TREASURY LAWS AMENDMENT (SUPPORT FOR SMALL BUSINESS AND CHARITIES AND OTHER MEASURES) BILL 2023

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

Contents

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

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

Schedules ........................................................................................... 3

Schedule 1

$20,000 instant asset write-off for small business

entities

Income Tax (Transitional Provisions) Act 1997

Schedule 2

Small business energy incentive

Income Tax (Transitional Provisions) Act 1997

Schedule 3

New class of deductible gift recipients

Part 1

Amendment of the Income Tax Assessment Act 1997

Income Tax Assessment Act 1997

Part 2

Amendment of the Taxation Administration Act 1953

Taxation Administration Act 1953

Part 3

Other amendments

A New Tax System (Australian Business Number) Act 1999

Schedule 4

Deductible gift recipients

specific listings

Income Tax Assessment Act 1997

Schedule 5

Exemption for Global Infrastructure Hub Ltd

Income Tax Assessment Act 1997

Schedule 6

Income tax amendments for updates to accounting

standards for general insurance contracts

Part 1

Main amendments

Income Tax Assessment Act 1997

Part 2

Other amendments

Income Tax Assessment Act 1997

Part 3

Application and transitional provisions

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

Income Tax Assessment Act 1997

Schedule 8

AFCA scheme

Part 1

Main amendments

Corporations Act 2001

Part 2

Application provision

Corporations Act 2001

Part 3

Other amendments

Treasury Laws Amendment (2023 Law Improvement Package No. 1)

Act 2023

No. , 2023

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

A Bill for an Act to amend the law relating to

taxation, financial services and corporations, and

for related purposes

The Parliament of Australia enacts:

1 Short title

This Act is the

Treasury Laws Amendment (Support for Small

Business and Charities and Other Measures) Act 2023

2 Commencement

(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.

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

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

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

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

enacted. It will not be amended to deal with any later amendments of

this Act.

(2) Any information in column 3 of the table is not part of this Act.

Information may be inserted in this column, or information in it

may be edited, in any published version of this Act.

3 Schedules

Legislation 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.

Schedule 1

$20,000 instant asset write-off for small business entities

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

small business entities

Income Tax (Transitional Provisions) Act 1997

1 Section 328-180 (heading)

Omit "

30 June 2023

", substitute "

30 June 2024

2 Subsection 328-180(1) (paragraph (b) of the definition of

increased access year

)

Omit "30

June 2023", substitute "30

June 2024".

3 Subsection 328-180(4) (heading)

Repeal the heading, substitute:

Temporary increase to asset cost threshold

4 At the end of subsection 328-180(4)

Add:

; or (d) were a reference to $20,000, if you first acquired the asset at

or after the 2015 budget time, and you:

(i) first used the asset, for a taxable purpose, on or after

1 July 2023 and on or before 30 June 2024; or

(ii) first installed the asset ready for use, for a taxable

purpose, on or after 1 July 2023 and on or before

30 June 2024.

5 At the end of subsection 328-180(5)

Add:

; or (e) were a reference to $20,000, if the amount is so included at

any time:

(i) on or after 1 July 2023; and

(ii) on or before 30 June 2024.

6 At the end of subsection 328-180(6)

Add:

Schedule 2

Small business energy incentive

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

Schedule

2--Small business energy incentive

Income Tax (Transitional Provisions) Act 1997

1 At the end of Division 328

Add:

328-465 Energy incentive

(1) You can deduct for an income year an amount that is equal to the

lower of:

(a) 20% of the total amount (which may be nil) of your

expenditure to which subsection 328-470(1) or (3) applies in

relation to the income year; and

(b) $20,000 less any amount deducted under paragraph (a) for a

previous income year.

Note:

The deduction relates to the period of 1 July 2023 to 30 June 2024. An

entity may have deducted an amount under paragraph (a) for a

previous income year if the entity has a substituted accounting period.

These are bonus deductions under the Income Tax Assessment Act

1997

(2) The

Income Tax Assessment Act 1997

has effect as if this section

and section 328-470 of this Act were provisions of Division 25 of

the

Income Tax Assessment Act 1997

(3) Sections 8-10, 40-215 and 355-715 of the

Income Tax Assessment

Act 1997

do not apply in relation to a deduction under this section.

328-470 What expenditure qualifies for the energy incentive

Expenditure included in the first element of cost of a depreciating

asset

(1) This subsection applies to an amount of expenditure in relation to

an income year if:

(a) the expenditure is included in the first element of cost of a

depreciating asset; and

Small business energy incentive

Schedule 2

No. , 2023

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

(b) you can deduct the expenditure under a provision of a

taxation law (other than section 328-465 of this Act) whether

or not in, or wholly in, the income year in which the

expenditure is incurred; and

for any purpose after 30 June 2023 but before 1 July 2024;

and

(d) you start to use the asset, or have it installed ready for use,

for a taxable purpose at a time (the

start time

) that is:

(i) in the income year; and

(ii) after 30 June 2023 but before 1 July 2024; and

(e) you are a small business entity, or an entity covered by

subsection (4), for the income year that includes the start

time; and

(f) subsection (2) (about eligible energy assets) applies to the

asset; and

(g) neither the expenditure nor the asset is excluded under

subsection (6); and

(h) the only balancing adjustment events that occur for the asset

at a time during the period starting on 1 July 2023 and ending

on 30 June 2024 occur because you stop holding the asset

because of an event or circumstance referred to in

subsection 40-365(2) (about involuntary disposals) of the

Income Tax Assessment Act 1997

(2) This subsection applies to an asset if:

(a) the asset uses electricity and one or more of the following

apply:

(i) a new reasonably comparable depreciating asset that

uses a fossil fuel (other than a use of which that is

merely incidental) is available in the market at the start

time;

(ii) if the asset is being acquired by way of replacement of

or substitution for another depreciating asset

the asset

is more energy efficient than the other asset;

(iii) if the asset is not being acquired by way of replacement

of or substitution for another depreciating asset

the

asset is more energy efficient than a new reasonably

Schedule 2

Small business energy incentive

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

comparable depreciating asset that is available in the

market at the start time; or

(b) the asset enables one or more of the following:

(i) a depreciating asset (other than an asset excluded under

subsection (6)) that uses electricity, or energy that is

generated from a renewable source, to be more energy

efficient;

(ii) electricity, or energy that is generated from a renewable

source, to be stored;

(iii) electricity, or energy that is generated from a renewable

source, to be used at a different time;

(iv) the use of electricity, or energy that is generated from a

renewable source, by another depreciating asset to be

monitored.

