TAX LAWS AMENDMENT (2009 MEASURES NO. 4) BILL 2009

i Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Contents

Short title ............................................................................................ 1

Commencement .................................................................................. 1

Schedule(s) ......................................................................................... 3

Amendment of assessments ................................................................ 3

Schedule 1--Research and development

Income Tax Assessment Act 1936

Schedule 2--Private ancillary funds

Part 1--Amendments commencing on 1 October 2009

A New Tax System (Australian Business Number) Act 1999

Income Tax Assessment Act 1936

Income Tax Assessment Act 1997

Taxation Administration Act 1953

Part 2--Amendments commencing on 1 January 2010

Income Tax Assessment Act 1997

Taxation Administration Act 1953

Part 3--Transitional provisions

Div ision 1--Preliminary

Div ision 2--Declared prescribed private funds

Div ision 3--Transitional private ancillary funds

Schedule 3--Demutualisation of friendly society health or life

insure rs

Part 1--Main amendment

Income Tax Assessment Act 1997

Part 2--Related amendments

Income Tax Assessment Act 1936

Income Tax Assessment Act 1997

Income Tax (Transitional Provisions) Act 1997

Schedule 4--Consolidation: application of losses with nil

available fraction

Income Tax Assessment Act 1936

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 ii

Income Tax Assessment Act 1997

Schedule 5--Minor amendme nts

Part 1--References to Ministers, Departments and Secretaries

Div ision 1--A mend ments commencing on Royal Assent

Excise Act 1901

Excise Tariff Act 1921

Fringe Benefits Tax (Application to the Commonwealth) Act 1986

Fringe Benefits Tax Assessment Act 1986

Income Tax Assessment Act 1936

Income Tax Assessment Act 1997

Income Tax (Transitional Provisions) Act 1997

Petroleum Resource Rent Tax Assessment Act 1987

Superannuation Contributions Tax (Application to the

Commonwealth) Act 1997

Taxation Administration Act 1953

Div ision 2--Other amend ments

Income Tax Assessment Act 1997

Taxation Administration Act 1953

Part 2--Repeal of Part IV of the Taxation Administration Act

1953

Administrative Decisions (Judicial Review) Act 1977

Banking Act 1959

Taxation Administration Act 1953

Part 3--Amendments relating to foreign income tax offsets

and foreign losses

Income Tax Assessment Act 1997

Income Tax (Transitional Provisions) Act 1997

Part 4--Other amendments

A New Tax System (Australian Business Number) Act 1999

Fringe Benefits Tax Assessment Act 1986

Income Tax Assessment Act 1936

Income Tax Assessment Act 1997

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 1

A Bill for an Act to amend the law relating to

taxation, and for related purposes

The Parliament of Australia enacts:

1 Short title

This Act may be cited as the Tax Laws Amendment (2009

Measures No. 4) Act 2009.

2 Commence ment

(1) Each provision of this Act specified in column 1 of the table

commences, or is taken to have commenced, in accordance with

column 2 of the table. Any other statement in column 2 has effect

according to its terms.

2 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Commencement information

Column 1

Column 2

Column 3

Provision(s)

Commencement

Date/Details

1. Sections 1 to 3

and anything in

this Act not

elsewhere covered

by this table

The day on which this Act receives the

Royal Assent.

2. Schedule 1

The day on which this Act receives the

Royal Assent.

3. Schedule 2,

Part 1

1 October 2009.

1 October 2009

4. Schedule 2,

Part 2

1 January 2010.

1 January 2010

5. Schedule 2,

Part 3

1 October 2009.

1 October 2009

6. Schedules 3

and 4

The day on which this Act receives the

Royal Assent.

7. Schedule 5,

Part 1, Division 1

The day on which this Act receives the

Royal Assent.

8. Schedule 5,

items 237 and 238

The later of:

(a) immediately after the start of the day on

which this Act receives the Royal

Assent; and

(b) the time item 1 of Schedule 1 to the

Nation Building Program (National

Land Transport) Amendment Act 2009

commences.

However, the provision(s) covered by this

table item do not commence at all if the

event mentioned in paragraph (b) does not

occur.

9. Schedule 5,

items 239 to 243

The later of:

(a) the start of the day on which this Act

receives the Royal Assent; and

(b) immed iately after the commencement of

item 1 of Schedule 2 to the Migration

Legislation Amendment (Worker

Protection) Act 2008.

10. Schedule 5,

The day on which this Act receives the

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 3

Commencement information

Column 1

Column 2

Column 3

Provision(s)

Commencement

Date/Details

Parts 2 to 5

Royal Assent.

Note:

This table relates only to the provisions of this Act as originally

passed by both Houses of the Parliament and assented to. It will not be

expanded to deal with provisions inserted in this Act after assent.

(2) Column 3 of the table contains additional information that is not

part of this Act. Information in this column may be added to or

edited in any published version of this Act.

3 Schedule(s)

Each Act that is specified in a Schedule to this Act is amended or

repealed as set out in the applicable items in the Schedule

concerned, and any other item in a Schedule to this Act has effect

according to its terms.

4 Amendment of assessments

Section 170 of the Income Tax Assessment Act 1936 does not

prevent the amendment of an assessment if:

(a) the assessment was made before the commencement of this

section; and

(b) the amendment is made within 2 years after that

commencement; and

Schedule 4.

Private ancillary funds Schedule 2

Amend ments commencing on 1 October 2009 Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 5

Schedule 2

Private ancillary funds

Part 1

Amendments commencing on 1 October

2009

A New Tax System (Australian Business Number) Act 1999

1 Paragraph 26(3)(ga)

After "section 426-65", insert "or 426-115".

Income Tax Assessment Act 1936

2 Subsection 6(1)

Insert:

private ancillary fund has the meaning given by section 426-105

in Schedule 1 to the Taxation Administration Act 1953.

3 At the end of subsection 16(4)

Add:

; or (n) if the information relates to the non-compliance of a private

ancillary fund or charity (or a trustee of a private ancillary

fund or charity) with a law of the Commonwealth, a State or

a Territory--the Attorney-General of a State or Territory for

the purposes of the administration of a law of the State or

Territory governing trusts or charities.

Income Tax Assessment Act 1997

4 Subsection 30-15(2) (table item 2, column headed

"Recipient")

Omit "

prescribed private fund", substitute "

private ancillary fund".

5 Subsection 30-15(2) (paragraph (c) of the cell at table

item

2, column headed "Special conditions")

Omit ", unless the fund is a prescribed private fund".

6 Paragraph 30-17(1)(b)

Schedule 2 Private ancillary funds

Part 1 A mend ments commencing on 1 October 2009

6 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Repeal the paragraph.

7 Subsection 30-125(1)

Repeal the subsection, substitute:

Endorsement of an entity that is a fund, authority or institution

(1) An entity is entitled to be endorsed as a

deductible gift recipient

if:

(a) the entity has an

ABN; and

(b) the entity is a fund, authority or institution that:

(i) is described (but not by name) in item 1, 2 or 4 of the

table in section 30-15; and

(ii) is not described by name in Subdivision 30-B if it is

described in item 1 of that table; and

(iii) meets the relevant conditions (if any) identified in the

column headed "Special conditions" of the item of that

table in which it is described; and

(i) the entity is established by an Act; and

(ii) the Act (or another Act) does not provide for the

winding up or termination of the entity; and

(d) in the case of a

private ancillary fund:

(i) the fund complies with the rules in the

private ancillary

fund guidelines; and

(ii) all of the trustees of the fund comply with those rules.

8 Subparagraph 30-227(2)(a)(iii)

Repeal the subparagraph.

9 After subsection 30-229(2)

Insert:

(2A) If:

(a) the

deductible gift recipient is:

(i) a fund, authority or institution; or

(ii) a deductible gift recipient only because it is endorsed

under Subdivision 30-BA as a deductible gift recipient

for the operation of a fund, authority or institution; and

Private ancillary funds Schedule 2

Amend ments commencing on 1 October 2009 Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 7

(b) the fund, authority or institution is covered by item 1, 2 or 4

of the table in section 30-15;

the statement may specify that the fund, authority or institution is

covered by that item.

10 Paragraph 31-10(1)(b)

Omit "

prescribed private fund", substitute "

private ancillary fund".

11 Paragraph 31-10(2)(b)

Omit "or be a

prescribed private fund".

12 Subsection 995-1(1)

Insert:

constitutional corporation means:

(a) a corporation to which paragraph 51(xx) of the Constitution

applies; or

(b) a body corporate that is incorporated in a Territory.

13 Subsection 995-1(1) (definition of prescribed private fund)

Repeal the definition.

14 Subsection 995-1(1)

Insert:

private ancillary fund has the meaning given by section 426-105

in Schedule 1 to the Taxation Administration Act 1953.

15 Subsection 995-1(1)

Insert:

private ancillary fund guidelines has the meaning given by

section 426-110 in Schedule 1 to the Taxation Administration Act

1953.

Taxation Administration Act 1953

16 Subsection 2(1)

Insert:

Schedule 2 Private ancillary funds

Part 1 A mend ments commencing on 1 October 2009

8 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

private ancillary fund has the meaning given by section 426-105

in Schedule 1.

17 Subsection 3C(4)

Repeal the subsection, substitute:

(4) Nothing in subsection (2) prohibits the Commissioner, a Second

Commissioner, a Deputy Commissioner or a person authorised by

the Commissioner, a Second Commissioner or a Deputy

Commissioner from communicating any information to:

(a) a person performing, as an officer, duties in relation to a

taxation law, for the purpose of enabling the person to

perform those duties; or

(b) if the information relates to the non-compliance of a private

ancillary fund or charity (or a trustee of a private ancillary

fund or charity) with a law of the Commonwealth, a State or

a Territory--the Attorney-General of a State or Territory for

the purposes of the administration of a law of the State or

Territory governing trusts and charities.

18 Subsection 250-10(2) in Schedule 1 (table item 140,

column headed "Provision")

Omit "Divisions 284, 286 and 288", substitute "298-15"

19 Paragraph 298-5(c) in Schedule 1

Omit "or Division 16", substitute ", Division 16 or section 426-120".

20 Subsection 353-20(3) in Schedule 1

Repeal the subsection, substitute:

(3) The Minister may only disclose information provided under

subsection (2) for a purpose relating to the removal of the name of

the

deductible gift recipient from Division 30 of the Income Tax

Assessment Act 1997.

21 At the end of section 426-1 in Schedule 1

Add:

Subdivision 426-D deals with a type of private philanthropic trust

fund known as a private ancillary fund.

Private ancillary funds Schedule 2

Amend ments commencing on 1 October 2009 Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 9

22 At the end of Division 426 in Schedule 1

Add:

Subdivision 426-D--Private ancillary funds

Guide to Subdivision 426-D

426-100 What this Subdivision is about

This Subdivision deals with a type of private philanthropic trust

fund known as a private ancillary fund.

The Minister may make guidelines determining when private

ancillary funds are entitled to be endorsed as deductible gift

recipients.

This Subdivision also provides for:

(a) penalties for trustees who fail to comply with the

private ancillary fund guidelines, and the liability

of directors of trustees to pay those penalties in

certain circumstances; and

(b) powers for the Commissioner to suspend or

remove trustees who breach their obligations.

Table of sections

Private ancillary funds

426-105 Private ancillary funds

426-110 Private ancillary fund guidelines

426-115 Australian Business Register must show private ancillary fund status

Administrative penalties

426-120 Administrative penalties for trustees of private ancillary funds

Suspension and removal of trustees

426-125 Suspension or removal of trustees

426-130 Commissioner to appoint acting trustee in cases of suspension or removal

426-135 Terms and conditions of appointment of acting trustee

Schedule 2 Private ancillary funds

Part 1 A mend ments commencing on 1 October 2009

10 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

426-140 Termination of appointment of acting trustee

426-145 Resignation of acting trustee

426-150 Property vesting orders

426-155 Powers of acting trustee

426-160 Commissioner may give directions to acting trustee

426-165 Property vested in acting trustee--former trustees' obligations relating to

books, identification of property and transfer of property

Private ancillary funds

426-105 Private ancillary funds

(1) A trust is a private ancillary fund if:

(a) each trustee of the trust is a

constitutional corporation; and

(b) each trustee has agreed, in the

approved form given to the

Commissioner, to comply with the rules in the

private

ancillary fund guidelines, as in force from time to time; and

accordance with subsection (2).

(2) A trustee may revoke an agreement mentioned in paragraph (1)(b)

only by giving the revocation to the Commissioner in the

approved form.

426-110 Private ancillary fund guidelines

The Minister must, by legislative instrument, formulate guidelines

(the private ancillary fund guidelines) setting out:

(a) rules that

private ancillary funds and their trustees must

comply with if the funds are to be, or are to remain, endorsed

deductible gift recipients; and

(b) the amount of the administrative penalty, or how to work out

the amount of the administrative penalty, under subsection

426-120(1).

426-115 Australian Business Register must show private ancillary

fund status

(1) If a

private ancillary fund has an

ABN, the

Australian Business

Registrar may enter in the

Australian Business Register in relation

to the fund a statement that it is a private ancillary fund.

Private ancillary funds Schedule 2

Amend ments commencing on 1 October 2009 Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 11

Note 1:

An entry (or lack of entry) of a statement required by this section does

not affect whether a trust is a private ancillary fund.

Note 2:

The Australian Business Register will also show if a private ancillary

fund is endorsed as a deductible gift recipient: see section 30-229 of

the Income Tax Assessment Act 1997.

(2) The

Australian Business Registrar must take reasonable steps to

ensure that a statement appearing in the

Australian Business

may:

(a) change the statement; or

(b) remove the statement from the Register if the statement is not

true.

Administrative penalties

426-120 Administrative penalties for trustees of private ancillary

funds

Administrative penalty

(1) The persons mentioned in subsection (2) are jointly and severally

liable to an administrative penalty if:

(a) a trustee of a

private ancillary fund holds the fund out as

being endorsed, entitled to be endorsed, or entitled to remain

endorsed, as a

deductible gift recipient; and

(b) the fund is not so endorsed or entitled.

