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This is a Bill, not an Act. For current law, see the Acts databases.
2013-2014-2015
The Parliament of the
Commonwealth of Australia
HOUSE OF REPRESENTATIVES
Presented and read a first time
Tax and Superannuation Laws
Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
(Treasury)
A Bill for an Act to amend the law relating to
taxation, and for related purposes
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
i
Contents
1
Short title ........................................................................................... 1
2
Commencement ................................................................................. 1
3
Schedules ........................................................................................... 2
Schedule 1--CGT treatment of earnout rights
3
Part 1--Main amendments
3
Income Tax Assessment Act 1997
3
Part 2--Preserving small business concessions
12
Income Tax Assessment Act 1997
12
Part 3--Other consequential amendments
16
Income Tax Assessment Act 1997
16
Taxation Administration Act 1953
18
Taxation (Interest on Overpayments and Early Payments) Act 1983
20
Part 4--Application and transitional provisions
21
Part 5--Amendments relating to foreign resident capital gains
withholding payments
22
Taxation Administration Act 1953
22
Schedule 2--Foreign resident capital gains withholding
payments
24
Part 1--Main amendments
24
Taxation Administration Act 1953
24
Part 2--Consequential amendments
33
Income Tax Assessment Act 1936
33
Income Tax Assessment Act 1997
33
Taxation Administration Act 1953
34
Part 3--Contingent amendments
37
Tax Laws Amendment (New Tax System for Managed Investment
Trusts) Act 2015
37
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
1
A Bill for an Act to amend the law relating to
1
taxation, and for related purposes
2
The Parliament of Australia enacts:
3
1 Short title
4
This Act may be cited as the Tax and Superannuation Laws
5
Amendment (2015 Measures No. 6) Act 2015.
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
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
Commencement information
Column 1
Column 2
Column 3
Provisions
Commencement
Date/Details
1. Sections 1 to 3
and anything in
this Act not
elsewhere covered
by this table
The day this Act receives the Royal Assent.
2. Schedule 1,
Parts 1 to 4
The day after this Act receives the Royal
Assent.
3. Schedule 1,
Part 5
Immediately after the commencement of the
provisions covered by table item 4.
4. Schedule 2,
Parts 1 and 2
The day after this Act receives the Royal
Assent.
5. Schedule 2,
Part 3
Immediately after the commencement of
Schedule 3 to the Tax Laws Amendment
(New Tax System for Managed Investment
Trusts) Act 2015.
However, the provisions do not commence
at all if that Schedule commences at the
same time as, or before, the provisions
covered by table item 4.
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
CGT treatment of earnout rights Schedule 1
Main amendments Part 1
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
3
Schedule 1--CGT treatment of earnout rights
1
Part 1--Main amendments
2
Income Tax Assessment Act 1997
3
1 After section 112-35
4
Insert:
5
112-36 Acquisitions of assets involving look-through earnout rights
6
Consequences for cost base and reduced cost base
7
(1) If you
*
acquire a
*
CGT asset because an entity
*
disposes of the
8
CGT asset to you, and that disposal causes
*
CGT event A1 (the
9
first CGT event) to happen:
10
(a) neither the
*
cost base nor the
*
reduced cost base of the CGT
11
asset includes the value of any
*
look-through earnout right
12
relating to the CGT asset and the acquisition; and
13
(b) include in the first element of the CGT asset's cost base and
14
reduced cost base any
*
financial benefit that you provide
15
under such a look-through earnout right; and
16
(c) reduce the first element of the CGT asset's cost base and
17
reduced cost base by an amount equal to the amount of any
18
financial benefit that you receive under such a look-through
19
earnout right.
20
Remaking choices affected by the look-through earnout right
21
(2) Despite section 103-25, you may remake any choice you made
22
under this Part or Part 3-3 for a later
*
CGT event involving the
23
*
CGT asset if:
24
(a) after the later CGT event, you provide or receive a
*
financial
25
benefit under such a
*
look-through earnout right; and
26
(b) you remake the choice at or before the time you are required
27
to lodge your
*
income tax return for the income year in
28
which the financial benefit is provided or received.
29
Schedule 1 CGT treatment of earnout rights
Part 1 Main amendments
4
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
Amending assessments affected by the look-through earnout right
1
(3) The Commissioner may amend an assessment of a
*
tax-related
2
liability if:
3
(a) an entity provides or receives a
*
financial benefit under such
4
a
*
look-through earnout right; and
5
(b) the amount of the tax-related liability:
6
(i) depends on that entity's taxable income for an income
7
year in which a
*
CGT event, involving the
*
CGT asset,
8
happens after the first CGT event but before the
9
financial benefit is provided or received; or
10
(ii) is otherwise affected by that right's character as a
11
look-through earnout right; and
12
(c) the Commissioner makes the amendment before the end of
13
the 4-year period starting at the end of the income year in
14
which the last possible financial benefit becomes or could
15
become due under the look-through earnout right.
16
The tax-related liability need not be a liability of that entity.
17
Note:
Subparagraph (b)(ii) covers changes to the amount of that tax-related
18
liability that happen directly or indirectly because of subsection (1) or
19
(2).
20
(4) If at a particular time a right is taken never to have been a
21
*
look-through earnout right because of subsection 118-565(2), the
22
Commissioner may amend an assessment of a
*
tax-related liability
23
for up to 4 years after that time if:
24
(a) an entity provides or receives a
*
financial benefit under the
25
right; and
26
(b) the amount of the tax-related liability:
27
(i) depends on that entity's taxable income for an income
28
year in which a
*
CGT event, involving the
*
CGT asset,
29
happens after the first CGT event but before the
30
financial benefit is provided or received; or
31
(ii) was otherwise affected by that right's character as a
32
look-through earnout right before subsection 118-565(2)
33
applied.
34
The tax-related liability need not be a liability of that entity.
35
CGT treatment of earnout rights Schedule 1
Main amendments Part 1
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
5
Note:
Subsection 118-565(2) restricts look-through earnout rights to rights
1
to financial benefits over a period not exceeding 5 years from the end
2
of the income year in which the first CGT event happens.
3
(5) If, after providing or receiving a
*
financial benefit under a right
4
referred to in subsection (3) or (4):
5
(a) you are dissatisfied with an assessment referred to in that
6
subsection; and
7
(b) the Commissioner notifies you that the Commissioner has
8
decided under that subsection not to amend your assessment;
9
you may object against the assessment, to the extent that it does not
10
take account of that right's character (as a
*
look-through earnout
11
right or not such a right), in the manner set out in Part IVC of the
12
Taxation Administration Act 1953.
