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This is a Bill, not an Act. For current law, see the Acts databases.
2016-2017
The Parliament of the
Commonwealth of Australia
HOUSE OF REPRESENTATIVES
Presented and read a first time
Treasury Laws Amendment (Enterprise
Tax Plan No. 2) Bill 2017
No. , 2017
(Treasury)
A Bill for an Act to amend the law relating to
taxation, and for related purposes
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
i
Contents
1
Short title ........................................................................................... 1
2
Commencement ................................................................................. 1
3
Schedules ........................................................................................... 3
Schedule 1--Reducing the corporate tax rate
4
Part 1--Amendments commencing 1 July 2019
4
Income Tax Rates Act 1986
4
Part 2--Amendments commencing 1 July 2020
5
Income Tax Rates Act 1986
5
Part 3--Amendments commencing 1 July 2021
6
Income Tax Rates Act 1986
6
Part 4--Amendments commencing 1 July 2022
7
Income Tax Rates Act 1986
7
Part 5--Amendments commencing 1 July 2023
8
Income Tax Rates Act 1986
8
Part 6--Amendments commencing 1 July 2024
10
Income Tax Rates Act 1986
10
Part 7--Amendments commencing 1 July 2025
11
Income Tax Rates Act 1986
11
Part 8--Amendments commencing 1 July 2026
12
Income Tax Rates Act 1986
12
Part 9--Application of amendments
13
Schedule 2--Main consequential amendments relating to
imputation
14
Part 1--Amendments commencing 1 July 2023
14
Income Tax Assessment Act 1997
14
Part 2--Application of amendments
18
Schedule 3--Other consequential amendments
19
ii
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Part 1--Amendments commencing 1 July 2023
19
Income Tax Assessment Act 1936
19
Income Tax Assessment Act 1997
19
Part 2--Amendments commencing 1 July 2024
22
Income Tax Assessment Act 1997
22
Part 3--Amendments commencing 1 July 2025
24
Income Tax Assessment Act 1997
24
Part 4--Amendments commencing 1 July 2026
26
Income Tax Assessment Act 1997
26
Schedule 4--Other amendments
28
Treasury Laws Amendment (Combating Multinational Tax Avoidance)
Act 2017
28
Treasury Laws Amendment (Enterprise Tax Plan) Act 2017
28
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
1
A Bill for an Act to amend the law relating to
1
taxation, and for related purposes
2
The Parliament of Australia enacts:
3
1 Short title
4
This Act is the Treasury Laws Amendment (Enterprise Tax Plan
5
No. 2) Act 2017.
6
2 Commencement
7
(1) Each provision of this Act specified in column 1 of the table
8
commences, or is taken to have commenced, in accordance with
9
column 2 of the table. Any other statement in column 2 has effect
10
according to its terms.
11
12
2
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Commencement information
Column 1
Column 2
Column 3
Provisions
Commencement
Date/Details
1. Sections 1 to 3
and anything in
this Act not
elsewhere covered
by this table
The day this Act receives the Royal Assent.
2. Schedule 1,
Part 1
1 July 2019.
1 July 2019
3. Schedule 1,
Part 2
1 July 2020.
1 July 2020
4. Schedule 1,
Part 3
1 July 2021.
1 July 2021
5. Schedule 1,
Part 4
1 July 2022.
1 July 2022
6. Schedule 1,
Part 5
1 July 2023.
1 July 2023
7. Schedule 1,
Part 6
1 July 2024.
1 July 2024
8. Schedule 1,
Part 7
1 July 2025.
1 July 2025
9. Schedule 1,
Part 8
1 July 2026.
1 July 2026
10. Schedule 1,
Part 9
The day this Act receives the Royal Assent.
11. Schedule 2,
Part 1
1 July 2023.
1 July 2023
12. Schedule 2,
Part 2
The day this Act receives the Royal Assent.
13. Schedule 3,
Part 1
1 July 2023.
1 July 2023
14. Schedule 3,
Part 2
1 July 2024.
1 July 2024
15. Schedule 3,
Part 3
1 July 2025.
1 July 2025
16. Schedule 3,
Part 4
1 July 2026.
1 July 2026
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
3
Commencement information
Column 1
Column 2
Column 3
Provisions
Commencement
Date/Details
17. Schedule 4,
items 1 and 2
Immediately after the commencement of
section 1 of the Treasury Laws Amendment
(Combating Multinational Tax Avoidance)
Act 2017.
4 April 2017
18. Schedule 4,
items 3, 4 and 5
Immediately after the commencement of
section 1 of the Treasury Laws Amendment
(Enterprise Tax Plan) Act 2017.
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 Reducing the corporate tax rate
Part 1 Amendments commencing 1 July 2019
4
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Schedule 1--Reducing the corporate tax rate
1
Part 1--Amendments commencing 1 July 2019
2
