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This is a Bill, not an Act. For current law, see the Acts databases.
2022-2023
The Parliament of the
Commonwealth of Australia
HOUSE OF REPRESENTATIVES
Presented and read a first time
Treasury Laws Amendment (Support for
Small Business and Charities and Other
Measures) Bill 2023
No. , 2023
(Treasury)
A Bill for an Act to amend the law relating to
taxation, financial services and corporations, and
for related purposes
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
i
Contents
1
Short title ........................................................................................... 1
2
Commencement ................................................................................. 1
3
Schedules ........................................................................................... 3
Schedule 1
--
$20,000 instant asset write-off for small business
entities
4
Income Tax (Transitional Provisions) Act 1997
4
Schedule 2
--
Small business energy incentive
6
Income Tax (Transitional Provisions) Act 1997
6
Schedule 3
--
New class of deductible gift recipients
11
Part 1
--
Amendment of the Income Tax Assessment Act 1997
11
Income Tax Assessment Act 1997
11
Part 2
--
Amendment of the Taxation Administration Act 1953
15
Taxation Administration Act 1953
15
Part 3
--
Other amendments
26
A New Tax System (Australian Business Number) Act 1999
26
Schedule 4
--
Deductible gift recipients
--
specific listings
27
Income Tax Assessment Act 1997
27
Schedule 5
--
Exemption for Global Infrastructure Hub Ltd
28
Income Tax Assessment Act 1997
28
Schedule 6
--
Income tax amendments for updates to accounting
standards for general insurance contracts
29
Part 1
--
Main amendments
29
Income Tax Assessment Act 1997
29
Part 2
--
Other amendments
34
Income Tax Assessment Act 1997
34
Part 3
--
Application and transitional provisions
37
ii
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Schedule 7
--
Non-
arm's length expenses of superannuation
funds
42
Income Tax Assessment Act 1997
42
Schedule 8
--
AFCA scheme
46
Part 1
--
Main amendments
46
Corporations Act 2001
46
Part 2
--
Application provision
48
Corporations Act 2001
48
Part 3
--
Other amendments
49
Treasury Laws Amendment (2023 Law Improvement Package No. 1)
Act 2023
49
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
1
A Bill for an Act to amend the law relating to
1
taxation, financial services and corporations, and
2
for related purposes
3
The Parliament of Australia enacts:
4
1 Short title
5
This Act is the
Treasury Laws Amendment (Support for Small
6
Business and Charities and Other Measures) Act 2023
.
7
2 Commencement
8
(1) Each provision of this Act specified in column 1 of the table
9
commences, or is taken to have commenced, in accordance with
10
column 2 of the table. Any other statement in column 2 has effect
11
according to its terms.
12
2
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
1
Commencement information
Column 1
Column 2
Column 3
Provisions
Commencement
Date/Details
1. Sections 1 to 3
and anything in
this Act not
elsewhere covered
by this table
The day this Act receives the Royal Assent.
2. Schedules 1
and 2
The first 1 January, 1 April, 1 July or
1 October to occur after the day this Act
receives the Royal Assent.
3. Schedule 3
The day after this Act receives the Royal
Assent.
4. Schedules 4 to
7
The first 1 January, 1 April, 1 July or
1 October to occur after the day this Act
receives the Royal Assent.
5. Schedule 8,
item 1
The later of:
(a) the start of the day after this Act receives
the Royal Assent; and
(b) immediately after the commencement of
item 269 of Schedule 2 to the
Treasury
Laws Amendment (2023 Law
Improvement Package No. 1) Act 2023
.
However, the provisions do not commence
at all if the event mentioned in paragraph (b)
does not occur.
6. Schedule 8,
item 2
The day after this Act receives the Royal
Assent.
However, the provisions do not commence
at all if item 289 of Schedule 2 to the
Treasury Laws Amendment (2023 Law
Improvement Package No. 1) Act 2023
commences on or before that day.
7. Schedule 8,
items 3 to 11
The day after this Act receives the Royal
Assent.
8. Schedule 8,
Part 3
Immediately before the commencement of
Schedule 2 to the
Treasury Laws
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
3
Commencement information
Column 1
Column 2
Column 3
Provisions
Commencement
Date/Details
Amendment (2023 Law Improvement
Package No. 1) Act 2023
.
However, the provisions do not commence
at all if that event:
(a) does not occur; or
(b) occurs on or before the day this Act
receives the Royal Assent.
Note:
This table relates only to the provisions of this Act as originally
1
enacted. It will not be amended to deal with any later amendments of
2
this Act.
3
(2) Any information in column 3 of the table is not part of this Act.
4
Information may be inserted in this column, or information in it
5
may be edited, in any published version of this Act.
6
3 Schedules
7
Legislation that is specified in a Schedule to this Act is amended or
8
repealed as set out in the applicable items in the Schedule
9
concerned, and any other item in a Schedule to this Act has effect
10
according to its terms.
11
Schedule 1
$20,000 instant asset write-off for small business entities
4
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Schedule
1--$20,000 instant asset write
-
off for
1
small business entities
2
3
Income Tax (Transitional Provisions) Act 1997
4
1 Section 328-180 (heading)
5
Omit "
30 June 2023
", substitute "
30 June 2024
".
6
2 Subsection 328-180(1) (paragraph (b) of the definition of
7
increased access year
)
8
Omit "30
June 2023", substitute "30
June 2024".
9
3 Subsection 328-180(4) (heading)
10
Repeal the heading, substitute:
11
Temporary increase to asset cost threshold
12
4 At the end of subsection 328-180(4)
13
Add:
14
; or (d) were a reference to $20,000, if you first acquired the asset at
15
or after the 2015 budget time, and you:
16
(i) first used the asset, for a taxable purpose, on or after
17
1 July 2023 and on or before 30 June 2024; or
18
(ii) first installed the asset ready for use, for a taxable
19
purpose, on or after 1 July 2023 and on or before
20
30 June 2024.
21
5 At the end of subsection 328-180(5)
22
Add:
23
; or (e) were a reference to $20,000, if the amount is so included at
24
any time:
25
(i) on or after 1 July 2023; and
26
(ii) on or before 30 June 2024.
27
6 At the end of subsection 328-180(6)
28
Add:
29
$20,000 instant asset write-off for small business entities
Schedule 1
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
5
; or (e) were a reference to $20,000, in relation to a deduction for an
1
income year that ends:
2
(i) on or after 1 July 2023; and
3
(ii) on or before 30 June 2024.
4
Schedule 2
Small business energy incentive
6
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Schedule
2--Small business energy incentive
1
2
Income Tax (Transitional Provisions) Act 1997
3
1 At the end of Division 328
4
Add:
5
328-465 Energy incentive
6
(1) You can deduct for an income year an amount that is equal to the
7
lower of:
8
(a) 20% of the total amount (which may be nil) of your
9
expenditure to which subsection 328-470(1) or (3) applies in
10
relation to the income year; and
11
(b) $20,000 less any amount deducted under paragraph (a) for a
12
previous income year.
13
Note:
The deduction relates to the period of 1 July 2023 to 30 June 2024. An
14
entity may have deducted an amount under paragraph (a) for a
15
previous income year if the entity has a substituted accounting period.
16
These are bonus deductions under the Income Tax Assessment Act
17
1997
18
(2) The
Income Tax Assessment Act 1997
has effect as if this section
19
and section 328-470 of this Act were provisions of Division 25 of
20
the
Income Tax Assessment Act 1997
.
21
(3) Sections 8-10, 40-215 and 355-715 of the
Income Tax Assessment
22
Act 1997
do not apply in relation to a deduction under this section.