13
2 Section 116-25 (at the end of the cell at table item dealing
14
with event A1, column headed "Special rules:")
15
Add:
16
If the disposal involves a
*
look-through earnout
right: see section 116-120
3 At the end of Division 116
17
Add:
18
116-120 Disposals of assets involving look-through earnout rights
19
Consequences for capital proceeds
20
(1) If
*
CGT event A1 happens because you
*
dispose of a
*
CGT asset,
21
your
*
capital proceeds from the disposal:
22
(a) do not include the value of any
*
look-through earnout right
23
relating to the CGT asset and the disposal; and
24
(b) are increased by any
*
financial benefit that you receive under
25
such a look-through earnout right; and
26
(c) are reduced by any financial benefit that you provide under
27
such a look-through earnout right.
28
Schedule 1 CGT treatment of earnout rights
Part 1 Main amendments
6
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
Remaking choices affected by the look-through earnout right
1
(2) Despite section 103-25, you may remake any choice you made
2
under this Part or Part 3-3 in relation to the
*
CGT event if:
3
(a) you provide or receive a
*
financial benefit under such a
4
*
look-through earnout right; and
5
(b) you remake the choice at or before the time you are required
6
to lodge your
*
income tax return for the income year in
7
which the financial benefit is provided or received.
8
Amending assessments affected by the look-through earnout right
9
(3) The Commissioner may amend an assessment of a
*
tax-related
10
liability if:
11
(a) an entity provides or receives a
*
financial benefit under such
12
a
*
look-through earnout right; and
13
(b) the amount of the tax-related liability:
14
(i) depends on that entity's taxable income for the income
15
year in which the
*
CGT event happens; or
16
(ii) is otherwise affected by that right's character as a
17
look-through earnout right; and
18
(c) the Commissioner makes the amendment before the end of
19
the 4-year period starting at the end of the income year in
20
which the last possible financial benefit becomes or could
21
become due under the look-through earnout right.
22
The tax-related liability need not be a liability of that entity.
23
Note:
Subparagraph (b)(ii) covers changes to the amount of that tax-related
24
liability that happen directly or indirectly because of subsection (1) or
25
(2).
26
(4) If at a particular time a right is taken never to have been a
27
*
look-through earnout right because of subsection 118-565(2), the
28
Commissioner may amend an assessment of a
*
tax-related liability
29
for up to 4 years after that time if:
30
(a) an entity provides or receives a
*
financial benefit under the
31
right; and
32
(b) the amount of the tax-related liability:
33
(i) depends on that entity's taxable income for the income
34
year in which the
*
CGT event happens; or
35
CGT treatment of earnout rights Schedule 1
Main amendments Part 1
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
7
(ii) was otherwise affected by that right's character as a
1
look-through earnout right before subsection 118-565(2)
2
applied.
3
The tax-related liability need not be a liability of that entity.
4
Note:
Subsection 118-565(2) restricts look-through earnout rights to rights
5
to financial benefits over a period not exceeding 5 years from the end
6
of the income year in which the CGT event happens.
7
(5) If, after providing or receiving a
*
financial benefit under a right
8
referred to in subsection (3) or (4):
9
(a) you are dissatisfied with an assessment referred to in that
10
subsection; and
11
(b) the Commissioner notifies you that the Commissioner has
12
decided under that subsection not to amend your assessment;
13
you may object against the assessment, to the extent that it does not
14
take account of that right's character (as a
*
look-through earnout
15
right or not such a right), in the manner set out in Part IVC of the
16
Taxation Administration Act 1953.
17
4 At the end of Division 118
18
Add:
19
Subdivision 118-I--Look-through earnout rights
20
Table of sections
21
118-560 Object
22
118-565 Look-through earnout rights
23
118-570 Extra ways a CGT asset can be an active asset
24
118-575 Creating and ending look-through earnout rights
25
118-580 Temporarily disregard capital losses affected by look-through earnout rights
26
118-560 Object
27
(1) This Subdivision and its related provisions set out special rules for
28
*
look-through earnout rights. The object of these rules is to avoid
29
unnecessary compliance costs and disadvantageous tax outcomes
30
when entities involved in the sale of a business:
31
(a) cannot agree on the current value of some or all of the
32
business' assets due to uncertainty about the future economic
33
performance of the business; and
34
Schedule 1 CGT treatment of earnout rights
Part 1 Main amendments
8
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
(b) resolve this uncertainty by agreeing to potentially provide
1
future additional consideration linked to this performance.
2
(2) These rules achieve this object by:
3
(a) disregarding any
*
capital gain or
*
capital loss relating to the
4
creation of a
*
look-through earnout right; and
5
(b) for the acquirer of the business--treating any
*
financial
6
benefits provided (or received) under the right as forming
7
part of (or reducing) the cost base or reduced cost base of the
8
business assets; and
9
(c) for the seller of the business--treating any financial benefits
10
received (or provided) under the right as increasing (or
11
reducing) the capital proceeds for the business assets.
12
Note:
Sections 112-36 and 116-120 are 2 of the more important related
13
provisions that set out these rules.
14
118-565 Look-through earnout rights
15
Look-through earnout rights--main case
16
(1) A look-through earnout right is a right for which the following
17
conditions are met:
18
(a) the right is a right to future
*
financial benefits that are not
19
reasonably ascertainable at the time the right is created;
20
(b) the right is created under an
*
arrangement that involves the
21
*
disposal of a
*
CGT asset;
22
(c) the disposal causes
*
CGT event A1 to happen;
23
(d) just before the CGT event, the CGT asset was an
*
active asset
24
of the entity who disposed of the asset;
25
Note:
For extra ways to be an active asset, see section 118-570.
26
(e) all of the financial benefits that can be provided under the
27
right are to be provided over a period ending no later than 5
28
years after the end of the income year in which the CGT
29
event happens;
30
(f) those financial benefits are contingent on the economic
31
performance of:
32
(i) the CGT asset; or
33
CGT treatment of earnout rights Schedule 1
Main amendments Part 1
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
9
(ii) a business for which it is reasonably expected that the
1
CGT asset will be an active asset for the period to which
2
those financial benefits relate;
3
(g) the value of those financial benefits reasonably relates to that
4
economic performance;
5
(h) the parties to the arrangement deal with each other at
*
arm's
6
length in making the arrangement.
7
Matters affecting the 5-year maximum period
8
(2) The condition in paragraph (1)(e) is not met, and is treated as never
9
having been met, for the right if:
10
(a) the
*
arrangement includes an option to extend or renew the
11
arrangement; or
12
(b) the parties to the arrangement vary the arrangement; or
13
(c) those parties enter into another arrangement over the
*
CGT
14
asset or a business for which it is reasonably expected that
15
the CGT asset will be an
*
active asset;
16
so that a party could, or does, provide
*
financial benefits under the
17
right (or one or more equivalent rights) over a total period ending
18
later than 5 years after the end of the income year in which the
19
*
CGT event happens.