Income Tax Rates Act 1986
3
1 Paragraph 23AA(b)
4
Omit "$50 million", substitute "$100 million".
5
Reducing the corporate tax rate Schedule 1
Amendments commencing 1 July 2020 Part 2
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
5
Part 2--Amendments commencing 1 July 2020
1
Income Tax Rates Act 1986
2
2 Paragraph 23AA(b)
3
Omit "$100 million", substitute "$250 million".
4
Schedule 1 Reducing the corporate tax rate
Part 3 Amendments commencing 1 July 2021
6
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Part 3--Amendments commencing 1 July 2021
1
Income Tax Rates Act 1986
2
3 Paragraph 23AA(b)
3
Omit "$250 million", substitute "$500 million".
4
Reducing the corporate tax rate Schedule 1
Amendments commencing 1 July 2022 Part 4
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
7
Part 4--Amendments commencing 1 July 2022
1
Income Tax Rates Act 1986
2
4 Paragraph 23AA(b)
3
Omit "$500 million", substitute "$1 billion".
4
Schedule 1 Reducing the corporate tax rate
Part 5 Amendments commencing 1 July 2023
8
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Part 5--Amendments commencing 1 July 2023
1
Income Tax Rates Act 1986
2
5 Subsection 3(1) (definition of base rate entity)
3
Repeal the definition.
4
6 Subsection 12(10)
5
Omit "30%", substitute "27.5%".
6
7 Subsection 23(2)
7
Repeal the subsection, substitute:
8
(2) The rate of tax in respect of the taxable income of a company is
9
27.5%, if subsections (3) to (5) and section 23A do not apply to the
10
company.
11
8 Paragraph 23(3)(b)
12
Repeal the paragraph, substitute:
13
(b) in respect of the standard component--27.5%.
14
9 Paragraph 23(4)(c)
15
Repeal the paragraph, substitute:
16
(c) in respect of so much of the taxable income as exceeds the
17
PDF component--27.5%.
18
10 Paragraph 23(6)(b)
19
Repeal the paragraph, substitute:
20
(b) the taxable income is not greater than $832.
21
11 Subsection 23(7)
22
Repeal the subsection, substitute:
23
(7) The amount of tax payable by a company (before applying any
24
rebate, credit or other tax offset (within the meaning of the Income
25
Tax Assessment Act 1997)) must not be greater than 41.25% of the
26
amount by which the taxable income of the company exceeds
27
Reducing the corporate tax rate Schedule 1
Amendments commencing 1 July 2023 Part 5
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
9
$49,999, if the company is a recognised medium credit union in
1
relation to the year of income.
2
12 Section 23AA
3
Repeal the section.
4
13 Paragraph 23A(a)
5
Omit "30%", substitute "27.5%".
6
14 Section 25
7
Repeal the section, substitute:
8
25 Rate of tax payable by trustees of public trading trusts
9
The rate of tax payable by a trustee of a public trading trust in
10
respect of the net income of the public trading trust in respect of
11
which the trustee is liable, under section 102S of the Assessment
12
Act, to be assessed and to pay tax is 27.5%.
13
15 Paragraph 28(a)
14
Repeal the paragraph, substitute:
15
(a) if paragraph 98(3)(b) of the Assessment Act (about
16
beneficiaries that are companies) applies--the rate specified
17
in subsection 23(2) of this Act; and
18
16 Paragraph 28A(a)
19
Omit "paragraph 23(2)(b)", substitute "subsection 23(2)".
20
Schedule 1 Reducing the corporate tax rate
Part 6 Amendments commencing 1 July 2024
10
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Part 6--Amendments commencing 1 July 2024
1
Income Tax Rates Act 1986
2
17 Subsection 12(10)
3
Omit "27.5%", substitute "27%".
4
18 Subsection 23(2)
5
Omit "27.5%", substitute "27%".
6
19 Paragraph 23(3)(b)
7
Omit "27.5%", substitute "27%".
8
20 Paragraph 23(4)(c)
9
Omit "27.5%", substitute "27%".
10
21 Paragraph 23(6)(b)
11
Omit "$832", substitute "$817".
12
22 Subsection 23(7)
13
Omit "41.25%", substitute "40.5%".
14
23 Paragraph 23A(a)
15
Omit "27.5%", substitute "27%".
16
24 Section 25
17
Omit "27.5%", substitute "27%".
18
Reducing the corporate tax rate Schedule 1
Amendments commencing 1 July 2025 Part 7
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
11
Part 7--Amendments commencing 1 July 2025
1
Income Tax Rates Act 1986
2
25 Subsection 12(10)
3
Omit "27%", substitute "26%".
4
26 Subsection 23(2)
5
Omit "27%", substitute "26%".
6
27 Paragraph 23(3)(b)
7
Omit "27%", substitute "26%".
8
28 Paragraph 23(4)(c)
9
Omit "27%", substitute "26%".
10
29 Paragraph 23(6)(b)
11
Omit "$817", substitute "$788".
12
30 Subsection 23(7)
13
Omit "40.5%", substitute "39%".
14
31 Paragraph 23A(a)
15
Omit "27%", substitute "26%".
16
32 Section 25
17
Omit "27%", substitute "26%".
