TAXATION LAWS AMENDMENT ACT (NO. 8) 2000 NO. 156, 2000 - SCHEDULE 6

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TAXATION LAWS AMENDMENT ACT (NO. 8) 2000 NO. 156, 2000 - SCHEDULE 6

- Other amendments

A New Tax System (Goods and Services Tax) Act 1999

1 Section 11-99 (table item 12)

Repeal the item.

2 At the end of section 29-10

Add:

(4): If the ^*GST return for the tax period referred to in paragraph (3)(b) states a ^*net amount that does not take into account an input tax credit attributable to that tax period:

(a): the input tax credit is not attributable to that tax period; and
(b): the input tax credit is attributable to the first tax period for which you give the Commissioner a GST return that does take it into account.

3 Section 29-39 (table item 11)

Repeal the item.

4 Section 29-99 (after table item 4)

Insert:

5
Sale of freehold interests etc.
Division 75

5 Section 37-1 (table item 27)

Repeal the item.

6 Section 48-1

Before "intra-group", insert "(in most cases)".

7 Subsection 48-5(2) (but not the note)

Repeal the subsection, substitute:

(2): If 2 or more entities would ^*satisfy the membership requirements of that ^*GST group, the application need not include all those entities.

8 Paragraphs 48-10(1)(d) and (e)

Omit "those other members", substitute "the other members of the GST group or proposed GST group".

9 At the end of subsection 48-10(1)

Add:

; and (g) does not have any branch that is registered under Division 54.

10 Subsection 48-10(2)

Omit "However, paragraph (1)(b)", substitute "Paragraph (1)(b)".

11 At the end of section 48-10

Add:

(3): A ^*company does not satisfy the membership requirements of a ^*GST group, or a proposed GST group, if:

(a): one or more other members of the GST group or proposed GST group are not companies; and
(b): none of the members of the GST group or proposed GST group that are companies satisfy section 48-15.

12 At the end of Subdivision 48-A

Add:

48-15 Relationship of companies and non-companies in a GST group

(1): A ^*company that is a member of a ^*GST group, or a proposed GST group, satisfies this section if:

(a): a ^*partnership, trust or individual that is a member of the GST group or proposed GST group would, if it were another company, have ^*at least a 90% stake in that company; or
(b): the company has only one member, and that member:

(i): is a partner in a partnership that is a member of the GST group or proposed GST group; or
(ii): is an individual that is a member of the GST group or proposed GST group; or
(iii): is a ^*family member of that partner or individual; or

(c): the company has more than one member, each of whom is:

(i): a partner in the same partnership that is a member of the GST group or proposed GST group; or
(ii): a family member of any such partner;

and one of the following applies:

(iii): at least 2 of the partners are members of the company;
(iv): one of the partners is a member of the company, and at least one other member of the company is a family member of a different partner;
(v): none of the partners is a member of the company, and the members of the company are not all family members of the same partner and no other partner; or

(d): the company has more than one member, each of whom is:

(i): an individual who is a member of the GST group or proposed GST group; or
(ii): a family member of that individual; or

(e): a trust is a member of the GST group or proposed GST group, and distributions of income or capital of the trust are not made except to an entity that is:

(i): the company; or
(ii): any other company that is a member of the GST group or proposed GST group; or
(iia): a member of, or a family member of a member of, any company referred to in subparagraph (i) or (ii) that is a company to which subsection (1A) applies; or
(iii): a charitable institution, a trustee of a charitable fund or a ^*gift-deductible entity.

(1A): This subsection applies to a company if:

(a): the company has only one member; or
(b): the company has more than one member, and:

(i): at least 2 of the members are beneficiaries of the trust in question (either directly, or indirectly through one or more interposed trusts); or
(ii): one of the members is such a beneficiary, and at least one other such beneficiary is a ^*family member of a different member of the company; or
(iii): none of the members is such a beneficiary, and those family members (of the members of the company) who are such beneficiaries are not all family members of the same member of the company and no other member.

(2): A person is a family member of an individual if the individual's family, within the meaning of section 272-95 of Schedule 2F to the ^*ITAA 1936, includes that person. There are no family members of an entity that is not an individual.

13 Subsection 48-45(3)

Repeal the subsection, substitute:

(3): However, an acquisition that an entity makes from another ^*member of the same ^*GST group is not a ^*creditable acquisition unless the supply of the thing acquired by the entity was a ^*taxable supply because of Division 84 (which is about offshore supplies other than goods or real property).