(2) The persons are:

(a) each person who is a trustee of the fund; and

(b) each director of each

constitutional corporation that is a

trustee of the fund, if:

(i) any of the penalty cannot reasonably be recovered from

the constitutional corporation; and

(ii) the constitutional corporation is not a registered trustee

company.

Note:

A person mentioned in paragraph (2)(a) may, in certain circumstances,

not be a constitutional corporation: see item 28 of Schedule 2 to the

Tax Laws Amendment (2009 Measures No. 4) Act 2009 (former

prescribed private funds).

(3) The amount of the penalty is:

Schedule 2 Private ancillary funds

Part 1 A mend ments commencing on 1 October 2009

12 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

(a) the amount specified in the

private ancillary fund guidelines

under paragraph 426-110(b); or

(b) the amount worked out in accordance with the method

specified under that paragraph.

The private ancillary fund guidelines may specify different

penalties or methods for different circumstances.

(4) The penalty must not be reimbursed from the fund.

Note:

Division 298 in this Schedule contains machinery provisions for

administrative penalties.

Defences for directors

(5) Paragraph (2)(b) does not apply to a director if:

(a) the director was not aware of the holding out mentioned in

paragraph (1)(a) and it would not have been reasonable to

expect the director to have been aware of that holding out; or

(b) the director took all reasonable steps to ensure that the

holding out mentioned in that paragraph did not occur; or

(6) In determining what is reasonable for the purposes of

paragraph (5)(a), (b) or (c), have regard to all relevant

circumstances.

(7) A person who wishes to rely on subsection (5) bears an evidential

burden in relation to the matters in that subsection.

Power of courts to grant relief

(8) Section 1318 of the Corporations Act 2001 (power of Court to

grant relief in case of breach of director's duty) does not apply to a

liability of a director under this section.

Suspension and removal of trustees

426-125 Suspension or re moval of trustees

Suspension

(1) The Commissioner may suspend all of the trustees of a

private

ancillary fund if the Commissioner is satisfied that the fund, or any

of the trustees of the fund, have breached:

Private ancillary funds Schedule 2

Amend ments commencing on 1 October 2009 Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 13

(a) the

private ancillary fund guidelines; or

(b) any other

Australian law.

(2) The suspension of a trustee:

(a) starts when the Commissioner gives the trustee notice of the

suspension under subsection (3); and

(b) ends at the time specified in the notice.

(3) If the Commissioner decides to suspend a trustee under this

section, the Commissioner must give to the trustee a written notice:

(a) setting out the decision; and

(b) giving the reasons for the decision; and

Extension of suspensions

(4) The Commissioner may change the time the suspension of a trustee

ends.

(5) If the Commissioner decides to change the time the suspension of a

trustee ends under this section, the Commissioner must give to the

trustee a written notice:

(a) setting out the decision; and

(b) giving the reasons for the decision; and

Removal

(6) The Commissioner may remove all of the trustees of a

private

ancillary fund if the Commissioner is satisfied that the fund, or any

of the trustees of the fund, have breached:

(a) the

private ancillary fund guidelines; or

(b) any other

Australian law.

(7) If the Commissioner decides to remove a trustee under this section,

the Commissioner must give to the trustee a written notice:

(a) setting out the decision; and

(b) giving the reasons for the decision.

Schedule 2 Private ancillary funds

Part 1 A mend ments commencing on 1 October 2009

14 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Review of decisions under this section

(8) A trustee who is dissatisfied with any of the following decisions

under this section may object in the manner set out in Part IVC of

this Act:

(a) a decision to suspend the trustee;

(b) a decision to change the time a suspension of the trustee

ends;

426-130 Commissioner to appoint acting trustee in cases of

suspension or re moval

Appointment of acting trustee

(1) If the Commissioner suspends all of the trustees of a

private

ancillary fund under section 426-125, the Commissioner must

appoint a single entity to act as the trustee (the acting trustee) of

the fund during the period of the suspension.

(2) If the Commissioner removes all of the trustees of a

private

ancillary fund under section 426-125, the Commissioner must

appoint a single entity to act as the trustee (the acting trustee) of

the fund until all of the vacancies in the position of trustee are

filled.

Acting trustee need not be constitutional corporation

(3) An acting trustee need not be a

constitutional corporation, and

may be the Commissioner. Paragraph 426-105(1)(a) does not apply

in relation to an acting trustee.

(4) An entity that is not a

constitutional corporation may not act as

trustee under this section for longer than 6 months.

Acting trustee must have agreed to comply with guidelines

(5) An entity may only be appointed as acting trustee if the entity has,

in accordance with paragraph 426-105(1)(b), agreed to comply

with the rules in the

private ancillary fund guidelines, as in force

from time to time.

Private ancillary funds Schedule 2

Amend ments commencing on 1 October 2009 Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 15

426-135 Terms and conditions of appointment of acting trustee

(1) The Commissioner may determine the terms and conditions of the

appointment of the acting trustee, including fees. The

determination has effect despite anything in:

(a) any

Australian law other than this section; or

(b) the

private ancillary fund's governing rules.

(2) Without limiting subsection (1), the Commissioner may make a

determination under that subsection to the effect that the acting

trustee's fees are to be paid out of the corpus of the

private

ancillary fund.

426-140 Termination of appointme nt of acting trustee

The Commissioner may terminate the appointment of the acting

trustee at any time.

426-145 Resignation of acting trustee

(1) The acting trustee may resign by writing given to the

Commissioner.

(2) The resignation does not take effect until the end of the seventh

day after the day on which it was given to the Commissioner.

426-150 Property vesting orders

(1) If the Commissioner appoints an acting trustee, the Commissioner

must make a written order vesting the property of the

private

ancillary fund in the acting trustee.

(2) If the appointment ends, the Commissioner must make a written

order vesting the property of the fund in the new acting trustee, the

previously suspended trustee or trustees or the new actual trustee or

trustees (whichever is applicable).

(3) If the Commissioner makes an order under this section vesting

property of a

private ancillary fund in an entity or entities, then,

subject to subsection (4), the property immediately vests in the

entity or entities by force of this section.

(4) If:

Schedule 2 Private ancillary funds

Part 1 A mend ments commencing on 1 October 2009

16 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

(a) the property is of a kind whose transfer or transmission may

be registered under an

Australian law; and

(b) that law enables the registration of such an order, or enables

the entity or entities to be registered as the owner of that

property;

the property does not vest in the entity or entities until the

requirements of the law referred to in paragraph (a) have been

complied with.

426-155 Powe rs of acting trustee

Subject to section 426-150:

(a) the acting trustee has and may exercise all the rights, title and

powers, and must perform all the functions and duties, of the

original trustee or trustees; and

(b) the

private ancillary fund's governing rules and every

Australian law apply in relation to the acting trustee as if the

acting trustee were the trustee of the fund.

426-160 Commissioner may give directions to acting trustee

(1) The Commissioner may give the acting trustee a written notice

directing the acting trustee to do, or not to do, one or more

specified acts or things in relation to the

private ancillary fund.

(2) The acting trustee commits an offence if:

(a) the acting trustee engages in conduct (within the meaning of

subsection 2(1) of this Act); and

(b) that engagement in conduct contravenes a notice given to the

acting trustee under subsection (1).

Penalty: 100 penalty units.

(3) This section does not affect the validity of a transaction entered

into in contravention of a notice given under subsection (1).

Private ancillary funds Schedule 2

Amend ments commencing on 1 October 2009 Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 17

426-165 Property vested in acting trustee--forme r trustees'

obligations relating to books, identification of prope rty

and transfer of property

Books

(1) An entity commits an offence if:

(a) the Commissioner makes an order under subsection

426-150(1) or (2) vesting the property of a

private ancillary

fund in an acting trustee; and

(b) just before the Commissioner made the order, the property

was vested in:

(a) the entity (the former trustee); or

(b) 2 or more entities (the former trustees), including the

entity; and

the Commissioner making the order, give the acting trustee

all books (within the meaning of the Corporations Act 2001)

relating to the fund's affairs that are in the former trustee's or

former trustees' possession, custody or control.

Penalty: 50 penalty units.

Identification of property and transfer of property

(2) Subsections (3) to (5) apply if:

(a) the property of a

private ancillary fund is vested in an entity

(the former trustee) or entities (the former trustees); and

(b) the Commissioner makes an order under subsection

426-150(1) or (2) vesting the property in an acting trustee.

(3) The acting trustee may, by notice in writing to the former trustee or

former trustees, require the former trustee or former trustees, so far

as the former trustee or former trustees can do so:

(a) to identify property of the fund; and

(b) to explain how the former trustee or former trustees have

kept account of that property.

(4) The acting trustee may, by notice in writing to the former trustee or

former trustees, require the former trustee or former trustees to take

specified action that is necessary to bring about a transfer of

specified property of the fund to the acting trustee.

Schedule 2 Private ancillary funds

Part 1 A mend ments commencing on 1 October 2009

18 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

(5) The former trustee, or each of the former trustees, commits an

offence if:

(a) the acting trustee gives the former trustee or former trustees a

notice under subsection (3) or (4); and

(b) the former trustee or former trustees do not, within 28 days of

the notice being given, comply with the requirement in the

notice.

Penalty: 50 penalty units.

Strict liability

(6) Subsections (1) and (5) are offences of strict liability.

Note:

For strict liability, see section 6.1 of the Criminal Code.

Private ancillary funds Schedule 2

Amend ments commencing on 1 January 2010 Part 2

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 19

Part 2

Amendments commencing on 1 January

2010

Income Tax Assessment Act 1997

23 Subsection 30-229(2A)

Omit "may", substitute "must".

Taxation Administration Act 1953

24 Subsection 426-115(1) in Schedule 1

Omit "may", substitute "must".

Schedule 2 Private ancillary funds

Part 3 Transitional provisions

20 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Part 3

Transitional provisions

Division 1

Preliminary

25 Definitions

In this Part:

commencement time means the time at which this item commences.

constitutional corporation has the meaning given by the Income Tax

Assessment Act 1997.

deductible gift recipient has the meaning given by the Income Tax

Assessment Act 1997.

prescribed private fund has the meaning given by the Income Tax

Assessment Act 1997 (as in force just before the commencement time).

private ancillary fund has the meaning given by section 426-105 in

Schedule 1 to the Taxation Administration Act 1953.

private ancillary fund guidelines has the meaning given by

section 426-110 in Schedule 1 to the Taxation Administration Act 1953.

Division 2

Declared prescribed private funds

26 Transitional

prescribed private fund declarations

(1) The Minister may, by legislative instrument, declare a trust to be a

prescribed private fund.

(2) Despite subsection 12(2) of the Legislative Instruments Act 2003,

the declaration has effect during the period:

(a) starting at the time specified in the declaration, which must

be before the commencement time; and

(b) ending just before the commencement time.

Division 3

Transitional private ancillary funds

27 Application of Division

This Division applies to a trust if, just before the commencement time,

the trust was a prescribed private fund (whether or not because of a

declaration made under item 26).

Private ancillary funds Schedule 2

Transitional provisions Part 3

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 21

28 Transitional

trustees need not be constitutional

corporations

Paragraph 426-105(1)(a) (trustees of private ancillary funds must be

constitutional corporations) and sections 426-125 to 426-165

(Suspension and removal of trustees) in Schedule 1 to the Taxation

Administration Act 1953 do not apply to the trust during the period:

(a) starting at the commencement time; and

(b) ending at the earlier of the following:

(i) the time (at or after the commencement time) the trust

first satisfies the requirements of that

paragraph (disregarding this item);

(ii) the first time any of the trustees of the trust revoke the

agreement mentioned in item 29 in accordance with

subsection 426-105(2) in that Schedule.

29 Transitional

agreement to comply with private ancillary

fund guidelines

(1)

For the purposes of Subdivision 426-D in Schedule 1 to the Taxation

Administration Act 1953, each of the trustees of the trust is taken to

have agreed, at the commencement time and in accordance with

paragraph 426-105(1)(b) in that Schedule, to comply with the rules in

the private ancillary fund guidelines, as in force from time to time.

(2)

To avoid doubt, subitem (1) does not prevent a trustee from revoking

that agreement at a later time as mentioned in paragraph 426-105(1)(c)

in that Schedule.

30 Transitional

endorsement as a deductible gift recipient

(1)

The trust is taken to have been endorsed as a deductible gift recipient

under section 30-120 of the Income Tax Assessment Act 1997 at the

commencement time.

(2)

To avoid doubt, subitem (1) does not prevent the Commissioner from

revoking that endorsement at a later time under section 426-55 in

Schedule 1 to the Taxation Administration Act 1953.

31 Transitional

transfer of property

Schedule 2 Private ancillary funds

Part 3 Transitional provisions

22 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

For the purposes of item 2 of the column headed "Recipient" of the

table in subsection 30-15(2) of the Income Tax Assessment Act 1997,

disregard a transfer of all of the property of the trust to another private

ancillary fund if:

(a) the other fund is a deductible gift recipient; and

(b) every trustee of the other fund is a constitutional corporation;

and

Demutualisation of friendly society health or life insurers Schedule 3

Main amendment Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 23

Schedule 3

Demutualisation of friendly

society health or life insurers

Part 1

Main amendment

Income Tax Assessment Act 1997

1 At the end of Part 3-32

Add:

Division 316--Demutualisation of friendly society health or

life insurers

Table of Subdivisions

Guide to Division 316

316-A Application

316-B Capital gains and losses connected with the demutualisation

316-C Cost base of shares and rights issued under the

demutualisation

316-D Lost policy holders trust

316-E Special CGT rules for legal personal representatives and

beneficiaries

316-F Non-CGT consequences of the demutualisation

Guide to Division 316

316-1 What this Division is about

Special tax consequences follow the demutualisation of a friendly

society that provides health insurance or life insurance, or has a

wholly-owned subsidiary that does.

Subdivision 316-A--Application

Table of sections

316-5

Application of this Division

Schedule 3 Demutualisation of friendly society health or life insurers

Part 1 Main amendment

24 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

316-5 Application of this Division

This Division applies in relation to a demutualisation of a

friendly

society if:

(a) the society is, or has a

wholly-owned subsidiary (a

health/life insurance subsidiary) that is:

(i) a private health insurer as defined in the Private Health

Insurance Act 2007; or

(ii) a company registered under section 21 of the Life

Insurance Act 1995; and

(b) the society does not have capital divided into

shares held by

its

members; and

the object of securing a profit or pecuniary gain for its

members.