23
328-470 What expenditure qualifies for the energy incentive
24
Expenditure included in the first element of cost of a depreciating
25
asset
26
(1) This subsection applies to an amount of expenditure in relation to
27
an income year if:
28
(a) the expenditure is included in the first element of cost of a
29
depreciating asset; and
30
Small business energy incentive
Schedule 2
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
7
(b) you can deduct the expenditure under a provision of a
1
taxation law (other than section 328-465 of this Act) whether
2
or not in, or wholly in, the income year in which the
3
expenditure is incurred; and
4
(c) you start to use the asset, or have it installed ready for use,
5
for any purpose after 30 June 2023 but before 1 July 2024;
6
and
7
(d) you start to use the asset, or have it installed ready for use,
8
for a taxable purpose at a time (the
start time
) that is:
9
(i) in the income year; and
10
(ii) after 30 June 2023 but before 1 July 2024; and
11
(e) you are a small business entity, or an entity covered by
12
subsection (4), for the income year that includes the start
13
time; and
14
(f) subsection (2) (about eligible energy assets) applies to the
15
asset; and
16
(g) neither the expenditure nor the asset is excluded under
17
subsection (6); and
18
(h) the only balancing adjustment events that occur for the asset
19
at a time during the period starting on 1 July 2023 and ending
20
on 30 June 2024 occur because you stop holding the asset
21
because of an event or circumstance referred to in
22
subsection 40-365(2) (about involuntary disposals) of the
23
Income Tax Assessment Act 1997
.
24
(2) This subsection applies to an asset if:
25
(a) the asset uses electricity and one or more of the following
26
apply:
27
(i) a new reasonably comparable depreciating asset that
28
uses a fossil fuel (other than a use of which that is
29
merely incidental) is available in the market at the start
30
time;
31
(ii) if the asset is being acquired by way of replacement of
32
or substitution for another depreciating asset
--
the asset
33
is more energy efficient than the other asset;
34
(iii) if the asset is not being acquired by way of replacement
35
of or substitution for another depreciating asset
--
the
36
asset is more energy efficient than a new reasonably
37
Schedule 2
Small business energy incentive
8
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
comparable depreciating asset that is available in the
1
market at the start time; or
2
(b) the asset enables one or more of the following:
3
(i) a depreciating asset (other than an asset excluded under
4
subsection (6)) that uses electricity, or energy that is
5
generated from a renewable source, to be more energy
6
efficient;
7
(ii) electricity, or energy that is generated from a renewable
8
source, to be stored;
9
(iii) electricity, or energy that is generated from a renewable
10
source, to be used at a different time;
11
(iv) the use of electricity, or energy that is generated from a
12
renewable source, by another depreciating asset to be
13
monitored.
14
Certain expenditure that is included in the second element of cost
15
of a depreciating asset
16
(3) This subsection applies to an amount of expenditure in relation to
17
an income year if:
18
(a) the amount is included in the second element of a
19
depreciating asset's cost under paragraph
40-190(2)(a) of the
20
Income Tax Assessment Act 1997
; and
21
(b) you can deduct the expenditure under a provision of a
22
taxation law (other than section 328-465 of this Act) whether
23
or not in, or wholly in, the income year in which the
24
expenditure is incurred; and
25
(c) the expenditure is incurred:
26
(i) in the income year; and
27
(ii) after 30 June 2023 but before 1 July 2024; and
28
(d) you are a small business entity, or an entity covered by
29
subsection (4), for the income year in which the expenditure
30
is incurred; and
31
(e) the expenditure enables one or more of the following:
32
(i) if the asset could use a fossil fuel (other than a use of
33
which that is merely incidental)
--
the asset to only use
34
electricity, or energy that is generated from a renewable
35
source;
36
Small business energy incentive
Schedule 2
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
9
(ii) if the asset uses electricity, or energy that is generated
1
from a renewable source
--
the asset to be more energy
2
efficient;
3
(iii) the asset to store electricity, or energy that is generated
4
from a renewable source;
5
(iv) the asset to use electricity, or energy that is generated
6
from a renewable source, at a different time;
7
(v) the asset to monitor its use of electricity, or energy that
8
is generated from a renewable source; and
9
(f) neither the expenditure nor the asset is excluded under
10
subsection (6); and
11
(g) the only balancing adjustment events that occur for the asset
12
at a time during the period starting on 1 July 2023 and ending
13
on 30 June 2024 occur because you stop holding the asset
14
because of an event or circumstance referred to in
15
subsection 40-365(2) (about involuntary disposals) of the
16
Income Tax Assessment Act 1997
.
17
Businesses with turnover under $50 million
18
(4) An entity is covered by this subsection for an income year if:
19
(a) the entity is not a small business entity for the income year;
20
and
21
(b) the entity would be a small business entity for the income
22
year if:
23
(i) each reference in Subdivision 328-C of the
Income Tax
24
Assessment Act 1997
(about what is a small business
25
entity) to $10 million were instead a reference to $50
26
million; and
27
(ii) the reference in paragraph 328-110(5)(b) of that Act to a
28
small business entity were instead a reference to an
29
entity covered by this subsection.
30
Working out whether you can deduct expenditure
31
(5) For the purposes of paragraph (1)(b) or (3)(b), in working out
32
whether you can deduct an amount of expenditure assume that:
33
(a) you will continue to hold the asset throughout its effective
34
life; and
35
Schedule 2
Small business energy incentive
10
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
(b) throughout that effective life, you will use it for a taxable
1
purpose:
2
(i) for the purposes of paragraph (1)(b)
--
to the same extent
3
as you use it, or have it installed ready for use, for a
4
taxable purpose in the income year in which you start to
5
use it, or have it installed ready for use, for a taxable
6
purpose; or
7
(ii) for the purposes of paragraph (3)(b)
--
to the same extent
8
as you use it for a taxable purpose in the income year in
9
which the expenditure is incurred.
10
Excluded assets and expenditure
11
(6) The following kinds of assets and expenditure are excluded by this
12
subsection:
13
(a) an asset that can use a fossil fuel (other than a use of which
14
that is merely incidental);
15
(b) expenditure (other than expenditure referred to in
16
subparagraph (3)(e)(i)) on an asset that can use a fossil fuel
17
(other than a use of which that is merely incidental);
18
(c) an asset that solely or predominantly generates electricity
19
from a renewable source (for example, photovoltaic cells) or
20
expenditure on such an asset;
21
(d) an asset, or expenditure, being capital works for which you
22
can deduct an amount under Division 43 of the
Income Tax
23
Assessment Act 1997
;
24
(e) a motor vehicle or expenditure on a motor vehicle;
25
(f) an asset, or expenditure on an asset, where expenditure on the
26
asset is allocated to a software development pool;
27
(g) financing costs, including interest, payments in the nature of
28
interest and expenses of borrowing.
29
Note:
Subsections (1) and (3) also do not apply to an item of trading stock
30
because such an asset is not a depreciating asset: see section 40-30 of
31
the
Income Tax Assessment Act 1997
.
32
New class of deductible gift recipients
Schedule 3
Amendment of the Income Tax Assessment Act 1997
Part 1
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
11
Schedule
3--New class of deductible gift
1
recipients
2
Part
1--Amendment of the Income Tax Assessment
3
Act 1997
4
Income Tax Assessment Act 1997
5
1 Section 30-105
6
Omit all the words before the table, substitute:
7
(1) This table sets out general categories of other recipients.
8
9
Other recipients
--
General
Item
Fund, authority or
institution
Special conditions
--
fund, authority or
institution
Special
conditions
--
gift
13.1.1
a
*
community charity trust
to which section 30-110
applies
the community charity
trust must be a
*
registered charity
none
13.1.2
a
*
community charity
corporation to which
section 30-110 applies
the community charity
corporation must be a
*
registered charity
none
(2) This table sets out specific other recipients.
10
2 At the end of Subdivision 30-B
11
Add:
12
30-110 Community charities
13
(1) For the purposes of item 13.1.1 of the table in
14
subsection 30-105(1), this section applies to a
*
community charity
15
trust if the trust is established and maintained under a will or
16
instrument of trust:
17
(a) for the purposes covered by:
18
(i) subsections (3) and (4) of this section; or
19
Schedule 3
New class of deductible gift recipients
Part 1
Amendment of the Income Tax Assessment Act 1997
12
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
(ii) subsections (3), (4) and (5) of this section; and
1
(b) for no other purposes.
