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Income Tax Assessment Amendment Act 1983 No. 14 of 1983 - SECT 65
65. After section 221YH of the Principal Act the following Division is
inserted:
''Division 3A-Collection of tax in respect of certain payments for work
Interpretation
''221YHA. (1) In this Division, unless the contrary intention appears-
'construction permit' means a permit or other approval that is required by a
law of the Commonwealth, a State or a Territory in connection with the
undertaking or carrying out of a construction project;
'construction project' means-
(a) the construction, erection, installation, alteration, modification,
repair or improvement of a structure;
(b) the demolition, destruction, dismantling or removal of a structure; or
(c) the undertaking of earthworks or the clearing of land,
and includes-
(d) the installation in, or in connection with, a structure of a system
of, or device for, heating, insulation, lighting, air-conditioning,
ventilation, power supply, drainage, sanitation, water supply,
security or fire protection;
(e) the painting or decorating of a structure;
(f) landscape gardening; and
(g) such other activities in relation to structures or land as may be
prescribed for the purposes of this definition;
'contract' means a contract, whether express or implied, whether or not in
writing and whether or not enforceable, or intended to be enforceable, by
legal proceedings;
'deduction exemption certificate' means a certificate issued by the
Commissioner under section 221YHQ;
'deduction form', in relation to a prescribed payment, means a document in a
form that is published by the Commissioner in the Gazette for the purposes of
this definition and is applicable to the period within which the prescribed
payment is made;
'deduction variation certificate' means a certificate issued by the
Commissioner under section 221YHP;
'government body' means the Commonwealth, a State or the Northern Territory,
or an authority of the Commonwealth, of a State or of the Northern Territory;
'householder notification form' means a document in a form published by the
Commissioner in the Gazette for the purposes of this definition;
'issuing authority' means a person or body that issues construction permits;
'month' means any of the 12 months of the year;
'payee' means a person who receives, or is entitled to receive, a prescribed
payment under a contract;
'paying authority' means a person who makes, or is liable to make, a
prescribed payment;
'paying authority notification form' means a document in a form published by
the Commissioner in the Gazette for the purposes of this definition;
'payment' means a payment that is made, or is liable to be made, under a
contract the performance of which, in whole or in part, involves the
performance of work (whether or not by the person to whom the payment is made
or is liable to be made), but does not include-
(a) a payment of salary or wages within the meaning of section 221A, other
than salary or wages to which paragraph (a) of the definition of
''salary or wages'' in sub-section 221A (1) applies; or
(b) a payment of exempt income;
'person' includes a company and a government body;
'prescribed certificate' means a deduction exemption certificate, a reporting
exemption certificate or a deduction variation certificate;
'prescribed payment' means a payment of a kind declared by the regulations to
be a prescribed payment for the purposes of this Division;
'reconciliation form', in relation to prescribed payments made by an eligible
paying authority during a month, means a document in a form that is published
by the Commissioner in the Gazette for the purposes of this definition and is
applicable to the period within which the month occurs;
'reporting exemption certificate' means a certificate issued by the
Commissioner under section 221YHR;
'structure' includes a part of a structure;
'work' includes-
(a) services; and
(b) work of a professional, technical, skilled or artistic kind,
and, without limiting the generality of the foregoing, includes activities of
a kind referred to in sub-paragraph 221A (2) (c) (i) or (ii);
''(2) Where-
(a) each of 2 or more activities would, but for this sub-section,
constitute a construction project; and
(b) the activities are so related that, taken together, they are
reasonably capable of being regarded as a single activity, the
activities shall, for the purposes of the application of this
Division, be taken to be a single construction project and not to
constitute separate construction projects.
''(3) Where-
(a) a natural person enters into a contract or contracts for the
undertaking or carrying out of a construction project by another
person;
(b) the payments to be made by the natural person under the contract or
contracts are wholly or principally of a private or domestic nature;
and
(c) the cost of the construction project, including the cost of-
(i) goods or materials used in, or forming part of, the
construction project; and
(ii) surveying, design or other activities preliminary to the
construction project,
may reasonably be expected to exceed $10,000, the natural person is, for the
purposes of this Division, a householder in relation to any prescribed payment
that is made, or is liable to be made, by the natural person under the
contract or contracts.
''(4) For the purposes of this Division, a person who is a paying authority in
relation to a prescribed payment is an eligible paying authority in relation
to the prescribed payment if-
(a) the person is not a natural person; or
(b) the person is a natural person and-
(i) the person is a householder in relation to the payment; or
(ii) the payment is not wholly or principally of a private or
domestic nature.
''(5) Without limiting the generality of sub-sections (3) and (4), a
prescribed payment made by a natural person shall be taken not to be of a
private or domestic nature if it is made by the person in his capacity as
trustee of a trust estate or as a member of a religious, charitable, social,
cultural, recreational or other organization or body.
''(6) For the purposes of this Division, a payee shall be taken to have
properly furnished a deduction form to an eligible paying authority in
relation to a prescribed payment if-
(a) in a case where the prescribed payment is not the first prescribed
payment made to the payee by the eligible paying authority during the
month in which the prescribed payment is made-the payee has, before
the time of making of the first prescribed payment made to the payee
by the eligible paying authority during that month, but not earlier
than 7 days before the commencement of that month, completed in
respect of that month the part of a deduction form applicable to the
payee and delivered the form to the eligible paying authority; and
(b) in any other case-the payee has, before the time of making of the
prescribed payment but not earlier than 7 days before the commencement
of the month in which the prescribed payment is made, completed in
respect of that month the part of a deduction form applicable to the
payee and delivered the form to the eligible paying authority.
Provision of information to Commissioner
''221YHB. (1) Subject to sub-section (3), where a person-
(a) is, on 1 September 1983, an eligible paying authority, other than a
householder, in relation to a prescribed payment that is liable to be
made under a contract; or
(b) after 1 September 1983, enters into a contract under which the person
is liable to make a prescribed payment in relation to which the person
is an eligible paying authority other than a householder, the person
shall, in relation to the prescribed payment, furnish to the
Commissioner, before 15 September 1983 or within 14 days after the
person enters into the contract, as the case may be, a paying
authority notification form.