20
(3) For the purposes of paragraph (1)(e) or subsection (2), in working
21
out the period over which
*
financial benefits under a right can be
22
provided, disregard any part of an
*
arrangement that allows for an
23
entity to defer providing such a financial benefit if:
24
(a) the deferral is contingent on an event happening that is
25
beyond the control of the parties to the arrangement; and
26
(b) the deferral cannot change the amount of any financial
27
benefit provided, or to be provided, under the right; and
28
(c) when the arrangement is entered into, the contingent event is
29
not reasonably expected to happen.
30
Look-through earnout rights--rights for ending other rights
31
(4) A look-through earnout right is a right to receive one or more
32
future
*
financial benefits that:
33
(a) are for ending a right to which subsection (1) applies; and
34
(b) are certain.
35
Schedule 1 CGT treatment of earnout rights
Part 1 Main amendments
10
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
Note:
This subsection will not apply if the old right ends as described in
1
subsection (2), as subsection (2) causes the old right to be treated as if
2
it had never been a right to which subsection (1) applies.
3
118-570 Extra ways a CGT asset can be an active asset
4
(1) For the purposes of this Subdivision, treat a
*
CGT asset as if it
5
were an active asset of an entity at a particular time, if:
6
(a) the entity owns it at that time; and
7
(b) it is either a
*
share in a company, or an interest in a trust; and
8
(c) at that time, the entity:
9
(i) is a
*
CGT concession stakeholder of the company or
10
trust; or
11
(ii) if the entity is not an individual--has a
*
small business
12
participation percentage in the company or trust of at
13
least 20%; and
14
(d) at that time, the company or trust:
15
(i) is carrying on a
*
business, and has been carrying on a
16
business since the start of the most recent income year
17
ending before that time; and
18
(ii) is not a
*
subsidiary member of a
*
consolidated group;
19
and
20
(e) the assessable income of the company or trust for that most
21
recent income year was greater than nil, and at least 80% of
22
that assessable income was:
23
(i) from the carrying on of one or more businesses; but
24
(ii) not
*
derived (directly or indirectly) from an asset of a
25
kind to which paragraph 152-40(4)(d) or (e) applies.
26
Note:
Paragraphs 152-40(4)(d) and (e) refer to financial instruments and
27
assets used to derive interest, annuities, rent, royalties or foreign
28
exchange gains.
29
(2) For the purposes of this Subdivision, treat a
*
CGT asset as if it
30
were an active asset of an entity at a particular time, if
31
subsection 152-40(3) would have been satisfied for the asset at that
32
time had paragraph 152-40(3)(a) only required the asset to be:
33
(a) a
*
share in a company; or
34
(b) an interest in a trust.
35
CGT treatment of earnout rights Schedule 1
Main amendments Part 1
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
11
Note:
This enables shares and interests in foreign entities to be active assets
1
for the purposes of this Subdivision.
2
(3) Subsections (1) and (2) do not limit section 152-40 (about active
3
assets).
4
118-575 Creating and ending look-through earnout rights
5
Disregard a
*
capital gain or
*
capital loss you make because:
6
(a)
*
CGT event C2 happens in relation to a
*
look-through
7
earnout right you receive; or
8
(b) CGT event D1 happens when you create a look-through
9
earnout right in another entity.
10
118-580 Temporarily disregard capital losses affected by
11
look-through earnout rights
12
(1) Temporarily disregard a portion of a
*
capital loss you make from
13
*
disposing of a
*
CGT asset if the capital loss could be reduced by
14
you receiving one or more
*
financial benefits under a
15
*
look-through earnout right relating to the CGT asset and the
16
disposal.
17
(2) The portion of the
*
capital loss that is temporarily disregarded is:
18
(a) if those
*
financial benefits can never exceed a maximum
19
amount that is certain--so much of the capital loss as is equal
20
to that maximum amount; or
21
(b) otherwise--all of the capital loss.
22
Note:
When you receive a financial benefit under the look-through earnout
23
right:
24
(a) you cease to disregard under this section a portion of your loss
25
related to the amount of that financial benefit; and
26
(b) your capital proceeds for the disposal increase (see
27
paragraph 116-120(1)(b)), causing a reduction in the amount of
28
your loss.
29
5 Subsection 995-1(1)
30
Insert:
31
look-through earnout right has the meaning given by
32
subsection 118-565(1) or (4).
33
Schedule 1 CGT treatment of earnout rights
Part 2 Preserving small business concessions
12
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
Part 2--Preserving small business concessions
1
Income Tax Assessment Act 1997
2
6 Paragraph 104-185(1)(a)
3
Omit "period (the replacement asset period) starting one year before,
4
and ending 2 years after, the last CGT event in the income year for
5
which you obtain the roll-over", substitute "
*
replacement asset period".
6
7 Section 104-190 (heading)
7
Repeal the heading, substitute:
8
104-190 Replacement asset period
9
8 Before subsection 104-190(1)
10
Insert:
11
(1A) If you choose a small business roll-over under Subdivision 152-E
12
for a
*
CGT event that happens in relation to a
*
CGT asset in an
13
income year, the replacement asset period is the period:
14
(a) starting one year before the last CGT event in the income
15
year for which you obtain the roll-over; and
16
(b) ending at the later of:
17
(i) 2 years after that last CGT event; and
18
(ii) if the first-mentioned CGT event happened because you
19
*
disposed of the CGT asset--6 months after the latest
20
time a possible
*
financial benefit becomes or could
21
become due under a
*
look-through earnout right relating
22
to the CGT asset and the disposal.
23
9 Subsections 104-190(1) and (2)
24
Omit "replacement asset period", substitute "replacement asset period".
25
10 Subsections 104-197(1), (3) and (5)
26
Omit "replacement asset period", substitute "
*
replacement asset
27
period".
28
CGT treatment of earnout rights Schedule 1
Preserving small business concessions Part 2
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
13
11 Paragraph 104-198(1)(a)
1
Omit "replacement asset period", substitute "
*
replacement asset
2
period".
3
12 Subsections 104-198(2) and (4)
4
Omit "replacement asset period", substitute "
*
replacement asset
5
period".
6
13 At the end of section 152-20
7
Add:
8
Effect of look-through earnout rights
9
(5) Despite subsections (1) to (4), in working out the net value of the
10
CGT assets of an entity at the time just before the
*
CGT event (the
11
valuing time), you can make a choice under subsection (6) if:
12
(a) at the valuing time, one or more of the entity's
*
CGT assets
13
were assets for which the entity later provided, or was later
14
provided with, one or more
*
financial benefits under one or
15
more
*
look-through earnout rights that were in existence at
16
the valuing time; or
17
(b) at the valuing time, one or more of the entity's CGT assets
18
were look-through earnout rights relating to CGT assets of:
19
(i) one or more of the other entities referred to in
20
section 152-15; or
21
(ii) one or more entities not referred to in that section; or
22
(c) you are the entity, and:
23
(i) the CGT event referred to in section 152-15 happened
24
because you
*
disposed of a CGT asset; and
25
(ii) your
*
capital proceeds from the disposal were affected
26
by one or more financial benefits provided to, or by, you
27
under one or more look-through earnout rights;
28
and no further financial benefits can be provided under any of
29
those look-through earnout rights.