2
(2) For the purposes of item 13.1.2 of the table in
3
subsection 30-105(1), this section applies to a
*
community charity
4
corporation if the corporation is operated:
5
(a) for the purposes covered by:
6
(i) subsections (3) and (4) of this section; or
7
(ii) subsections (3), (4) and (5) of this section; and
8
(b) for no other purposes.
9
Mandatory purposes
10
(3) This subsection covers the purpose of providing money, property
11
or benefits to a fund, authority or institution if:
12
(a) gifts to the fund, authority or institution are deductible under
13
item 1 of the table in section 30-15; and
14
(b) the fund, authority or institution is described (whether or not
15
by name) in an item of a table in this Subdivision (other than
16
item 13.1.1 or 13.1.2 of the table in subsection 30-105(1));
17
and
18
(c) the money, property or benefits are so provided to the fund,
19
authority or institution for any purposes set out in the item of
20
that table in which the fund, authority or institution is
21
described.
22
(4) This subsection covers the purpose of engaging in an activity that:
23
(a) is the principal activity of a fund, authority or institution
24
described (but not by name) in an item of a table in this
25
Subdivision (other than item 13.1.1 or 13.1.2 of the table in
26
subsection 30-105(1)); or
27
(b) involves pursuing the principal purpose of a fund, authority
28
or institution described (but not by name) in an item of a
29
table in this Subdivision (other than item 13.1.1 or 13.1.2 of
30
the table in subsection 30-105(1)).
31
Permitted purpose
32
(5) This subsection covers the purpose of establishing a fund, authority
33
or institution described (whether or not by name) in an item of a
34
New class of deductible gift recipients
Schedule 3
Amendment of the Income Tax Assessment Act 1997
Part 1
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
13
table in this Subdivision (other than item 13.1.1 or 13.1.2 of the
1
table in subsection 30-105(1)).
2
3 Paragraph 30-125(1)(d)
3
Repeal the paragraph, substitute:
4
(d) in the case of an
*
ancillary or community charity trust fund
--
5
the fund and all of its trustees comply with the rules in the
6
*
applicable trust fund guidelines; and
7
(e) in the case of a
*
community charity corporation
--
the
8
corporation and all of its directors comply with the rules in
9
the
*
community charity corporation guidelines.
10
4 Section 30-315 (after table item 34AA)
11
Insert:
12
34AAA
Community charity corporations
item 13.1.2
34AAB
Community charity trusts
item 13.1.1
5 Subsection 995-1(1)
13
Insert:
14
ancillary or community charity trust fund
means:
15
(a) a
*
public ancillary fund; or
16
(b) a
*
private ancillary fund; or
17
(c) a
*
community charity trust.
18
applicable trust fund guidelines
means:
19
(a) in relation to a
*
public ancillary fund
--
the
*
public ancillary
20
fund guidelines; or
21
(b) in relation to a
*
private ancillary fund
--
the
*
private ancillary
22
fund guidelines; or
23
(c) in relation to a
*
community charity trust
--
the
*
community
24
charity trust guidelines.
25
community charity corporation
has the meaning given by
26
section 426-180 in Schedule 1 to the
Taxation Administration Act
27
1953
.
28
Schedule 3
New class of deductible gift recipients
Part 1
Amendment of the Income Tax Assessment Act 1997
14
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
community charity corporation guidelines
has the meaning given
1
by section 426-185 in Schedule 1 to the
Taxation Administration
2
Act 1953
.
3
community charity trust
has the meaning given by section 426-117
4
in Schedule 1 to the
Taxation Administration Act 1953
.
5
community charity trust guidelines
has the meaning given by
6
section 426-118 in Schedule 1 to the
Taxation Administration Act
7
1953
.
8
New class of deductible gift recipients
Schedule 3
Amendment of the Taxation Administration Act 1953
Part 2
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
15
Part
2--Amendment of the Taxation Administration
1
Act 1953
2
Taxation Administration Act 1953
3
6 Paragraph 298-5(c) in Schedule 1
4
Omit "or 426
-
120", substitute ", 426
-120 or 426-
195".
5
7 Subsection 355-65(8) in Schedule 1 (cell at table item 6,
6
column headed "and the record or disclosure ... ")
7
Repeal the cell, substitute:
8
(a) is of information that relates to
non-compliance of:
(i) an
*
ancillary or community
charity trust fund; or
(ii) a
*
community charity
corporation; or
(iii) a charity (other than a
charity already covered by
subparagraph (i) or (ii));
with an
*
Australian law; and
(b) is for the purpose of the
administration of an Australian law
governing trusts and charities.
8 Section 426-1 in Schedule 1
9
Omit:
10
Subdivision 426-D deals with types of philanthropic trust funds
11
known as
public ancillary funds
and
private ancillary funds
.
12
substitute:
13
Subdivision 426-D deals with types of philanthropic trust funds
14
known as
public ancillary funds
,
private ancillary funds
and
15
community charity trusts
.
16
Schedule 3
New class of deductible gift recipients
Part 2
Amendment of the Taxation Administration Act 1953
16
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Subdivision 426-E deals with certain philanthropic companies
1
known as
community charity corporations
.
2
9 Subdivision 426-D in Schedule 1 (heading)
3
Repeal the heading, substitute:
4
Subdivision 426-D
--
Ancillary and community charity trust
5
funds
6
10 Section 426-100 in Schedule 1
7
Repeal the section, substitute:
8
426-100 What this Subdivision is about
9
This Subdivision deals with types of philanthropic trust funds
10
known as
public ancillary funds
,
private ancillary funds
and
11
community charity trusts
.
12
The Minister must make guidelines determining when such trust
13
funds are entitled to be endorsed as deductible gift recipients.
14
This Subdivision also provides for:
15
(a) penalties for trustees who fail to comply with the
16
applicable trust fund guidelines, and the liability of
17
directors of trustees to pay those penalties in certain
18
circumstances; and
19
(b) powers for the Commissioner to suspend or remove
20
trustees who breach their obligations.
21
11 After section 426-115 in Schedule 1
22
Insert:
23
Community charity trusts
24
426-117 Community charity trusts
25
(1) A trust is a
community charity trust
if:
26
New class of deductible gift recipients
Schedule 3
Amendment of the Taxation Administration Act 1953
Part 2
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
17
(a) the trust is specified in a declaration in force under
1
subsection (3); and
2
(b) each trustee of the trust is a
*
constitutional corporation; and
3
(c) each trustee has agreed, in the
*
approved form given to the
4
Commissioner, to comply with the rules in the
*
community
5
charity trust guidelines, as in force from time to time; and
6
(d) none of the trustees has revoked that agreement in
7
accordance with subsection (2).
8
(2) A trustee may revoke an agreement mentioned in paragraph (1)(c)
9
only by giving the revocation to the Commissioner in the
10
*
approved form.
11
(3) The Minister may, by legislative instrument, declare one or more
12
trusts for the purposes of paragraph (1)(a).
13
426-118 Community charity trust guidelines
14
The Minister must, by legislative instrument, formulate guidelines
15
(the
community charity trust guidelines
) setting out:
16
(a) rules that
*
community charity trusts and their trustees must
17
comply with if the trusts are to be, or are to remain, endorsed
18
as
*
deductible gift recipients; and
19
(b) the amount of the administrative penalty, or how to work out
20
the amount of the administrative penalty, under
21
subsection 426-120(1) in relation to community charity
22
trusts.
23
426-119 Australian Business Register must show community charity
24
trust status
25
(1) If a
*
community charity trust has an
*
ABN, the
*
Australian
26
Business Registrar must enter in the
*
Australian Business Register
27
in relation to the trust a statement that it is a community charity
28
trust.
29
Note 1:
An entry (or lack of entry) of a statement required by this section does
30
not affect whether a trust is a community charity trust.