Certain expenditure that is included in the second element of cost

of a depreciating asset

(3) This subsection applies to an amount of expenditure in relation to

an income year if:

(a) the amount is included in the second element of a

depreciating asset's cost under paragraph

40-190(2)(a) of the

Income Tax Assessment Act 1997

; and

(b) you can deduct the expenditure under a provision of a

taxation law (other than section 328-465 of this Act) whether

or not in, or wholly in, the income year in which the

expenditure is incurred; and

(i) in the income year; and

(ii) after 30 June 2023 but before 1 July 2024; and

(d) you are a small business entity, or an entity covered by

subsection (4), for the income year in which the expenditure

is incurred; and

(e) the expenditure enables one or more of the following:

(i) if the asset could use a fossil fuel (other than a use of

which that is merely incidental)

the asset to only use

electricity, or energy that is generated from a renewable

source;

Small business energy incentive

Schedule 2

No. , 2023

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

(ii) if the asset uses electricity, or energy that is generated

from a renewable source

the asset to be more energy

efficient;

(iii) the asset to store electricity, or energy that is generated

from a renewable source;

(iv) the asset to use electricity, or energy that is generated

from a renewable source, at a different time;

(v) the asset to monitor its use of electricity, or energy that

is generated from a renewable source; and

(f) neither the expenditure nor the asset is excluded under

subsection (6); and

(g) the only balancing adjustment events that occur for the asset

at a time during the period starting on 1 July 2023 and ending

on 30 June 2024 occur because you stop holding the asset

because of an event or circumstance referred to in

subsection 40-365(2) (about involuntary disposals) of the

Income Tax Assessment Act 1997

Businesses with turnover under $50 million

(4) An entity is covered by this subsection for an income year if:

(a) the entity is not a small business entity for the income year;

and

(b) the entity would be a small business entity for the income

year if:

(i) each reference in Subdivision 328-C of the

Income Tax

Assessment Act 1997

(about what is a small business

entity) to $10 million were instead a reference to $50

million; and

(ii) the reference in paragraph 328-110(5)(b) of that Act to a

small business entity were instead a reference to an

entity covered by this subsection.

Working out whether you can deduct expenditure

(5) For the purposes of paragraph (1)(b) or (3)(b), in working out

whether you can deduct an amount of expenditure assume that:

(a) you will continue to hold the asset throughout its effective

life; and

Schedule 2

Small business energy incentive

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

purpose:

(i) for the purposes of paragraph (1)(b)

to the same extent

as you use it, or have it installed ready for use, for a

taxable purpose in the income year in which you start to

use it, or have it installed ready for use, for a taxable

purpose; or

(ii) for the purposes of paragraph (3)(b)

to the same extent

as you use it for a taxable purpose in the income year in

which the expenditure is incurred.

Excluded assets and expenditure

(6) The following kinds of assets and expenditure are excluded by this

subsection:

(a) an asset that can use a fossil fuel (other than a use of which

that is merely incidental);

(b) expenditure (other than expenditure referred to in

subparagraph (3)(e)(i)) on an asset that can use a fossil fuel

(other than a use of which that is merely incidental);

from a renewable source (for example, photovoltaic cells) or

expenditure on such an asset;

(d) an asset, or expenditure, being capital works for which you

can deduct an amount under Division 43 of the

Income Tax

Assessment Act 1997

;

(e) a motor vehicle or expenditure on a motor vehicle;

(f) an asset, or expenditure on an asset, where expenditure on the

asset is allocated to a software development pool;

(g) financing costs, including interest, payments in the nature of

interest and expenses of borrowing.

Note:

Subsections (1) and (3) also do not apply to an item of trading stock

because such an asset is not a depreciating asset: see section 40-30 of

the

Income Tax Assessment Act 1997

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

Schedule

3--New class of deductible gift

recipients

Part

1--Amendment of the Income Tax Assessment

Act 1997

Income Tax Assessment Act 1997

1 Section 30-105

Omit all the words before the table, substitute:

(1) This table sets out general categories of other recipients.

Other recipients

General

Item

Fund, authority or

institution

Special conditions

fund, authority or

institution

Special

conditions

gift

13.1.1

community charity trust

to which section 30-110

applies

the community charity

trust must be a

registered charity

none

13.1.2

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.

2 At the end of Subdivision 30-B

Add:

30-110 Community charities

(1) For the purposes of item 13.1.1 of the table in

subsection 30-105(1), this section applies to a

community charity

trust if the trust is established and maintained under a will or

instrument of trust:

(a) for the purposes covered by:

(i) subsections (3) and (4) of this section; or

Schedule 3

New class of deductible gift recipients

Part 1

Amendment of the Income Tax Assessment Act 1997

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

(b) for no other purposes.

(2) For the purposes of item 13.1.2 of the table in

subsection 30-105(1), this section applies to a

community charity

corporation if the corporation is operated:

(a) for the purposes covered by:

(i) subsections (3) and (4) of this section; or

(ii) subsections (3), (4) and (5) of this section; and

(b) for no other purposes.

Mandatory purposes

(3) This subsection covers the purpose of providing money, property

or benefits to a fund, authority or institution if:

(a) gifts to the fund, authority or institution are deductible under

item 1 of the table in section 30-15; and

(b) the fund, authority or institution is described (whether or not

by name) in an item of a table in this Subdivision (other than

item 13.1.1 or 13.1.2 of the table in subsection 30-105(1));

and

authority or institution for any purposes set out in the item of

that table in which the fund, authority or institution is

described.

