 230-80(2)(a) and (3)(a)
4
Omit "make", substitute "have".
5
57 Subsections 230-100(2), (3), (4) and (5)
6
Omit "make", substitute "have".
7
58 Section 230-125
8
Omit "make", substitute "have".
9
Division 2
--
Other amendments
10
Income Tax Assessment Act 1997
11
59 Subparagraph 230-5(2)(a)(iv) (second occurring)
12
Renumber as subparagraph (iva).
13
60 Paragraph 230-85(a)
14
After "even", insert "if".
15
Note:
This item fixes a typographical error.
16
61 Subparagraph 230-140(3)(c)(ii)
17
Omit "will be provided or received", substitute "is to be provided or
18
received".
19
62 Paragraph 230-190(7)(a)
20
Omit "are to apply", substitute "is to apply".
21
Note:
This item fixes a grammatical error.
22
Taxation of financial arrangements Schedule 8
Miscellaneous amendments Part 7
Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013 No. , 2013
53
63 Subsections 230-290(1) and (3)
1
Omit "
*
foreign currency retranslation election", substitute "
*
foreign
2
exchange retranslation election".
3
Note:
This item fixes typographical errors.
4
64 Paragraph 230-455(1)(d)
5
Omit "subparagraph (iv)", substitute "subparagraph (a)(iv)".
6
Note:
This item clarifies a cross-reference.
7
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