31
Note 2:
The Australian Business Register will also show if a community
32
charity trust is endorsed as a deductible gift recipient: see
33
section 30-229 of the
Income Tax Assessment Act 1997
.
34
Schedule 3
New class of deductible gift recipients
Part 2
Amendment of the Taxation Administration Act 1953
18
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
(2) The
*
Australian Business Registrar must take reasonable steps to
1
ensure that a statement appearing in the
*
Australian Business
2
Register under this section is true. For this purpose, the Registrar
3
may:
4
(a) change the statement; or
5
(b) remove the statement from the Register if the statement is not
6
true.
7
12 Section 426-120 in Schedule 1 (heading)
8
Omit "
ancillary funds
", substitute "
ancillary and community charity
9
trust funds
".
10
13 Paragraph 426-120(1)(a) in Schedule 1
11
Omit "
*
ancillary fund", substitute "
*
ancillary or community charity trust
12
fund".
13
14 At the end of subsection 426-120(1) in Schedule 1
14
Add:
15
Note:
The Commissioner is required to give written notice of the penalty
16
(see section 298-10).
17
15 Subsection 426-120(3) in Schedule 1
18
Repeal the subsection, substitute:
19
(3) The amount of the penalty is:
20
(a) the amount specified in the
*
applicable trust fund guidelines
21
for the purposes of subsection (1); or
22
(b) the amount worked out in accordance with the method
23
specified in the applicable trust fund guidelines for the
24
purposes of subsection (1).
25
The guidelines may specify different penalties or methods for
26
different circumstances.
27
16 Subsection 426-125(1) in Schedule 1
28
Omit "
*
ancillary fund", substitute "
*
ancillary or community charity trust
29
fund".
30
New class of deductible gift recipients
Schedule 3
Amendment of the Taxation Administration Act 1953
Part 2
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
19
17 Paragraph 426-125(1)(a) in Schedule 1
1
Repeal the paragraph, substitute:
2
(a) the
*
applicable trust fund guidelines; or
3
18 Subsection 426-125(6) in Schedule 1
4
Omit "
*
ancillary fund", substitute "
*
ancillary or community charity trust
5
fund".
6
19 Paragraph 426-125(6)(a) in Schedule 1
7
Repeal the paragraph, substitute:
8
(a) the
*
applicable trust fund guidelines; or
9
20 Subsection 426-130(1) in Schedule 1
10
Omit "
*
ancillary fund", substitute "
*
ancillary or community charity trust
11
fund".
12
21 Subsection 426-130(2) in Schedule 1
13
Omit "
*
ancillary fund", substitute "
*
ancillary or community charity trust
14
fund".
15
22 Subsection 426-130(3) in Schedule 1
16
Omit the second sentence.
17
23 Subsection 426-130(5) in Schedule 1
18
Repeal the subsection, substitute:
19
Acting trustee must have agreed to comply with guidelines
20
(5) An entity may only be appointed as acting trustee if the entity has
21
agreed, in accordance with paragraph 426-102(1)(b), 426-105(1)(b)
22
or 426-117(1)(c), to comply with the rules in the
*
applicable trust
23
fund guidelines as in force from time to time.
24
24 Paragraph 426-135(1)(b) in Schedule 1
25
Omit
"
*
ancillary fund's", substitute "
*
ancillary or community charity
26
trust fund's".
27
Schedule 3
New class of deductible gift recipients
Part 2
Amendment of the Taxation Administration Act 1953
20
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
25 Subsection 426-135(2) in Schedule 1
1
Omit "
*
ancillary fund", substitute "
*
ancillary or community charity trust
2
fund".
3
26 Subsection 426-150(1) in Schedule 1
4
Omit "
*
ancillary fund", substitute "
*
ancillary or community charity trust
5
fund".
6
27 Subsection 426-150(3) in Schedule 1
7
Omit "
*
ancillary fund", substitute "
*
ancillary or community charity trust
8
fund".
9
28 Paragraph 426-155(b) in Schedule 1
10
Omit "
*
ancillary fund's", substitute "
*
ancillary or community charity
11
trust fund's".
12
29 Subsection 426-160(1) in Schedule 1
13
Omit "
*
ancillary fund", substitute "
*
ancillary or community charity trust
14
fund".
15
30 Paragraph 426-165(1)(a) in Schedule 1
16
Omit "
*
ancillary fund", substitute "
*
ancillary or community charity trust
17
fund".
18
31 Paragraph 426-165(2)(a) in Schedule 1
19
Omit "
*
ancillary fund", substitute "
*
ancillary or community charity trust
20
fund".
21
32 Group heading before section 426-170 in Schedule 1
22
Repeal the heading, substitute:
23
Limitation on certain transfers
24
33 Section 426-170 in Schedule 1
25
Repeal the section, substitute:
26
New class of deductible gift recipients
Schedule 3
Amendment of the Taxation Administration Act 1953
Part 2
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
21
426-170 Limitation on ancillary and community charity trust funds
1
making certain transfers
2
(1) An
*
ancillary fund must not provide money, property or benefits to
3
another ancillary fund unless permitted to do so by the
*
public
4
ancillary fund guidelines or the
*
private ancillary fund guidelines
5
(whichever are applicable) for the first-mentioned fund.
6
(2) A
*
community charity trust must not provide money, property or
7
benefits to:
8
(a) another community charity trust; or
9
(b) an
*
ancillary fund; or
10
(c) a
*
community charity corporation;
11
unless permitted to do so by the
*
community charity trust
12
guidelines.
13
34 At the end of Part 5-35 in Schedule 1
14
Add:
15
Subdivision 426-E
--
Community charity corporations
16
Guide to Subdivision 426-E
17
426-175 What this Subdivision is about
18
This Subdivision deals with philanthropic companies known as
19
community charity corporations
.
20
The Minister must make guidelines determining when community
21
charity corporations are entitled to be endorsed as deductible gift
22
recipients.
23
This Subdivision also provides for penalties for failures to comply
24
with the guidelines.
25
Table of sections
26
Community charity corporations
27
426-180 Community charity corporations
28
Schedule 3
New class of deductible gift recipients
Part 2
Amendment of the Taxation Administration Act 1953
22
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
426-185 Community charity corporation guidelines
1
426-190 Australian Business Register must show community charity corporation
2
status
3
Administrative penalties
4
426-195 Administrative penalties for community charity corporations
5
Limitation on certain transfers
6
426-200 Limitation on community charity corporations making certain transfers
7
Community charity corporations
8
426-180 Community charity corporations
9
(1) A company is a
community charity corporation
if:
10
(a) the company is:
11
(i) a
*
constitutional corporation; or
12
(ii) a body corporate that is not a constitutional corporation;
13
and
14
(b) the company is specified in a declaration in force under
15
subsection (3); and
16
(c) each director of the company has agreed, in the
*
approved
17
form given to the Commissioner, to comply with the rules in
18
the
*
community charity corporation guidelines, as in force
19
from time to time; and
20
(d) none of the directors of the company has revoked that
21
agreement in accordance with subsection (2).
22
(2) A director may revoke an agreement mentioned in paragraph (1)(c)
23
only by giving the revocation to the Commissioner in the
24
*
approved form.
25
(3) The Minister may, by legislative instrument, declare one or more
26
companies for the purposes of paragraph (1)(b).
27
426-185 Community charity corporation guidelines
28
The Minister must, by legislative instrument, formulate guidelines
29
(the
community charity corporation guidelines
) setting out:
30
New class of deductible gift recipients
Schedule 3
Amendment of the Taxation Administration Act 1953
Part 2
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
23
(a) rules that
*
community charity corporations and their directors
1
must comply with if the corporations are to be, or are to
2
remain, endorsed as
*
deductible gift recipients; and
3
(b) the amount of the administrative penalty, or how to work out
4
the amount of the administrative penalty, under
5
subsection 426-195(1) in relation to community charity
6
corporations.