(4) This subsection covers the purpose of engaging in an activity that:

(a) is the principal activity of a fund, authority or institution

described (but not by name) in an item of a table in this

Subdivision (other than item 13.1.1 or 13.1.2 of the table in

subsection 30-105(1)); or

(b) involves pursuing the principal purpose of a fund, authority

or institution described (but not by name) in an item of a

table in this Subdivision (other than item 13.1.1 or 13.1.2 of

the table in subsection 30-105(1)).

Permitted purpose

(5) This subsection covers the purpose of establishing a fund, authority

or institution described (whether or not by name) in an item of a

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

table in this Subdivision (other than item 13.1.1 or 13.1.2 of the

table in subsection 30-105(1)).

3 Paragraph 30-125(1)(d)

Repeal the paragraph, substitute:

(d) in the case of an

ancillary or community charity trust fund

the fund and all of its trustees comply with the rules in the

applicable trust fund guidelines; and

(e) in the case of a

community charity corporation

the

corporation and all of its directors comply with the rules in

the

community charity corporation guidelines.

4 Section 30-315 (after table item 34AA)

Insert:

34AAA

Community charity corporations

item 13.1.2

34AAB

Community charity trusts

item 13.1.1

5 Subsection 995-1(1)

Insert:

ancillary or community charity trust fund

means:

(a) a

public ancillary fund; or

(b) a

private ancillary fund; or

community charity trust.

applicable trust fund guidelines

means:

(a) in relation to a

public ancillary fund

the

public ancillary

fund guidelines; or

(b) in relation to a

private ancillary fund

the

private ancillary

fund guidelines; or

community charity trust

the

community

charity trust guidelines.

community charity corporation

has the meaning given by

section 426-180 in Schedule 1 to the

Taxation Administration Act

1953

Schedule 3

New class of deductible gift recipients

Part 1

Amendment of the Income Tax Assessment Act 1997

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

community charity corporation guidelines

has the meaning given

by section 426-185 in Schedule 1 to the

Taxation Administration

Act 1953

community charity trust

has the meaning given by section 426-117

in Schedule 1 to the

Taxation Administration Act 1953

community charity trust guidelines

has the meaning given by

section 426-118 in Schedule 1 to the

Taxation Administration Act

1953

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

Part

2--Amendment of the Taxation Administration

Act 1953

Taxation Administration Act 1953

6 Paragraph 298-5(c) in Schedule 1

Omit "or 426

120", substitute ", 426

-120 or 426-

195".

7 Subsection 355-65(8) in Schedule 1 (cell at table item 6,

column headed "and the record or disclosure ... ")

Repeal the cell, substitute:

(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

Omit:

Subdivision 426-D deals with types of philanthropic trust funds

known as

public ancillary funds

and

private ancillary funds

substitute:

Subdivision 426-D deals with types of philanthropic trust funds

known as

public ancillary funds

private ancillary funds

and

community charity trusts

Schedule 3

New class of deductible gift recipients

Part 2

Amendment of the Taxation Administration Act 1953

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

Subdivision 426-E deals with certain philanthropic companies

known as

community charity corporations

9 Subdivision 426-D in Schedule 1 (heading)

Repeal the heading, substitute:

Subdivision 426-D

Ancillary and community charity trust

funds

10 Section 426-100 in Schedule 1

Repeal the section, substitute:

426-100 What this Subdivision is about

This Subdivision deals with types of philanthropic trust funds

known as

public ancillary funds

private ancillary funds

and

community charity trusts

The Minister must make guidelines determining when such trust

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

applicable trust 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.

11 After section 426-115 in Schedule 1

Insert:

Community charity trusts

426-117 Community charity trusts

(1) A trust is a

community charity trust

if:

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

(a) the trust is specified in a declaration in force under

subsection (3); and

(b) each trustee of the trust is a

constitutional corporation; and

approved form given to the

Commissioner, to comply with the rules in the

community

charity trust guidelines, as in force from time to time; and

(d) none of the trustees has revoked that agreement in

accordance with subsection (2).

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

only by giving the revocation to the Commissioner in the

approved form.

(3) The Minister may, by legislative instrument, declare one or more

trusts for the purposes of paragraph (1)(a).

426-118 Community charity trust guidelines

The Minister must, by legislative instrument, formulate guidelines

(the

community charity trust guidelines

) setting out:

(a) rules that

community charity trusts and their trustees must

comply with if the trusts 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) in relation to community charity

trusts.

426-119 Australian Business Register must show community charity

trust status

(1) If a

community charity trust has an

ABN, the

Australian

Business Registrar must enter in the

Australian Business Register

in relation to the trust a statement that it is a community charity

trust.

Note 1:

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

not affect whether a trust is a community charity trust.

Note 2:

The Australian Business Register will also show if a community

charity trust is endorsed as a deductible gift recipient: see

section 30-229 of the

Income Tax Assessment Act 1997

Schedule 3

New class of deductible gift recipients

Part 2

Amendment of the Taxation Administration Act 1953

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

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.

12 Section 426-120 in Schedule 1 (heading)

Omit "

ancillary funds

", substitute "

ancillary and community charity

trust funds

13 Paragraph 426-120(1)(a) in Schedule 1

Omit "

ancillary fund", substitute "

ancillary or community charity trust

fund".

14 At the end of subsection 426-120(1) in Schedule 1

Add:

Note:

The Commissioner is required to give written notice of the penalty

(see section 298-10).

15 Subsection 426-120(3) in Schedule 1

Repeal the subsection, substitute:

(3) The amount of the penalty is:

(a) the amount specified in the

applicable trust fund guidelines

for the purposes of subsection (1); or

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

specified in the applicable trust fund guidelines for the

purposes of subsection (1).

The guidelines may specify different penalties or methods for

different circumstances.

16 Subsection 426-125(1) in Schedule 1

Omit "

ancillary fund", substitute "

ancillary or community charity trust

fund".