Subdivision 316-B--Capital gains and losses connected with the

demutualisation

Guide to Subdivision 316-B

316-50 What this Subdivision is about

Disregard capital gains and losses made by any entity from a CGT

event happening under the demutualisation, unless the entity:

(a) is or has been a member of the friendly society or

insured through the society or any of its

wholly-owned subsidiaries; and

(b) receives money for the event.

Table of sections

Gains and losses of members, insured entities and successors

316-55

Disregarding capital gains and losses, except some involving receipt of

money

316-60

Taking account of some capital gains and losses involving receipt of money

316-65

Valuation factor for sections 316-60, 316-105 and 316-165

316-70

Value of the friendly society

Demutualisation of friendly society health or life insurers Schedule 3

Main amendment Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 25

Friendly society's gains and losses

316-75

Disregarding friendly society's capital gains and losses

Other entities' gains and losses

316-80

Disregarding other entities' capital gains and losses

Gains and losses of members, insured entities and successors

316-55 Disregarding capital gains and losses, except some involving

receipt of money

(1) Disregard an entity's

capital gain or

capital loss from a

CGT

event that happens under the demutualisation to a

CGT asset if:

(a) the entity:

(i) is or has been a

member of the

friendly society; or

(ii) is or has been insured through the friendly society or a

health/life insurance subsidiary of the friendly society;

and

(b) the CGT asset is one of these (an interest affected by

demutualisation):

(i) an interest in the friendly society as the owner or holder

of a policy of insurance with the friendly society or

health/life insurance subsidiary;

(ii) a

membership interest in the friendly society;

(iii) a right or interest of another kind in the friendly society;

(iv) a right or interest of another kind that arises under the

demutualisation, except an interest in a lost policy

holders trust (see section 316-155).

Note:

Subdivision 316-D deals with the effects of CGT events happening to

interests in lost policy holders trusts.

(2) Disregard a

capital gain or

capital loss of an entity (the

successor) from a

CGT event that happens under the

demutualisation to a

CGT asset if:

(a) the successor is the

legal personal representative, or

beneficiary in the estate, of a deceased individual who was:

(i) a

member of the

friendly society; or

(ii) insured through the friendly society or a health/life

insurance subsidiary of the friendly society; and

(b) the CGT asset:

Schedule 3 Demutualisation of friendly society health or life insurers

Part 1 Main amendment

26 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

(i) forms part of the deceased individual's estate; and

(ii) devolves or

passes to the successor; and

(iii) is an interest affected by demutualisation (see

paragraph (1)(b)).

316-60 Taking account of some capital gains and losses involving

receipt of money

(1) This section applies if:

(a) a

CGT event happens under the demutualisation to an

entity's interest affected by demutualisation (see

section 316-55); and

(b) the event involves:

(i) the variation or abrogation of rights attaching to or

consisting of the interest; or

(ii) the conversion, cancellation, extinguishment or

redemption of the interest; and

(i) the entity is one described in paragraph 316-55(1)(a); or

(ii) the entity is one described in paragraph 316-55(2)(a)

and the interest is a

CGT asset described in paragraph

316-55(2)(b); and

(d) the

capital proceeds from the event include or consist of

money received by the entity.

(2) Work out whether the entity makes a

capital gain or

capital loss

from the

CGT event, and the amount of the gain or loss, assuming

that:

(a) the

capital proceeds from the CGT event were the amount

they would be if they did not include any

market value of

property other than money; and

(b) the

cost base and

reduced cost base for the interest were the

amount worked out using the formula:

Capital proceeds from

Valuation factor worked out

the CGT event

under section 316-65

Example: Assume the entity receives $50 in money and 10 shares with a market

value of $4 each in respect of CGT event C2 happening, and that the

valuation factor worked out under section 316-65 is 0.9. The entity

makes a capital gain from the event of $5, worked out as follows:

Demutualisation of friendly society health or life insurers Schedule 3

Main amendment Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 27

$50

0.9

This ignores the market value of the shares because they are property

other than money.

Note:

Division 114 (Indexation of cost base) is not relevant, because this

section provides exhaustively for working out the amount of the cost

base.

(3) The

capital gain or

capital loss is not to be disregarded, despite:

(a) section 316-55; and

(b) any provision of this Act for disregarding the

capital gain or

capital loss because the interest affected by demutualisation

was

acquired before 20 September 1985.

Note:

The capital gain is not a discount capital gain: see section 115-55.

316-65 Valuation factor for sections 316-60, 316-105 and 316-165

(1) For the purposes of sections 316-60, 316-105 and 316-165, the

valuation factor is the amount worked out using the formula:

Market value of the friendly

Embedded value of the friendly

society's health insurance

society's other business (if any)

business (if any)

Total capital proceeds for all entities from CGT events happening

under the demutualisation to interests affected by demutualisation

(except those described in subparagraph 316-55(1)(b)(iv))

where:

embedded value of the friendly society's other business (if any)

means the amount that would be the value of the

friendly society

worked out under section 316-70 assuming that neither the friendly

society, nor any health/life insurance subsidiary of it,

carried on

any health insurance business within the meaning of the Private

Health Insurance Act 2007.

market value of the friendly society's health insurance business

(if any) means the total

market value of every health insurance

business, within the meaning of the Private Health Insurance Act

2007,

carried on by either or both of the

friendly society and its

health/life insurance subsidiaries (if any), taking account of any

consideration paid to the society or subsidiary for disposal or

control of that business.

Schedule 3 Demutualisation of friendly society health or life insurers

Part 1 Main amendment

28 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

(2) Disregard paragraph 316-60(2)(a) for the purposes of the formula

in subsection (1) of this section.

316-70 Value of the friendly society

(1) The value of the

friendly society is the sum, worked out in

accordance with this section, of the friendly society's existing

business value and its adjusted net worth on the day (the applicable

accounting day) identified under subsection (3).

Eligible actuary and Australian actuarial practice

(2) The sum is to be worked out, according to Australian actuarial

practice, by an

actuary who is not an employee of:

(a) the

friendly society; or

(b) a health/life insurance subsidiary of the friendly society; or

wholly-owned subsidiary under the demutualisation.

Applicable accounting day

(3) The applicable accounting day is:

(a) if an accounting period of the

friendly society ends on the

day (the demutualisation resolution day) identified under

subsection (4)--that day; or

(b) in any other case--the last day of the most recent accounting

period of the friendly society ending before the

demutualisation resolution day.

Demutualisation resolution day

(4) The demutualisation resolution day is:

(a) the day on which the resolution to proceed with the

demutualisation is passed; or

(b) if, under the demutualisation, the whole of the

life insurance

business of the

friendly society or of a health/life insurance

subsidiary of the friendly society is transferred to another

company under a scheme confirmed by the Federal Court of

Australia--the day (or the last day) on which the transfer

takes place.

Demutualisation of friendly society health or life insurers Schedule 3

Main amendment Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 29

Adjustment for changes after applicable accounting day

(5) In a case covered by paragraph (3)(b), if any significant change in

the amount of the existing business value or adjusted net worth

occurs between the applicable accounting day and the

demutualisation resolution day, the amount is to be adjusted to take

account of the change.

Continued business assumption

(6) In working out the existing business value or the adjusted net

worth, assume:

(a) that after the applicable accounting day the

friendly society,

and any health/life insurance subsidiary of the friendly

society, will continue to conduct

business and any other

activity in the same way as before that day, and will not

conduct any different business or other activity; and

(b) that the demutualisation will not occur; and

society will continue to be a

wholly-owned subsidiary of the

friendly society.

Expenditure assumption

(7) In working out the existing business value, assume that expenditure

that the

friendly society and any of its health/life insurance

subsidiaries will incur, in conducting

business, on recurring items

after the demutualisation resolution day will be of the same kinds

and amounts (increased to take account of any inflation) as it

incurred in the accounting period, or part of an accounting period,

ending on the demutualisation resolution day.

Friendly society's gains and losses

316-75 Disregarding friendly society's capital gains and losses

Disregard the

friendly society's

capital gain or

capital loss from

CGT event that happens under the demutualisation.

Schedule 3 Demutualisation of friendly society health or life insurers

Part 1 Main amendment

30 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Other entities' gains and losses

316-80 Disregarding othe r entities' capital gains and losses

Disregard an entity's

capital gain or

capital loss from a

CGT

event that happens under the demutualisation if:

(a) the entity is established solely for the purpose of participating

in the demutualisation and is not a lost policy holders trust

(see section 316-155); and

(b) the CGT event:

(i) happens before or at the same time as the allocation or

distribution of the accumulated surplus of the

friendly

society; and

(ii) is connected to that allocation or distribution.

Note:

The allocation or distribution of the accumulated surplus could happen

through an arrangement involving more than one transaction.

Subdivision 316-C--Cost base of shares and rights issued under

the demutualisation

Guide to Subdivision 316-C

316-100 What this Subdivision is about

The value of the friendly society and its business affects cost bases

of shares and certain rights issued under the demutualisation to:

(a) entities that are or were members of the friendly

society; or

(b) entities insured through the society or its

subsidiaries; or

(d) the trustee of the lost policy holders trust.

Table of sections

316-105 Cost base and time of acquisition of shares and certain rights issued under

demutualisation

Demutualisation of friendly society health or life insurers Schedule 3

Main amendment Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 31

316-110 Demutualisation assets

316-115 Entities to which section 316-105 applies

316-105 Cost base and time of acquisition of shares and certain

rights issued under demutualisation

First element of cost base

(1) The first element of the

cost base and

reduced cost base of a

CGT asset is the amount worked out using the formula in

subsection (2) if:

(a) the asset is a CGT asset (a demutualisation asset) covered by

section 316-110; and

(b) the asset is issued to an entity covered by section 316-115.

(2) The formula is:

Value of the CGT asset

Valuation factor worked out

when it was issued

under section 316-65

Time of acquisition

(3) The entity is taken to have

acquired the

CGT asset at the time it

is issued.

316-110 Demutualisation assets

(1) This section covers a

CGT asset that:

(a) is:

(i) a

share in the

friendly society; or

(ii) a right to

acquire a share in the friendly society; or

(iii) a share in an entity that owns all of the shares in the

friendly society; or

(iv) a right to acquire a share in an entity mentioned in

subparagraph (iii); and

(b) is issued under the demutualisation; and

(i) the variation or abrogation of rights attaching to or

consisting of an interest affected by demutualisation

(see paragraph 316-55(1)(b)); or

Schedule 3 Demutualisation of friendly society health or life insurers

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32 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

(ii) the conversion, cancellation, extinguishment or

redemption of an interest affected by demutualisation.

Exclusion for rights with an exercise price

(2) Despite subsection (1), this section does not cover a right to

acquire a

share in an entity if the holder of the right must pay an

amount to exercise the right.

Exclusion where assets not issued simultaneously

(3) Despite subsection (1), a

CGT asset is not covered by this section

unless all of the CGT assets covered by subsection (1) for the

demutualisation are issued:

(a) at the same time; and

(b) to entities that are covered by section 316-115.

316-115 Entities to which section 316-105 applies

(1) This section covers an entity that:

(a) either:

(i) is or has been a

member of the

friendly society; or

(ii) is or has been insured through the friendly society or a

health/life insurance subsidiary of the friendly society;

and

(b) is entitled under the demutualisation to an allocation of

demutualisation assets.

(2) This section also covers an entity that has become entitled to an

allocation of demutualisation assets because of the death of an

individual who was an entity described in subsection (1).

(3) This section also covers the trustee of a lost policy holders trust

(see section 316-155).

Demutualisation of friendly society health or life insurers Schedule 3

Main amendment Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 33

Subdivision 316-D--Lost policy holders trust

Guide to Subdivision 316-D

316-150 What this Subdivision is about

If the demutualisation creates a trust just to hold shares, rights to

acquire shares or money for entities that were members of the

friendly society or insured through the society or its subsidiary, or

are successors of such entities, then:

(a) capital gains or losses from CGT events happening

to beneficiaries' interests in the trust are

disregarded, except where the capital proceeds

include money; and

(b) when a CGT event happens involving the transfer

of the shares or rights to a beneficiary, or a

beneficiary's absolute entitlement to them, the

trustee's capital gain or loss is disregarded and the

beneficiary has the same cost base and time of

acquisition as the trustee; and

other CGT events happening to the shares or

rights.

Table of sections

Application

316-155 Lost policy holders trust

Effects of CGT events happening to interests and assets in trust

316-160 Disregarding beneficiaries' capital gains and losses, except some involving

receipt of money

316-165 Taking account of some capital gains and losses involving receipt of money

by beneficiaries

316-170 Roll-over where shares or rights to acquire shares transferred to beneficiary

of lost policy holders trust

316-175 Trustee assessed if shares or rights dealt with not for benefit of beneficiary

of lost policy holders trust

Schedule 3 Demutualisation of friendly society health or life insurers

Part 1 Main amendment

34 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

316-180 Subdivision 126-E does not apply

Application

316-155 Lost policy holders trust

(1) This Subdivision applies if the conditions in subsections (2) and (5)

are met.

First condition

(2) The first condition is that the scheme approved by a court for the

demutualisation provides for a trust (the lost policy holders trust)

to exist solely for one or both of the purposes that are described in

subsection (3) in relation to persons (beneficiaries of the lost

policy holders trust) covered by subsection (4).

(3) The purposes are as follows:

(a) holding demutualisation assets (see section 316-110) that are

shares or rights to

acquire shares, or proceeds from disposal

of those assets, on behalf of one or more beneficiaries of the

lost policy holders trust and transferring those assets or

proceeds to those beneficiaries;

(b) holding on behalf of one or more beneficiaries of the lost

policy holders trust, and paying to them, money payable to

them for:

(i) the variation or abrogation of rights attaching to or

consisting of the beneficiaries' interests affected by

demutualisation (see paragraph 316-55(1)(b)); or

(ii) the conversion, cancellation, extinguishment or

redemption of those interests.

(4) This subsection covers:

(a) a person who is or has been a

member of the friendly society

or is or has been insured through the

friendly society or a

health/life insurance subsidiary of the friendly society; and

(b) a

legal personal representative, or beneficiary in the estate,

of such a person who has died.