7
426-190 Australian Business Register must show community charity
8
corporation status
9
(1) If a
*
community charity corporation has an
*
ABN, the
*
Australian
10
Business Registrar must enter in the
*
Australian Business Register
11
in relation to the corporation a statement that it is a community
12
charity corporation.
13
Note 1:
An entry (or lack of entry) of a statement required by this section does
14
not affect whether a company is a community charity corporation.
15
Note 2:
The Australian Business Register will also show if a community
16
charity corporation is endorsed as a deductible gift recipient: see
17
section 30-229 of the
Income Tax Assessment Act 1997
.
18
(2) The
*
Australian Business Registrar must take reasonable steps to
19
ensure that a statement appearing in the
*
Australian Business
20
Register under this section is true. For this purpose, the Registrar
21
may:
22
(a) change the statement; or
23
(b) remove the statement from the Register if the statement is not
24
true.
25
Administrative penalties
26
426-195 Administrative penalties for community charity
27
corporations
28
Administrative penalty
29
(1) All of the directors of a
*
community charity corporation are jointly
30
and severally liable to an administrative penalty if:
31
Schedule 3
New class of deductible gift recipients
Part 2
Amendment of the Taxation Administration Act 1953
24
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
(a) the corporation, or a director of the corporation, holds out
1
that the corporation is endorsed as a
*
deductible gift recipient
2
and the corporation is not so endorsed; or
3
(b) the corporation, or a director of the corporation, holds out
4
that the corporation is entitled to remain endorsed as a
5
deductible gift recipient and the corporation is not so entitled;
6
or
7
(c) the corporation, or a director of the corporation, holds out
8
that the corporation will be endorsed, as a deductible gift
9
recipient, at a particular time and the corporation is not so
10
endorsed at that time.
11
Note:
The Commissioner is required to give written notice of the penalty
12
(see section 298-10).
13
(2) The amount of the penalty is:
14
(a) the amount specified in the
*
community charity corporation
15
guidelines for the purposes of subsection (1); or
16
(b) the amount worked out in accordance with the method
17
specified in the community charity corporation guidelines for
18
the purposes of subsection (1).
19
The guidelines may specify different penalties or methods for
20
different circumstances.
21
(3) A director who is liable to the penalty must not be reimbursed the
22
penalty from the corporation.
23
Note:
Division 298 in this Schedule contains machinery provisions for
24
administrative penalties.
25
Defences for directors
26
(4) Subsection (1) does not apply to a director if:
27
(a) the director was not aware of the holding out mentioned in
28
paragraph (1)(a), (b) or (c) (whichever applicable) and it
29
would not have been reasonable to expect the director to have
30
been aware of that holding out; or
31
(b) the director took all reasonable steps to ensure that the
32
holding out mentioned in that paragraph did not occur; or
33
(c) there were no such steps that the director could have taken.
34
New class of deductible gift recipients
Schedule 3
Amendment of the Taxation Administration Act 1953
Part 2
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
25
(5) In determining what is reasonable for the purposes of
1
paragraph (4)(a), (b) or (c), have regard to all relevant
2
circumstances.
3
(6) A person who wishes to rely on subsection (4) bears an evidential
4
burden in relation to the matters in that subsection.
5
Power of courts to grant relief
6
(7) Section 1318 of the
Corporations Act 2001
(power of Court to
7
grant relief in case of breach of director's duty) does not apply to a
8
liability of a director under this section.
9
Limitation on certain transfers
10
426-200 Limitation on community charity corporations making
11
certain transfers
12
A
*
community charity corporation must not provide money,
13
property or benefits to:
14
(a) another community charity corporation; or
15
(b) an
*
ancillary fund; or
16
(c) a
*
community charity trust;
17
unless permitted to do so by the
*
community charity corporation
18
guidelines.
19
Schedule 3
New class of deductible gift recipients
Part 3
Other amendments
26
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Part
3--Other amendments
1
A New Tax System (Australian Business Number) Act 1999
2
35 Paragraph 26(3)(ga)
3
Omit "or 426
-
115", substitute ", 426
-115, 426-119 or 426-
190".
4
Deductible gift recipients
--
specific listings
Schedule 4
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
27
Schedule
4--Deductible gift recipients--
1
specific listings
2
3
Income Tax Assessment Act 1997
4
1 Subsection 30-45(2) (table item 4.2.44, column headed
5
"Special conditions")
6
Omit "9
March 2023", substitute "9
March 2028".
7
2 Section 30-90 (table item
10.2.9, column headed "Special
8
conditions")
9
Omit "and bef
ore 1
July 2023".
10
3 In the appropriate position in subsection 30-105(2) (table)
11
Insert:
12
13
13.2.38 Justice Reform Initiative
Limited
the gift must be made after
30 June 2023 and before
1 July 2028
13.2.39 Transparency International
Australia
the gift must be made after
30 June 2023
4 Section 30-315 (after table item 64AA)
14
Insert:
15
16
64AB
Justice Reform Initiative Limited
item 13.2.38
5 Section 30-315 (after table item 116AA)
17
Insert:
18
19
116AB
Transparency International Australia
item 13.2.39
20
Schedule 5
Exemption for Global Infrastructure Hub Ltd
28
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Schedule
5--Exemption for Global
1
Infrastructure Hub Ltd
2
3
Income Tax Assessment Act 1997
4
1 Section 50-40 (table item
8.4, column headed "Special
5
conditions", paragraph
(b))
6
Omit "1
July 2023", substitute "1
July 2024".
7
Note:
Table item 8.4 of section 50-40 will be repealed on 1 July 2025: see Part 2 of
8
Schedule 4 to the
Tax and Superannuation Laws Amendment (2015 Measures No. 1)
9
Act 2015
.
10
Income tax amendments for updates to accounting standards for general insurance
contracts
Schedule 6
Main amendments
Part 1
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
29
Schedule
6--Income tax amendments for
1
updates to accounting standards for
2
general insurance contracts
3
Part
1--Main amendments
4
Income Tax Assessment Act 1997
5
1 Section 321-10 (heading)
6
Repeal the heading, substitute:
7
321-10 Assessable income to include amount for reduction in
8
adjusted liability for incurred claims
9
2 Paragraph 321-10(a)
10
Repeal the paragraph, substitute:
11
(a) the value, at the end of the previous income year, of the
12
company's adjusted
*
liability for incurred claims under
13
*
general insurance policies; exceeds
14
3 Section 321-15 (heading)
15
Repeal the heading, substitute:
16
321-15 Deduction for increase in adjusted liability for incurred
17
claims
18
4 Paragraph 321-15(a)
19
Repeal the paragraph, substitute:
20
(a)
the value, at the end of the current year, of the company's
21
adjusted
*
liability for incurred claims under
*
general
22
insurance policies; exceeds
23
5 Section 321-20
24
Repeal the section, substitute:
25
Schedule 6
Income tax amendments for updates to accounting standards for general
insurance contracts
Part 1
Main amendments
30
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
321-20 How the value of adjusted liability for incurred claims is
1
worked out
2
Work out the value, at the end of an income year, of a
*
general
3
insurance company's adjusted
*
liability for incurred claims under
4
*
general insurance policies in this way:
5
Method statement
6
Step 1. Use the
*
applicable insurance contracts accounting
7
standard to measure, at the end of the income year, the
8
company's
*
liability for incurred claims under
*
general
9
insurance policies, but when doing so disregard any
10
claims handling costs that are neither attached to, nor
11
directly attributable to, a particular claim.
12
Step 2. Using that standard, reduce the result from step 1 by so
13
much of that result as the company expects at the end of
14
the income year to recover under a reinsurance contract:
15
(a) within the meaning of that standard; but
16
(b) that is not one to which subsection 148(1) of the
17
Income Tax Assessment Act 1936
(about
18
reinsurance with non-residents) applies.
19
6 Section 321-45
20
Omit "or receivable".