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 Paragraph 426-125(1)(a) in Schedule 1

Repeal the paragraph, substitute:

(a) the

applicable trust fund guidelines; or

18 Subsection 426-125(6) in Schedule 1

Omit "

ancillary fund", substitute "

ancillary or community charity trust

fund".

19 Paragraph 426-125(6)(a) in Schedule 1

Repeal the paragraph, substitute:

(a) the

applicable trust fund guidelines; or

20 Subsection 426-130(1) in Schedule 1

Omit "

ancillary fund", substitute "

ancillary or community charity trust

fund".

21 Subsection 426-130(2) in Schedule 1

Omit "

ancillary fund", substitute "

ancillary or community charity trust

fund".

22 Subsection 426-130(3) in Schedule 1

Omit the second sentence.

23 Subsection 426-130(5) in Schedule 1

Repeal the subsection, substitute:

Acting trustee must have agreed to comply with guidelines

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

agreed, in accordance with paragraph 426-102(1)(b), 426-105(1)(b)

or 426-117(1)(c), to comply with the rules in the

applicable trust

fund guidelines as in force from time to time.

24 Paragraph 426-135(1)(b) in Schedule 1

Omit

ancillary fund's", substitute "

ancillary or community charity

trust fund's".

Schedule 3

New class of deductible gift recipients

Part 2

Amendment of the Taxation Administration Act 1953

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

25 Subsection 426-135(2) in Schedule 1

Omit "

ancillary fund", substitute "

ancillary or community charity trust

fund".

26 Subsection 426-150(1) in Schedule 1

Omit "

ancillary fund", substitute "

ancillary or community charity trust

fund".

27 Subsection 426-150(3) in Schedule 1

Omit "

ancillary fund", substitute "

ancillary or community charity trust

fund".

28 Paragraph 426-155(b) in Schedule 1

Omit "

ancillary fund's", substitute "

ancillary or community charity

trust fund's".

29 Subsection 426-160(1) in Schedule 1

Omit "

ancillary fund", substitute "

ancillary or community charity trust

fund".

30 Paragraph 426-165(1)(a) in Schedule 1

Omit "

ancillary fund", substitute "

ancillary or community charity trust

fund".

31 Paragraph 426-165(2)(a) in Schedule 1

Omit "

ancillary fund", substitute "

ancillary or community charity trust

fund".

32 Group heading before section 426-170 in Schedule 1

Repeal the heading, substitute:

Limitation on certain transfers

33 Section 426-170 in Schedule 1

Repeal the section, substitute:

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

426-170 Limitation on ancillary and community charity trust funds

making certain transfers

(1) An

ancillary fund must not provide money, property or benefits to

another ancillary fund unless permitted to do so by the

public

ancillary fund guidelines or the

private ancillary fund guidelines

(whichever are applicable) for the first-mentioned fund.

(2) A

community charity trust must not provide money, property or

benefits to:

(a) another community charity trust; or

(b) an

ancillary fund; or

community charity corporation;

unless permitted to do so by the

community charity trust

guidelines.

34 At the end of Part 5-35 in Schedule 1

Add:

Subdivision 426-E

Community charity corporations

Guide to Subdivision 426-E

426-175 What this Subdivision is about

This Subdivision deals with philanthropic companies known as

community charity corporations

The Minister must make guidelines determining when community

charity corporations are entitled to be endorsed as deductible gift

recipients.

This Subdivision also provides for penalties for failures to comply

with the guidelines.

Table of sections

Community charity corporations

426-180 Community charity corporations

Schedule 3

New class of deductible gift recipients

Part 2

Amendment of the Taxation Administration Act 1953

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

426-185 Community charity corporation guidelines

426-190 Australian Business Register must show community charity corporation

status

Administrative penalties

426-195 Administrative penalties for community charity corporations

Limitation on certain transfers

426-200 Limitation on community charity corporations making certain transfers

Community charity corporations

426-180 Community charity corporations

(1) A company is a

community charity corporation

if:

(a) the company is:

(i) a

constitutional corporation; or

(ii) a body corporate that is not a constitutional corporation;

and

(b) the company is specified in a declaration in force under

subsection (3); and

approved

form given to the Commissioner, to comply with the rules in

the

community charity corporation guidelines, as in force

from time to time; and

(d) none of the directors of the company has revoked that

agreement in accordance with subsection (2).

(2) A director may revoke an agreement mentioned in paragraph (1)(c)

only by giving the revocation to the Commissioner in the

approved form.

(3) The Minister may, by legislative instrument, declare one or more

companies for the purposes of paragraph (1)(b).

426-185 Community charity corporation guidelines

The Minister must, by legislative instrument, formulate guidelines

(the

community charity corporation guidelines

) setting out:

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

(a) rules that

community charity corporations and their directors

must comply with if the corporations are to be, or are to

remain, endorsed as

deductible gift recipients; and

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

the amount of the administrative penalty, under

subsection 426-195(1) in relation to community charity

corporations.

426-190 Australian Business Register must show community charity

corporation status

(1) If a

community charity corporation has an

ABN, the

Australian

Business Registrar must enter in the

Australian Business Register

in relation to the corporation a statement that it is a community

charity corporation.

Note 1:

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

not affect whether a company is a community charity corporation.

Note 2:

The Australian Business Register will also show if a community

charity corporation 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

426-195 Administrative penalties for community charity

corporations

Administrative penalty

(1) All of the directors of a

community charity corporation are jointly

and severally liable to an administrative penalty if:

Schedule 3

New class of deductible gift recipients

Part 2

Amendment of the Taxation Administration Act 1953

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

that the corporation is endorsed as a

deductible gift recipient

and the corporation is not so endorsed; or

(b) the corporation, or a director of the corporation, holds out

that the corporation is entitled to remain endorsed as a

deductible gift recipient and the corporation is not so entitled;

that the corporation will be endorsed, as a deductible gift

recipient, at a particular time and the corporation is not so

endorsed at that time.

Note:

The Commissioner is required to give written notice of the penalty

(see section 298-10).