Demutualisation of friendly society health or life insurers Schedule 3

Main amendment Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 35

Second condition

(5) The second condition is that, under the demutualisation, the trustee

of the lost policy holders trust is:

(a) issued with demutualisation assets that are

shares, or rights

acquire shares; or

(b) paid money described in paragraph (3)(b) to hold and pay to

beneficiaries of the lost policy holders trust.

Effects of CGT events happening to interests and assets in trust

316-160 Disregarding beneficiaries' capital gains and losses, except

some involving receipt of money

Disregard a

capital gain or

capital loss of a beneficiary of the lost

policy holders trust from a

CGT event that happens to the

beneficiary's interest in the trust.

316-165 Taking account of some capital gains and losses involving

receipt of money by beneficiaries

(1) This section applies if:

(a) a

CGT event happens to an interest of a beneficiary of the

lost policy holders trust in that trust; and

(b) the

capital proceeds from the event include or consist of

money received by the beneficiary.

(2) Work out whether the beneficiary makes a

capital gain or

capital

loss from the

CGT event, and the amount of the gain or loss,

assuming that:

(a) the

capital proceeds from the CGT event were the amount

they would be if they did not include any

market value of

property other than money; and

(b) the

cost base and

reduced cost base for the interest were the

amount worked out using the formula:

Capital proceeds from

Valuation factor worked out

the CGT event

under section 316-65

Example: Assume that the beneficiary of the lost policy holders trust is paid $50

in money by the trustee to satisfy the beneficiary's interest in the trust

so that a CGT event happens, and that the valuation factor worked out

Schedule 3 Demutualisation of friendly society health or life insurers

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36 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

under section 316-65 is 0.9. The beneficiary makes a capital gain from

the event of $5, worked out as follows:

$50

0.9

Note:

Division 114 (Indexation of cost base) is not relevant, because this

section provides exhaustively for working out the amount of the cost

base.

(3) The

capital gain or

capital loss is not to be disregarded, despite

sections 316-55 and 316-160.

Note:

The capital gain is not a discount capital gain: see section 115-55.

316-170 Roll-over whe re shares or rights to acquire shares

transferred to beneficiary of lost policy holders trust

(1) This section applies in relation to a

CGT event if:

(a) the CGT event happens in relation to an asset that:

(i) is a

share or a right to

acquire one or more shares; and

(ii) is held by the trustee of the lost policy holders trust on

behalf of a beneficiary of the lost policy holders trust;

and

(b) the CGT event happens because the beneficiary of the lost

policy holders trust either:

(i) is transferred the asset by the trustee; or

(ii) becomes absolutely entitled to the asset.

Consequence for trustee

(2) Disregard a

capital gain or

capital loss the trustee makes from the

CGT event.

Consequences for beneficiary

(3) The

cost base and

reduced cost base of the asset in the hands of

the trustee of the lost policy holders trust just before the

CGT

event becomes the first element of the cost base and reduced cost

base of the asset in the hands of the beneficiary of the lost policy

holders trust.

Note:

Section 316-105 affects the cost base of the asset in the hands of the

trustee of the lost policy holders trust if the asset is covered by

section 316-110.

Demutualisation of friendly society health or life insurers Schedule 3

Main amendment Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 37

(4) The beneficiary of the lost policy holders trust is taken to have

acquired the asset when the trustee acquired it.

316-175 Trustee assessed if shares or rights dealt with not for benefit

of beneficiary of lost policy holde rs trust

(1) This section applies in relation to a

capital gain from a

CGT

event if:

(a) the CGT event happens in relation to a demutualisation asset

that:

(i) is a

share or a right to

acquire a share; and

(ii) is held by the trustee of a lost policy holders trust; and

(b) section 316-170 does not apply to the CGT event.

(2) For the purposes of sections 97, 98A and 100 of the Income Tax

Assessment Act 1936, the share of the net income of the trust that is

attributable to the

capital gain is taken not to be included in the

assessable income of a beneficiary of the trust.

(3) The trustee is not assessed, and is not liable to pay tax, in respect of

the share under section 98 of the Income Tax Assessment Act 1936.

Note:

Because of these consequences in relation to sections 97 and 98 of the

Income Tax Assessment Act 1936, the trustee will be assessed on the

beneficiary's share under section 99A of that Act.

316-180 Subdivision 126-E does not apply

Subdivision 126-E does not apply in relation to the

demutualisation.

Note:

Subdivision 126-E is about an entitlement to shares after

demutualisation and scrip for scrip roll-over.

Subdivision 316-E--Special CGT rules for legal personal

representatives and beneficiaries

Table of sections

316-200 Demutualisation assets not owned by deceased but passing to beneficiary in

deceased estate

316-205 Interest in lost policy holders trust not owned by deceased but passing to

beneficiary in deceased estate

Schedule 3 Demutualisation of friendly society health or life insurers

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38 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

316-200 Demutualisation assets not owned by deceased but passing

to beneficiary in deceased estate

(1) This section sets out what happens if a

CGT asset:

(a) is a demutualisation asset (see section 316-110); and

(b) forms part of the estate of an individual who is an entity

described in subsection 316-115(1) and has died; and

(d)

passes to a beneficiary in the individual's estate because the

asset is transferred to the beneficiary by the individual's

legal personal representative.

Note:

Division 128 deals with the effect of death in relation to CGT assets a

person owns just before dying.

Consequence for legal personal representative

(2) Disregard a

capital gain or

capital loss the

legal personal

representative makes because the asset

passes to the beneficiary.

Consequence for beneficiary

(3) The

cost base and

reduced cost base of the asset in the hands of

the

legal personal representative just before the asset

passes to

the beneficiary becomes the first element of the cost base and

reduced cost base of the asset in the hands of the beneficiary.

(4) The beneficiary is taken to have

acquired the asset when the

legal

personal representative acquired it.

316-205 Interest in lost policy holders trust not owned by deceased

but passing to beneficiary in deceased estate

(1) This section sets out what happens if a

CGT asset:

(a) is an interest in a lost policy holders trust (see

section 316-155); and

(b) forms part of the estate of an individual who is an entity

described in subsection 316-115(1) and has died; and

(d)

passes to a beneficiary in the individual's estate because the

asset is transferred to the beneficiary by the individual's

legal personal representative.

Demutualisation of friendly society health or life insurers Schedule 3

Main amendment Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 39

Note:

Division 128 deals with the effect of death in relation to CGT assets a

person owns just before dying.

Consequence for legal personal representative

(2) Disregard a

capital gain or

capital loss the

legal personal

representative makes because the asset

passes to the beneficiary.

Subdivision 316-F--Non-CGT consequences of the

demutualisation

Guide to Subdivision 316-F

316-250 What this Subdivision is about

In many cases, income from demutualisation is assessed through

the CGT provisions rather than as ordinary income or other

statutory income.

Franking debits arise for the friendly society and its subsidiaries to

ensure they do not enjoy a franking surplus. Franking debits and

credits arise to negate credits and debits from things attributable to

the time before demutualisation.

Table of sections

316-255 General taxation consequences of issue of demutualisation assets etc.

316-260 Franking debits to stop the friendly society and its subsidiaries having

franking surpluses

316-265 Franking debits to negate franking credits from some distributions to

friendly society and subsidiaries

316-270 Franking debits to negate franking credits from post-demutualisation

payments of pre-demutualisation tax

316-275 Franking credits to negate franking debits from refunds of tax paid before

demutualisation

316-255 General taxation consequences of issue of demutualisation

assets etc.

(1) An amount of

ordinary income or

statutory income (other than a

net capital gain) of an entity covered by subsection (2) is not

assessable income and is not

exempt income if:

Schedule 3 Demutualisation of friendly society health or life insurers

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40 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

(a) the amount would otherwise be included in the ordinary

income or statutory income of the entity only because a

demutualisation asset (see section 316-110) was issued to the

entity; or

(b) the amount is a payment made to the entity, under the

demutualisation, in connection with:

(i) the variation or abrogation of rights attaching to or

consisting of an interest affected by demutualisation

(see paragraph 316-55(1)(b)); or

(ii) the conversion, cancellation, extinguishment or

redemption of an interest affected by demutualisation;

income or statutory income of the entity only because a

share or a right to

acquire one or more shares was

transferred to the entity by the trustee of a lost policy holders

trust (see section 316-155); or

(d) the amount is a payment made to the entity from a lost policy

holders trust in connection with:

(i) the variation or abrogation of rights attaching to or

consisting of an interest affected by demutualisation; or

(ii) the conversion, cancellation, extinguishment or

redemption of an interest affected by demutualisation.

(2) This subsection covers an entity that:

(a) is or has been a

member of the

friendly society; or

(b) is or has been insured through the friendly society or a

health/life insurance subsidiary of the friendly society; or

payment, because of the death of a person covered by

paragraph (a) or (b); or

(d) is a beneficiary of a lost policy holders trust (see

section 316-155).

316-260 Franking debits to stop the friendly society and its

subsidiaries having franking surpluses

(1) A

franking debit arises in the

franking account of the

friendly

society or a

wholly-owned subsidiary of the society if the account

Demutualisation of friendly society health or life insurers Schedule 3

Main amendment Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 41

is in

surplus immediately before the demutualisation resolution

day identified under subsection 316-70(4).

(2) The amount of the

franking debit equals the

surplus.

(3) The

franking debit arises at the start of that day.

316-265 Franking debits to negate franking credits from some

distributions to friendly society and subsidiaries

(1) This section applies if a

franking credit arises in the

franking

account of the

friendly society or a

wholly-owned subsidiary of

the society because a

distribution declared before the

demutualisation resolution day identified under subsection

316-70(4) is made to the society or subsidiary on or after that day.

(2) A

franking debit arises in that account.

(3) The amount of the

franking debit equals the amount of the

franking credit.

(4) The

franking debit arises at the same time as the

franking credit

arises.

316-270 Franking debits to negate franking credits from

post-demutualisation payments of pre-demutualisation

tax

(1) This section applies if a

franking credit arises in the

franking

account of the

friendly society or a

wholly-owned subsidiary of

the society because, on or after the demutualisation resolution day

identified under subsection 316-70(4), the society or subsidiary

pays a PAYG instalment, or

pays income tax, that is wholly or

partly attributable to a period before that day.

(2) A

franking debit arises in that account.

(3) The amount of the

franking debit is so much of the

franking

credit as is attributable to the period before that day.

(4) The

franking debit arises at the same time as the

franking credit

arises.

Schedule 3 Demutualisation of friendly society health or life insurers

Part 1 Main amendment

42 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

316-275 Franking credits to negate franking debits from refunds of

tax paid before demutualisation

(1) This section applies if a

franking debit arises in the

franking

account of the

friendly society or a

wholly-owned subsidiary of

the society because, on or after the demutualisation resolution day

identified under subsection 316-70(4), the society or subsidiary

receives a refund of income tax that is wholly or partly

attributable to a period before that day.

(2) A

franking credit arises in that account.

(3) The amount of the

franking credit is so much of the

franking

debit as is attributable to the period before that day.

(4) The

franking credit arises at the same time as the

franking debit

arises.

Demutualisation of friendly society health or life insurers Schedule 3

Related amend ments Part 2

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 43

Part 2

Related amendments

Income Tax Assessment Act 1936

2 At the end of Subdivision C of Division 9AA of Part III

Add:

121AU This Subdivision does not apply to de mutualisation of

friendly society health or life insurers

This Subdivision does not apply in relation to the demutualisation

of a company in relation to whose demutualisation Division 316

(Demutualisation of friendly society health or life insurers) of the

Income Tax Assessment Act 1997 applies.

Note:

Section 316-5 of the Income Tax Assessment Act 1997 explains which

demutualisations of entities Division 316 of that Act applies to.

3 After paragraph 326-10(1)(ba) in Schedule 2H

Insert:

(bb) is not an entity in relation to whose demutualisation

Division 316 (Demutualisation of friendly society health or

life insurers) of that Act applies; and

4 Application

The amendments of the Income Tax Assessment Act 1936 made by this

Part apply in relation to demutualisations occurring on or after 1 July

2008.

Income Tax Assessment Act 1997

5 Section 11-

55 (before table item headed "demutualisation

of private health insurers")

Insert:

demutualisation of friendly society health or life insurers

amounts related to issue, or transfer fro m lost policy

holders trust, of demutualisation assets ............................

316-255

payments received directly, or fro m lost policy holders

trust, in exchange for cancellation or variation of

interests under the demutualisation ...................................

316-255

Schedule 3 Demutualisation of friendly society health or life insurers

Part 2 Related amend ments

44 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

6 Section 102-30 (after table item 10)

Insert:

10A

All entities

Div ision 316 contains special ru les

affecting capital gains and capital losses

connected with demutualisation of friendly

society health or life insurers.

Div ision 316

7 Section 109-60 (table item

4, column headed "In these

circumstances:")

After "company", insert "except a friendly society health or life

insurer".

8 Section 109-60 (table item

10, column headed "In these

circumstances:")

Omit "or health insurer", substitute ", health insurer and friendly society

health or life insurer".

9 Section 109-60 (table items

13 and 14, column headed "In

these circumstances:")

After "insurer", insert "except a friendly society health or life insurer".

10 Section 109-60 (after table item 14)

Insert:

14A

You are issued with a share,

or a right to acquire shares,

under a demutualisation of a

friendly society health or life

insurer

the time the share or

right is issued

section 316-105

14B

You are transferred a share,

or right to acquire shares, by

a lost policy holders trust

under a demutualisation of a

friendly society health or life

insurer

the time the share or

right is issued to the

trustee

section 316-170

11 Section 112-97 (table item

5, column headed "In this

situation")

After "company", insert "except a friendly society health or life

insurer".

Demutualisation of friendly society health or life insurers Schedule 3

Related amend ments Part 2

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 45

12 Section 112-97 (table item

5A, column headed "In this

situation")

Omit "or health insurer", substitute ", health insurer and friendly society

health or life insurer".

13 Section 112-97 (table items

29 and 30, column headed "In

this situation")

After "insurer", insert "except a friendly society health or life insurer".