30
Note:
For paragraph (c), capital proceeds can be affected by financial
31
benefits provided under a look-through earnout right (see
32
section 116-120).
33
Schedule 1 CGT treatment of earnout rights
Part 2 Preserving small business concessions
14
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
(6) You can choose to treat the
*
market value of each of the
*
CGT
1
assets first mentioned in the applicable paragraph of subsection (5)
2
as if it were, at the valuing time, equal to:
3
(a) if paragraph (5)(a) applies--the first element of the CGT
4
asset's
*
cost base at the valuing time; or
5
(b) if subparagraph (5)(b)(i) applies--nil; or
6
(c) if subparagraph (5)(b)(ii) applies--the total of the financial
7
benefits provided under the
*
look-through earnout right after
8
the valuing time; or
9
(d) if paragraph (5)(c) applies--those
*
capital proceeds.
10
Note:
For paragraph (a), the first element of a CGT asset's cost base can be
11
affected by financial benefits provided under a look-through earnout
12
right (see section 112-36).
13
(7) In working out the net value of the CGT assets of an entity at the
14
valuing time, if:
15
(a) you make a choice under subsection (6) about a
*
CGT asset
16
of the entity that is a CGT asset covered by paragraph (5)(a)
17
or (c); and
18
(b) a
*
look-through earnout right covered by that paragraph is
19
also a CGT asset of the entity;
20
treat the
*
market value of that right as if it were nil at the valuing
21
time.
22
14 Paragraph 152-125(1)(b)
23
Repeal the paragraph, substitute:
24
(b) the company or trust makes one or more payments relating to
25
the exempt amount to an individual (whether directly or
26
indirectly through one or more interposed entities) before the
27
later of:
28
(i) 2 years after the relevant
*
CGT event; and
29
(ii) if the relevant CGT event happened because the
30
company or trust
*
disposed of the relevant CGT asset--
31
6 months after the latest time a possible
*
financial
32
benefit becomes or could become due under a
33
*
look-through earnout right relating to that CGT asset
34
and the disposal; and
35
(c) the individual was a
*
CGT concession stakeholder of the
36
company or trust just before the relevant CGT event.
37
CGT treatment of earnout rights Schedule 1
Preserving small business concessions Part 2
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
15
15 After subsection 152-305(1A)
1
Insert:
2
(1B) For the purposes of (but without limiting) subsection (1A), you are
3
treated as receiving the
*
capital proceeds in instalments if:
4
(a) the
*
CGT event happened because you
*
disposed of the
5
*
CGT asset; and
6
(b) the capital proceeds from the disposal are increased by one or
7
more
*
financial benefits that you receive under a
8
*
look-through earnout right.
9
16 After subsection 152-325(2)
10
Insert:
11
(2A) For the purposes of (but without limiting) subsection (2), the
12
company or trust is treated as receiving the
*
capital proceeds in
13
instalments if:
14
(a) the
*
CGT event happened because the company or trust
15
*
disposed of the
*
CGT asset; and
16
(b) the capital proceeds from the disposal are increased by one or
17
more
*
financial benefits that the company or trust receives
18
under a
*
look-through earnout right.
19
17 Paragraph 292-100(4)(b)
20
Repeal the paragraph, substitute:
21
(b) the entity makes a payment to you before the later of:
22
(i) 2 years after the CGT event; and
23
(ii) if the CGT event happened because the entity
*
disposed
24
of the relevant
*
CGT asset--6 months after the latest
25
time a possible
*
financial benefit becomes or could
26
become due under a
*
look-through earnout right relating
27
to that CGT asset and the disposal; and
28
18 Subsection 995-1(1)
29
Insert:
30
replacement asset period has the meaning given by
31
section 104-190.
32
Schedule 1 CGT treatment of earnout rights
Part 3 Other consequential amendments
16
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
Part 3--Other consequential amendments
1
Income Tax Assessment Act 1997
2
19 Paragraph 25-85(2)(a)
3
Omit "
*
contingent on the economic performance", substitute
4
"
*
contingent on aspects of the economic performance".
5
20 Paragraph 230-15(4)(a)
6
Omit "
*
contingent on the economic performance", substitute
7
"
*
contingent on aspects of the economic performance".
8
21 Subsection 230-460(13)
9
Omit "contingent only on the economic performance", substitute "only
10
*
contingent on aspects of the economic performance".
11
22 Subsection 820-930(2) (table item 2)
12
Omit "
*
contingent on the economic performance", substitute
13
"
*
contingent on aspects of the economic performance".
14
23 Subsection 974-75(1) (table item 2)
15
Omit "
*
contingent on the economic performance", substitute
16
"
*
contingent on aspects of the economic performance".
17
24 Paragraph 974-80(2)(a)
18
Omit "
*
contingent on the economic performance", substitute
19
"
*
contingent on aspects of the economic performance".
20
25 Subsection 974-80(2) (example)
21
Omit "contingent on the economic performance" (wherever occurring),
22
substitute "contingent on aspects of the economic performance".
23
26 Section 974-85 (heading)
24
Repeal the heading, substitute:
25
CGT treatment of earnout rights Schedule 1
Other consequential amendments Part 3
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
17
974-85 Right or return contingent on aspects of economic
1
performance
2
27 Subsection 974-85(1)
3
Repeal the subsection, substitute:
4
(1) A right, or the amount of a return, is contingent on aspects of the
5
economic performance of an entity, or a part of the entity's
6
activities, if the right or return is contingent on the economic
7
performance of that entity, or that part of those activities, but not
8
solely because of one of the following:
9
(a) the ability or willingness of an entity to meet the obligation to
10
satisfy the right to the return;
11
(b) the receipts or turnover of the entity or the turnover generated
12
by those activities.
13
28 Subsection 974-85(2)
14
After "contingent, on", insert "aspects of".
15
29 Paragraph 974-85(4)(c)
16
Omit "
*
contingent on the economic performance", substitute
17
"
*
contingent on aspects of the economic performance".
18
30 Subsection 974-140(1)
19
Omit "
*
contingent on the economic performance", substitute
20
"
*
contingent on aspects of the economic performance".
21
31 Subsection 995-1(1) (definition of contingent on the
22
economic performance)
23
Repeal the definition.
24
32 Subsection 995-1(1)
25
Insert:
26
contingent on aspects of the economic performance has the
27
meaning given by section 974-85.