(2) The amount of the penalty is:

(a) the amount specified in the

community charity corporation

guidelines for the purposes of subsection (1); or

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

specified in the community charity corporation guidelines for

the purposes of subsection (1).

The guidelines may specify different penalties or methods for

different circumstances.

(3) A director who is liable to the penalty must not be reimbursed the

penalty from the corporation.

Note:

Division 298 in this Schedule contains machinery provisions for

administrative penalties.

Defences for directors

(4) Subsection (1) does not apply to a director if:

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

paragraph (1)(a), (b) or (c) (whichever applicable) 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

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

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

paragraph (4)(a), (b) or (c), have regard to all relevant

circumstances.

(6) A person who wishes to rely on subsection (4) bears an evidential

burden in relation to the matters in that subsection.

Power of courts to grant relief

(7) 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.

Limitation on certain transfers

426-200 Limitation on community charity corporations making

certain transfers

community charity corporation must not provide money,

property or benefits to:

(a) another community charity corporation; or

(b) an

ancillary fund; or

community charity trust;

unless permitted to do so by the

community charity corporation

guidelines.

Schedule 3

New class of deductible gift recipients

Part 3

Other amendments

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

Part

3--Other amendments

A New Tax System (Australian Business Number) Act 1999

35 Paragraph 26(3)(ga)

Omit "or 426

115", substitute ", 426

-115, 426-119 or 426-

190".

Deductible gift recipients

specific listings

Schedule 4

No. , 2023

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

Schedule

4--Deductible gift recipients--

specific listings

Income Tax Assessment Act 1997

1 Subsection 30-45(2) (table item 4.2.44, column headed

"Special conditions")

Omit "9

March 2023", substitute "9

March 2028".

2 Section 30-90 (table item

10.2.9, column headed "Special

conditions")

Omit "and bef

ore 1

July 2023".

3 In the appropriate position in subsection 30-105(2) (table)

Insert:

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)

Insert:

64AB

Justice Reform Initiative Limited

item 13.2.38

5 Section 30-315 (after table item 116AA)

Insert:

116AB

Transparency International Australia

item 13.2.39

Schedule 5

Exemption for Global Infrastructure Hub Ltd

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

Schedule

5--Exemption for Global

Infrastructure Hub Ltd

Income Tax Assessment Act 1997

1 Section 50-40 (table item

8.4, column headed "Special

conditions", paragraph

(b))

Omit "1

July 2023", substitute "1

July 2024".

Note:

Table item 8.4 of section 50-40 will be repealed on 1 July 2025: see Part 2 of

Schedule 4 to the

Tax and Superannuation Laws Amendment (2015 Measures No. 1)

Act 2015

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

Schedule

6--Income tax amendments for

updates to accounting standards for

general insurance contracts

Part

1--Main amendments

Income Tax Assessment Act 1997

1 Section 321-10 (heading)

Repeal the heading, substitute:

321-10 Assessable income to include amount for reduction in

adjusted liability for incurred claims

2 Paragraph 321-10(a)

Repeal the paragraph, substitute:

(a) the value, at the end of the previous income year, of the

company's adjusted

liability for incurred claims under

general insurance policies; exceeds

3 Section 321-15 (heading)

Repeal the heading, substitute:

321-15 Deduction for increase in adjusted liability for incurred

claims

4 Paragraph 321-15(a)

Repeal the paragraph, substitute:

(a)

the value, at the end of the current year, of the company's

adjusted

liability for incurred claims under

general

insurance policies; exceeds

5 Section 321-20

Repeal the section, substitute:

Schedule 6

Income tax amendments for updates to accounting standards for general

insurance contracts

Part 1

Main amendments

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

worked out

Work out the value, at the end of an income year, of a

general

insurance company's adjusted

liability for incurred claims under

general insurance policies in this way:

Method statement

Step 1. Use the

applicable insurance contracts accounting

standard to measure, at the end of the income year, the

company's

liability for incurred claims under

general

insurance policies, but when doing so disregard any

claims handling costs that are neither attached to, nor

directly attributable to, a particular claim.

Step 2. Using that standard, reduce the result from step 1 by so

much of that result as the company expects at the end of

the income year to recover under a reinsurance contract:

(a) within the meaning of that standard; but

(b) that is not one to which subsection 148(1) of the

Income Tax Assessment Act 1936

(about

reinsurance with non-residents) applies.

6 Section 321-45

Omit "or receivable".

7 Section 321-50 (heading)

Repeal the heading, substitute:

321-50 Assessable income to include amount for reduction in

adjusted liability for remaining coverage

8 Paragraph 321-50(a)

Omit "unearned premium reserve", substitute "adjusted

liability for

remaining coverage under

general insurance policies".

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

9 Paragraph 321-50(b)

Omit "reserve", substitute "liability".

10 Section 321-55 (heading)

Repeal the heading, substitute:

321-55 Deduction for increase in adjusted liability for remaining

coverage

11 Paragraph 321-55(a)

Omit "unearned premium reserve", substitute "adjusted

liability for

remaining coverage under

general insurance policies".

12 Paragraph 321-55(b)

Omit "reserve", substitute "liability".

13 Section 321-60

Repeal the section, substitute:

321-60 How the value of adjusted liability for remaining coverage is

worked out

Work out the value, at the end of an income year, of a

general

insurance company's adjusted

liability for remaining coverage

under

general insurance policies in this way:

Method statement

Step 1. Use the

applicable insurance contracts accounting

standard to measure, at the end of the income year, the

company's

liability for remaining coverage under

general insurance policies, but when doing so disregard

that

standard's treatment of loss components and

loss-recovery components of onerous contracts (within

the meaning of that standard).

Step 2. Using that standard, reduce the result from step 1 by any

asset for insurance acquisition cash flows.