18
Schedule 1 Reducing the corporate tax rate
Part 8 Amendments commencing 1 July 2026
12
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Part 8--Amendments commencing 1 July 2026
1
Income Tax Rates Act 1986
2
33 Subsection 12(10)
3
Omit "26%", substitute "25%".
4
34 Subsection 23(2)
5
Omit "26%", substitute "25%".
6
35 Paragraph 23(3)(b)
7
Omit "26%", substitute "25%".
8
36 Paragraph 23(4)(c)
9
Omit "26%", substitute "25%".
10
37 Paragraph 23(6)(b)
11
Omit "$788", substitute "$762".
12
38 Subsection 23(7)
13
Omit "39%", substitute "37.5%".
14
39 Paragraph 23A(a)
15
Omit "26%", substitute "25%".
16
40 Section 25
17
Omit "26%", substitute "25%".
18
Reducing the corporate tax rate Schedule 1
Application of amendments Part 9
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
13
Part 9--Application of amendments
1
41 Application of amendments
2
(1)
Subject to the following subitems, the amendments made by Part 1 of
3
this Schedule apply to the 2019-20 year of income and later years of
4
income.
5
(2)
Subject to the following subitems, the amendments made by Part 2 of
6
this Schedule apply to the 2020-21 year of income and later years of
7
income.
8
(3)
Subject to the following subitems, the amendments made by Part 3 of
9
this Schedule apply to the 2021-22 year of income and later years of
10
income.
11
(4)
Subject to the following subitems, the amendments made by Part 4 of
12
this Schedule apply to the 2022-23 year of income and later years of
13
income.
14
(5)
Subject to the following subitems, the amendments made by Part 5 of
15
this Schedule apply to the 2023-24 year of income and later years of
16
income.
17
(6)
Subject to the following subitems, the amendments made by Part 6 of
18
this Schedule apply to the 2024-25 year of income and later years of
19
income.
20
(7)
Subject to the following subitem, the amendments made by Part 7 of
21
this Schedule apply to the 2025-26 year of income and later years of
22
income.
23
(8)
The amendments made by Part 8 of this Schedule apply to the 2026-27
24
year of income and later years of income.
25
Schedule 2 Main consequential amendments relating to imputation
Part 1 Amendments commencing 1 July 2023
14
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Schedule 2--Main consequential amendments
1
relating to imputation
2
Part 1--Amendments commencing 1 July 2023
3
Income Tax Assessment Act 1997
4
1 Subsection 36-55(2) (method statement, step 2)
5
Omit "the entity's
*
corporate tax rate for imputation purposes for that
6
year", substitute "the
*
corporate tax rate".
7
2 Subsection 197-45(2) (formula)
8
Repeal the formula, substitute:
9
*
Applicable franking percentage
Transferred amount
Corporate tax gross-up rate
ï‚´
10
3 Subsection 197-45(2) (definition of applicable gross-up
11
rate)
12
Repeal the definition.
13
4 Subsection 197-60(3) (paragraph (a) of the definition of
14
applicable tax rate)
15
Omit "
*
the company's
*
corporate tax rate for imputation purposes for
16
the income year in which the choice is made", substitute "the
*
corporate
17
tax rate".
18
5 Subsection 197-60(4) (formula)
19
Repeal the formula, substitute:
20
*
*
1
Tainting amount at time
of choice to untaint
Corporate tax gross-up rate
ï‚´
21
6 Subsection 197-60(4)
22
Omit all the words after the formula.
23
Main consequential amendments relating to imputation Schedule 2
Amendments commencing 1 July 2023 Part 1
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
15
7 Subsection 197-65(3) (formula)
1
Repeal the formula, substitute:
2
*
Applicable franking percentage
Transferred amount
Corporate tax gross-up rate
ï‚´
3
8 Subsection 197-65(3) (definition of applicable gross-up
4
rate)
5
Repeal the definition.
6
9 Subsection 200-25(1)
7
Omit "the entity's corporate tax rate for imputation purposes for the
8
income year in which the distribution is made", substitute "the
9
corporate tax rate".
10
10 Section 202-55
11
Omit "the entity's corporate tax rate for imputation purposes for the
12
income year in which the distribution is made", substitute "the
13
corporate tax rate".
14
11 Subsection 202-60(2) (formula)
15
Repeal the formula, substitute:
16
*
*
1
Amount of the frankable distribution
Corporate tax gross-up rate
ï‚´
17
12 Subsection 202-60(2)
18
Omit all the words after the formula.
19
13 Subsection 203-50(2) (formula)
20
Repeal the formula, substitute:
21
*
*
Franking % differential
Amount of the frankable distribution
Corporate tax gross-up rate
ï‚´
22
14 Subsection 203-50(2) (definition of applicable gross-up
23
rate)