28
Schedule 1 CGT treatment of earnout rights
Part 3 Other consequential amendments
18
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
Taxation Administration Act 1953
1
33 After paragraph 14ZW(1)(aaa)
2
Insert:
3
(aaaa) if the taxation objection is made under subsection 112-36(5)
4
or 116-120(5) of the Income Tax Assessment Act 1997--60
5
days after the notice mentioned in paragraph (b) of that
6
subsection is given to the person; or
7
34 At the end of section 280-100 in Schedule 1
8
Add:
9
Liability arising because of a financial benefit under a
10
look-through earnout right
11
(5) Subsection (1) does not apply if:
12
(a) you provide or receive a
*
financial benefit under a
13
*
look-through earnout right; and
14
(b) you request the Commissioner to amend your assessment for
15
an income year (the taxing year) to take account of the
16
financial benefit; and
17
(c) you make that request at or before the time:
18
(i) you are required to lodge your
*
income tax return for
19
the income year in which the financial benefit is
20
provided or received; or
21
(ii) you would be so required if you were required to lodge
22
an income tax return for that income year; and
23
(d) as a result of paragraph (a), you are liable to pay an
24
additional amount of income tax for the taxing year.
25
35 At the end of section 280-102A in Schedule 1
26
Add:
27
Liability arising because of a financial benefit under a
28
look-through earnout right
29
(4) Subsection (1) does not apply if:
30
(a) you provide or receive a
*
financial benefit under a
31
*
look-through earnout right; and
32
CGT treatment of earnout rights Schedule 1
Other consequential amendments Part 3
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
19
(b) you request the Commissioner to amend your
*
excess
1
non-concessional contributions tax assessment for a
2
*
financial year to take account of the financial benefit; and
3
(c) you make that request at or before the time:
4
(i) you are required to lodge your
*
income tax return for
5
the income year in which the financial benefit is
6
provided or received; or
7
(ii) you would be so required if you were required to lodge
8
an income tax return for that income year; and
9
(d) as a result of paragraph (a), you are liable to pay an
10
additional amount of
*
excess non-concessional contributions
11
tax for the financial year.
12
36 At the end of section 280-102B in Schedule 1
13
Add:
14
Liability arising because of a financial benefit under a
15
look-through earnout right
16
(5) Subsection (1) does not apply if:
17
(a) you provide or receive a
*
financial benefit under a
18
*
look-through earnout right; and
19
(b) you request the Commissioner to amend your assessment of
20
*
Division 293 tax payable in relation to an income year (the
21
taxing year) to take account of the financial benefit; and
22
(c) you make that request at or before the time:
23
(i) you are required to lodge your
*
income tax return for
24
the income year in which the financial benefit is
25
provided or received; or
26
(ii) you would be so required if you were required to lodge
27
an income tax return for that income year; and
28
(d) as a result of paragraph (a), you are liable to pay an
29
additional amount of Division 293 tax for the taxing year.
30
Schedule 1 CGT treatment of earnout rights
Part 3 Other consequential amendments
20
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
Taxation (Interest on Overpayments and Early Payments)
1
Act 1983
2
37 After subsection 9(1A)
3
Insert:
4
(1B) Subsection (1) does not apply to an overpayment to the extent that
5
the overpayment results from the person providing or receiving a
6
financial benefit (within the meaning of the Income Tax
7
Assessment Act 1997) under a look-through earnout right (within
8
the meaning of that Act).
9
CGT treatment of earnout rights Schedule 1
Application and transitional provisions Part 4
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
21
Part 4--Application and transitional provisions
1
38 Application of amendments
2
The amendments made by Parts 1 to 3 apply in relation to look-through
3
earnout rights created on or after 24 April 2015.
4
39 Transitional
--protection for anticipating announcement
5
(1)
Section 170B of the Income Tax Assessment Act 1936 also applies as if
6
the following additional announcement were listed in the table in
7
subsection (8) of that section:
8
14
Budget Paper No. 2, Budget Measures 2010-11, Part 1,
topic headed "Capital gains tax--look-through
treatment for earnout arrangements".
11 May 2010
(2)
Subsection 170B(3) and paragraph 170B(8)(b) of that Act also apply in
9
relation to that announcement as if references in those provisions to
10
14 December 2013 were references to 23 April 2015.
11
Schedule 1 CGT treatment of earnout rights
Part 5 Amendments relating to foreign resident capital gains withholding payments
22
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
Part 5--Amendments relating to foreign resident
1
capital gains withholding payments
2
Taxation Administration Act 1953
3
40 Subparagraph 14-200(3)(a)(i) in Schedule 1
4
Repeal the subparagraph, substitute:
5
(i) the first element of the
*
CGT asset's
*
cost base just after
6
the
*
acquisition, ignoring paragraphs 112-36(1)(b) and
7
(c) of the Income Tax Assessment Act 1997 (about the
8
effect of look-through earnout rights); less
9
41 After section 14-200 in Schedule 1
10
Insert:
11
14-205 Effect of look-through earnout rights
12
Acquisitions of taxable Australian property from foreign residents
13
(1) You must pay to the Commissioner an amount if:
14
(a) you are required under section 14-200 to pay an amount to
15
the Commissioner in relation to your
*
acquisition of a
*
CGT
16
asset; and
17
(b) under a
*
look-through earnout right relating to the CGT asset
18
and the acquisition, you provide a
*
financial benefit to one or
19
more entities; and
20
(c) subsection 14-210(1) (about foreign residents) would apply
21
to at least one of those entities at the time you provide the
22
financial benefit if section 14-210 were modified as
23
described in subsection (2) of this section; and
24
(d) an amount is not already required to be withheld from a
25
*
withholding payment relating to the financial benefit.
26
Note 1:
To work out the amount payable, see subsection (4).
27
Note 2:
You must pay the amount on account of income tax possibly payable
28
by the entities on their increased capital proceeds from receiving the
29
financial benefit.
30
CGT treatment of earnout rights Schedule 1
Amendments relating to foreign resident capital gains withholding payments Part 5
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
23
Modifications of the relevant foreign residents test
1
(2) The modifications of section 14-210 are as follows:
2
3
Modifications to section 14-210 for the purposes of this section
Column 1
Column 2
Item
For a reference in that section to:
substitute a reference to:
1
transaction is entered into
*
financial benefit is provided
2
transaction (other than a reference
covered by item 1)
*
financial benefit
3
14-200
14-205
When you must pay the amount
4
(3) You must pay the amount to the Commissioner on or before the
5
day you provide the
*
financial benefit.
6
Note:
There are penalties for failing to pay the amount (see Division 16).
7
(4) The amount to be paid to the Commissioner is:
8
(a) unless paragraph (b) applies--an amount equal to 10% of the
9
*
market value of the
*
financial benefit; or
10
(b) the varied amount applying under section 14-235.
11
42 Subsection 250-10(2) in Schedule 1 (table item 101)
12
After "14-200", insert "or 14-205".