Schedule 6

Income tax amendments for updates to accounting standards for general

insurance contracts

Part 1

Main amendments

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

premiums paid or payable by the company, in that or an

earlier income year, for the reinsurance of risks covered

by those

general insurance policies in respect of later

income years, except:

(a) reinsurance premiums that the company cannot

deduct because of subsection 148(1) of the

Income

Tax Assessment Act 1936

(about reinsurance with

non-residents); and

(b) reinsurance premiums that were paid or payable in

respect of a particular class of

insurance business

if, under the reinsurance contract (within the

meaning of that standard), the reinsurer agreed to

pay, in respect of a loss incurred by the company

that is covered by the relevant policy, some or all

of the excess over an agreed amount.

Step 4. Using that standard, add to the result from step 3 any

reinsurance commissions received or receivable by the

company that relate to reinsurance premiums counted

under step 3.

14 Subsection 995-1(1)

Insert:

applicable insurance contracts accounting standard

means:

(a) unless paragraph (b) applies

accounting standard AASB

17, as in force on 31 December 2022; or

(b) if the regulations prescribe another accounting standard

(which may be AASB 17 as in force at another time)

that

accounting standard.

asset for insurance acquisition cash flows

has the same meaning

as in the

applicable insurance contracts accounting standard.

liability for incurred claims

has the same meaning as in the

applicable insurance contracts accounting standard.

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

Note:

For how to work out the adjusted liability for incurred claims, see

section 321-20.

liability for remaining coverage

has the same meaning as in the

applicable insurance contracts accounting standard.

Note:

For how to work out the adjusted liability for remaining coverage, see

section 321-60.

Schedule 6

Income tax amendments for updates to accounting standards for general

insurance contracts

Part 2

Other amendments

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

Part

2--Other amendments

Income Tax Assessment Act 1997

15 Section 10-

5 (table item headed "general insurance

companies and companies that self insure")

Repeal the item, substitute:

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

companies and companies that self insure")

Repeal the item, substitute:

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)

Repeal the paragraph, substitute:

(i) the

liability for incurred claims of a

general insurance

company or of a private health insurer (within the

meaning of the

Private Health Insurance (Prudential

Supervision) Act 2015

) under

general insurance

policies;

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

(ii) the

liability for remaining coverage of a general

insurance company or of a private health insurer (within

the meaning of that Act) under general insurance

policies; or

18 Paragraph 713-710(a)

Omit "the outstanding claims liability of a

general insurance

company", substitute "a

neral insurance company's adjusted

liability for incurred claims".

19 Paragraph 713-710(b)

Omit "the unearned premium reserve of a general insurance company",

substitute "a general insurance company's adjusted

liability for

remaining coverage".

20 Section 713-710 (note 1)

Omit "the outstanding claims liability of a general insurance company",

substitute "a general insurance company's adjusted liability for incurred

claims".

21 Section 713-710 (note 2)

Omit "the unearned premium reserve of a general insurance company",

substitute "a general insurance company's adjusted liability for

remaining coverage".

22 Subsection 713-725(4)

Repeal the subsection, substitute:

(4) The things are the

general insurance company's:

(a)

assets for insurance acquisition cash flows to the extent that

they are used to measure the company's adjusted

liability for

remaining coverage; and

(b) deferred reinsurance expenses to the extent that they are used

to measure the company's adjusted liability for remaining

coverage; and

under the

applicable insurance contracts standard to the

extent that they relate to insurance contracts or reinsurance

contracts; and

Schedule 6

Income tax amendments for updates to accounting standards for general

insurance contracts

Part 2

Other amendments

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

attributable to, a particular claim, to the extent that these

costs are used to measure the company's adjusted

liability

for incurred claims; and

(e) loss components and loss-recovery components of onerous

contracts to the extent that they are used to measure the

company's adjusted liability for remaining coverage.

23 Subsection 995-1(1) (definition of

outstanding claims

)

Repeal the definition.

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

Part

3--Application and transitional provisions

24 Definition

In this Part:

start year

means the first income year starting on or after 1 January

2023.

25 Application of amendments

The amendments made by this Schedule apply in relation to

assessments for the start year and later income years.

26 Transitional

first income year for which amendments

apply

Scope

(1)

This item applies to a general insurance company unless the company

elects for item 27 to apply in the manner set out in that item.

Provision for, and payment of, claims by general insurance

companies

(2)

In applying Subdivision 321-A of the

Income Tax Assessment Act 1997

(as amended by this Schedule) to a general insurance company's

assessment for the start year:

(a) treat paragraphs 321-10(a) and 321-15(b) of that Act as

referring to the value, at the end of the previous income year,

of the company's liability for outstanding claims under

general insurance policies; and

(b) that value is to be worked out:

(i) under section 321-20 of that Act as in force immediately

before the commencement of this Schedule; and

(ii) not under that section as amended by this Schedule.

(3)

Subitem (2) does not affect paragraph 321-10(b) of that Act.

Note:

That paragraph refers to the value, at the end of that first income year, of the company's

adjusted liability for incurred claims under general insurance policies.

Schedule 6

Income tax amendments for updates to accounting standards for general

insurance contracts

Part 3

Application and transitional provisions

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

Premium income of general insurance companies

(4)

In applying Subdivision 321-B of the

Income Tax Assessment Act 1997

(as amended by this Schedule) to a general insurance company's

assessment for the start year:

(a) treat paragraphs 321-50(a) and 321-55(b) of that Act as

referring to the value, at the end of the previous income year,

of the company's unearned premium reserve; and

(b) that value is to be worked out:

(i) under section 321-60 of that Act as in force immediately

before the commencement of this Schedule; and

(ii) not under that section as amended by this Schedule.

(5)

Subitem (4) does not affect paragraph 321-50(b) of that Act.

Note:

That paragraph refers to the value, at the end of that first income year, of the company's

adjusted liability for remaining coverage under general insurance policies.

27 Transitional

special provision for certain income years

Election for this item to apply

(1)

This item applies to a general insurance company for the following

income years (each a

relevant income year

) if the company chooses for

this item, instead of item 26, to apply to the company:

(a) the start year;

(b) the following 4 income years.

(2)

The choice:

(a) is irrevocable; and

(b) must be made in the approved form by the earlier of:

(i)

the day by which the company's income tax return for

the start year is due to be lodged; and

(ii) the day on which that income tax return is lodged.