''(2) Where, before 1 September 1983, a person is of the opinion that, on 1
September 1983, the person will be a person to whom paragraph (1) (a) applies,
the person may, before 1 September 1983, furnish to the Commissioner a paying
authority notification form.
''(3) A person is not required under sub-section (1) to furnish a paying
authority notification form to the Commissioner if the person has previously
furnished a paying authority notification form to the Commissioner under that
sub-section or under sub-section (2).
''(4) Subject to sub-section (6), where a person is, on 1 September 1983, a
householder in relation to a prescribed payment or prescribed payments liable
to be made by the person under a contract or contracts for the undertaking or
carrying out of a construction project, the person shall furnish to the
Commissioner, before 15 September 1983, a householder notification form in
relation to the construction project.
''(5) Where, before 1 September 1983, a person is of the opinion that, on 1
September 1983, the person will be a person to whom sub-section (4) applies in
relation to a construction project, the person may, before 1 September 1983,
furnish to the Commissioner a householder notification form in relation to
that construction project.
''(6) A person is not required under sub-section (4) to furnish a householder
notification form to the Commissioner in relation to a construction project if
the person has previously furnished a householder notification form to the
Commissioner under sub-section (5) in relation to that construction project.
''(7) Subject to sub-section (8), where-
(a) after 1 September 1983, a person enters into a contract for the
undertaking or carrying out of a construction project, or part of a
construction project, by another person; and
(b) the person is a householder in relation to a prescribed payment or
prescribed payments that the person is liable to make under the
contract, the person shall, within 14 days after the contract is
entered into, furnish to the Commissioner a householder notification
form in relation to the construction project.
''(8) A person is not required under sub-section (7) to furnish a householder
notification form to the Commissioner in relation to a construction project if
the person has previously furnished a householder notification form to the
Commissioner under sub-section (4), (5) or (7) in relation to the construction
project.
''(9) Where sub-section (4), (5) or (7) applies in relation to a person in
relation to a construction project that is completed on or after 1 September
1983, the person shall, within 14 days after the completion of the
construction project, give notice in writing to the Commissioner of the
completion of the construction project.
''(10) Where, on or after 1 September 1983, an issuing authority issues a
construction permit in respect of a construction project, the issuing
authority shall, in relation to the construction project and within 14 days
after the end of the month in which it issues the permit, or within such
further period as the Commissioner allows, furnish to the Commissioner such
information as the Commissioner, by notice published in the Gazette, requires
for the purposes of this sub-section.
''(11) Where a person other than a government body fails to comply with any of
the requirements of this section (other than sub-section (10)) within the
period within which the requirement is required to be complied with, the
following provisions have effect:
(a) the person is guilty of an offence punishable, on conviction, by a
fine not exceeding $50;
(b) the obligation to comply with the requirement continues,
notwithstanding that that period has expired, until the requirement is
complied with;
(c) the person is guilty of a separate and further offence in respect of
each day during which the failure to comply with the requirement
continues, being a day after the expiration of that period; and
(d) the penalty applicable to each such separate and further offence is a
fine not exceeding $50. Duties of payees
''221YHC. (1) Subject to section 221YHR, a person who becomes entitled to
receive a prescribed payment from an eligible paying authority shall, before
the prescribed payment is made but not earlier than 7 days before the
commencement of the month in which the prescribed payment is made, complete in
respect of the month the part of a deduction form applicable to the payee and
deliver the form to the eligible paying authority.
''(2) Where a person becomes entitled to receive 2 or more prescribed payments
from the same eligible paying authority during any month, the person is not
required to comply with sub-section (1) in relation to the second or any
subsequent prescribed payment to be made to the person by the eligible paying
authority during the month.
''(3) A person, other than a government body, who contravenes sub-section (1)
is guilty of an offence punishable, on conviction, by a fine not exceeding
$50.
''(4) This section does not apply in relation to a prescribed payment made
before 1 September 1983. Duties of eligible paying authorities
''221YHD. (1) A person who is an eligible paying authority in relation to a
prescribed payment or prescribed payments that the person is liable to make
during a month (in this sub-section referred to as the 'relevant month')
shall-
(a) subject to section 221YHQ, deduct the relevant amount from each
prescribed payment in relation to which the person is not a
householder; and
(b) subject to sub-sections (2) and (3) and section 221YHR, within 14 days
after the end of the relevant month-
(i) in relation to each payee who has properly furnished a
deduction form to the eligible paying authority in relation to
prescribed payments made or liable to be made to the payee
during the relevant month-complete the part of the deduction
form applicable to the paying authority;
(ii) in relation to each payee in relation to whom sub-paragraph (i)
does not apply-complete in respect of the relevant month the
part of a deduction form applicable to the eligible paying
authority and so much of the part applicable to the payee as
the eligible paying authority is able to complete;
(iii) complete a reconciliation form in relation to all prescribed
payments made by the eligible paying authority during the
relevant month;
(iv) if no amount has been deducted under paragraph (a) from any
prescribed payment made by the eligible paying authority during
the relevant month-forward to the Commissioner the deduction
forms together with the reconciliation form;
(v) in a case to which sub-paragraph (iv) does not apply-
(A) pay to the Commissioner all amounts deducted under
paragraph (a) from prescribed payments made by the
eligible paying authority during the relevant month; and
(B) at the time of making the payment referred to in
sub-sub-paragraph (A), forward to the Commissioner the
deduction forms and reconciliation form completed in
respect of the relevant month; and
(vi) deliver to each payee a copy of the deduction form completed by
the eligible paying authority in accordance with sub-paragraph
(i) or (ii) in relation to the payee in respect of the relevant
month.
''(2) The Commissioner may, in such instances and to such extent as he thinks
fit, by notice in writing served on an eligible paying authority-
(a) extend the period within which the requirements of paragraph (1) (b)
are required to be complied with; or
(b) vary the requirements of paragraph (1) (b) in their application in
relation to the eligible paying authority in relation to prescribed
payments to which section 221YHQ applies.