13
43 Application of amendments
14
The amendments made by this Part, to the extent that they relate to
15
acquisitions of a kind described in subsection 14-205(1) in Schedule 1
16
to the Taxation Administration Act 1953 (as inserted by this Part), apply
17
in relation to acquisitions on or after the later of:
18
(a) 1 July 2016; and
19
(b) the commencement of this Part.
20
Note:
For working out when a CGT asset is acquired, see Division 109 of the Income Tax
21
Assessment Act 1997.
22
Schedule 2 Foreign resident capital gains withholding payments
Part 1 Main amendments
24
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
Schedule 2--Foreign resident capital gains
1
withholding payments
2
Part 1--Main amendments
3
Taxation Administration Act 1953
4
1 At the end of Division 14 in Schedule 1
5
Add:
6
Subdivision 14-D--Capital proceeds involving foreign residents
7
and taxable Australian property
8
Table of sections
9
14-200
Certain acquisitions of taxable Australian property from foreign residents
10
14-210
Whether an entity is a relevant foreign resident
11
14-215
Excluded transactions
12
14-220
Commissioner clearance certificates
13
14-225
Entity declarations
14
14-230
Administrative penalties for false or misleading declarations
15
14-235
Varying amounts to be paid to the Commissioner
16
14-200 Certain acquisitions of taxable Australian property from
17
foreign residents
18
(1) You must pay to the Commissioner an amount if:
19
(a) you become the owner of a
*
CGT asset as a result of
20
*
acquiring it from one or more entities under one or more
21
transactions; and
22
(b) subsection 14-210(1) (about foreign residents) applies to at
23
least one of those entities at the time one of those transactions
24
is entered into; and
25
(c) at that time, the CGT asset is:
26
(i)
*
taxable Australian real property; or
27
(ii) an
*
indirect Australian real property interest; or
28
(iii) an option or right to acquire such property or such an
29
interest;
30
Foreign resident capital gains withholding payments Schedule 2
Main amendments Part 1
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
25
unless a transaction referred to in paragraph (a) is excluded under
1
section 14-215.
2
Note:
You must pay the amount on account of income tax possibly payable
3
by the entities on their capital proceeds resulting from your acquisition
4
of the CGT asset.
5
(2) You must pay the amount to the Commissioner on or before the
6
day you became the
*
CGT asset's owner.
7
Note:
There are penalties for failing to pay the amount (see Division 16).
8
(3) The amount to be paid to the Commissioner is:
9
(a) unless paragraph (b) applies--an amount equal to 10% of:
10
(i) the first element of the
*
CGT asset's
*
cost base just after
11
the
*
acquisition; less
12
(ii) if the acquisition is the result of you exercising an
13
option--any payment you made, and the
*
market value
14
of any property you gave, for the option (or to renew or
15
extend it); or
16
(b) the varied amount applying under section 14-235.
17
(4) This section does not apply if the amount that would otherwise be
18
payable is nil.
19
14-210 Whether an entity is a relevant foreign resident
20
Is the entity a foreign resident at the time of the transaction?
21
(1) This subsection applies to an entity at the time a transaction is
22
entered into if, at that time:
23
(a) you know that the entity is a foreign resident; or
24
(b) you reasonably believe that the entity is a foreign resident; or
25
(c) you do not reasonably believe that the entity is an Australian
26
resident, and either:
27
(i) the entity has an address outside Australia (according to
28
any record that is in your possession, or is kept or
29
maintained on your behalf, about the transaction); or
30
(ii) you are authorised to provide a related financial benefit
31
to a place outside Australia (whether to the entity or to
32
anyone else); or
33
Schedule 2 Foreign resident capital gains withholding payments
Part 1 Main amendments
26
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
(d) the entity has a connection outside Australia of a kind
1
specified in the regulations; or
2
(e) the
*
CGT asset to which the transaction relates is:
3
(i)
*
taxable Australian real property; or
4
(ii) an
*
indirect Australian real property interest, the holding
5
of which causes a company title interest (within the
6
meaning of Part X of the Income Tax Assessment Act
7
1936) to arise.
8
Note:
This subsection is relevant to whether you must pay an amount to the
9
Commissioner under section 14-200.
10
Exception--the entity gives you a clearance certificate
11
(2) Despite subsection (1), that subsection does not apply to the entity
12
in relation to the transaction if:
13
(a) before you pay the Commissioner under section 14-200 in
14
relation to the
*
CGT asset to which the transaction relates,
15
the entity gives you a certificate about the entity that:
16
(i) was issued under subsection 14-220(1); and
17
(ii) is for a period covering the time the transaction is
18
entered into; and
19
(b) the CGT asset is of a kind described in paragraph (1)(e) of
20
this section.
21
Exception--the entity gives you a residency or interests declaration
22
(3) Despite subsection (1), that subsection does not apply to the entity
23
in relation to the transaction if:
24
(a) before you pay the Commissioner under section 14-200 in
25
relation to the
*
CGT asset to which the transaction relates,
26
the entity gives you a declaration that:
27
(i) is about the entity or the CGT asset; and
28
(ii) was given under subsection 14-225(1) or (2); and
29
(iii) is for a period covering the time the transaction is
30
entered into; and
31
(b) when you are given the declaration, you do not know the
32
declaration to be false; and
33
Foreign resident capital gains withholding payments Schedule 2
Main amendments Part 1
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
27
(c) for a declaration given under subsection 14-225(1)--the CGT
1
asset is not of a kind described in paragraph (1)(e) of this
2
section.
3
14-215 Excluded transactions
4
Kinds of excluded transactions
5
(1) A transaction that results in the
*
acquisition of a
*
CGT asset is
6
excluded under this section if:
7
(a) just after the transaction, the CGT asset:
8
(i) is
*
taxable Australian real property; or
9
(ii) is an
*
indirect Australian real property interest, the
10
holding of which causes a company title interest (within
11
the meaning of Part X of the Income Tax Assessment
12
Act 1936) to arise;
13
and the
*
market value of the CGT asset is less than $2
14
million; or
15
(b) the transaction is on an
*
approved stock exchange; or
16
(c) the transaction is conducted using a crossing system (within
17
the meaning of the
*
market integrity rules); or
18
(d) an amount is already required to be withheld from a
19
*
withholding payment relating to the transaction; or
20
(e) subsection 26BC(3) of the Income Tax Assessment Act 1936
21
(about securities lending arrangements) applies in relation to
22
the transaction as a result of the transaction being covered by
23
subparagraph (a)(ii) of that subsection; or
24
(f) any of the entities to which subsection 14-210(1) (about
25
foreign residents) applies at the time of the transaction:
26
(i) is a company for which any of the conditions in
27
paragraph 161A(1)(a) of the Corporations Act 2001
28
(about insolvency and external administration) is
29
satisfied; or
30
(ii) is, under a
*
foreign law, in the same or a similar position
31
to a company covered by subparagraph (i); or
32
(g) the transaction arises from any of the following:
33
(i) the administration of the estate of a bankrupt;
34
Schedule 2 Foreign resident capital gains withholding payments
Part 1 Main amendments
28
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
(ii) a composition or scheme of arrangement accepted under
1
Division 6 of Part IV of the Bankruptcy Act 1966;
2
(iii) a debt agreement under Part IX of that Act;
3
(iv) a personal insolvency agreement under Part X of that
4
Act;
5
(v) circumstances that are, under a foreign law, the same or
6
similar to those in any of the above subparagraphs.