Note:

The Commissioner may defer the time for giving the choice: see section 388-55 in

Schedule 1 to the

Taxation Administration Act 1953

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

Interaction with other amendments

(3)

This item has effect in addition to the operation of the

Income Tax

Assessment Act 1997

, as amended by this Schedule, provided for by

item 25 of this Schedule.

Provision for, and payment of, claims by general insurance

companies

(4)

If:

(a) the value, at the end of the income year before the start year,

of the company's liability for outstanding claims under

general insurance policies as worked out:

(i) under section 321-20 of the

Income Tax Assessment Act

1997

as in force immediately before the commencement

of this Schedule; and

(ii) not under that section as amended by this Schedule;

exceeds

(b) the value, at the end of the income year before the start year,

of the

company's adjusted liability for incurred claims under

general insurance policies as worked out under

section 321-20 of that Act as amended by this Schedule;

the company's assessable income for each relevant income year

includes an amount equal to one-fifth of the excess.

(5)

If:

(a) the value, at the end of the income year before the start year,

of the company's adjusted liability for incurred claims under

general insurance policies as worked out under

section 321-20 of the

Income Tax Assessment Act 1997

amended by this Schedule; exceeds

(b) the value, at the end of the income year before the start year,

of the company's liability for outstanding claims under

general insurance policies as worked out:

(i) under section 321-20 of that Act as in force immediately

before the commencement of this Schedule; and

(ii) not under that section as amended by this Schedule;

the company can deduct for each relevant income year an amount equal

to one-fifth of the excess.

Schedule 6

Income tax amendments for updates to accounting standards for general

insurance contracts

Part 3

Application and transitional provisions

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

Premium income of general insurance companies

(6)

If:

(a) the value, at the end of the income year before the start year,

of the company's unearned premium reserve as worked out:

(i) under section 321-60 of the

Income Tax Assessment Act

1997

as in force immediately before the commencement

of this Schedule; and

(ii) not under that section as amended by this Schedule;

exceeds

(b) the value, at the end of the income year before the start year,

of the company's adjusted liability for remaining

coverage

under general insurance policies as worked out under

section 321-60 of that Act as amended by this Schedule;

the company's assessable income for each relevant income year

includes an amount equal to one-fifth of the excess.

(7)

If:

(a) the value, at the end of the income year before the start year,

of the company's adjusted liability for remaining coverage

under general insurance policies as worked out under

section 321-60 of the

Income Tax Assessment Act 1997

amended by this Schedule; exceeds

(b) the value, at the end of the income year before the start year,

of the company's unearned premium reserve as worked out:

(i) under section 321-60 of that Act as in force immediately

before the commencement of this Schedule; and

(ii) not under that section as amended by this Schedule;

the company can deduct for each relevant income year an amount equal

to one-fifth of the excess.

Company ceases to carry on insurance business

(8)

However, if the company ceases in a relevant income year to carry on

an insurance business:

(a) subitems (4) to (7) do not apply for that income year or any

future income years; and

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

(b) instead, for that income year, so much of any excess referred

to in any of those subitems as has not been included in the

company's assessa

ble income, or allowed as a deduction, for

any previous relevant income years is to be included in that

assessable income or allowed as a deduction (as the case

requires).

Schedule 7

Non-

arm's length expenses of superann

uation funds

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

Income Tax Assessment Act 1997

1 Subsection 295-545(2)

Repeal the subsection, substitute:

(2) If an entity is not of a kind referred to in paragraph 295-550(8)(a)

(about certain small entities), the

non-

arm's length component

for

an income year is the entity's

non-

arm's length income for that

year less any deductions to the extent that they are attributable to

that income.

(2A) If the entity is of a kind referred to in paragraph 295-550(8)(a)

(about certain small entities), the

non-

arm's length component

for

an income year is the lesser of:

(a) the sum of:

(i)

each amount of the entity's

non-

arm's length income

under subsection 295-550(1), (2), (4) or (5) for that year

less any deductions to the extent that they are

attributable to that income; and

(ii) each

amount of the entity's non

arm's length income

under subsection 295-550(8) or (9) for that year; and

(b)

the entity's taxable income for the income year:

(i)

less the contributions that are included in the entity's

assessable income under Subdivision 295-C for the

income year; and

(ii) plus any deductions to the extent that they are

attributable to those contributions.

2 Paragraphs 295-550(1)(b) and (c)

Repeal the paragraphs, substitute:

(b) if the entity is of a kind referred to in paragraph (8)(a) (about

certain small entities):

(i) in gaining or producing the income, the entity incurs a

loss, outgoing or expenditure of an amount that is less

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

than the amount of a loss, outgoing or expenditure that

the entity might have been expected to incur if those

parties had been dealing with each other at arm's length

in relation to the scheme; and

(ii) subsection (8) does not apply to the loss, outgoing or

expenditure;

certain small entities):

(i) in gaining or producing the income, the entity does not

incur a loss, outgoing or expenditure that the entity

might have been expected to incur if those parties had

been dealing with each other at arm's length in relation

to the scheme; and

(ii) subsection (9) does not apply to the loss, outgoing or

expenditure that the entity might have been expected to

incur.

3 Paragraphs 295-550(5)(b) and (c)

Repeal the paragraphs, substitute:

(b) if the entity is of a kind referred to in paragraph (8)(a) (about

certain small entities)

in acquiring the entitlement or in

gaining or producing the income, the entity incurs a loss,

outgoing or expenditure of an amount that is less than the

amount of a loss, outgoing or expenditure that the entity

might have been expected to incur if those parties had been

dealing with each other at arm's length in relation to the

scheme;

certain small entities)

in acquiring the entitlement or in

gaining or producing the income, the entity does not incur a

loss, outgoing or expenditure that the entity might have been

expected to incur if those parties had been dealing with each

other at arm's length in relation to the scheme.