''(3) An eligible paying authority, other than a government body, that
contravenes or fails to comply with a requirement of sub-section (1)
(including a requirement as varied under sub-section (2)) is guilty of an
offence punishable, on conviction, by-
(a) in a case to which paragraph (1) (a) applies-a fine not exceeding
$1,000;
(b) in a case to which sub-sub-paragraph (1) (b) (v) (A) applies-
(i) in the case of an individual-a fine not exceeding $5,000 or
imprisonment for a period not exceeding 12 months, or both; and
(ii) in any other case-a fine not exceeding $25,000; or
(c) in any other case-a fine not exceeding $2,000.
''(4) Where a person is convicted of an offence to which paragraph (3) (a)
applies in relation to an amount required to be deducted from a prescribed
payment, the court may, in addition to imposing a penalty under sub-section
(3) in respect of the offence, order the person to pay to the Commissioner as
a penalty a sum not exceeding the amount required to be deducted.
''(5) In sub-section (1), 'relevant amount', in relation to a deduction that
is to be made from a prescribed payment by an eligible paying authority to a
payee, means-
(a) where the payee has properly furnished a deduction form to the
eligible paying authority in relation to the prescribed payment-
(i) in a case to which neither sub-paragraph (ii) nor sub-paragraph
(iii) applies-the amount determined in accordance with
regulations for the purposes of this sub-paragraph in relation
to prescribed payments or prescribed payments of a class that
includes the prescribed payment;
(ii) where-
(A) the payment is made to the payee in person;
(B) the payee has, in the deduction form, declared that a
deduction variation certificate is in force varying the
amount otherwise to be deducted from the prescribed
payment under regulations for the purposes of
sub-paragraph (i);
(C) the payee has produced a deduction variation certificate
varying the amount otherwise to be deducted from the
prescribed payment under regulations for the purposes of
sub-paragraph (i); and
(D) the eligible paying authority has no reasonable grounds
for believing that the deduction variation certificate
has been revoked,
the amount to be deducted under those regulations as varied as mentioned in
sub-sub-paragraph (C); or
(iii) where-
(A) the payment is not made to the payee in person; and
(B) the payee has, in the deduction form, declared that a
deduction variation certificate is in force varying, as
specified in the declaration, the amount otherwise to be
deducted from the prescribed payment under regulations
for the purposes of sub-paragraph (i),
the amount to be deducted under the regulations, varied as specified in the
declaration; or
(b) in any other case-the amount that would be applicable under
sub-paragraph (a) (i) if that sub-paragraph were applicable in
relation to the prescribed payment, increased by an amount equal to
15% of the prescribed payment.
''(6) This section does not apply in relation to a prescribed payment made
before 1 September 1983. Deduction forms to be forwarded to Commissioner
''221YHE. (1) A payee shall forward to the Commissioner with the return to be
furnished by the payee under section 161 in relation to a year of income any
deduction form delivered to the payee under sub-paragraph 221YHD (1) (b) (vi)
that relates to prescribed payments made to the payee during the year of
income.
''(2) A person, other than a government body, who fails to comply with the
requirements of sub-section (1) is guilty of an offence punishable, on
conviction, by a fine not exceeding $1,000. Credits in respect of deductions
from prescribed payments
''221YHF. (1) Subject to sub-sections (4) and (5), where-
(a) the Commissioner receives a deduction form or deduction forms in
relation to deductions made in a year of income from prescribed
payments to a person, not being a partnership or the trustee of a
trust estate; and
(b) an assessment has been made of the tax payable, or the Commissioner is
satisfied that no tax is payable, by the person in relation to the
year of income, the person is entitled to a credit of an amount equal
to the amount of the deductions recorded in the form or forms.
''(2) Subject to sub-sections (4) and (5), where-
(a) the Commissioner receives a deduction form or deduction forms in
relation to deductions made in a year of income from prescribed
payments to a partnership;
(b) the return of income of the partnership in relation to the year of
income has been furnished to the Commissioner; and
(c) an assessment has been made of the tax payable, or the Commissioner is
satisfied that no tax is payable, in relation to the year of income by
a partner in the partnership whose individual interest in the net
income or partnership loss of the partnership is wholly or partly
attributable to the prescribed payments, the partner is entitled to a
credit of an amount equal to so much of the sum of the deductions as
bears to that sum the same proportion as so much of that individual
interest as is attributable to the prescribed payments bears to so
much of the net income or partnership loss as is attributable to the
prescribed payments.
''(3) Subject to sub-sections (4) and (5), the following provisions have
effect where the Commissioner receives a deduction form or deduction forms in
relation to deductions made in a year of income from prescribed payments made
to the trustee of a trust estate:
(a) where-
(i) a share of the net income of the trust estate is included in
the assessable income of a beneficiary in the trust estate
under section 97, being a share that is wholly or partly
attributable to the prescribed payments; and
(ii) an assessment has been made of the tax payable, or the
Commissioner is satisfied that no tax is payable, by the
beneficiary in relation to the year of income,
the beneficiary is entitled to a credit of an amount equal to so much of the
sum of the deductions as bears to that sum the same proportion as so much of
that share of the net income of the trust estate as is attributable to the
prescribed payments bears to so much of the net income of the trust estate as
is attributable to the prescribed payments;
(b) where-
(i) the trustee is liable to be assessed under section 98 in
respect of a share of the net income of the trust estate to
which a beneficiary is presently entitled, being a share that
is wholly or partly attributable to the prescribed payments;
and
(ii) an assessment has been made of the tax payable, or the
Commissioner is satisfied that no tax is payable, by the
trustee in respect of that share,
the trustee is entitled to a credit of an amount equal to so much of the sum
of the deductions as bears to that sum the same proportion as so much of that
share of the net income of the trust estate as is attributable to the
prescribed payments bears to so much of the net income of the trust estate as
is attributable to the prescribed payments;
(c) where-
(i) the trustee is liable to be assessed under section 99 or 99A in
respect of the net income, or a part of the net income, of the
trust estate and that net income or part is wholly or partly
attributable to the prescribed payments; and
(ii) an assessment has been made of the tax payable, or the
Commissioner is satisfied that no tax is payable, by the
trustee under those sections in respect of that net income or
part,
the trustee is entitled to a credit of an amount equal to so much of the sum
of the deductions as bears to that sum the same proportion as so much of the
net income or part of the net income in respect of which the trustee is so
liable to be assessed as is attributable to the prescribed payments bears to
so much of the net income of the trust estate as is attributable to the
prescribed payments.