14 Section 112-97 (after table item 30)

Insert:

30A

A CGT event occurs under a

demutualisation of a friendly

society health or life insurer

and the capital proceeds from

the event include money

All elements of cost base section 316-60

30B

You are issued with an asset

under a demutualisation of a

friendly society health or life

insurer

First element of cost base

and reduced cost base

section 316-105

30C

A CGT event happens to an

interest in a lost policy holders

trust and the capital proceeds

fro m the event include money

All elements of cost base section 316-165

30D

You are transferred a share, or

right to acquire shares, by a

lost policy holders trust under

a demutualisation of a friendly

society health or life insurer

The total cost base and

reduced cost base

section 316-170

15 At the end of Subdivision 115-A

Add:

115-55 Capital gains involving money received from

demutualisation of friendly society health or life insurer

Your

capital gain from a

CGT event is not a discount capital

gain if it is affected by section 316-60 or 316-165.

Note:

Those sections affect capital gains involving the receipt of money as a

result of the demutualisation of a friendly society health or life insurer.

Schedule 3 Demutualisation of friendly society health or life insurers

Part 2 Related amend ments

46 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

16 Section 118-1 (note 3)

Omit "Division 315 (about demutualisation of private health insurers)",

substitute "Divisions 315 and 316 (about demutualisation of certain

insurers)".

17 Subsection 118-20(4)

Omit "section 59-40", substitute "sections 59-40 and 316-255".

18 Paragraphs 149-165(1)(b) and 149-170(1)(b)

Repeal the paragraphs, substitute:

(b) has since stopped being a company of either of those kinds,

but either:

(i) has continued in existence as a company covered by

paragraph 149-50(1)(a) or (e) or a

publicly traded unit

trust; or

(ii) has undergone a demutualisation in relation to which

Division 316 (Demutualisation of friendly society health

or life insurers) applied and has continued in existence

as a company; and

19 After section 197-37

Insert:

197-38 Exclusion for transfers connected with de mutualisations of

friendly society health or life insurers

(1) Subject to subsection (2), this Division does not apply to the

transferred amount if:

(a) the amount is transferred in connection with a

demutualisation of a company; and

(b) Division 316 (about demutualisations of friendly society

health and life insurers) applies in relation to the

demutualisation; and

share capital

account the amount is transferred is either:

(i) the

friendly society described in that Division; or

(ii) the company that owns all the shares in the friendly

society.

Demutualisation of friendly society health or life insurers Schedule 3

Related amend ments Part 2

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 47

(2) Subsection (1) does not stop this Division from applying to so

much, if any, of the transferred amount as exceeds the sum of the

cost bases of

shares in the issuing company that:

(a) are demutualisation assets (see section 316-110); and

(b) are issued to an entity covered by section 316-115.

Note:

Section 316-115 identifies entities connected directly or indirectly

with the friendly society and affected by the special cost base rules in

section 316-105.

(3) For the purposes of subsection (2), work out the

cost base of a

share on the day on which it is issued, taking account of

section 316-105.

20 Subsection 205-15(1) (at the end of the table)

Add:

franking cred it arises

under section 316-275

for the

friendly society

or one of its

wholly-owned

subsidiaries because

the society or

subsidiary

receives a

refund of inco me tax

the amount of the debit

specified in subsection

316-275(3)

at the time provided by

subsection 316-275(4)

21 Subsection 205-30(1) (at the end of the table)

Add:

franking debit arises

under section 316-260

for the

friendly society

or one of its

wholly-owned

subsidiaries because

the

franking account

of the society or

subsidiary is in

surplus

the amount of the debit

specified in subsection

316-260(2)

at the time provided by

subsection 316-260(3)

franking debit arises

under section 316-265

for the

friendly society

or one of its

the amount of the debit

specified in subsection

316-265(3)

at the time provided by

subsection 316-265(4)

Schedule 3 Demutualisation of friendly society health or life insurers

Part 2 Related amend ments

48 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

wholly-owned

subsidiaries because a

franking cred it arises

for the society or

subsidiary

franking debit arises

under section 316-270

for the

friendly society

or one of its

wholly-owned

subsidiaries because a

franking cred it arises

for the society or

subsidiary

the amount of the debit

specified in subsection

316-270(3)

at the time provided by

subsection 316-270(4)

22 After subparagraph 315-15(a)(ii)

Insert:

(iia) is not an entity to whose demutualisation Division 316

applies; and

23 Application

The amendments of the Income Tax Assessment Act 1997 made by this

Part apply in relation to demutualisations occurring on or after 1 July

2008.

Income Tax (Transitional Provisions) Act 1997

24 After Part 3-30

Insert:

Part 3-32--Co-operatives and mutual entities

Division 316--Demutualisation of friendly society health or

life insurers

Table of Subdivisions

316-A Application

Demutualisation of friendly society health or life insurers Schedule 3

Related amend ments Part 2

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 49

Subdivision 316-A--Application

Table of sections

316-1

Application of Division 316 of the Income Tax Assessment Act 1997

316-1 Application of Division 316 of the Income Tax Assessment Act

1997

Division 316 of the Income Tax Assessment Act 1997 applies in

relation to demutualisations occurring on or after 1 July 2008.

Schedule 4 Consolidation: application of losses with nil availab le fraction

50 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Schedule 4

Consolidation: application of

losses with nil available fraction

Income Tax Assessment Act 1936

1 At the end of subsection 245-105(1) in Schedule 2C

Add:

Note:

The total net forgiven amount may be reduced under section 707-415

of the Income Tax Assessment Act 1997.

Income Tax Assessment Act 1997

2 At the end of subsection 104-520(3)

Add:

Note:

The amount remaining may be reduced under section 707-415.

3 Subsection 243-35(2) (method statement, at the end of step

Add:

Note:

The amount of a capital allowance deduction may be reduced under

section 707-415.

4 At the end of Subdivision 707-D

Add:

707-415 Application of losses with nil available fraction for certain

purposes

(1) Subsection (2) applies if:

(a) an entity (the joining entity) becomes a

member of a

consolidated group at a time (the joining time); and

(b) a

tax loss or a

net capital loss was transferred from the

joining entity to the

head company of the group at the

joining time under Subdivision 707-A; and

bundle of losses for which the

available fraction is 0.

Consolidation: application of losses with nil available fraction Schedule 4

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 51

(2) The

head company can choose to apply the loss as shown in the

table:

Item

If ...

the head company can

choose to apply the

loss in reduction of ...

for the purposes

of ...

(a) the jo ining entity owed

a debt just before the

joining time to an entity

that was not a

member

of the group at the

joining time; and

(b) the loss is wholly or

partly attributable to the

debt; and

Schedule 2C to the

Income Tax Assessment

Act 1936 applies in

relation to the debt (or

another debt that is

reasonably connected to

the debt) because the

debt is forgiven after the

joining time

the total net forgiven

amount mentioned in

subsection 245-105(1)

in that Schedule

applying that total

net forgiven

amount in

accordance with

subsections

245-105(5), (6),

(7) and (8) of that

Schedule.

(a) the jo ining entity owed

limited recourse debt

just before the joining

time to an entity that

was not a

member of

the group at the joining

time; and

(b) Div ision 243 applies in

relation to the debt; and

partly attributable to a

deduction mentioned in

paragraph 243-15(1)(c)

for an income year

ending before the

joining time

the deduction

working out the

excess referred to

in subsection

243-35(1).

(a) the jo ining entity ceases

to be a

subsidiary

the amount remain ing

mentioned in paragraph

working out

Schedule 4 Consolidation: application of losses with nil availab le fraction

52 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Item

If ...

the head company can

choose to apply the

loss in reduction of ...

for the purposes

of ...

member of the group at

a time (the leaving

time) after the joining

time; and

(b) the entity's liab ilities at

the leaving time are the

same as, or are

reasonably connected

to, the liabilities that it

had at the joining time

104-520(1)(b )

whether

CGT

event L5 happens

at the leaving

time, and if so,

the amount of any

capital gain

under subsection

104-520(3).

Limits on application of loss

(3) The loss can be applied under subsection (2) in relation to an

income year only to the extent that it could be

utilised by the

head company for the income year, on the assumption that the

available fraction for the

bundle of losses was 1.

(4) The amount of the loss that may be applied in accordance with

item 1 of the table in subsection (2) cannot exceed the gross

forgiven amount (within the meaning of section 245-75 in

Schedule 2C to the Income Tax Assessment Act 1936) of the debt to

which the loss is attributable.

(5) The amount of the loss that may be applied in accordance with

item 2 of the table in subsection (2) cannot exceed the amount of

the loss that is attributable to the deduction mentioned in that item.

(6) For the purposes of item 3 of the table in subsection (2), if:

(a) assuming that the joining entity ceased to be a

subsidiary

member of the

consolidated group just after the joining time,

the

head company of the group would make a

capital gain

because of

CGT event L5; and

(b) the sum of the losses in the

bundle of losses mentioned in

paragraph (1)(c) exceeds the amount of the capital gain;

the total amount of those losses that may be applied in accordance

with that item cannot exceed the amount of the capital gain.

(7) To avoid doubt, a loss can be applied under this section only to the

extent that it has not already been applied.

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

54 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Schedule 5

Minor amendments

Part 1

References to Ministers, Departments and

Secretaries

Division 1

Amendments commencing on Royal Assent

Excise Act 1901

1 Subsection 4(1)

Insert:

Finance Minister has the meaning given by the Income Tax

Assessment Act 1997.

2 Subsection 4(1) (definition of Industry Minister)

Repeal the definition.

3 Subsection 4(1)

Insert:

Resources Minister has the meaning given by the Petroleum

Resource Rent Tax Assessment Act 1987.

4 At the end of paragraphs 162B(5)(a) and (b)

Add "and".

5 Subsection 162B(5)

Omit "Minister for Finance", substitute "Finance Minister".

6 Paragraph 165A(1)(b)

Omit "Industry Minister", substitute "Resources Minister".

7 Paragraph 165A(2)(b)

Omit "Industry Minister", substitute "Resources Minister".

8 Subsection 165A(3)

Omit "Industry Minister", substitute "Resources Minister".

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 55

9 Subsection 165A(4)

Omit "Industry Minister", substitute "Resources Minister".

10 Subsection 165A(11)

Omit "Minister for Finance", substitute "Finance Minister".

11 Subsection 165A(12)

Omit "Minister for Finance", substitute "Finance Minister".

Excise Tariff Act 1921

12 Subsection 3(1) (definition of intermediate area)

Omit "Minister for Industry, Science and Resources", substitute

"Resources Minister".

13 Subsection 3A(1)

Omit "Minister for Industry, Science and Resources", substitute

"Resources Minister".

Fringe Benefits Tax (Application to the Commonwealth) Act

1986

14 Subsection 3(1)

Insert:

Finance Department means the Department that:

(a) deals with matters arising under section 1 of the Financial

Management and Accountability Act 1997; and

(b) is administered by the Finance Minister.

15 Subsection 3(1)

Insert:

Finance Minister has the meaning given by the Income Tax

Assessment Act 1997.

16 Subsection 3(1) (at the end of paragraph (a) of the

definition of responsible Department)

Add "and".

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

56 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

17 Subsection 3(1) (paragraph (c) of the definition of

responsible Department)

Omit "Department of the Special Minister of State", substitute "Finance

Department".

18 Subsection 7(1)

Omit "Minister for Finance", substitute "Finance Minister".

Note:

The heading to section 7 is altered by omitting "Minister for Finance" and substituting

"Finance Minister".

Fringe Benefits Tax Assessment Act 1986

19 Paragraph 47(8)(b)

Omit "Department of Health, Housing, Local Government and

Community Services", substitute "Families Department".

20 Subsection 136(1)

Insert:

Families Department has the meaning given by the Income Tax

Assessment Act 1997.

Income Tax Assessment Act 1936

21 Subsection 6(1)

Insert:

Agriculture Secretary has the meaning given by the Income Tax

Assessment Act 1997.

22 Subsection 6(1)

Insert:

Arts Department has the meaning given by the Income Tax

Assessment Act 1997.

23 Subsection 6(1)

Insert:

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 57

Arts Minister has the meaning given by the Income Tax

Assessment Act 1997.

24 Subsection 6(1)

Insert:

Arts Secretary has the meaning given by the Income Tax

Assessment Act 1997.

25 Subsection 6(1)

Insert:

Defence Department means the Department that:

(a) deals with matters arising under section 1 of the Defence Act

1903; and

(b) is administered by the Defence Minister.

26 Subsection 6(1)

Insert:

Defence Minister has the meaning given by the Income Tax

Assessment Act 1997.

27 Subsection 6(1)

Insert:

Defence Secretary means the Secretary of the Defence

Department.

28 Subsection 6(1)

Insert:

Education Department has the meaning given by the Income Tax

Assessment Act 1997.

29 Subsection 6(1)

Insert:

Education Secretary means the Secretary of the Education

Department.

30 Subsection 6(1)

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

58 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Insert:

Employment Department means the Department that:

(a) deals with matters arising under section 1 of the Fair Work

Act 2009; and

(b) is administered by the Employment Minister.

31 Subsection 6(1)

Insert:

Employment Minister means the Minister administering section 1

of the Fair Work Act 2009.

32 Subsection 6(1)

Insert:

Employment Secretary means the Secretary of the Employment

Department.

33 Subsection 6(1)

Insert:

Families Secretary has the meaning given by the Income Tax

Assessment Act 1997.

34 Subsection 6(1)

Insert:

Health Department means the Department that:

(a) deals with matters arising under section 1 of the National

Health Act 1953; and

(b) is administered by the Health Minister.

35 Subsection 6(1)

Insert:

Health Minister means the Minister administering section 1 of the

National Health Act 1953.

36 Subsection 6(1)

Insert:

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 59

Health Secretary means the Secretary of the Health Department.

37 Subsection 6(1)

Insert:

Housing Secretary has the meaning given by the Income Tax

Assessment Act 1997.

38 Subsection 6(1)

Insert:

Immigration Department means the Department that:

(a) deals with matters arising under section 1 of the Migration

Act 1958; and

(b) is administered by the Immigration Minister.

39 Subsection 6(1)

Insert:

Immigration Minister means the Minister administering section 1

of the Migration Act 1958.

40 Subsection 6(1)

Insert:

Immigration Secretary means the Secretary of the Immigration

Department.