24
Repeal the definition.
25
Schedule 2 Main consequential amendments relating to imputation
Part 1 Amendments commencing 1 July 2023
16
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
15 Subsection 215-20(2) (formula)
1
Repeal the formula, substitute:
2
*
*
Franking credit on the dividend
Corporate tax gross-up rate
ï‚´
3
16 Subsection 215-20(2)
4
Omit all the words after the formula.
5
17 Subsection 705-90(3) (formula)
6
Repeal the formula, substitute:
7
*
*
Balance of franking account (worked
Corporate tax gross-up rate
out on assumptions in subsection (4))
ï‚´
8
18 Subsection 705-90(3)
9
Omit all the words after the formula.
10
19 Paragraph 707-310(3A)(c) (formula)
11
Repeal the formula, substitute:
12
*
1
Franking offsets
Corporate tax rate
for the income year
ï‚´
13
20 Section 976-1 (formula)
14
Repeal the formula, substitute:
15
*
*
Franking credit on the distribution
Corporate tax gross-up rate
ï‚´
16
21 Section 976-1
17
Omit all the words after the formula.
18
22 Section 976-10 (formula)
19
Repeal the formula, substitute:
20
*
*
Exempting credit on the distribution
Corporate tax gross-up rate
ï‚´
21
23 Section 976-10
22
Omit all the words after the formula.
23
Main consequential amendments relating to imputation Schedule 2
Amendments commencing 1 July 2023 Part 1
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
17
24 Section 976-15 (formula)
1
Repeal the formula, substitute:
2
*
*
Venture capital credit on the distribution
Corporate tax gross-up rate
ï‚´
3
4
25 Section 976-15
5
Omit all the words after the formula.
6
26 Subsection 995-1(1) (definition of corporate tax gross-up
7
rate)
8
Repeal the definition, substitute:
9
corporate tax gross-up rate means the amount worked out using
10
the following formula:
11
*
*
100%
Corporate tax rate
Corporate tax rate
ï€-
12
27 Subsection 995-1(1) (definition of corporate tax rate)
13
Repeal the definition, substitute:
14
corporate tax rate means the rate of tax in respect of the taxable
15
income of a company under subsection 23(2) of the Income Tax
16
Rates Act 1986.
17
28 Subsection 995-1(1) (definition of corporate tax rate for
18
imputation purposes)
19
Repeal the definition.
20
Schedule 2 Main consequential amendments relating to imputation
Part 2 Application of amendments
18
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Part 2--Application of amendments
1
29 Application of amendments
2
The amendments made by Part 1 of this Schedule apply to the 2023-24
3
income year and later income years.
4
Other consequential amendments Schedule 3
Amendments commencing 1 July 2023 Part 1
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
19
Schedule 3--Other consequential
1
amendments
2
Part 1--Amendments commencing 1 July 2023
3
Income Tax Assessment Act 1936
4
1 Subsection 160AAB(1) (definition of statutory percentage)
5
Repeal the definition, substitute:
6
statutory percentage means:
7
(a) if the year of income is the 2002-03 year of income or a later
8
year of income before the 2024-25 year of income--30%; or
9
(b) if the year of income is the 2024-25 year of income--27.5%;
10
or
11
(c) if the year of income is the 2025-26 year of income--27%; or
12
(d) if the year of income is the 2026-27 year of income--26%; or
13
(e) if the year of income is the 2027-28 year of income or a later
14
year of income--25%.
15
Income Tax Assessment Act 1997
16
2 Subsection 36-17(5) (example)
17
Repeal the example, substitute:
18
Example: For the 2023-24 income year, Company A has:
19
ï‚·
a tax loss of $150 from a previous income year; and
20
ï‚·
assessable income of $200 (franked distribution of $72.50,
21
franking credit of $27.50 and $100 of income from other
22
sources); and
23
ï‚·
no deductions; and
24
ï‚·
no net exempt income.
25
The tax offset of $27.50 from the franking credit is not stated in
26
Division 67 to be subject to the refundable tax offset rules.
27
Company A would not have an amount of excess franking offsets for
28
that year if the tax loss were disregarded (see section 36-55). This is
29
because the tax offset of $27.50 is less than $55, the amount of income
30
tax that Company A would have to pay if it did not have the tax offset
31
and the tax loss. Paragraph (a) therefore does not apply.
32
Schedule 3 Other consequential amendments
Part 1 Amendments commencing 1 July 2023
20
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
If Company A chooses to deduct the full amount of the tax loss, it
1
would have an amount of excess franking offsets of $13.75:
2
$27.50
$200
$150
27.5%