''(4) Sub-sections (1), (2) and (3) do not apply where the Commissioner is
satisfied that a deduction form received by him records, as a deduction from a
prescribed payment, an amount that was not deducted from a prescribed payment.
''(5) Where, in relation to a deduction that the Commissioner is satisfied was
made from a prescribed payment-
(a) a deduction form has not been received by the Commissioner; or
(b) the Commissioner is satisfied that particulars contained in a
deduction form received by him in relation to the deduction (including
particulars relating to the payee in relation to the prescribed
payment from which the deduction was made) are incorrect, sub-sections
(1), (2) and (3) of this section apply as if the Commissioner had
received a deduction form in relation to the deduction that recorded
particulars in relation to the deduction that the Commissioner is
satisfied are correct.
''(6) Where a person has become entitled to a credit under sub-section (5) in
relation to an amount deducted from a prescribed payment in a case to which
paragraph (5) (a) applies, the person is not entitled to receive any further
credit on receipt by the Commissioner of a deduction form in relation to that
amount. Application of credits
''221YHG. (1) Subject to this section, the amount of a credit to which a
person is entitled by virtue of this Division is a debt due and payable to
that person by the Commissioner on behalf of the Commonwealth.
''(2) Where, in a case to which neither sub-section (3) nor (4) applies, a
person is entitled to a credit under section 221YHF, the Commissioner shall-
(a) if the amount of the credit does not exceed the tax payable by the
person under an assessment in relation to the year of income in which
the deductions to which the credit relates were made-apply the amount
of the credit in payment or part payment of that tax; and
(b) if the amount of the credit exceeds the tax payable-apply-
(i) so much of the amount of the credit as does not exceed the tax
in payment of the tax; and
(ii) so much of the excess as does not exceed the amount of any
other tax payable by the person in payment or part payment of
that other tax.
''(3) Where the trustee of a trust estate is entitled to a credit under
paragraph 221YHF (3) (b) in relation to a share of a beneficiary of the net
income of the trust estate of a year of income, the Commissioner shall-
(a) if the amount of the credit does not exceed the tax payable in respect
of that share-apply the amount of the credit in payment or part
payment of that tax; and
(b) if the amount of the credit exceeds the tax payable in respect of that
share-apply-
(i) so much of the amount of the credit as does not exceed the tax
payable in respect of that share in payment of the tax; and
(ii) so much of the excess as does not exceed the amount of any tax
payable by the trustee under section 98 in respect of a share
of the beneficiary of the net income of the trust estate of any
other year of income in payment or part payment of that other
tax.
''(4) Where the trustee of a trust estate is entitled to a credit under
paragraph 221YHF (3) (c) in relation to the net income or a part of the net
income of the trust estate, the Commissioner shall-
(a) if the amount of the credit does not exceed the tax payable under
section 99 or 99A in respect of that net income or part-apply the
amount of the credit in payment or part payment of that tax; and
(b) if the amount of the credit exceeds the tax payable under section 99
or 99A in respect of that net income or part-apply-
(i) so much of the amount of the credit as does not exceed that tax
in payment of that tax; and
(ii) so much of the excess as does not exceed the amount of any tax
payable by the trustee under section 99 or 99A in respect of
the net income or a part of the net income of the trust estate
of any other year of income in payment or part payment of that
other tax.
''(5) Where, under sub-section (2), (3) or (4), the Commissioner has applied
an amount of a credit in payment of an amount of tax payable by a person, the
person shall be deemed to have paid the amount so applied in payment of the
tax and at the time at which it was so applied or at such earlier time as the
Commissioner determines.
''(6) Where the amount, or the sum of the amounts, applied or paid by the
Commissioner as a credit to which a person is entitled under this Division
exceeds the amount of the credit to which the person is so entitled, the
Commissioner may recover the amount of the excess as if it were income tax due
and payable by that person.
''(7) In this section-
(a) a reference to tax payable by a person other than a trustee is a
reference to an amount payable by the person to the Commonwealth
under, or by virtue of, this Act;
(b) a reference to tax payable by the trustee of a trust estate in respect
of a share of a beneficiary of the net income of the trust estate of a
year of income is a reference to any amount payable by the trustee to
the Commonwealth under, or by virtue of, this Act in relation to the
beneficiary in relation to the year of income; and
(c) a reference to tax payable by the trustee of a trust estate under
section 99 or 99A in respect of the net income or a part of the net
income of the trust estate of a year of income is a reference to any
amount payable by the trustee to the Commonwealth under, or by virtue
of, this Act in relation to the trust estate in relation to the year
of income, not being an amount payable by the trustee in relation to a
particular beneficiary. Failure to make deductions from prescribed
payments
''221YHH. (1) Where an eligible paying authority other than a government body
fails, at the time of making a prescribed payment to a payee, to deduct from
the payment the amount required to be deducted under this Division, the
eligible paying authority is liable to pay to the Commissioner, by way of
penalty-
(a) an amount (in this section referred to as the 'undeducted amount')
equal to the amount that the eligible paying authority failed to
deduct; and
(b) an amount equal to 20% per annum of so much of the undeducted amount
as remains unpaid, computed from the expiration of the period within
which the amount that the eligible paying authority failed to deduct
would have been required to be paid to the Commissioner.