21
7 Section 321-50 (heading)
22
Repeal the heading, substitute:
23
321-50 Assessable income to include amount for reduction in
24
adjusted liability for remaining coverage
25
8 Paragraph 321-50(a)
26
Omit "unearned premium reserve", substitute "adjusted
*
liability for
27
remaining coverage under
*
general insurance policies".
28
Income tax amendments for updates to accounting standards for general insurance
contracts
Schedule 6
Main amendments
Part 1
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
31
9 Paragraph 321-50(b)
1
Omit "reserve", substitute "liability".
2
10 Section 321-55 (heading)
3
Repeal the heading, substitute:
4
321-55 Deduction for increase in adjusted liability for remaining
5
coverage
6
11 Paragraph 321-55(a)
7
Omit "unearned premium reserve", substitute "adjusted
*
liability for
8
remaining coverage under
*
general insurance policies".
9
12 Paragraph 321-55(b)
10
Omit "reserve", substitute "liability".
11
13 Section 321-60
12
Repeal the section, substitute:
13
321-60 How the value of adjusted liability for remaining coverage is
14
worked out
15
Work out the value, at the end of an income year, of a
*
general
16
insurance company's adjusted
*
liability for remaining coverage
17
under
*
general insurance policies in this way:
18
Method statement
19
Step 1. Use the
*
applicable insurance contracts accounting
20
standard to measure, at the end of the income year, the
21
company's
*
liability for remaining coverage under
22
*
general insurance policies, but when doing so disregard
23
that
standard's treatment of loss components and
24
loss-recovery components of onerous contracts (within
25
the meaning of that standard).
26
Step 2. Using that standard, reduce the result from step 1 by any
27
*
asset for insurance acquisition cash flows.
28
Schedule 6
Income tax amendments for updates to accounting standards for general
insurance contracts
Part 1
Main amendments
32
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Step 3. Using that standard, reduce the result from step 2 by any
1
premiums paid or payable by the company, in that or an
2
earlier income year, for the reinsurance of risks covered
3
by those
*
general insurance policies in respect of later
4
income years, except:
5
(a) reinsurance premiums that the company cannot
6
deduct because of subsection 148(1) of the
Income
7
Tax Assessment Act 1936
(about reinsurance with
8
non-residents); and
9
(b) reinsurance premiums that were paid or payable in
10
respect of a particular class of
*
insurance business
11
if, under the reinsurance contract (within the
12
meaning of that standard), the reinsurer agreed to
13
pay, in respect of a loss incurred by the company
14
that is covered by the relevant policy, some or all
15
of the excess over an agreed amount.
16
Step 4. Using that standard, add to the result from step 3 any
17
reinsurance commissions received or receivable by the
18
company that relate to reinsurance premiums counted
19
under step 3.
20
14 Subsection 995-1(1)
21
Insert:
22
applicable insurance contracts accounting standard
means:
23
(a) unless paragraph (b) applies
--
*
accounting standard AASB
24
17, as in force on 31 December 2022; or
25
(b) if the regulations prescribe another accounting standard
26
(which may be AASB 17 as in force at another time)
--
that
27
accounting standard.
28
asset for insurance acquisition cash flows
has the same meaning
29
as in the
*
applicable insurance contracts accounting standard.
30
liability for incurred claims
has the same meaning as in the
31
*
applicable insurance contracts accounting standard.
32
Income tax amendments for updates to accounting standards for general insurance
contracts
Schedule 6
Main amendments
Part 1
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
33
Note:
For how to work out the adjusted liability for incurred claims, see
1
section 321-20.
2
liability for remaining coverage
has the same meaning as in the
3
*
applicable insurance contracts accounting standard.
4
Note:
For how to work out the adjusted liability for remaining coverage, see
5
section 321-60.
6
Schedule 6
Income tax amendments for updates to accounting standards for general
insurance contracts
Part 2
Other amendments
34
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Part
2--Other amendments
1
Income Tax Assessment Act 1997
2
15 Section 10-
5 (table item headed "general insurance
3
companies and companies that self insure")
4
Repeal the item, substitute:
5
general insurance companies and companies that self
insure
gross premiums ...................................................................
reduction in value of adjusted liability for incurred
claims ............................................................................
321-45
321-10
reduction in value of adjusted liability for remaining
coverage ........................................................................
321-50
reduction in value of outstanding claims liability ............... 321-80
16 Section 12-5 (table
item headed "general insurance
6
companies and companies that self insure")
7
Repeal the item, substitute:
8
general insurance companies and companies that self
insure
claims paid .......................................................................... 321-25 and 321-95
increase in value of adjusted liability for incurred
claims ............................................................................
321-15
increase in value of adjusted liability for remaining
coverage ........................................................................
321-55
increase in value of outstanding claims liability ................. 321-85
17 Paragraph 705-70(1AC)(c)
9
Repeal the paragraph, substitute:
10
(c) the liability is either of the following:
11
(i) the
*
liability for incurred claims of a
*
general insurance
12
company or of a private health insurer (within the
13
meaning of the
Private Health Insurance (Prudential
14
Supervision) Act 2015
) under
*
general insurance
15
policies;
16
Income tax amendments for updates to accounting standards for general insurance
contracts
Schedule 6
Other amendments
Part 2
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
35
(ii) the
*
liability for remaining coverage of a general
1
insurance company or of a private health insurer (within
2
the meaning of that Act) under general insurance
3
policies; or
4
18 Paragraph 713-710(a)
5
Omit "the outstanding claims liability of a
*
general insurance
6
company", substitute "a
*
ge
neral insurance company's adjusted
7
*
liability for incurred claims".
8
19 Paragraph 713-710(b)
9
Omit "the unearned premium reserve of a general insurance company",
10
substitute "a general insurance company's adjusted
*
liability for
11
remaining coverage".
12
20 Section 713-710 (note 1)
13
Omit "the outstanding claims liability of a general insurance company",
14
substitute "a general insurance company's adjusted liability for incurred
15
claims".
16
21 Section 713-710 (note 2)
17
Omit "the unearned premium reserve of a general insurance company",
18
substitute "a general insurance company's adjusted liability for
19
remaining coverage".
20
22 Subsection 713-725(4)
21
Repeal the subsection, substitute:
22
(4) The things are the
*
general insurance company's:
23
(a)
*
assets for insurance acquisition cash flows to the extent that
24
they are used to measure the company's adjusted
*
liability for
25
remaining coverage; and
26
(b) deferred reinsurance expenses to the extent that they are used
27
to measure the company's adjusted liability for remaining
28
coverage; and
29
(c) recoveries receivable, or potential recoveries, measured
30
under the
*
applicable insurance contracts standard to the
31
extent that they relate to insurance contracts or reinsurance
32
contracts; and
33
Schedule 6
Income tax amendments for updates to accounting standards for general
insurance contracts
Part 2
Other amendments
36
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
(d) claims handling costs that are neither attached to, nor directly
1
attributable to, a particular claim, to the extent that these
2
costs are used to measure the company's adjusted
*
liability
3
for incurred claims; and
4
(e) loss components and loss-recovery components of onerous
5
contracts to the extent that they are used to measure the
6
company's adjusted liability for remaining coverage.
7
23 Subsection 995-1(1) (definition of
outstanding claims
)
8
Repeal the definition.
9
Income tax amendments for updates to accounting standards for general insurance
contracts
Schedule 6
Application and transitional provisions
Part 3
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
37
Part
3--Application and transitional provisions
1
24 Definition
2
In this Part:
3
start year
means the first income year starting on or after 1 January
4
2023.
5
25 Application of amendments
6
The amendments made by this Schedule apply in relation to
7
assessments for the start year and later income years.
8
26 Transitional
--
first income year for which amendments
9
apply
10
Scope
11
(1)
This item applies to a general insurance company unless the company
12
elects for item 27 to apply in the manner set out in that item.