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

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ï€-
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

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



3
Company A therefore cannot make this choice because of
4
paragraph (b).
5
However, if Company A chooses to deduct $100 of the tax loss, it
6
would not have an amount of excess franking offsets:
7
$27.50
$200
$100
27.5%

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


ï€-
ï‚´








8
Company A therefore can choose to deduct $100 of the tax loss.
9
3 Subsection 36-55(1) (example)
10
Repeal the example, substitute:
11
Example: For the 2023-24 income year, Company E has:
12
ï‚·
assessable income of $200 (franked distribution of $145 and
13
franking credit of $55); and
14
ï‚·
$100 of deductions that are allowable.
15
The tax offset of $55 from the franking credit is not stated in
16
Division 67 to be subject to the refundable tax offset rules.
17
Disregarding the tax offset of $55 from the franking credit, the amount
18
of income tax that Company E would have to pay is $27.50:
19
$145
$55
$100
27.5%





ï€-
ï‚´








20
This amount is $27.50 less than the tax offset of $55. Company E
21
therefore has an amount of excess franking offsets of $27.50 for that
22
year.
23
4 Subsection 36-55(2) (example)
24
Omit "2017-2018", substitute "2023-2024".
25
5 Subsection 36-55(2) (example)
26
Omit "$30", substitute "$27.50".
27
6 Subsection 65-30(2)
28
Repeal the subsection, substitute:
29
Other consequential amendments Schedule 3
Amendments commencing 1 July 2023 Part 1
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
21
(2) However, reduce the
*
tax offset by the amount worked out by
1
multiplying your
*
net exempt income by 0.275, if you have a
2
taxable income for the income year.
3
7 Subsection 65-35(3A)
4
Repeal the subsection, substitute:
5
(3A) In reducing
*
net exempt income for an income year under
6
subsection (3), each 27.5 cents of
*
tax offset reduces the net
7
exempt income by $1.
8
8 Subsection 115-280(3) (example)
9
Repeal the example, substitute:
10
Example: A listed investment company disposes of a CGT asset for $30,000.
11
The asset had a cost base of $10,000. The capital gain is therefore
12
$20,000. The company applies a capital loss of $10,000 against the
13
gain. Its net capital gain is $10,000.
14
The net capital gain is subject to tax at 27.5%. The after tax gain is
15
therefore $7,250.
16
The company pays a fully franked dividend to Daryl, one of its
17
shareholders. It advises Daryl that his share of the attributable part of
18
the dividend is:
19
$7.25
$7.25
0.275
1
0.275
$10