41 Subsection 6(1)

Insert:

Research Department means the Department that:

(a) deals with matters arising under section 1 of the Australian

Research Council Act 2001; and

(b) is administered by the Research Minister.

42 Subsection 6(1)

Insert:

Research Minister means the Minister administering section 1 of

the Australian Research Council Act 2001.

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

60 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

43 Subsection 6(1)

Insert:

Research Secretary means the Secretary of the Research

Department.

44 Subsection 6(1)

Insert:

social security law has the meaning given by the Social Security

Act 1991.

45 Subsection 6(1)

Insert:

Trade Department means the Department that:

(a) deals with matters arising under section 1 of the Export

Market Development Grants Act 1997; and

(b) is administered by the Trade Minister.

46 Subsection 6(1)

Insert:

Trade Minister means the Minister administering section 1 of the

Export Market Development Grants Act 1997.

47 Subsection 6(1)

Insert:

Trade Secretary means the Secretary of the Trade Department.

48 Subsection 6(1)

Insert:

Veterans' Affairs Department means the Department that:

(a) deals with matters arising under section 1 of the Veterans'

Entitlements Act 1986; and

(b) is administered by the Veterans' Affairs Minister.

49 Subsection 6(1)

Insert:

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 61

Veterans' Affairs Minister means the Minister administering

section 1 of the Veterans' Entitlements Act 1986.

50 Subsection 6(1)

Insert:

Veterans' Affairs Secretary means the Secretary of the Veterans'

Affairs Department.

51 At the end of paragraphs 16(4)(a), (b), (c) and (d)

Add "or".

52 Paragraph 16(4)(e)

Repeal the paragraph, substitute:

(e) the Employment Secretary, or the Families Secretary, for the

purpose of the administration of the social security law; or

53 Paragraph 16(4)(ea)

Omit "Secretary to the Department of Employment, Education and

Training", substitute "Employment Secretary".

54 At the end of paragraph 16(4)(ea)

Add "or".

55 Paragraph 16(4)(eb)

Omit "(within the meaning of the Social Security Act 1991);", substitute

"; or".

56 Paragraph 16(4)(f)

Omit "Secretary to the Department of Health", substitute "Health

Secretary".

57 Paragraph 16(4)(f)

Omit "Minister of State for Health", substitute "Health Minister".

58 At the end of paragraphs 16(4)(f), (fa) and (fb)

Add "or".

59 Paragraph 16(4)(fc)

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

62 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Omit "Secretary to the Department of Family and Community

Services", substitute "Families Secretary".

60 At the end of paragraphs 16(4)(fc), (fd), (g), (gaa), (ga) and

(gb)

Add "or".

61 Paragraph 16(4)(h)

Omit "Secretary, Department of Defence,", substitute "Defence

Secretary".

62 At the end of paragraphs 16(4)(h) and (ha)

Add "or".

63 Paragraph 16(4)(hb)

Omit "Secretary to the Department of Education and the Secretary to

the Department of Social Security", substitute "Education Secretary or

the Secretary of the Department of Human Services,".

64 At the end of paragraphs 16(4)(hb), (hba), (hc), (hca),

(hcaa) and (hcb)

Add "or".

65 Paragraph 16(4)(hd)

Omit "Secretary to the Department of Immigration and Ethnic Affairs",

substitute "Immigration Secretary".

66 At the end of paragraph 16(4)(hd)

Add "or".

67 Paragraph 16(4)(j)

Omit "Secretary to the Department of Housing and Construction",

substitute "Housing Secretary or the Secretary of the Department of the

Treasury".

68 At the end of paragraphs 16(4)(j) and (ja)

Add "or".

69 Subsection 16(5B)

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 63

Omit "Secretary to the Department of Trade", substitute "Trade

Secretary".

70 Subsection 16(5C)

Omit "Secretary to the Department of Trade", substitute "Trade

Secretary".

71 Subsections 23AF(11) to (14)

Omit "Minister for Trade", substitute "Trade Minister".

72 Subsection 23AF(18) (at the end of paragraphs (a) to (d) of

the definition of eligible project)

Add "or".

73 Subsection 23AF(18) (paragraph (f) of the definition of

eligible project)

Omit "Minister for Trade", substitute "Trade Minister".

74 Subsection 73A(6) (definition of Research Secretary)

Repeal the definition.

75 Subsection 124K(1) (definition of Australian film)

Omit "Minister", substitute "Arts Minister".

76 Subsection 124K(1) (definition of Minister)

Repeal the definition.

77 Subsections 124K(1A) and (1B)

Omit "Minister", substitute "Arts Minister".

78 Subsection 124K(1B)

Omit "Secretary to the Minister's Department", substitute "Arts

Secretary".

79 Subsection 124K(1B)

Omit "Minister's Department" (second occurring), substitute "Arts

Department".

80 Subsection 124K(1D)

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

64 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Omit "Minister", substitute "Arts Minister".

81 Subsection 124ZAA(1) (definition of Minister)

Repeal the definition.

82 Subsection 124ZAA(11)

Omit "Minister" (first occurring), substitute "Arts Minister".

83 Subsection 124ZAB(1)

Omit "Minister", substitute "Arts Minister".

84 At the end of paragraph 124ZAB(2)(a)

Add "and".

85 Paragraph 124ZAB(2)(c)

Omit "Minister", substitute "Arts Minister".

86 Subsections 124ZAB(3) to (4)

Omit "Minister" (first occurring), substitute "Arts Minister".

87 Subsection 124ZAB(5)

Omit "Minister", substitute "Arts Minister".

88 Paragraph 124ZAB(6)(a)

Omit "Minister", substitute "Arts Minister".

89 Subsections 124ZAB(6A) and (7)

Omit "Minister" (first occurring), substitute "Arts Minister".

90 Subsection 124ZAC(1)

Omit "Minister", substitute "Arts Minister".

91 At the end of paragraph 124ZAC(2)(a)

Add "and".

92 Paragraph 124ZAC(2)(c)

Omit "Minister", substitute "Arts Minister".

93 Subsections 124ZAC(3) and (5)

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 65

Omit "Minister" (first occurring), substitute "Arts Minister".

94 Section 124ZAD

Omit "Minister" (first occurring), substitute "Arts Minister".

95 At the end of paragraphs 124ZAD(a) and (b)

Add "and".

96 At the end of subparagraph 124ZAD(c)(i)

Add "and".

97 At the end of paragraphs 124ZAD(c) and (d)

Add "and".

98 Subsection 124ZADAA(1)

Omit "(1) The Minister", substitute "The Arts Minister".

Note:

The heading to section 124ZADAA is altered by omitting "Minister" and substituting

"Arts Minister".

99 Subsection 124ZADAA(1)

Omit "Secretary to the Minister's Department", substitute "Arts

Secretary".

100 Subsection 124ZADAA(1)

Omit "Minister's Department" (second occurring), substitute "Arts

Department".

101 Subsections 124ZADAB(1) and (2)

Omit "Minister", substitute "Arts Minister".

Note:

The heading to section 124ZADAB is altered by omitting "Minister" and substituting

"Arts Minister".

102 Subsection 159J(6) (paragraph (c) of the definition of

invalid relative)

Omit "Department of Health", substitute "Health Department".

103 Subsection 159J(6) (paragraph (c) of the definition of

invalid relative)

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

66 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Omit "Secretary to the Department of Social Security", substitute

"Families Secretary".

104 Subsection 202CB(6)

Omit "Secretary to the Department of Social Security", substitute

"Education Secretary, to the Employment Secretary".

105 Subsection 202CB(7)

Omit "Secretary to the Department of Veterans' Affairs", substitute

"Veterans' Affairs Secretary".

106 Subsection 202CE(7)

Omit "Secretary to the Department of Social Security", substitute

"Employment Secretary".

107 Subsection 202CE(8)

Omit "Secretary to the Department of Veterans' Affairs", substitute

"Veterans' Affairs Secretary".

108 Paragraph 251R(5)(d)

Omit "Secretary of the Department whose Minister administers that

Act", substitute "Families Secretary".

109 At the end of paragraphs 251U(1)(a), (b), (c), (ca), (caa),

(cb), (cc) and (d)

Add "or".

110 At the end of subparagraph 251U(1)(e)(i)

Add "or".

111 Paragraph 251U(1)(f)

Omit "Minister for Health", substitute "Health Minister".

112 Subsection 264AA(1)

Omit "Secretary to the Department of Primary Industries and Energy",

substitute "Agriculture Secretary".

Note:

The heading to section 264AA is altered by omitting "Department of Primary

Industries and Energy" and substituting "Agriculture Secretary".

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 67

Income Tax Assessment Act 1997

113 Section 25-7 (note)

Omit "Secretary to the Department of Family and Community

Services", substitute "Families Secretary".

114 Subsection 30-25(1) (table item 2.1.7)

Omit "Minister for Employment, Education, Training and Youth

Affairs", substitute "

Education Minister".

115 Paragraph 30-30(1)(c)

Omit "Minister for Employment, Education, Training and Youth

Affairs", substitute "

Education Minister".

116 Paragraph 30-30(1)(d)

Omit "Minister", substitute "Education Minister".

117 Section 30-75

Before "Minister", insert "

Families".

118 Subsection 30-80(1) (table item 9.1.2)

Omit "Minister for Foreign Affairs", substitute "

Foreign Affairs

Minister".

119 Paragraph 30-85(2)(a)

Omit "Minister for Foreign Affairs", substitute "

Foreign Affairs

Minister".

120 Paragraph 30-85(2)(b)

Omit "Minister for Foreign Affairs", substitute "Foreign Affairs

Minister".

121 Subsection 30-85(5)

Omit "Minister for Foreign Affairs", substitute "

Foreign Affairs

Minister".

122 Subsection 30-210(1)

Omit "Secretary to the Department of Communications and the Arts",

substitute "

Arts Secretary".

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

68 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

123 Subsections 30-230(5) and 30-235(1)

Omit "Minister for Communications and the Arts", substitute "

Arts

Minister".

124 Section 30-240

Omit "Minister for Communications and the Arts", substitute "

Arts

Minister".

125 Section 30-287

Omit "Secretary of the Department of Family and Community

Services", substitute "

Families Secretary".

126 Subsection 30-289(4)

Omit "Minister for Family and Community Services", substitute

Families Minister".

127 Subsections 30-289A(3) and 30-289B(1)

Omit "Secretary of the Department of Family and Community

Services", substitute "

Families Secretary".

128 Subsections 30-289B(1) and (4) and 30-289C(1)

Omit "Minister for Family and Community Services", substitute

Families Minister".

129 Subsection 30-289C(1)

Omit "Secretary of the Department of Family and Community

Services", substitute "

Families Secretary".

130 Section 30-295

Omit "Secretary to the Department of Communications and the Arts",

substitute "

Arts Secretary".

131 Subsection 30-300(6)

Omit "Minister for Communications and the Arts", substitute "

Arts

Minister".

132 Subsection 30-300(7)

Omit "Secretary to the Department of Communications and the Arts",

substitute "

Arts Secretary".

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 69

133 Subsection 30-305(1)

Omit "Secretary to the Department of Communications and Arts",

substitute "

Arts Secretary".

134 Subsections 30-305(1) and (4) and 30-310(1)

Omit "Minister for Communications and the Arts", substitute "

Arts

Minister".

135 Subsection 30-310(1)

Omit "Secretary to the Department of Communications and the Arts",

substitute "

Arts Secretary".

136 Subsection 34-25(1)

Omit "Secretary to the Department of Industry, Science and Tourism

(the Industry Secretary)", substitute "

Industry Secretary".

137 Section 34-65

Omit "Department of Industry, Science and Tourism", substitute

Industry Department".

138 Subsection 40-180(2) (table item 10)

Omit "Minister for Finance", substitute "

Finance Minister".

139 Subsection 40-300(2) (table item 11)

Omit "Minister for Finance", substitute "

Finance Minister".

140 Paragraph 40-670(1)(a)

Omit "Secretary of the Department of Agriculture, Fisheries and

Forestry", substitute "

Agriculture Secretary".

141 Paragraph 40-670(1)(b)

Omit "that Department", substitute "the

Agriculture Department".

142 Paragraph 40-670(1)(b)

Omit "that Secretary", substitute "the Agriculture Secretary".

143 Paragraph 51-32(3)(b)

Omit "Minister administering section 1 of the Defence Act 1903",

substitute "

Defence Minister".

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

70 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

144 Subsection 51-32(3)

Omit "that Act", substitute "the Defence Act 1903".

145 Subsection 52-131(9) (note)

Repeal the note, substitute:

Note:

In 2009, the ABSTUDY Policy Manual was accessible through the

website of the Education Department.

146 Subsection 61-630(3)

Omit "Minister administering the Student Assistance Act 1973 (the

Education Minister)", substitute "

Education Minister".

147 Subsection 61-630(5)

Omit "Education Minister", substitute "

Education Minister".

148 Paragraph 375-865(2)(b)

Omit "Arts Minister", substitute "

Arts Minister".

149 Paragraphs 376-10(1)(b) and (c), 376-230(1)(a) and (b) and

376-240(3)(d)

Omit "

Arts Minister", substitute "Arts Minister".

150 Section 396-5

Omit "Minister for Transport and Regional Development", substitute

"Transport Minister".

151 Section 396-40

Omit "Minister for Transport and Regional Development", substitute

Transport Minister".

152 Subsections 396-65(1) and (2)

Omit "Minister for Transport and Regional Development", substitute

Transport Minister".

153 Section 396-70 (heading)

Repeal the heading, substitute:

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 71

396-70 Transport Minister to consider applications

154 Subsections 396-70(1), (5) and (6)

Omit "Minister for Transport and Regional Development", substitute

Transport Minister".

155 Subsection 396-70(7)

Omit "Minister for Transport and Regional Development" (first

occurring), substitute "

Transport Minister".

156 Subsection 396-70(7)

Omit "for Transport and Regional Development" (second occurring).

157 Subsection 396-75(1)

Omit "Minister for Transport and Regional Development" (first

occurring), substitute "

Transport Minister".

158 Paragraph 396-75(1)(g)

Omit "for Transport and Regional Development".