13
Provision for, and payment of, claims by general insurance
14
companies
15
(2)
In applying Subdivision 321-A of the
Income Tax Assessment Act 1997
16
(as amended by this Schedule) to a general insurance company's
17
assessment for the start year:
18
(a) treat paragraphs 321-10(a) and 321-15(b) of that Act as
19
referring to the value, at the end of the previous income year,
20
of the company's liability for outstanding claims under
21
general insurance policies; and
22
(b) that value is to be worked out:
23
(i) under section 321-20 of that Act as in force immediately
24
before the commencement of this Schedule; and
25
(ii) not under that section as amended by this Schedule.
26
(3)
Subitem (2) does not affect paragraph 321-10(b) of that Act.
27
Note:
That paragraph refers to the value, at the end of that first income year, of the company's
28
adjusted liability for incurred claims under general insurance policies.
29
Schedule 6
Income tax amendments for updates to accounting standards for general
insurance contracts
Part 3
Application and transitional provisions
38
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Premium income of general insurance companies
1
(4)
In applying Subdivision 321-B of the
Income Tax Assessment Act 1997
2
(as amended by this Schedule) to a general insurance company's
3
assessment for the start year:
4
(a) treat paragraphs 321-50(a) and 321-55(b) of that Act as
5
referring to the value, at the end of the previous income year,
6
of the company's unearned premium reserve; and
7
(b) that value is to be worked out:
8
(i) under section 321-60 of that Act as in force immediately
9
before the commencement of this Schedule; and
10
(ii) not under that section as amended by this Schedule.
11
(5)
Subitem (4) does not affect paragraph 321-50(b) of that Act.
12
Note:
That paragraph refers to the value, at the end of that first income year, of the company's
13
adjusted liability for remaining coverage under general insurance policies.
14
27 Transitional
--
special provision for certain income years
15
Election for this item to apply
16
(1)
This item applies to a general insurance company for the following
17
income years (each a
relevant income year
) if the company chooses for
18
this item, instead of item 26, to apply to the company:
19
(a) the start year;
20
(b) the following 4 income years.
21
(2)
The choice:
22
(a) is irrevocable; and
23
(b) must be made in the approved form by the earlier of:
24
(i)
the day by which the company's income tax return for
25
the start year is due to be lodged; and
26
(ii) the day on which that income tax return is lodged.
27
Note:
The Commissioner may defer the time for giving the choice: see section 388-55 in
28
Schedule 1 to the
Taxation Administration Act 1953
.
29
Income tax amendments for updates to accounting standards for general insurance
contracts
Schedule 6
Application and transitional provisions
Part 3
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
39
Interaction with other amendments
1
(3)
This item has effect in addition to the operation of the
Income Tax
2
Assessment Act 1997
, as amended by this Schedule, provided for by
3
item 25 of this Schedule.
4
Provision for, and payment of, claims by general insurance
5
companies
6
(4)
If:
7
(a) the value, at the end of the income year before the start year,
8
of the company's liability for outstanding claims under
9
general insurance policies as worked out:
10
(i) under section 321-20 of the
Income Tax Assessment Act
11
1997
as in force immediately before the commencement
12
of this Schedule; and
13
(ii) not under that section as amended by this Schedule;
14
exceeds
15
(b) the value, at the end of the income year before the start year,
16
of the
company's adjusted liability for incurred claims under
17
general insurance policies as worked out under
18
section 321-20 of that Act as amended by this Schedule;
19
the company's assessable income for each relevant income year
20
includes an amount equal to one-fifth of the excess.
21
(5)
If:
22
(a) the value, at the end of the income year before the start year,
23
of the company's adjusted liability for incurred claims under
24
general insurance policies as worked out under
25
section 321-20 of the
Income Tax Assessment Act 1997
as
26
amended by this Schedule; exceeds
27
(b) the value, at the end of the income year before the start year,
28
of the company's liability for outstanding claims under
29
general insurance policies as worked out:
30
(i) under section 321-20 of that Act as in force immediately
31
before the commencement of this Schedule; and
32
(ii) not under that section as amended by this Schedule;
33
the company can deduct for each relevant income year an amount equal
34
to one-fifth of the excess.
35
Schedule 6
Income tax amendments for updates to accounting standards for general
insurance contracts
Part 3
Application and transitional provisions
40
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Premium income of general insurance companies
1
(6)
If:
2
(a) the value, at the end of the income year before the start year,
3
of the company's unearned premium reserve as worked out:
4
(i) under section 321-60 of the
Income Tax Assessment Act
5
1997
as in force immediately before the commencement
6
of this Schedule; and
7
(ii) not under that section as amended by this Schedule;
8
exceeds
9
(b) the value, at the end of the income year before the start year,
10
of the company's adjusted liability for remaining
coverage
11
under general insurance policies as worked out under
12
section 321-60 of that Act as amended by this Schedule;
13
the company's assessable income for each relevant income year
14
includes an amount equal to one-fifth of the excess.
15
(7)
If:
16
(a) the value, at the end of the income year before the start year,
17
of the company's adjusted liability for remaining coverage
18
under general insurance policies as worked out under
19
section 321-60 of the
Income Tax Assessment Act 1997
as
20
amended by this Schedule; exceeds
21
(b) the value, at the end of the income year before the start year,
22
of the company's unearned premium reserve as worked out:
23
(i) under section 321-60 of that Act as in force immediately
24
before the commencement of this Schedule; and
25
(ii) not under that section as amended by this Schedule;
26
the company can deduct for each relevant income year an amount equal
27
to one-fifth of the excess.
28
Company ceases to carry on insurance business
29
(8)
However, if the company ceases in a relevant income year to carry on
30
an insurance business:
31
(a) subitems (4) to (7) do not apply for that income year or any
32
future income years; and
33
Income tax amendments for updates to accounting standards for general insurance
contracts
Schedule 6
Application and transitional provisions
Part 3
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
41
(b) instead, for that income year, so much of any excess referred
1
to in any of those subitems as has not been included in the
2
company's assessa
ble income, or allowed as a deduction, for
3
any previous relevant income years is to be included in that
4
assessable income or allowed as a deduction (as the case
5
requires).
6
Schedule 7
Non-
arm's length expenses of superann
uation funds
42
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Schedule
7--Non
-
arm's length expenses of
1
superannuation funds
2
3
Income Tax Assessment Act 1997
4
1 Subsection 295-545(2)
5
Repeal the subsection, substitute:
6
(2) If an entity is not of a kind referred to in paragraph 295-550(8)(a)
7
(about certain small entities), the
non-
arm's length component
for
8
an income year is the entity's
*
non-
arm's length income for that
9
year less any deductions to the extent that they are attributable to
10
that income.
11
(2A) If the entity is of a kind referred to in paragraph 295-550(8)(a)
12
(about certain small entities), the
non-
arm's length component
for
13
an income year is the lesser of:
14
(a) the sum of:
15
(i)
each amount of the entity's
*
non-
arm's length income
16
under subsection 295-550(1), (2), (4) or (5) for that year
17
less any deductions to the extent that they are
18
attributable to that income; and
19
(ii) each
amount of the entity's non
-
arm's length income
20
under subsection 295-550(8) or (9) for that year; and
21
(b)
the entity's taxable income for the income year:
22
(i)
less the contributions that are included in the entity's
23
assessable income under Subdivision 295-C for the
24
income year; and
25
(ii) plus any deductions to the extent that they are
26
attributable to those contributions.
27
2 Paragraphs 295-550(1)(b) and (c)
28
Repeal the paragraphs, substitute:
29
(b) if the entity is of a kind referred to in paragraph (8)(a) (about
30
certain small entities):
31
(i) in gaining or producing the income, the entity incurs a
32
loss, outgoing or expenditure of an amount that is less
33
Non-
arm's length expenses of superannuation funds
Schedule 7
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
43
than the amount of a loss, outgoing or expenditure that
1
the entity might have been expected to incur if those
2
parties had been dealing with each other at arm's length
3
in relation to the scheme; and
4
(ii) subsection (8) does not apply to the loss, outgoing or
5
expenditure;
6
(c) if the entity is of a kind referred to in paragraph (8)(a) (about
7
certain small entities):
8
(i) in gaining or producing the income, the entity does not
9
incur a loss, outgoing or expenditure that the entity
10
might have been expected to incur if those parties had
11
been dealing with each other at arm's length in relation
12
to the scheme; and
13
(ii) subsection (9) does not apply to the loss, outgoing or
14
expenditure that the entity might have been expected to
15
incur.