7
Note:
This section is relevant to whether you must pay an amount to the
8
Commissioner under section 14-200.
9
Dealing with joint ownership etc. of certain CGT assets
10
(2) For the purposes of paragraph (1)(a), if:
11
(a) the
*
CGT asset is an interest in real property, or an interest in
12
a
*
mining, quarrying or prospecting right; and
13
(b) just after the transaction, there are one or more similar
14
interests in the same real property or right;
15
treat the
*
market value of the CGT asset just after the transaction as
16
including the market value of each of those similar interests.
17
(3) Without limiting subsection (2):
18
(a) treat an interest as being similar to the
*
CGT asset if it is
19
specified in regulations made for the purposes of this
20
paragraph in relation to CGT assets of that kind; and
21
(b) treat an interest as not being similar to the CGT asset if it is
22
specified in regulations made for the purposes of this
23
paragraph in relation to CGT assets of that kind.
24
14-220 Commissioner clearance certificates
25
(1) The Commissioner may certify that, based on information before
26
the Commissioner, there is nothing to suggest that an entity is or
27
will be a foreign resident during a specified period.
28
Note:
Such a certificate could result in you not being required to pay an
29
amount under this Subdivision (see subsection 14-210(2)).
30
(2) A certificate under subsection (1):
31
(a) may be issued on application to the Commissioner in the
32
*
approved form; and
33
(b) is to be in writing; and
34
Foreign resident capital gains withholding payments Schedule 2
Main amendments Part 1
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
29
(c) applies only for the purposes of this Subdivision.
1
(3) For the purposes of (but without limiting) paragraph 388-50(1)(c),
2
the Commissioner may require an application for a certificate
3
under subsection (1) to state:
4
(a) whether the applicant holds or will hold specified
*
CGT
5
assets on behalf of another entity during any part of the
6
period for which the certificate is sought; and
7
(b) whether the applicant knows or reasonably believes that the
8
other entity is or will be a foreign resident during that period.
9
Note:
Section 388-50 sets out when an application is in the approved form.
10
(4) A certificate issued under subsection (1) is not a legislative
11
instrument.
12
14-225 Entity declarations
13
Declaration that an entity is an Australian resident
14
(1) An entity may, in writing, declare that, for a specified period, the
15
entity is and will be an Australian resident.
16
Note:
Such a declaration could result in you not being required to pay an
17
amount under this Subdivision (see subsection 14-210(3)).
18
Declaration that asset not an indirect Australian real property
19
interest
20
(2) An entity may, in writing, declare that, for a specified period,
21
specified
*
CGT assets are
*
membership interests but not
*
indirect
22
Australian real property interests.
23
Note:
Such a declaration could result in you not being required to pay an
24
amount under this Subdivision (see subsection 14-210(3)).
25
Limit on the periods for which declarations have effect
26
(3) A period specified in a declaration under this section is of no effect
27
to the extent that it includes days later than 6 months after the day
28
the declaration is made.
29
Schedule 2 Foreign resident capital gains withholding payments
Part 1 Main amendments
30
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
Declarations are not legislative instruments
1
(4) A declaration under this section is not a legislative instrument.
2
14-230 Administrative penalties for false or misleading declarations
3
Knowingly making false or misleading declarations
4
(1) You are liable to pay the Commissioner a penalty of 120 penalty
5
units if:
6
(a) you make a statement; and
7
(b) the statement is, or purports to be, a declaration under
8
section 14-225; and
9
(c) the statement is false or misleading in a material particular,
10
whether because of things in it or omitted from it; and
11
(d) you know, at the time of making the statement, that it is so
12
false or misleading.
13
Note:
Division 298 contains machinery provisions for administrative
14
penalties.
15
Recklessly making false or misleading declarations
16
(2) You are liable to pay the Commissioner a penalty of 80 penalty
17
units if:
18
(a) you make a statement; and
19
(b) the statement is, or purports to be, a declaration under
20
section 14-225; and
21
(c) the statement is false or misleading in a material particular,
22
whether because of things in it or omitted from it; and
23
(d) you were reckless in connection with the making of the
24
statement.
25
Note:
Division 298 contains machinery provisions for administrative
26
penalties.
27
Not taking reasonable care in making declarations
28
(3) You are liable to pay the Commissioner a penalty of 40 penalty
29
units if:
30
(a) you make a statement; and
31
Foreign resident capital gains withholding payments Schedule 2
Main amendments Part 1
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
31
(b) the statement is, or purports to be, a declaration under
1
section 14-225; and
2
(c) the statement is false or misleading in a material particular,
3
whether because of things in it or omitted from it; and
4
(d) you did not take reasonable care in connection with the
5
making of the statement.
6
Note:
Division 298 contains machinery provisions for administrative
7
penalties.
8
14-235 Varying amounts to be paid to the Commissioner
9
Policies relevant to varying amounts
10
(1) In exercising a power under this section to vary an amount, the
11
Commissioner must have regard to the need to protect a creditor's
12
right to recover a debt.
13
Varying particular amounts
14
(2) The Commissioner may, in writing, vary a particular amount
15
payable by you to the Commissioner under this Subdivision. The
16
variation takes effect when you become aware of it.
17
Note:
Decisions to vary, or not to vary, are reviewable (see section 20-80).
18
(3) Any of the following entities may apply to the Commissioner in
19
the
*
approved form for a variation under subsection (2):
20
(a) you;
21
(b) an entity from which you
*
acquire, or could acquire, the
22
*
CGT asset;
23
(c) an entity that is owed a debt by an entity covered by
24
paragraph (b).
25
(4) A variation made under subsection (2) is not a legislative
26
instrument.
27
Varying classes of amounts
28
(5) The Commissioner may, by legislative instrument, vary classes of
29
amounts payable to the Commissioner under this Subdivision.
30
Schedule 2 Foreign resident capital gains withholding payments
Part 1 Main amendments
32
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
Amounts may be reduced to nil
1
(6) The Commissioner's power under subsection (2) or (5) to vary an
2
amount includes the power to reduce the amount to nil.
3
Foreign resident capital gains withholding payments Schedule 2
Consequential amendments Part 2
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
33
Part 2--Consequential amendments
1
Income Tax Assessment Act 1936
2
2 At the end of section 202
3
Add:
4
; and (s) to facilitate the administration of Subdivision 14-D in
5
Schedule 1 to the Taxation Administration Act 1953.