159 Subsection 396-75(2)

Omit "Minister for Transport and Regiona l Development", substitute

Transport Minister".

160 Subsection 396-80(1)

Omit "Minister for Transport and Regional Development" (first

occurring), substitute "

Transport Minister".

161 Subsection 396-80(1)

Omit "for Transport and Regional Development" (second occurring).

162 Subsection 396-80(4)

Omit "Minister for Transport and Regional Development", substitute

Transport Minister".

163 Paragraph 396-80(5)(b)

Omit "Minister for Transport and Regional Development", substitute

Transport Minister".

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

72 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

164 Subsection 396-80(5)

Omit "for Transport and Regional Development" (last occurring).

165 Subsection 396-90(2)

Omit "Minister for Transport and Regional Development", substitute

Transport Minister".

166 Section 396-100

Omit "Minister for Transport and Regional Development", substitute

Transport Minister".

167 Section 396-105 (heading)

Repeal the heading, substitute:

396-105 Delegation by Transport Minister

168 Section 396-105

Omit "Minister for Transport and Regional Development", substitute

Transport Minister".

169 Section 396-105

Omit "Secretary to that Minister's Department", substitute "

Transport

Secretary".

170 Section 396-105

Omit "that Minister's Department" (second occurring), substitute "the

Transport Department".

171 Section 396-110 (heading)

Repeal the heading, substitute:

396-110 Decision by Transport Minister not revie wable by AAT

172 Section 396-110

Omit "Minister for Transport and Regional Development", substitute

Transport Minister".

173 Subsection 995-1(1)

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 73

Insert:

Agriculture Department means the Department that:

(a) deals with matters arising under section 1 of the Farm

Household Support Act 1992; and

(b) is administered by the

Agriculture Minister.

174 Subsection 995-1(1)

Insert:

Agriculture Minister means the Minister administering section 1

of the Farm Household Support Act 1992.

175 Subsection 995-1(1)

Insert:

Agriculture Secretary means the Secretary of the

Agriculture

Department.

176 Subsection 995-1(1)

Insert:

Arts Department means the Department that:

(a) deals with matters arising under section 1 of the National

Gallery Act 1975; and

(b) is administered by the

Arts Minister.

177 Subsection 995-1(1) (definition of Arts Minister)

Repeal the definition, substitute:

Arts Minister means the Minister administering section 1 of the

National Gallery Act 1975.

178 Subsection 995-1(1) (definition of Arts Secretary)

Repeal the definition, substitute:

Arts Secretary means the Secretary of the

Arts Department.

179 Subsection 995-1(1)

Insert:

Climate Change Department means the Department that:

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

74 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

(a) deals with matters arising under section 1 of the National

Greenhouse and Energy Reporting Act 2007; and

(b) is administered by the

Climate Change Minister.

180 Subsection 995-1(1) (definition of Climate Change

Minister)

After "administering", insert "section 1 of".

181 Subsection 995-1(1) (definition of Climate Change

Secretary)

Repeal the definition, substitute:

Climate Change Secretary means the Secretary of the

Climate

Change Department.

182 Subsection 995-1(1) (definition of Defence Minister)

After "administering", insert "section 1 of".

183 Subsection 995-1(1)

Insert:

Education Department means the Department that:

(a) deals with matters arising under section 1 of the Student

Assistance Act 1973; and

(b) is administered by the

Education Minister.

184 Subsection 995-1(1)

Insert:

Education Minister means the Minister administering section 1 of

the Student Assistance Act 1973.

185 Subsection 995-1(1)

Insert:

Environment Department means the Department that:

(a) deals with matters arising under section 1 of the Environment

Protection and Biodiversity Conservation Act 1999; and

(b) is administered by the

Environment Minister.

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 75

186 Subsection 995-1(1) (definition of Environment Minister)

After "administering", insert "section 1 of".

187 Subsection 995-1(1) (definition of Environment

Secretary)

Repeal the definition, substitute:

Environment Secretary means the Secretary of the

Environment

Department.

188 Subsection 995-1(1)

Insert:

Families Department means the Department that:

(a) deals with matters arising under section 1 of the A New Tax

System (Family Assistance) (Administration) Act 1999; and

(b) is administered by the

Families Minister.

189 Subsection 995-1(1)

Insert:

Families Minister means the Minister administering section 1 of

the A New Tax System (Family Assistance) (Administration) Act

1999.

190 Subsection 995-1(1)

Insert:

Families Secretary means the Secretary of the

Families

Department.

191 Subsection 995-1(1)

Insert:

Finance Minister means the Minister administering section 1 of

the Financial Management and Accountability Act 1997.

192 Subsection 995-1(1)

Insert:

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

76 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Foreign Affairs Minister means the Minister administering

section 1 of the International Development Association Act 1960.

193 Subsection 995-1(1)

Insert:

Heritage Department means the Department that:

(a) deals with matters arising under section 1 of the Australian

Heritage Council Act 2003; and

(b) is administered by the

Heritage Minister.

194 Subsection 995-1(1)

Insert:

Heritage Minister means the Minister administering section 1 of

the Australian Heritage Council Act 2003.

195 Subsection 995-1(1) (definition of Heritage Secretary)

Repeal the definition, substitute:

Heritage Secretary means the Secretary of the

Heritage

Department.

196 Subsection 995-1(1)

Insert:

Housing Department means the Department that:

(a) deals with matters arising under section 1 of the National

Rental Affordability Scheme Act 2008; and

(b) is administered by the

Housing Minister.

197 Subsection 995-1(1)

Insert:

Housing Minister means the Minister administering section 1 of

the National Rental Affordability Scheme Act 2008.

198 Subsection 995-1(1) (definition of Housing Secretary)

Repeal the definition, substitute:

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 77

Housing Secretary means the Secretary of the

Housing

Department.

199 Subsection 995-1(1)

Insert:

Industry Department means the Department that:

(a) deals with matters arising under section 1 of the Industry

Research and Development Act 1986; and

(b) is administered by the

Industry Minister.

200 Subsection 995-1(1)

Insert:

Industry Minister means the Minister administering section 1 of

the Industry Research and Development Act 1986.

201 Subsection 995-1(1) (definition of Industry Secretary)

Repeal the definition, substitute:

Industry Secretary means the Secretary of the

Industry

Department.

202 Subsection 995-1(1)

Insert:

Transport Department means the Department that:

(a) deals with matters arising under section 1 of the AusLink

(National Land Transport) Act 2005; and

(b) is administered by the

Transport Minister.

203 Subsection 995-1(1)

Insert:

Transport Minister means the Minister administering section 1 of

the AusLink (National Land Transport) Act 2005.

204 Subsection 995-1(1)

Insert:

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

78 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Transport Secretary means the Secretary of the

Transport

Department.

Income Tax (Transitional Provisions) Act 1997

205 Section 30-10

Before "Minister" (second occurring), insert "Arts".

206 Subsection 30-15(1)

Before "Minister" (second occurring), insert "Arts".

207 Subsection 30-15(1) (note)

Before "Minister", insert "Arts".

208 Section 30-20

Before "Minister" (second occurring), insert "Arts".

Petroleum Resource Rent Tax Assessment Act 1987

209 Section 2 (definition of certifying Minister)

Repeal the definition.

210 Section 2

Insert:

Resources Department means the Department that:

(a) deals with matters arising under section 1 of the Offshore

Petroleum and Greenhouse Gas Storage Act 2006; and

(b) is administered by the Resources Minister.

211 Section 2

Insert:

Resources Minister means the Minister administering section 1 of

the Offshore Petroleum and Greenhouse Gas Storage Act 2006.

212 Subsection 18(2)

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 79

Omit "certifying Minister or an officer of the Department of Primary

Industries and Energy authorised by the certifying", substitute

"Resources Minister or an officer of the Resources Department

authorised by the".

213 Subsection 18(3)

Omit "certifying Minister", substitute "Resources Minister".

214 Subsection 20(1)

Omit "certifying Minister" (first occurring), substitute "Resources

Minister".

215 At the end of paragraph 20(1)(a)

Add "and".

216 Subsection 20(1)

Omit "certifying Minister shall", substitute "Minister must".

217 Paragraph 20(2)(b)

Omit "certifying Minister" (first occurring), substitute "Resources

Minister".

218 Paragraph 20(2)(b)

Omit "certifying" (second and third occurring).

219 Subsection 20(7)

Omit "certifying Minister" (first occurring), substitute "Resources

Minister".

220 Subsection 20(7)

Omit "certifying Minister shall", substitute "Minister must".

221 Subsection 20(8)

Omit "certifying Minister" (first occurring), substitute "Resources

Minister".

222 Subsection 20(8)

Omit "certifying" (second and third occurring).

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

80 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

223 Subsections 20(8) and (9)

Omit "certifying Minister shall", substitute "Minister must".

224 Paragraph 20(12)(a)

Omit "certifying Minister", substitute "Resources Minister".

225 At the end of paragraph 20(12)(a)

Add "or".

226 Paragraphs 20(12)(b) and (c)

Omit "certifying".

227 Subsection 36B(1)

Omit "Minister administering the Offshore Petroleum and Greenhouse

Gas Storage Act 2006", substitute "Resources Minister".

228 Subsections 36B(2), (3) and (5)

Omit "Minister", substitute "Resources Minister".

229 Subsection 36B(5)

Omit "Minister's Department", substitute "Resources Department".

230 Subsection 108(5)

Omit "certifying Minister", substitute "Resources Minister".

Superannuation Contributions Tax (Application to the

Commonwealth) Act 1997

231 At the end of section 3

Add:

(3) In this Act:

Finance Minister has the meaning given by the Income Tax

Assessment Act 1997.

232 Subsection 6(1)

Omit "Minister for Finance", substitute "Finance Minister".

Minor amend ments Schedule 5

References to Ministers, Departments and Secretaries Part 1

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 81

Note:

The heading to section 6 is altered by omitting "Minister for Finance" and substituting

"Finance Minister".

Taxation Administration Act 1953

233 Subsection 2(1)

Insert:

Immigration Secretary has the meaning given by the Income Tax

Assessment Act 1936.

234 Subsection 14Q(1) (definition of Immigration Department)

Repeal the definition.

235 Subparagraph 14S(4)(b)(i)

Omit "Secretary to the Immigration Department", substitute

"Immigration Secretary".

236 Subsection 14S(5)

Omit "Secretary to the Immigration Department", substitute

"Immigration Secretary".

Division 2

Other amendments

Income Tax Assessment Act 1997

237 Subsection 995-1(1) (paragraph (a) of the definition of

Transport Department)

Omit "AusLink (National Land Transport) Act 2005", substitute

"Nation Building Program (National Land Transport) Act 2009".

238 Subsection 995-1(1) (definition of Transport Minister)

Omit "AusLink (National Land Transport) Act 2005", substitute

"Nation Building Program (National Land Transport) Act 2009".

Taxation Administration Act 1953

239 Subsection 2(1)

Insert:

Schedule 5 Minor amendments

Part 1 References to Ministers, Departments and Secretaries

82 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Immigration Department has the meaning given by the Income

Tax Assessment Act 1936.

240 Subsection 2(1)

Insert:

Immigration Minister has the meaning given by the Income Tax

Assessment Act 1936.

241 Subsection 2(1)

Insert:

migration officer means:

(a) the Immigration Secretary; or

(b) an employee of the Immigration Department.

242 Subparagraphs 3ED(1)(b)(i) and (ii) and (3)(a)(i) and (ii)

and (b)(i)

Omit "Minister's", substitute "Immigration Minister's".

243 Section 3ED(5) (definition of migration officer)

Repeal the definition.

Minor amend ments Schedule 5

Repeal of Part IV of the Taxation Ad min istration Act 1953 Part 2

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 83

Part 2

Repeal of Part IV of the Taxation

Administration Act 1953

Administrative Decisions (Judicial Review) Act 1977

244 Paragraph (g) of Schedule 1

Repeal the paragraph.

Banking Act 1959

245 Section 39B

Repeal the section.

Taxation Administration Act 1953

246 Subsection 3(1)

Omit "(1) Subject to subsection (2), this", substitute "This".

247 Subsection 3(2)

Repeal the subsection.

248 Paragraph 3B(1AA)(a)

Repeal the paragraph, substitute:

(a) include information concerning any breaches, of which the

Commissioner has notice, of undertakings given for the

purposes of subsection 14C(2); and

249 Subsection 3B(4) (definition of this Act)

Omit "except insofar as it relates to Part IV".

250 Subsection 3C(9) (definition of this Act)

Omit "except insofar as it relates to Part IV".

251 Paragraph 8J(2)(p)

Omit "or 14I(1)(c)".

252 Part IV

Repeal the Part.

Schedule 5 Minor amendments

Part 2 Repeal of Part IV of the Taxation Administration Act 1953

84 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

253 Section 14ZQ (definition of appealable objection

decision)

Repeal the definition.

254 Paragraph 14ZR(1)(a)

Omit ", but not including section 14E of this Act".

255 Paragraphs 14ZZ(a) to (c)

Repeal the paragraphs, substitute:

(a) if the decision is a reviewable objection decision--either:

(i) apply to the Tribunal for review of the decision; or

(ii) appeal to the Federal Court against the decision; or

(b) otherwise--appeal to the Federal Court against the decision.

256 Sections 14ZZN, 14ZZO and 14ZZP

Omit "appealable".

Note 1: The heading to section 14ZZP is altered by omitting "appealable".

Note 2: The heading to section 14ZZQ is altered by omitting "appealable".

257 Paragraphs 14ZZS(1)(a) and (b)

Omit "appealable".

Minor amend ments Schedule 5

Amend ments relating to foreign income ta x offsets and foreign losses Part 3

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 85

Part 3

Amendments relating to foreign income tax

offsets and foreign losses

Income Tax Assessment Act 1997

258 Subsection 770-135(1)

After "entity", insert "(other than a

CFC or a

FIF)".

Income Tax (Transitional Provisions) Act 1997

259 Subsection 770-1(1)

Omit "The Income Tax Assessment Act 1936", substitute "Subject to

subsection (4), the Income Tax Assessment Act 1936".

260 At the end of section 770-1

Add:

(4) A reference in section 90 of the 1936 Act to deductions allowable

under Division 36 of the 1997 Act does not include a reference to

deductions in respect of the foreign loss component of the tax loss.