16
3 Paragraphs 295-550(5)(b) and (c)
17
Repeal the paragraphs, substitute:
18
(b) if the entity is of a kind referred to in paragraph (8)(a) (about
19
certain small entities)
--
in acquiring the entitlement or in
20
gaining or producing the income, the entity incurs a loss,
21
outgoing or expenditure of an amount that is less than the
22
amount of a loss, outgoing or expenditure that the entity
23
might have been expected to incur if those parties had been
24
dealing with each other at arm's length in relation to the
25
scheme;
26
(c) if the entity is of a kind referred to in paragraph (8)(a) (about
27
certain small entities)
--
in acquiring the entitlement or in
28
gaining or producing the income, the entity does not incur a
29
loss, outgoing or expenditure that the entity might have been
30
expected to incur if those parties had been dealing with each
31
other at arm's length in relation to the scheme.
32
4 At the end of section 295-550
33
Add:
34
Schedule 7
Non-
arm's length expenses of superannuation funds
44
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Certain small entities
--
general expenses
1
(8) If:
2
(a) a
*
complying superannuation entity is:
3
(i) a
*
regulated superannuation fund with no more than 6
4
members; or
5
(ii) a
*
self managed superannuation fund; and
6
(b) as a result of a
*
scheme the parties to which were not dealing
7
with each other at
*
arm's length in relation to the scheme:
8
(i) in gaining or producing the
*
ordinary income and
9
*
statutory income of the entity (but not in gaining or
10
producing income in relation to any particular asset or
11
assets of the entity), the entity incurs a loss, outgoing or
12
expenditure of an amount; and
13
(ii) the amount is less than the amount of a loss, outgoing or
14
expenditure that the entity might have been expected to
15
incur if those parties had been dealing with each other at
16
arm's length in relation to the scheme;
17
an amount of the entity's ordinary income and statutory income
18
equal to twice the difference between the amount that the entity did
19
incur and the amount that the entity might have been expected to
20
incur is
non-
arm's length income
of the entity.
21
(9) If:
22
(a) a
*
complying superannuation entity is of a kind referred to in
23
paragraph (8)(a) (about certain small entities); and
24
(b) as a result of a
*
scheme the parties to which were not dealing
25
with each other at
*
arm's length in relation to the scheme, in
26
gaining or producing the
*
ordinary income and
*
statutory
27
income of the entity (but not in gaining or producing income
28
in relation to any particular asset or assets of the entity), the
29
entity does not incur a loss, outgoing or expenditure that the
30
entity might have been expected to incur if those parties had
31
been dealing with each other at arm's length in relation to the
32
scheme;
33
an amount of the entity's ordinary income and statutory income
34
equal to twice the amount that the entity might have been expected
35
to incur is
non-
arm's length income
of the entity.
36
Non-
arm's length expenses of superannuation funds
Schedule 7
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
45
5 Application of amendments
1
(1)
The amendments of the
Income Tax Assessment Act 1997
made by this
2
Schedule apply in relation to income derived in the 2018-19 income
3
year or a later income year.
4
(2)
Despite subitem (1), the amendments do not apply in relation to:
5
(a) a loss, outgoing or expenditure that is incurred before the
6
2018-19 income year; and
7
(b) a loss, outgoing or expenditure that was not incurred before
8
the 2018-19 income year, but might have been expected to be
9
incurred before the 2018-19 income year.
10
(3)
To avoid doubt, the amendments of the
Income Tax Assessment Act
11
1997
made by Schedule 2 to the
Treasury Laws Amendment (2018
12
Superannuation Measures No. 1) Act 2019
do not apply, and are taken
13
never to have applied, in relation to:
14
(a) a loss, outgoing or expenditure that is incurred before the
15
2018-19 income year; and
16
(b) a loss, outgoing or expenditure that was not incurred before
17
the 2018-19 income year, but might have been expected to be
18
incurred before the 2018-19 income year.
19
Schedule 8
AFCA scheme
Part 1
Main amendments
46
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Schedule
8--AFCA scheme
1
Part
1--Main amendments
2
Corporations Act 2001
3
1 Section 9 (definition of
superannuation complaint
)
4
Omit "subsections
1053(3) and (4)", substitute "sec
tion
1053".
5
2 Section 761A (definition of
superannuation complaint
)
6
Omit "subsection
1053(3)", substitute "section
1053".
7
3 Subsection 1051(4) (note)
8
Omit "The complaints may be complaints relating to superannuation or
9
complaints relating to other financ
ial services.".
10
4 Subdivision A of Division 3 of Part 7.10A (heading)
11
Repeal the heading, substitute:
12
Subdivision A
--
Preliminary
13
5 Section 1053 (heading)
14
Repeal the heading, substitute:
15
1053 Meaning of
superannuation complaint
16
6 Subsection 1053(1)
17
Omit "A person may, subject to section
1056, make a complaint relating
18
to superannuation under the AFCA scheme only if the complaint is a
19
complaint", substitute "Subject to subsection
(4), a complaint made
20
under the AFCA scheme is a
superannuation complaint
if the
21
complaint is".
22
7 Subsection 1053(1) (note 1)
23
Repeal the note.
24
AFCA scheme
Schedule 8
Main amendments
Part 1
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
47
8 Subsection 1053(1) (note 2)
1
Omit "2".
2
9 Subsection 1053(3)
3
Repeal the subsection.
4
10 At the end of Subdivision A of Division 3 of Part 7.10A
5
Add:
6
1053B This Division does not restrict ability to make other
7
complaints
8
To avoid doubt, this Division does not limit the ability of a person
9
to make a complaint under the AFCA scheme (including a
10
complaint relating to superannuation) that is not a superannuation
11
complaint.
12
Note:
Schedule 8 to the
Treasury Laws Amendment (Support for Small
13
Business and Charities and Other Measures) Act 2023
, which added
14
this section, was enacted as a response to the decision of the Federal
15
Court of Australia in
MetLife Insurance Limited v Australian
16
Financial Complaints Authority Limited
[2022] FCAFC 173.
17
Schedule 8
AFCA scheme
Part 2
Application provision
48
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
No. , 2023
Part
2--Application provision
1
Corporations Act 2001
2
11 In the appropriate position in Chapter 10
3
Insert:
4
Part
10.73--Application provisions relating to
5
Schedule
8 to the Treasury Laws
6
Amendment (Support for Small Business
7
and Charities and Other Measures) Act
8
2023
9
10
1703 Application provision
11
(1) The amendments made by Part 1 of Schedule 8 to the
Treasury
12
Laws Amendment (Support for Small Business and Charities and
13
Other Measures) Act 2023
apply in relation to a complaint made
14
under the AFCA scheme, whether the complaint was made before,
15
on or after the commencement of this section.
16
(2) To avoid doubt, a reference in subsection (1) of this section to a
17
complaint made under the AFCA scheme includes a reference to a
18
complaint that:
19
(a) was purportedly made under the AFCA scheme before that
20
commencement; and
21
(b) was a complaint relating to superannuation but was not a
22
superannuation complaint.
23
(3) Despite subsection (1), the amendments do not affect the validity
24
(or invalidity) of a determination, made or purportedly made by
25
AFCA before that commencement, of a complaint made under the
26
AFCA scheme.
27
AFCA scheme
Schedule 8
Other amendments
Part 3
No. , 2023
Treasury Laws Amendment (Support for Small Business and Charities
and Other Measures) Bill 2023
49
Part
3--Other amendments
1
Treasury Laws Amendment (2023 Law Improvement
2
Package No. 1) Act 2023
3
12 Item 555 of Schedule 2 (heading)
4
Omit "
2
".
5