4 At the end of section 295-550

Add:

Schedule 7

Non-

arm's length expenses of superannuation funds

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

Certain small entities

general expenses

(8) If:

(a) a

complying superannuation entity is:

(i) a

regulated superannuation fund with no more than 6

members; or

(ii) a

self managed superannuation fund; and

(b) as a result of a

scheme the parties to which were not dealing

with each other at

arm's length in relation to the scheme:

(i) in gaining or producing the

ordinary income and

statutory income of the entity (but not in gaining or

producing income in relation to any particular asset or

assets of the entity), the entity incurs a loss, outgoing or

expenditure of an amount; and

(ii) the amount is less than the amount of a loss, outgoing or

expenditure that the entity might have been expected to

incur if those parties had been dealing with each other at

arm's length in relation to the scheme;

an amount of the entity's ordinary income and statutory income

equal to twice the difference between the amount that the entity did

incur and the amount that the entity might have been expected to

incur is

non-

arm's length income

of the entity.

(9) If:

(a) a

complying superannuation entity is of a kind referred to in

paragraph (8)(a) (about certain small entities); and

(b) as a result of a

scheme the parties to which were not dealing

with each other at

arm's length in relation to the scheme, in

gaining or producing the

ordinary income and

statutory

income of the entity (but not in gaining or producing income

in relation to any particular asset or assets of the entity), the

entity does not incur a loss, outgoing or expenditure that the

entity might have been expected to incur if those parties had

been dealing with each other at arm's length in relation to the

scheme;

an amount of the entity's ordinary income and statutory income

equal to twice the amount that the entity might have been expected

to incur is

non-

arm's length income

of the entity.

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

5 Application of amendments

(1)

The amendments of the

Income Tax Assessment Act 1997

made by this

Schedule apply in relation to income derived in the 2018-19 income

year or a later income year.

(2)

Despite subitem (1), the amendments do not apply in relation to:

(a) a loss, outgoing or expenditure that is incurred before the

2018-19 income year; and

(b) a loss, outgoing or expenditure that was not incurred before

the 2018-19 income year, but might have been expected to be

incurred before the 2018-19 income year.

(3)

To avoid doubt, the amendments of the

Income Tax Assessment Act

1997

made by Schedule 2 to the

Treasury Laws Amendment (2018

Superannuation Measures No. 1) Act 2019

do not apply, and are taken

never to have applied, in relation to:

(a) a loss, outgoing or expenditure that is incurred before the

2018-19 income year; and

(b) a loss, outgoing or expenditure that was not incurred before

the 2018-19 income year, but might have been expected to be

incurred before the 2018-19 income year.

Schedule 8

AFCA scheme

Part 1

Main amendments

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

Schedule

8--AFCA scheme

Part

1--Main amendments

Corporations Act 2001

1 Section 9 (definition of

superannuation complaint

)

Omit "subsections

1053(3) and (4)", substitute "sec

tion

1053".

2 Section 761A (definition of

superannuation complaint

)

Omit "subsection

1053(3)", substitute "section

1053".

3 Subsection 1051(4) (note)

Omit "The complaints may be complaints relating to superannuation or

complaints relating to other financ

ial services.".

4 Subdivision A of Division 3 of Part 7.10A (heading)

Repeal the heading, substitute:

Subdivision A

Preliminary

5 Section 1053 (heading)

Repeal the heading, substitute:

1053 Meaning of

superannuation complaint

6 Subsection 1053(1)

Omit "A person may, subject to section

1056, make a complaint relating

to superannuation under the AFCA scheme only if the complaint is a

complaint", substitute "Subject to subsection

(4), a complaint made

under the AFCA scheme is a

superannuation complaint

if the

complaint is".

7 Subsection 1053(1) (note 1)

Repeal the note.

AFCA scheme

Schedule 8

Main amendments

Part 1

No. , 2023

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

8 Subsection 1053(1) (note 2)

Omit "2".

9 Subsection 1053(3)

Repeal the subsection.

10 At the end of Subdivision A of Division 3 of Part 7.10A

Add:

1053B This Division does not restrict ability to make other

complaints

To avoid doubt, this Division does not limit the ability of a person

to make a complaint under the AFCA scheme (including a

complaint relating to superannuation) that is not a superannuation

complaint.

Note:

Schedule 8 to the

Treasury Laws Amendment (Support for Small

Business and Charities and Other Measures) Act 2023

, which added

this section, was enacted as a response to the decision of the Federal

Court of Australia in

MetLife Insurance Limited v Australian

Financial Complaints Authority Limited

[2022] FCAFC 173.

Schedule 8

AFCA scheme

Part 2

Application provision

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

No. , 2023

Part

2--Application provision

Corporations Act 2001

11 In the appropriate position in Chapter 10

Insert:

Part

10.73--Application provisions relating to

Schedule

8 to the Treasury Laws

Amendment (Support for Small Business

and Charities and Other Measures) Act

2023

1703 Application provision

(1) The amendments made by Part 1 of Schedule 8 to the

Treasury

Laws Amendment (Support for Small Business and Charities and

Other Measures) Act 2023

apply in relation to a complaint made

under the AFCA scheme, whether the complaint was made before,

on or after the commencement of this section.

(2) To avoid doubt, a reference in subsection (1) of this section to a

complaint made under the AFCA scheme includes a reference to a

complaint that:

(a) was purportedly made under the AFCA scheme before that

commencement; and

(b) was a complaint relating to superannuation but was not a

superannuation complaint.

(3) Despite subsection (1), the amendments do not affect the validity

(or invalidity) of a determination, made or purportedly made by

AFCA before that commencement, of a complaint made under the

AFCA scheme.

AFCA scheme

Schedule 8

Other amendments

Part 3

No. , 2023

Treasury Laws Amendment (Support for Small Business and Charities

and Other Measures) Bill 2023

Part

3--Other amendments

Treasury Laws Amendment (2023 Law Improvement

Package No. 1) Act 2023

12 Item 555 of Schedule 2 (heading)

Omit "

Commonwealth of Australia Bills

TREASURY LAWS AMENDMENT (SUPPORT FOR SMALL BUSINESS AND CHARITIES AND OTHER MEASURES) BILL 2023

Document Outline