''(2) Where an eligible paying authority, being a government body other than
the Commonwealth, fails, at the time of making a prescribed payment to a
payee, to deduct from the payment the amount required to be deducted under
this Division, the eligible paying authority is liable to pay to the
Commissioner, by way of penalty, an amount equal to 20% per annum of the
undeducted amount in respect of the period commencing on the expiration of the
period within which the amount that the eligible paying authority failed to
deduct would have been required to be paid to the Commissioner and ending on
the day on which the whole of the amount payable by the eligible paying
authority under this sub-section in respect of the undeducted amount is paid.
''(3) If in any case in which a person is liable to pay an amount to the
Commissioner under sub-section (1), a prosecution for an offence against this
Division is instituted in respect of the same subject matter, the amount shall
not be payable unless and until the prosecution is withdrawn. Failure to pay
amounts deducted to Commissioner
''221YHJ. (1) Where an amount payable to the Commissioner by an eligible
paying authority other than the Commonwealth under sub-paragraph 221YHD (1)
(b) (v) remains unpaid after the expiration of the period within which it is
required to be paid-
(a) the amount continues to be payable by the eligible paying authority to
the Commissioner; and
(b) the eligible paying authority is liable to pay to the Commissioner, by
way of penalty-
(i) in the case of an eligible paying authority being a government
body-an amount at the rate of 20% per annum on any amount
referred to in paragraph (a) remaining unpaid, computed from
the expiration of that period; and
(ii) in any other case-
(A) an amount equal to 20% of the amount referred to in
paragraph (a); and
(B) an amount at the rate of 20% per annum on any amount
referred to in paragraph (a) or sub-sub-paragraph (A)
remaining unpaid, computed from the expiration of that
period.
''(2) If in any case in which a person is liable to pay an amount to the
Commissioner under sub-sub-paragraph (1)(b)(ii)(A), a prosecution for an
offence against this Division is instituted in respect of the same subject
matter, the amount shall not be payable unless and until the prosecution is
withdrawn.
''(3) Where-
(a) an amount deducted from a prescribed payment is payable to the
Commissioner under this Division by a person; and
(b) the property of that person has become vested in, or the control of
the property of that person has passed to, a trustee, the trustee is
liable to pay the amount to the Commissioner.
''(4) Notwithstanding anything contained in any other law of the Commonwealth,
or in any law of a State or of the Northern Territory-
(a) an amount payable to the Commissioner by a trustee under sub-section
(3) has priority over all other debts (other than amounts payable
under sub-section 221P (1)), whether preferential, secured or
unsecured; and
(b) where an amount is payable by a trustee to the Commissioner under
sub-section 221P (1), an amount payable by the trustee under
sub-section (3) of this section ranks equally with the amount payable
under sub-section 221P (1) in priority to all other debts, whether
preferential, secured or unsecured.
''(5) Where a trustee, being a trustee of an estate of a bankrupt or the
liquidator of a company that is being wound up, is liable to pay an amount to
the Commissioner under this section, sub-section (4) does not have the effect
that the amount is payable in priority to any costs, charges or expenses of
the administration of the estate or of the winding up of the company
(including costs of a creditor or other person upon whose petition the
sequestration order or the winding up order (if any) was made and remuneration
of the trustee) that are lawfully payable out of the assets of the estate or
of the company except where, in the case of the winding up of a company, the
Crown in right of a State or of the Northern Territory or any other creditor
is entitled to the payment of a debt by the liquidator, in priority to all or
any of those costs, charges and expenses and has not waived that priority.
Failure to furnish deduction form, &c.
''221YHK. (1) Where-
(a) a person who is an eligible paying authority in relation to a
prescribed payment but is not a government body fails, within the
required time, to forward a deduction form to the Commissioner, in
accordance with sub-paragraph 221YHD (1) (b) (iv) or sub-sub-paragraph
221YHD (1) (b) (v) (B) (including that sub-paragraph or
sub-sub-paragraph, as the case may be, as varied under sub-section
221YHD (2)), in relation to a prescribed payment; and
(b) the person is a householder in relation to the prescribed payment or
is required, by sub-section 221YHQ (9) not to make a deduction from
the prescribed payment, the person is liable to pay to the
Commissioner, by way of penalty-
(c) where the person is a householder in relation to the prescribed
payment and paragraph (d) does not apply-the amount that the person
would be required to pay to the Commissioner in respect of the
prescribed payment under paragraphs 221YHH (1)(a) and (b) if the
person-
(i) were not a householder;
(ii) were required to deduct from the prescribed payment an amount
determined in accordance with sub-paragraph 221YHD (5) (a) (i);
and
(iii) had failed to deduct that amount;
(d) where the person is a householder in relation to the prescribed
payment and, at the time when the prescribed payment was made, there
was in force a deduction exemption certificate issued to the payee and
applicable to the time when the payment was made-$50; and
(e) in any other case-$50.
''(2) If in any case in which a person is liable to pay an amount to the
Commissioner under sub-section (1), a prosecution for an offence against this
Division is instituted in respect of the same subject matter, the amount shall
not be payable unless and until the prosecution is withdrawn. Remission of
certain amounts
''221YHL. (1) Where an amount (in this section referred to as the 'late
payment penalty') is payable by a person under paragraph 221YHH (1) (b),
sub-paragraph 221YHJ (1) (b) (i) or sub-sub-paragraph 221YHJ (1) (b) (ii) (B),
in relation to another amount that has not been paid (in this section referred
to as the 'principal amount') and-
(a) the Commissioner is satisfied that-
(i) the circumstances that contributed to the delay in payment of
the principal amount were not due to, or caused directly or
indirectly by, an act or omission of the person; and
(ii) the person has taken reasonable action to mitigate, or mitigate
the effects of, those circumstances;
(b) the Commissioner is satisfied that-
(i) the circumstances that contributed to the delay in payment of
the principal amount were due to, or caused directly or
indirectly by, an act or omission of the person;
(ii) the person has taken reasonable action to mitigate, or mitigate
the effects of, those circumstances; and
(iii) having regard to the nature of those circumstances, it would be
fair and reasonable to remit the late payment penalty or part
of the late payment penalty; or
(c) the Commissioner is satisfied that there are special circumstances by
reason of which it would be fair and reasonable to remit the late
payment penalty or part of the late payment penalty, the Commissioner
may remit the late payment penalty or part of the late payment
penalty.