ï‚´

ï€-













20
Daryl, being an individual, can deduct 50% of $10, which is $5.
21
Schedule 3 Other consequential amendments
Part 2 Amendments commencing 1 July 2024
22
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Part 2--Amendments commencing 1 July 2024
1
Income Tax Assessment Act 1997
2
9 Subsection 36-17(5) (example)
3
Repeal the example, substitute:
4
Example: For the 2024-25 income year, Company A has:
5
ï‚·
a tax loss of $150 from a previous income year; and
6
ï‚·
assessable income of $200 (franked distribution of $73,
7
franking credit of $27 and $100 of income from other
8
sources); and
9
ï‚·
no deductions; and
10
ï‚·
no net exempt income.
11
The tax offset of $27 from the franking credit is not stated in
12
Division 67 to be subject to the refundable tax offset rules.
13
Company A would not have an amount of excess franking offsets for
14
that year if the tax loss were disregarded (see section 36-55). This is
15
because the tax offset of $27 is less than $54, the amount of income
16
tax that Company A would have to pay if it did not have the tax offset
17
and the tax loss. Paragraph (a) therefore does not apply.
18
If Company A chooses to deduct the full amount of the tax loss, it
19
would have an amount of excess franking offsets of $13.50:
20
$27
$200
$150
27%




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ï€-
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







21
Company A therefore cannot make this choice because of
22
paragraph (b).
23
However, if Company A chooses to deduct $100 of the tax loss, it
24
would not have an amount of excess franking offsets:
25
$27
$200
$100
27%





ï€-
ï‚´








26
Company A therefore can choose to deduct $100 of the tax loss.
27
10 Subsection 36-55(1) (example)
28
Repeal the example, substitute:
29
Example: For the 2024-25 income year, Company E has:
30
ï‚·
assessable income of $200 (franked distribution of $146 and
31
franking credit of $54); and
32
Other consequential amendments Schedule 3
Amendments commencing 1 July 2024 Part 2
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
23
ï‚·
$100 of deductions that are allowable.
1
The tax offset of $54 from the franking credit is not stated in
2
Division 67 to be subject to the refundable tax offset rules.
3
Disregarding the tax offset of $54 from the franking credit, the amount
4
of income tax that Company E would have to pay is $27:
5
$146
$54
$100
27%





ï€-
ï‚´








6
This amount is $27 less than the tax offset of $54. Company E
7
therefore has an amount of excess franking offsets of $27 for that year.
8
11 Subsection 36-55(2) (example)
9
Omit "2023-2024", substitute "2024-2025".
10
12 Subsection 36-55(2) (example)
11
Omit "$27.50", substitute "$27".
12
13 Subsection 65-30(2)
13
Omit "0.275", substitute "0.27".
14
14 Subsection 65-35(3A)
15
Omit "27.5", substitute "27".
16
15 Subsection 115-280(3) (example)
17
Repeal the example, substitute:
18
Example: A listed investment company disposes of a CGT asset for $30,000.
19
The asset had a cost base of $10,000. The capital gain is therefore
20
$20,000. The company applies a capital loss of $10,000 against the
21
gain. Its net capital gain is $10,000.
22
The net capital gain is subject to tax at 27%. The after tax gain is
23
therefore $7,300.
24
The company pays a fully franked dividend to Daryl, one of its
25
shareholders. It advises Daryl that his share of the attributable part of
26
the dividend is:
27
$7.30
$7.30
0.27
1
0.27
$10



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

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
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
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
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