Note:

For foreign loss component, see section 770-25.

261 Paragraphs 770-5(1)(a) and (b)

Repeal the paragraphs, substitute:

(a) the entity has incurred an overall foreign loss in respect of a

class of assessable foreign income (within the meaning of

former section 160AFD of the 1936 Act) for the earlier

income year; and

(b) a positive amount (an unutilised overall foreign loss

amount) remains after reducing the overall foreign loss to the

extent that it has been taken into account under that former

section in reducing the entity's assessable foreign income of

the relevant class for an income year before the

commencement year; and

amount) remains after reducing the unutilised overall foreign

loss amount under section 770-10.

262 Subsection 770-5(3)

Schedule 5 Minor amendments

Part 3 A mend ments relating to foreign income tax offsets and foreign losses

86 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Omit all the words after "sum of the", substitute "reduced unutilised

overall foreign loss amounts for all classes of assessable foreign income

for the earlier year".

263 Section 770-10 (heading)

Repeal the heading, substitute:

770-10 Reducing an unutilised overall foreign loss amount

264 Section 770-10

Omit "overall foreign loss", substitute "unutilised overall foreign loss

amount".

265 Section 770-10 (method statement, step 1)

Omit "amount applicable under paragraph 770-5(1)(a) to the extent (if

any) that the loss", substitute "unutilised overall foreign loss amount to

the extent (if any) that the relevant overall foreign loss".

266 Section 770-10 (method statement, at the end of step 1)

Add:

Otherwise--do not reduce the unutilised overall foreign

loss amount under this step.

267 Section 770-10 (method statement, note to step 1)

Repeal the note.

268 Subsection 770-30(1)

Omit "any", substitute "an".

269 At the end of section 770-30

Add:

(3) To avoid doubt, if, because of subsection (1) or section 770-100, an

entity cannot deduct all or part of a tax loss in an income year,

subsection 36-17(7) of the 1997 Act does not prevent the entity

deducting other tax losses in the same year in accordance with that

subsection.

Minor amend ments Schedule 5

Amend ments relating to foreign income tax offsets and foreign losses Part 3

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 87

270 Paragraph 770-95(b)

Omit "transfer; and", substitute "transfer.".

271 Paragraph 770-95(c)

Repeal the paragraph.

272 Section 770-95 (notes 1 and 2)

Repeal the notes, substitute:

Note:

This section ensures a tax loss retains its foreign loss component and

starting total even though the head company is taken, after the

transfer, to have made the loss for the income year in which the

transfer occurs.

273 Subsection 770-100(2)

Omit "(the deduction year)".

274 Subsection 770-100(3)

Omit "other entities", substitute "any entity".

275 Subsection 770-100(3)

Omit "end of the deduction year", substitute "latest time (the latest

transfer time) the loss was transferred to the head company".

276 At the end of section 770-100

Add:

(4) In applying paragraph (b) of item 2, 3 or 4 of the table in

subsection 770-30(1) of this Act, disregard any amount deducted,

in respect of a tax loss mentioned in subsection (1) of this section,

before the latest transfer time.

277 Paragraphs 770-165(1)(a) and (b)

Repeal the paragraphs, substitute:

(a) the eligible CFC has a loss under section 426 of the 1936 Act

for the earlier period in relation to notional assessable income

of a class; and

(b) a positive amount (an unutilised CFC loss amount) remains

after reducing the loss to the extent that it has been

previously taken into account under section 431 of the 1936

Schedule 5 Minor amendments

Part 3 A mend ments relating to foreign income tax offsets and foreign losses

88 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Act in respect of a statutory accounting period before the

commencement period; and

remains after reducing the unutilised CFC loss amount under

section 770-170.

278 Subsection 770-165(3)

Omit all the words after "sum of the", substitute "reduced unutilised

CFC loss amounts in relation to notional assessable income of all

classes for the earlier period".

279 Section 770-170 (heading)

Repeal the heading, substitute:

770-170 Reducing an unutilised CFC loss amount

280 Section 770-170

Omit "each loss", substitute "each unutilised CFC loss amount".

281 Section 770-170 (method statement, step 1)

Omit "amount applicable under paragraph 770-165(1)(a) to the extent

(if any) that the loss", substitute "unutilised CFC loss amount to the

extent (if any) that the relevant loss".

282 Application of Part

The amendments made by this Part apply in relation to income years,

statutory accounting periods and notional accounting periods starting on

or after 1 July 2008.

Minor amend ments Schedule 5

Other amend ments Part 4

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 89

Part 4

Other amendments

A New Tax System (Australian Business Number) Act 1999

283 Subsection 25(2) (note 1)

Omit "Income Tax Assessment Act 1997", substitute "ITAA 1997".

284 Section 41 (definition of electronic signature)

Omit "Income Tax Assessment Act 1997", substitute "

ITAA 1997".

285 Section 41 (definition of non-cash benefit)

Omit "Income Tax Assessment Act 1997", substitute "

ITAA 1997".

286 Section 41 (definition of withholding payment)

Omit "Income Tax Assessment Act 1997", substitute "

ITAA 1997".

287 Section 41 (definition of withholding payment covered by

a particular provision in Schedule 1 to the Taxation

Administration Act 1953)

Omit "Income Tax Assessment Act 1997", substitute "

ITAA 1997".

Fringe Benefits Tax Assessment Act 1986

288 At the end of subparagraphs 10(3)(a)(i), (ii), (iii) and (iv)

Add "and".

289 Sub-subparagraph 10(3)(a)(v)(B)

Omit "sales tax or".

290 At the end of subparagraph 10(3)(c)(i)

Add "and".

291 At the end of paragraph 10(3D)(a)

Add "or".

292 Paragraph 10(3D)(c)

Omit "sales tax or".

Schedule 5 Minor amendments

Part 4 Other amendments

90 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

293 Paragraph 42(1)(a)

Omit "where the recipients", substitute "if the recipient's".

294 Subparagraph 42(1)(a)(i)

Omit "retailers, an", substitute "retailers--an".

295 At the end of sub-subparagraph 42(1)(a)(i)(B)

Add "or".

296 Subparagraph 42(1)(a)(i)

Omit all the words after sub-subparagraph (B).

297 Subparagraph 42(1)(a)(ii)

Omit "where", substitute "if".

298 Sub-subparagraph 42(1)(a)(ii)(B)

Omit "recipients property", substitute "recipient's property".

299 Subparagraph 42(1)(a)(iii)

Omit "recipients property", substitute "recipient's property"

300 At the end of subparagraph 42(1)(a)(iii)

Add "or".

301 Paragraph 42(1)(b)

Repeal the paragraph, substitute:

(b) if paragraph (a) does not apply and the property was acquired

by the provider--an amount equal to the lesser of:

(i) the arm's length price in respect of the acquisition of the

recipient's property by the provider; or

(ii) the notional value of the recipient's property at the

provision time; or

302 Paragraph 42(1)(c)

Omit "recipients property", substitute "recipient's property"

303 Subsection 42(1)

Omit "recipients contribution", substitute "recipient's contribution".

Minor amend ments Schedule 5

Other amend ments Part 4

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 91

304 After subsection 148(2)

Insert:

(2A) Subsection (2) does not apply if the employee would be entitled to

a deduction under Division 30 (Gifts or contributions) of the

Income Tax Assessment Act 1997 if the employee, rather than the

provider, provided the benefit to the recipient.

305 Application of item 304

The amendment made by item 304 of this Schedule applies in relation

to:

(a) the FBT year starting on 1 April 2008; and

(b) later FBT years.

Income Tax Assessment Act 1936

306 Subsection 6(1) (at the end of the definition of full

self-assessment taxpayer)

Add:

; (g) the trustee of an FHSA trust in relation to the current year.

307 Application of item 306

The amendment made by item 306 of this Schedule applies in relation

to:

(a) the 2009-10 year of income; and

(b) later years of income.

308 Subsection 16(5BA)

Repeal the subsection.

309 Subsection 16(5C)

Omit ", the Secretary to the Department of Science".

310 Paragraph 16(5C)(a)

Omit "or (5BA)".

311 Subsection 82KZL(1) (at the end of paragraphs (a) and

(b) of the definition of excluded expenditure)

Schedule 5 Minor amendments

Part 4 Other amendments

92 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Add "or".

312 At the end of paragraph 82KZL(2)(a)

Add "and".

313 Paragraph 99H(1)(c)

Omit "subsection 12-400(4)", substitute "subsection 12-405(4)".

314 At the end of subsection 128W(1)

Add:

Note:

For provisions about collection and recovery of mining withholding

tax and other amounts, see Part 4-15 in Schedule 1 to the Taxation

Administration Act 1953.

315 Subsections 128W(2), (3) and (7)

Repeal the subsections.

316 Application of item 315

The amendment made by item 315 of this Schedule does not apply in

relation to any mining withholding tax that became due and payable

before 1 July 2000.

317 Paragraph 161AA(d)

Omit "fund that is an eligible superannuation fund (as defined in

section 267)", substitute "superannuation fund".

318 Application of item 317

The amendment made by item 317 of this Schedule applies in relation

to:

(a) the 2009-10 year of income; and

(b) later years of income.

Income Tax Assessment Act 1997

319 Subsection 30-25(1) (table item 2.1.7)

Omit "declared by a signed instrument to be a technical and further

education institution within the meaning of the Employment, Education

and Training Act 1988", substitute "determined to be a technical and

further education institution under the Student Assistance Act 1973".

Minor amend ments Schedule 5

Other amend ments Part 4

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 93

320 Subsection 30-86(4)

Omit "declaration", substitute "recognition".

321 Subsection 40-425(2)

Omit ", except a

horticultural plant", substitute "(except a

horticultural plant)".

322 Paragraphs 54-10(1)(e) and (1A)(e)

Omit "State insurers", substitute "

State insurers".

323 Subsection 54-10(2)

Repeal the subsection.

324 Subsection 124-10(3) (note 2)

After "Subdivision 124-B (about compulsory acquisition, loss or

destruction),", insert "Subdivision 124-C (about statutory licences),".

325 Subsection 124-140(1) (note)

After "Note", insert "1".

326 At the end of subsection 124-140(1)

Add:

Note 2:

Subdivision 124-C of the Income Tax (Transitional Provisions) Act

1997 modifies this roll-over for certain water-related licences.

327 Subparagraphs 130-90(3)(a)(i) and (ii)

Repeal the subparagraphs, substitute:

(i) in any case--under an

employee share scheme; or

(ii) in the case of a share--as a result of exercising a right

acquired under an employee share scheme; or

(iii) in the case of a share--in satisfaction of a beneficial

interest that was the result of exercising a right acquired

under an employee share scheme;

328 Paragraph 130-90(3)(c)

After "exercising a right,", insert "or in satisfaction of a beneficial

interest that was the result of exercising a right--".

329 Subsection 149-30(1) (second sentence)

Schedule 5 Minor amendments

Part 4 Other amendments

94 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Repeal the sentence.

330 After subsection 149-30(1)

Insert:

(1A) Also, Part 3-1 and this Part (except this Division) apply to the asset

as if the entity had acquired it at that earliest time.

331 Subsection 149-30(2)

Omit "subsection (1) applies", substitute "subsections (1) and (1A)

apply".

332 After subsection 152-110(1)

Insert:

(1A) For the purposes of paragraphs (1)(b) and (c), disregard subsection

149-30(1A) (which applies if an asset stops being a pre-CGT

asset).

333 Paragraph 152-125(1)(a)

Omit "of the following applies", substitute "or more of the following

apply".

334 Subparagraph 152-125(1)(a)(iii)

Omit "and".

335 At the end of paragraph 152-125(1)(a)

Add:

(iv) subparagraph (i) of this paragraph would have applied

to an amount (the exempt amount) if subsection

149-30(1A) and section 149-35 had not applied to the

relevant asset; and

336 Application of items 332 to 335

The amendments made by items 332 to 335 of this Schedule apply in

relation to a payment made by a company or trust on or after the

commencement of this item.

337 Paragraph 855-20(a)

Minor amend ments Schedule 5

Other amend ments Part 4

Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009 95

After "Australia", insert "(including a lease of land, if the land is

situated in Australia)".

338 Application of item 337

(1)

The amendment made by item 337 of this Schedule applies in relation

to CGT events happening on or after 20 May 2009.

(2)

Furthermore, the amendment is to be disregarded for the purposes of

interpreting Subdivision 855-A of the Income Tax Assessment Act 1997

as in force before the commencement of this item.

339 Subsection 960-190(1) (table item 3)

Omit "

partnership", substitute "partnership".

340 Subsection 995-1(1) (paragraphs (a) and (b) of the

definition of legal personal representative)

Omit "a person", substitute "an individual".

341 Subsection 995-1(1)

Insert:

State insurer means a body that carries on State insurance (within

the meaning of paragraph 51(xiv) of the Constitution).

International Tax Agreements Act 1953

342 Subsections 16(4) and (5)

Repeal the subsections, substitute:

(4) A rebate, or the sum of the rebates, a taxpayer is entitled to under

subsection (2), in respect of income of a year of income, must not

exceed the amount of Australian tax payable in respect of the

taxpayer's taxable income of that year after all other rebates of, and

deductions from, that tax have been taken into account.

Tax Laws Amendment (2007 Measures No. 5) Act 2007

343 Item 14 of Schedule 7

After "Schedule", insert "(other than item 13)".

Schedule 5 Minor amendments

Part 5 Transitional provision

96 Tax Laws Amendment (2009 Measures No. 4) Bill 2009 No. , 2009

Part 5

Transitional provision

344 Transitional provision

technical and further education

institutions

(1)

An institution that, just before the commencement of item 319 of this

Schedule, was covered by item 2.1.7 of the table in subsection 30-25(1)

of the Income Tax Assessment Act 1997 is taken, for the purposes of that

item in that table, to have been determined by the Education Minister to

be a technical and further education institution under the Student

Assistance Act 1973 at that commencement.

(2)

To avoid doubt, subitem (1) does not prevent the Education Minister

from revoking that determination.

Commonwealth of Australia Bills

TAX LAWS AMENDMENT (2009 MEASURES NO. 4) BILL 2009