''(2) The Commissioner may, in any case, for reasons that he thinks
sufficient, remit the whole or any part of any amount payable by a person
under paragraph 221YHH (1) (a), sub-sub-paragraph 221YHJ (1) (b) (ii) (A) or
sub-section 221YHK (1).
''(3) Where the Commissioner makes a decision to remit part only of an amount
payable as mentioned in sub-section (2), or not to remit any part of such an
amount, the Commissioner shall give notice in writing of his decision to the
person by whom the amount is, or but for the remission would be, payable.
Persons discharged from liability in respect of deductions
''221YHM. Where a person has made a deduction from a prescribed payment and
that deduction was made, or purports to have been made, for the purposes of
section 221YHD, the person is, by force of this section, discharged from all
liability to pay or account for the deduction to any person other than the
Commissioner. Recovery of amounts by Commissioner
''221YHN. (1) An amount payable to the Commissioner under this Division by a
person other than the Commonwealth is a debt due to the Commonwealth and
payable to the Commissioner and-
(a) that amount may by sued for and recovered in a court of competent
jurisdiction by the Commissioner or a Deputy Commissioner suing in his
official name; or
(b) a court before which proceedings are taken against that person for an
offence against a provision of this Division may order that person to
pay that amount to the Commissioner.
''(2) The provisions of section 243 apply in proceedings for the recovery of
an amount payable to the Commissioner under this Division in like manner as
those provisions apply in proceedings by the Crown for the recovery of a
pecuniary penalty under this Act.
''(3) The provisions of section 249 apply to an order for the payment of a sum
of money to the Commissioner made under paragraph (1) (b) of this section or
sub-section 221YHD (4) in like manner as those provisions apply to an order
for the payment of a sum of money to the Commissioner made under Part VII.
''(4) Where-
(a) 2 or more amounts payable to the Commissioner by a person would, but
for this sub-section, be debts due to the Commonwealth under
sub-section (1);
(b) an amount (in this sub-section referred to as the 'relevant payment')
is paid to the Commissioner in respect of one or more of those
amounts; and
(c) the sum of the amounts payable exceeds the relevant payment, the
Commissioner may, notwithstanding any direction to the contrary by or
on behalf of the person by whom the amounts are payable or the person
making the relevant payment, apply the relevant payment in partial
discharge of the sum of the amounts payable and recover as a debt due
to the Commonwealth the amount by which the sum of the amounts payable
exceeds the relevant payment. Payments into and out of Consolidated
Revenue Fund
''221YHO. (1) All moneys received by the Commissioner in pursuance of this
Division shall be paid into the Consolidated Revenue Fund.
''(2) An amount that the Commissioner is liable to pay in pursuance of this
Division is payable out of the Consolidated Revenue Fund, which, to the
necessary extent, is appropriated accordingly. Deduction variation
certificates
''221YHP. (1) Subject to this section, on application in writing by a person,
in a form approved by the Commissioner for the purposes of this section, the
Commissioner may issue to the person a deduction variation certificate under
this section in relation to a year of income or a part of a year of income.
''(2) The Commissioner shall not issue a deduction variation certificate to a
person in relation to a year of income or a part of a year of income unless he
is satisfied that, because special circumstances exist in relation to the
person in relation to the year of income, or the part of the year of income,
as the case may be, the amount otherwise to be deducted from prescribed
payments to the person under regulations for the purposes of sub-paragraph
221YHD (5) (a) (i) should be reduced.
''(3) Subject to section 221YHS, a deduction variation certificate remains in
force during the period specified in the certificate as the period during
which the certificate remains in force. Deduction exemption certificates
''221YHQ. (1) Subject to this section, on application in writing by a person,
in a form approved by the Commissioner for the purposes of this section, the
Commissioner may issue a deduction exemption certificate under this section to
the person in relation to a specified period.
''(2) Subject to sub-sections (4) and (5), the Commissioner shall not issue a
deduction exemption certificate to a person (in this sub-section referred to
as the 'applicant') unless the Commissioner is satisfied that there is no
reasonable likelihood that tax will be payable by the applicant in relation to
the year of income to which the certificate, if issued, will relate or the
following conditions are satisfied:
(a) the Commissioner is satisfied-
(i) that the applicant has, for a period (in this paragraph
referred to as the 'relevant period') of 3 years immediately
preceding the date of the application, been regularly engaged
in carrying on business in Australia;
(ii) that, during the relevant period, the applicant has, in
relation to each business carried on by the applicant during
the relevant period-
(A) maintained such accounting and taxation records in
relation to the business as correctly record and explain
the transactions and financial position of the business;
(B) conducted the business at or from established premises
that were advertised to the public as being premises from
which the business was carried on; and
(C) conducted all financial transactions relating to the
business through a bank account or bank accounts that was
or were separate from any private or domestic account
maintained by the applicant;
(iii) that, during the relevant period, the applicant has
satisfactorily complied with his obligations under Acts
administered by the Commissioner; and
(iv) that, during the period to which the certificate, if issued,
will relate-
(A) the applicant will regularly be engaged in carrying on
business in Australia;
(B) the conditions specified in sub-sub-paragraphs (ii) (A)
to (C) will be satisfied in relation to each business
that might be carried on by the applicant during that
period; and
(C) the applicant will satisfactorily comply with his
obligations under Acts administered by the Commissioner;
(b) if the applicant kept taxation and accounting records in relation to
the year of income in relation to which the applicant last furnished a
return of income under section 161 and the records-
(i) include a balance sheet; and
(ii) have been audited by a person who, in the opinion of the
Commissioner, is competent and qualified to audit the records,