28
Daryl, being an individual, can deduct 50% of $10, which is $5.
29
Schedule 3 Other consequential amendments
Part 3 Amendments commencing 1 July 2025
24
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Part 3--Amendments commencing 1 July 2025
1
Income Tax Assessment Act 1997
2
16 Subsection 36-17(5) (example)
3
Repeal the example, substitute:
4
Example: For the 2025-26 income year, Company A has:
5
ï‚·
a tax loss of $150 from a previous income year; and
6
ï‚·
assessable income of $200 (franked distribution of $74,
7
franking credit of $26 and $100 of income from other
8
sources); and
9
ï‚·
no deductions; and
10
ï‚·
no net exempt income.
11
The tax offset of $26 from the franking credit is not stated in
12
Division 67 to be subject to the refundable tax offset rules.
13
Company A would not have an amount of excess franking offsets for
14
that year if the tax loss were disregarded (see section 36-55). This is
15
because the tax offset of $26 is less than $52, the amount of income
16
tax that Company A would have to pay if it did not have the tax offset
17
and the tax loss. Paragraph (a) therefore does not apply.
18
If Company A chooses to deduct the full amount of the tax loss, it
19
would have an amount of excess franking offsets of $13:
20
$26
$200
$150
26%
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
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
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




21
Company A therefore cannot make this choice because of
22
paragraph (b).
23
However, if Company A chooses to deduct $100 of the tax loss, it
24
would not have an amount of excess franking offsets:
25
$26
$200
$100
26%

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

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
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
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
26
Company A therefore can choose to deduct $100 of the tax loss.
27
17 Subsection 36-55(1) (example)
28
Repeal the example, substitute:
29
Example: For the 2025-26 income year, Company E has:
30
ï‚·
assessable income of $200 (franked distribution of $148 and
31
franking credit of $52); and
32
Other consequential amendments Schedule 3
Amendments commencing 1 July 2025 Part 3
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
25
ï‚·
$100 of deductions that are allowable.
1
The tax offset of $52 from the franking credit is not stated in
2
Division 67 to be subject to the refundable tax offset rules.
3
Disregarding the tax offset of $52 from the franking credit, the amount
4
of income tax that Company E would have to pay is $26:
5
$148
$52
$100
26%

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
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

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




6
This amount is $26 less than the tax offset of $52. Company E
7
therefore has an amount of excess franking offsets of $26 for that year.
8
18 Subsection 36-55(2) (example)
9
Omit "2024-2025", substitute "2025-2026".
10
19 Subsection 36-55(2) (example)
11
Omit "$27", substitute "$26".
12
20 Subsection 65-30(2)
13
Omit "0.27", substitute "0.26".
14
21 Subsection 65-35(3A)
15
Omit "27", substitute "26".
16
22 Subsection 115-280(3) (example)
17
Repeal the example, substitute:
18
Example: A listed investment company disposes of a CGT asset for $30,000.
19
The asset had a cost base of $10,000. The capital gain is therefore
20
$20,000. The company applies a capital loss of $10,000 against the
21
gain. Its net capital gain is $10,000.
22
The net capital gain is subject to tax at 26%. The after tax gain is
23
therefore $7,400.
24
The company pays a fully franked dividend to Daryl, one of its
25
shareholders. It advises Daryl that his share of the attributable part of
26
the dividend is:
27
$7.40
$7.40
0.26
1
0.26
$10


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
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
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








28
Daryl, being an individual, can deduct 50% of $10, which is $5.
29
Schedule 3 Other consequential amendments
Part 4 Amendments commencing 1 July 2026
26
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Part 4--Amendments commencing 1 July 2026
1
Income Tax Assessment Act 1997
2
23 Subsection 36-17(5) (example)
3
Repeal the example, substitute:
4
Example: For the 2026-27 income year, Company A has:
5
ï‚·
a tax loss of $150 from a previous income year; and
6
ï‚·
assessable income of $200 (franked distribution of $75,
7
franking credit of $25 and $100 of income from other
8
sources); and
9
ï‚·
no deductions; and
10
ï‚·
no net exempt income.
11
The tax offset of $25 from the franking credit is not stated in
12
Division 67 to be subject to the refundable tax offset rules.
13
Company A would not have an amount of excess franking offsets for
14
that year if the tax loss were disregarded (see section 36-55). This is
15
because the tax offset of $25 is less than $50, the amount of income
16
tax that Company A would have to pay if it did not have the tax offset
17
and the tax loss. Paragraph (a) therefore does not apply.
18
If Company A chooses to deduct the full amount of the tax loss, it
19
would have an amount of excess franking offsets of $12.50:
20
$25
$200
$150
25%
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
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