6
Income Tax Assessment Act 1997
7
3 Section 855-15 (note)
8
Omit "Note:", substitute "Note 1:".
9
4 At the end of section 855-15
10
Add:
11
Note 2:
Payments may need to be made to the Commissioner for acquisitions
12
of some kinds of taxable Australian property if foreign residents are
13
involved (see Subdivision 14-D in Schedule 1 to the Taxation
14
Administration Act 1953).
15
5 Subsection 995-1(1) (paragraph (b) of the definition of
16
amount required to be withheld)
17
Omit "
*
non-cash benefit of which the withholding payment consists",
18
substitute "
*
non-cash benefit or
*
capital proceeds to which the
19
withholding payment relates".
20
6 Subsection 995-1(1) (paragraph (b) of the definition of
21
amount withheld)
22
Omit "
*
non-cash benefit of which the withholding payment consists",
23
substitute "
*
non-cash benefit or
*
capital proceeds to which the
24
withholding payment relates".
25
7 Subsection 995-1(1) (paragraph (c) of the definition of
26
withholding payment, first occurring)
27
After "
*
non-cash benefit", insert ", or the
*
capital proceeds,".
28
Schedule 2 Foreign resident capital gains withholding payments
Part 2 Consequential amendments
34
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
8 Subsection 995-1(1) (note 2 at the end of the definition of
1
withholding payment, first occurring)
2
Omit "or non-cash benefit", substitute ", non-cash benefit or capital
3
proceeds".
4
9 Subsection 995-1(1) (at the end of the definition of
5
withholding payment covered by a particular provision
6
in Schedule 1 to the Taxation Administration Act 1953)
7
Add:
8
; or (d) the
*
capital proceeds in respect of which Subdivision 14-D in
9
that Schedule requires an amount to be paid to the
10
Commissioner.
11
Taxation Administration Act 1953
12
10 Paragraph 8WA(1AA)(b)
13
Omit "or (r)", substitute ", (r) or (s)".
14
11 Paragraph 8WB(1A)(a)
15
Omit "or (r)", substitute ", (r) or (s)".
16
12 Paragraph 8WB(1A)(b)
17
Omit "or (r)", substitute ", (r) or (s)".
18
13 Paragraph 10-5(2)(b) in Schedule 1
19
Repeal the paragraph, substitute:
20
(b) non-cash benefits, and capital proceeds involving foreign
21
residents and certain kinds of taxable Australian property
22
(see Division 14).
23
14 Subsection 10-5(2) in Schedule 1 (note)
24
After "non-cash benefit", insert "or capital proceeds".
25
15 Section 16-20 in Schedule 1
26
Before "An", insert "(1)".
27
Foreign resident capital gains withholding payments Schedule 2
Consequential amendments Part 2
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
35
16 At the end of section 16-20 in Schedule 1
1
Add:
2
(2) An entity is discharged from all liability to pay so much of the total
3
amount payable to
*
acquire a
*
CGT asset as is equal to any amount
4
the entity pays to the Commissioner under Subdivision 14-D in
5
relation to the acquisition.
6
17 Subsections 16-70(3) and (4) in Schedule 1
7
Repeal the subsections, substitute:
8
(3) An entity that must pay an amount to the Commissioner under
9
Subdivision 14-B, 14-C or 14-D must do so in accordance with
10
sections 16-80 and 16-85.
11
Note:
For provisions about the collection and recovery of amounts payable
12
to the Commissioner under this Part, see Part 4-15.
13
18 Section 16-80 in Schedule 1
14
Omit "16-70(1), (3) or (4)", substitute "16-70(1) or (3)".
15
19 Paragraph 16-140(1)(b) in Schedule 1
16
After "non-cash benefits", insert "or capital proceeds".
17
20 Paragraph 16-143(2)(b) in Schedule 1
18
Omit "non-cash benefits", substitute "
*
non-cash benefits or
*
capital
19
proceeds".
20
21 Paragraph 16-150(b) in Schedule 1
21
After "non-cash benefits", insert "or capital proceeds".
22
22 Subparagraph 18-65(1)(a)(ii) in Schedule 1
23
After "Division 14", insert "(other than Subdivision 14-D)".
24
23 Paragraph 18-65(6)(c) in Schedule 1
25
After "14", insert "(other than Subdivision 14-D)".
26
24 Subparagraph 18-70(1)(a)(ii) in Schedule 1
27
Omit "recipient; and", substitute "recipient; or".
28
Schedule 2 Foreign resident capital gains withholding payments
Part 2 Consequential amendments
36
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
No. , 2015
25 At the end of paragraph 18-70(1)(a) in Schedule 1
1
Add:
2
(iii) paid to the Commissioner an amount purportedly under
3
Subdivision 14-D for
*
capital proceeds provided to, or
4
applied on behalf of, the recipient; and
5
26 Paragraph 18-70(1)(c) in Schedule 1
6
Before "section 18-65", insert "if subparagraph (a)(i), (ia) or (ii)
7
applies--".
8
27 Section 20-80 in Schedule 1 (after table item 10)
9
Insert:
10
14
Decision under subsection 14-220(1) not to issue a certificate on
application under subsection 14-220(2)
15
Decision under subsection 14-220(1) to issue a certificate
16
Decision under subsection 14-235(2) not to vary an amount on application
under subsection 14-235(3)
17
Decision under subsection 14-235(2) to vary an amount
28 Subsection 250-10(2) in Schedule 1 (after table item 100)
11
Insert:
12
101
payment of amount to
Commissioner
14-200 in
Schedule 1
Taxation Administration Act 1953
29 Paragraph 298-5(c) in Schedule 1
13
After "Subdivision 12-H", insert "or 14-D".
14
30 Application of amendments
15
The amendments made by Part 1 and this Part, to the extent that they
16
relate to acquisitions of a kind described in section 14-200 in
17
Schedule 1 to the Taxation Administration Act 1953 (as inserted by
18
Part 1), apply in relation to acquisitions on or after 1 July 2016.
19
Note:
For working out when a CGT asset is acquired, see Division 109 of the Income Tax
20
Assessment Act 1997.
21
Foreign resident capital gains withholding payments Schedule 2
Contingent amendments Part 3
No. , 2015
Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill
2015
37
Part 3--Contingent amendments
1
Tax Laws Amendment (New Tax System for Managed
2
Investment Trusts) Act 2015
3
31 Item 14 of Schedule 3 (heading)
4
Repeal the heading, substitute:
5
14 Paragraph 16-20(1)(b) in Schedule 1
6
Note:
This Part only commences if Schedule 3 to the Tax Laws Amendment (New Tax System
7
for Managed Investment Trusts) Act 2015 commences after the other Parts of this
8
Schedule.
9