the applicant has furnished to the Commissioner a declaration by a prescribed
person that the prescribed person has examined the records and has satisfied
himself that the return of income accurately discloses the assessable income
and allowable deductions of the applicant in respect of that year of income;
(c) if the applicant is a company, partnership or trustee of a trust
estate and is not required to furnish a declaration in accordance with
paragraph (b) in relation to the year of income in relation to which
the applicant last furnished a return of income under section 161-the
applicant has furnished to the Commissioner-
(i) a statement setting out details of all property (including
money) acquired or disposed of by the applicant during that
year of income;
(ii) a statement reconciling the details specified in accordance
with sub-paragraph (i) with the assessable income and allowable
deductions specified in the return of income; and
(iii) a declaration by a prescribed person that the prescribed person
has examined the statements prepared in accordance with
sub-paragraphs (i) and (ii) and has satisfied himself that the
return of income accurately discloses the assessable income and
allowable deductions of the applicant in respect of that year
of income;
(d) if the applicant is not a company, partnership or trustee of a trust
estate and is not required to furnish a declaration in accordance with
paragraph (b) in relation to the year of income in relation to which
the applicant last furnished a return of income under section 161-the
applicant has furnished to the Commissioner-
(i) a statement setting out details of all property (including
money) acquired or disposed of by the applicant during that
year of income (including details relating to acquisitions or
disposals of a private or domestic nature);
(ii) a statement reconciling the details specified in accordance
with sub-paragraph (i) with the assessable income and allowable
deductions specified in the return of income; and
(iii) a declaration by a prescribed person that the prescribed person
has examined the statements prepared in accordance with
sub-paragraphs (i) and (ii) and has satisfied himself that the
return of income accurately discloses the assessable income and
allowable deductions of the applicant in respect of that year
of income; and
(e) where paragraph (c) or (d) applies in relation to the applicant and
the Commissioner requires any statements or declarations of the kind
referred to in those paragraphs in relation to an associate of the
applicant-the applicant or the associate has furnished to the
Commissioner those statements or declarations.
''(3) For the purposes of sub-section (2)-
(a) a reference to the Commissioner being satisfied that there is no
reasonable likelihood that tax will be payable in relation to a year
of income by an applicant for a deduction exemption certificate shall,
in the case of an applicant being a partnership or the trustee of a
trust estate, be read as a reference to the Commissioner being
satisfied that there is no reasonable likelihood that there will be
any net income of the partnership or trust estate, as the case may be,
in relation to the year of income;
(b) a reference to a prescribed person is a reference to-
(i) a person who is a registered tax agent within the meaning of
Part VIIA; or
(ii) a person who, in the opinion of the Commissioner, is competent
and qualified to furnish a declaration required by that
sub-section; and
(c) a reference to an associate of a person (in this paragraph referred to
as the 'relevant person') is a reference to-
(i) where the relevant person is a company (including a company in
the capacity of trustee of a trust estate)-any person who is a
director of, or shareholder in, the company;
(ii) where the relevant person is a partnership-any of the partners
in the partnership; and
(iii) in any other case-any relative of the relevant person.
''(4) Where-
(a) a person meets the requirements of sub-paragraph (2) (a) (iv) but
fails to meet one or more of the requirements of sub-paragraphs (2)
(a) (i), (ii) and (iii); and
(b) the Commissioner, having regard to-
(i) the purposes of this Division;
(ii) the special circumstances (if any) that exist or existed in
relation to the person; and
(iii) such other matters (if any) as he thinks fit,
is of the opinion that it would be unreasonable not to issue a deduction
exemption certificate to the person, the Commissioner may issue a deduction
exemption certificate to the person.
''(5) The special circumstances to which the Commissioner may have regard in
the application of sub-section (4) in relation to a person being a company, a
partnership or the trustee of a trust estate include-
(a) in the case of a company being a private company in relation to the
year of income next preceding the year of income to which, or to part
of which, the certificate, if issued, will relate-the extent to which
the requirements of sub-paragraphs (2) (a) (i), (ii) and (iii) have
been complied with in relation to any businesses carried on by
directors of, or shareholders in, the company;
(b) in the case of a company to which paragraph (a) does not apply-the
extent to which the requirements of sub-paragraphs (2) (a) (i), (ii)
and (iii) have been complied with in relation to any businesses
carried on by directors of the company;
(c) in the case of a partnership-the extent to which the requirements of
sub-paragraphs (2) (a) (i), (ii) and (iii) have been complied with in
relation to any businesses carried on by partners in the partnership;
or
(d) in the case of a trustee of a trust estate-the extent to which the
requirements of sub-paragraphs (2) (a) (i), (ii) and (iii) have been
complied with in relation to any businesses (not including the
business of the trust estate) carried on by the trustee.
''(6) For the purposes of the application of sub-section (5) in relation to an
application for a deduction exemption certificate, a person shall be deemed to
have fully complied with the requirements of sub-paragraphs (2) (a) (i), (ii)
and (iii) in relation to all businesses carried on by the person at any time
before the date of the application for the certificate if, on the date of the
application, the person was the holder of a deduction exemption certificate
that was in force.
''(7) In the application of sub-paragraph (2) (a) (i) in relation to a person
in the capacity of trustee of a trust estate, the reference to the person
having been regularly engaged in carrying on business in Australia shall be
read as a reference to the person having been regularly engaged in carrying on
the business of the trust estate in Australia.
''(8) Subject to section 221YHS, a deduction exemption certificate remains in
force during the period specified in the certificate as the period during
which the certificate remains in force.