21
Company A therefore cannot make this choice because of
22
paragraph (b).
23
However, if Company A chooses to deduct $100 of the tax loss, it
24
would not have an amount of excess franking offsets:
25
$25
$200
$100
25%





ï€-
ï‚´








26
Company A therefore can choose to deduct $100 of the tax loss.
27
24 Subsection 36-55(1) (example)
28
Repeal the example, substitute:
29
Example: For the 2026-27 income year, Company E has:
30
ï‚·
assessable income of $200 (franked distribution of $150 and
31
franking credit of $50); and
32
Other consequential amendments Schedule 3
Amendments commencing 1 July 2026 Part 4
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
27
ï‚·
$100 of deductions that are allowable.
1
The tax offset of $50 from the franking credit is not stated in
2
Division 67 to be subject to the refundable tax offset rules.
3
Disregarding the tax offset of $50 from the franking credit, the amount
4
of income tax that Company E would have to pay is $25:
5
$150
$50
$100
25%





ï€-
ï‚´








6
This amount is $25 less than the tax offset of $50. Company E
7
therefore has an amount of excess franking offsets of $25 for that year.
8
25 Subsection 36-55(2) (example)
9
Omit "2025-2026", substitute "2026-2027".
10
26 Subsection 36-55(2) (example)
11
Omit "$26", substitute "$25".
12
27 Subsection 65-30(2)
13
Omit "0.26", substitute "0.25".
14
28 Subsection 65-35(3A)
15
Omit "26", substitute "25".
16
29 Subsection 115-280(3) (example)
17
Repeal the example, substitute:
18
Example: A listed investment company disposes of a CGT asset for $30,000.
19
The asset had a cost base of $10,000. The capital gain is therefore
20
$20,000. The company applies a capital loss of $10,000 against the
21
gain. Its net capital gain is $10,000.
22
The net capital gain is subject to tax at 25%. The after tax gain is
23
therefore $7,500.
24
The company pays a fully franked dividend to Daryl, one of its
25
shareholders. It advises Daryl that his share of the attributable part of
26
the dividend is:
27
$7.50
$7.50
0.25
1
0.25
$10







ï‚´

ï€-













28
Daryl, being an individual, can deduct 50% of $10, which is $5.
29
Schedule 4 Other amendments
28
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
No. , 2017
Schedule 4--Other amendments
1
2
Treasury Laws Amendment (Combating Multinational Tax
3
Avoidance) Act 2017
4
1 Subsection 2(1) (table item 3)
5
Repeal the item, substitute:
6
3. Schedule 1,
item 7
At the same time as Part 1 of Schedule 2 to
the Treasury Laws Amendment (Enterprise
Tax Plan No. 2) Act 2017 commences.
However, the provisions do not commence
at all if that Part does not commence.
2 Item 7 of Schedule 1
7
Repeal the item, substitute:
8
7 Subsection 177A(1) (definition of standard corporate tax
9
rate)
10
Omit "covered by paragraph 23(2)(b)", substitute "under
11
subsection 23(2)".
12
Note:
This item commences on 1 July 2023, at the same time as Part 1 of Schedule 2 to the
13
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Act 2017.
14
Treasury Laws Amendment (Enterprise Tax Plan) Act 2017
15
3 Subsection 2(1) (table items 5, 6 and 7)
16
Repeal the items.
17
4 Parts 9, 10 and 11 of Schedule 1
18
Repeal the Parts.
19
5 Item 57 of Schedule 1
20
Repeal the item, substitute:
21
Other amendments Schedule 4
No. , 2017
Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017
29
57 Application of amendments
1
(1)
Subject to the following subitems, the amendments made by Part 1 of
2
this Schedule apply to the 2016-17 year of income and later years of
3
income.
4
(2)
Subject to the following subitem, the amendments made by Part 2 of
5
this Schedule apply to the 2017-18 year of income and later years of
6
income.
7
(3)
The amendments made by Part 3 of this Schedule apply to the 2018-19
8
year of income and later years of income.
9