''(9) Where a payee has properly furnished a deduction form to an eligible
paying authority in relation to a prescribed payment and-
(a) if the payment is to be made to the payee in person-
(i) the payee has declared in the deduction form that a deduction
exemption certificate has been issued to the payee in respect
of the period specified in the declaration and has not been
revoked;
(ii) the payee has produced to the eligible paying authority a
deduction exemption certificate issued to the payee and
applicable to the time when the payment is to be made; and
(iii) the eligible paying authority has no reasonable grounds for
believing that the deduction exemption certificate has been
revoked; or
(b) if the payment is not to be made to the payee in person-the payee has
declared in the deduction form that a deduction exemption certificate
has been issued to the payee in respect of the period specified in the
declaration and has not been revoked, the eligible paying authority
shall not make any deduction from the prescribed payment under
paragraph 221YHD (1) (a). Reporting exemption certificates
''221YHR. (1) Where-
(a) an application in writing, in a form approved by the Commissioner for
the purposes of this section, is made jointly to the Commissioner by
an eligible paying authority and a payee with whom the eligible paying
authority has entered into a contract under which the eligible paying
authority is liable to make prescribed payments to the payee;
(b) a deduction exemption certificate issued to the payee is in force; and
(c) the Commissioner is satisfied that special circumstances exist in
relation to the eligible paying authority and the payee, the
Commissioner may issue to the eligible paying authority and the payee
jointly a reporting exemption certificate under this section in
relation to prescribed payments under the contract.
''(2) Subject to section 221YHS, the reporting exemption certificate remains
in force while there is in force a deduction exemption certificate issued to
the payee.
''(3) Sections 221YHC and 221YHD do not apply in relation to prescribed
payments in relation to which a reporting exemption certificate is in force.
Revocation of certificates
''221YHS. (1) The Commissioner may, at any time, revoke a prescribed
certificate, and where he does so, he shall, in writing, notify the person or
persons to whom the certificate was issued of the revocation.
''(2) A person who is notified by the Commissioner under sub-section (1) of
the revocation of a certificate shall, within 14 days after he receives the
notification, return the certificate to the Commissioner.
Penalty: $500.
''(3) If-
(a) a person (in this sub-section referred to as the 'payee') to whom a
deduction variation certificate or a deduction exemption certificate
has been issued properly furnishes to an eligible paying authority in
relation to a prescribed payment a deduction form in which the payee
has made a declaration in relation to the certificate as mentioned in
paragraph 221YHD (5) (a) or sub-section 221YHQ (9);
(b) after the payee furnishes the deduction form to the eligible paying
authority and before the prescribed payment is made, the payee
receives notification under sub-section (1) of the revocation of the
certificate; and
(c) the payee does not notify the eligible paying authority of the
revocation before the prescribed payment is made, the payee is guilty
of an offence punishable, on conviction, by a fine not exceeding
$2,000. Notification and review of decisions
''221YHT. (1) Where the Commissioner makes a decision on an application under
section 221YHP, 221YHQ or 221YHR, the Commissioner shall give notice in
writing of his decision to the applicant.
''(2) Where a person who has been notified of a decision of the Commissioner
made under section 221YHL (other than sub-section (1)) or section 221YHP,
221YHQ, 221YHR or 221YHS is dissatisfied with the decision, the person may,
within 60 days after service on the person of notice of the decision of the
Commissioner, post to, or lodge with, the Commissioner an objection in writing
against the decision stating fully and in detail the grounds on which the
person relies.
''(3) The provisions of Division 2 of Part V (other than section 185) apply in
relation to an objection made under sub-section (2) in like manner as those
provisions apply in relation to an objection against an assessment. Offences
''221YHU. A person shall not-
(a) endeavour to obtain, for his own advantage or benefit, credit with
respect to, or payment of, the amount of a deduction made from a
prescribed payment made to another person;
(b) present, for the purpose of obtaining credit, payment or other
benefit, a deduction form, or document purporting to be a deduction
form, other than a deduction form duly delivered to him;
(c) alter a prescribed certificate or produce to an eligible paying
authority a deduction exemption certificate or a deduction variation
certificate that has been altered without the authority of the
Commissioner;
(d) without lawful excuse, have in his possession a forgery or colourable
imitation of a prescribed certificate;
(e) falsely pretend to be the person named in a deduction exemption
certificate or a deduction variation certificate; or
(f) by the production of a document other than a prescribed certificate
issued to him that is for the time being in force, cause an eligible
paying authority to refrain from making a deduction from a prescribed
payment or to make a deduction from a prescribed payment of an amount
less than the amount applicable under the regulations in relation to
the prescribed payment.
Penalty: $5,000 or imprisonment for 12 months, or both. Time for prosecutions
''221YHV. A prosecution for an offence against this Division may be commenced
at any time. Joinder of charges under this Division
''221YHW. (1) Charges against the same person for any number of offences
against this Division may be joined in one complaint if those charges are
founded on the same facts or form, or are part of, a series of offences of the
same or a similar character.
''(2) Where more than one charge is included in the same complaint in
pursuance of sub-section (1), particulars of each offence charged shall be set
out in a separate paragraph.
''(3) All charges so joined shall be tried together unless the court considers
it just that any charge should be tried separately and makes an order to that
effect.
''(4) If a person is found guilty of more than one offence, the court may, if
it thinks fit, impose one penalty in respect of all offences of which the
person has been found guilty, but that penalty shall not exceed the sum of the
maximum penalties that could be imposed if penalties were imposed for each
offence separately. Power of Commissioner to obtain information
''221YHX. Section 264 applies, for the purposes of this Division, as if the
reference in paragraph (1) (b) of that section to a person's income or
assessment were a reference to a matter relevant to the administration or
operation of this Division. Declarations
''221YHY. Any form that is approved, or published in the Gazette, by the
Commissioner for the purposes of this Division may be required to contain a
declaration by the person using the form. Special provisions relating to
partnerships
''221YHZ. (1) Subject to this section, this Division applies in relation to
the making and receipt of prescribed payments by a partnership as if the
partnership were a person.
''(2) Where, but for this sub-section, an obligation would be imposed on a
partnership by virtue of the operation of sub-section (1), the obligation may
be discharged by any of the partners.
''(3) Where, by virtue of the operation of sub-section (1), an amount is
payable under this Division by a partnership, the partners are jointly and
severally liable to pay that amount.
''(4) Where, by virtue of the operation of sub-section (1), an offence against
this Division is deemed to have been committed by a partnership, that offence
shall be deemed to have been committed by each of the partners.''.
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