14 Paragraph 48-70(1)(a)

Omit " ^*company", substitute "entity".

15 Section 66-20

Repeal the section.

16 Subsection 69-10(1)

Omit "is an amount equal to ¹/11 of that limit", substitute "is the amount of GST payable on the supply or importation of the car up to ¹/11 of that limit".

17 Subsections 69-10(1A) and (2)

Repeal the subsections, substitute:

(2): However, if:

(a): the supply of the car is ^*GST-free to any extent under Subdivision 38-P; or
(b): the importation of the car is non-taxable to any extent under paragraph 13-10(b) because it would have been GST-free to any extent under Subdivision 38-P if it had been a supply;

you are not entitled to the input tax credit for the acquisition or importation.

(3): If your acquisition or importation is ^*partly creditable, the input tax credit is reduced to the extent (expressed as a percentage) to which the acquisition or importation is made for a ^*creditable purpose.
(4): This section does not apply in relation to:

(a): the acquisition or importation of a ^*car that is not a ^*luxury car because of subsection 25-1(2) of the A New Tax System (Luxury Car Tax) Act 1999 ; or

Note: Emergency vehicles, cars fitted to transport disabled people, non-passenger commercial vehicles, motor homes and campervans are not luxury cars under that subsection.

(b): the acquisition of a car by lease or hire.

(5): This section has effect despite sections 11-25 and 15-20 (which are about the amount of input tax credits on creditable acquisitions and creditable importations).

18 After section 72-90

Insert:

72-92 Non-profit sub-entities

This Division applies to a ^*non-profit sub-entity of an entity as if the non-profit sub-entity were an ^*associate of:

(a): that entity; and
(b): every other non-profit sub-entity of that entity; and
(c): any other associate of that entity.

19 At the end of Division 75

Add:

75-30 Tax invoices not required for supplies of real property under the margin scheme

(1): You are not required to issue a ^*tax invoice for a ^*taxable supply that you make that is solely a supply of ^*real property under the ^*margin scheme.
(2): This section has effect despite section 29-70 (which is about the requirement to issue tax invoices).

20 Subsection 78-15(4) (step 2 in the method statement)

Omit "those payments", substitute "those payments (except to the extent that they are payments of excess to which section 78-18 applies)".

21 After section 78-15

Insert:

78-18 Increasing adjustments for payments of excess under insurance policies

(1): An insurer has an increasing adjustment if:

(a): there is a payment of an excess to the insurer under an ^*insurance policy; and
(b): the insurer makes, or has made, payments or supplies in settlement of a claim under the policy; and
(c): the insurer makes, or has made, ^*creditable acquisitions or ^*creditable importations directly for the purpose of settling the claim.

(2): The amount of the increasing adjustment is ¹/11 of the amount that represents the extent to which the payment of excess relates to ^*creditable acquisitions and ^*creditable importations made by the insurer directly for the purpose of settling the claim.
(3): An insurer has an increasing adjustment if:

(a): there is a payment of an excess to the insurer under an ^*insurance policy; and
(b): the insurer makes, or has made, ^*creditable acquisitions or ^*creditable importations directly for the purpose of settling the claim; and
(c): the insurer has not made any payments or supplies in settlement of the claim.

The amount of the increasing adjustment is ¹/11 of the amount of the payment of the excess.

22 Section 78-30 (heading)

Repeal the heading, substitute:

78-30 Acquisitions by insurers in the course of settling claims under non-taxable policies
23 Subsection 78-30(1)

Omit "of ^*goods".

24 Paragraph 78-30(1)(a)

Repeal the paragraph, substitute:

(a): the insurer makes the acquisition:

(i): to the extent that the acquisition is an acquisition of goods—solely for the purpose of supplying the goods in the course of settling a claim under an ^*insurance policy; or
(ii): otherwise—solely for a purpose directly related to settling a particular claim under an ^*insurance policy; and

25 Paragraph 78-30(1)(b)

Omit "was not a ^*taxable supply", substitute "was ^*GST-free".

25A At the end of Subdivision 78-A

Add:

78-42 Adjustment events relating to increasing adjustments under section 78-18

Division 19 applies in relation to an ^*increasing adjustment that an insurer has under section 78-18 as if:

(a): payments of excess under an ^*insurance policy to which the adjustment relates were ^*consideration for a ^*taxable supply that the insurer made; and
(b): the adjustment were the GST payable on the taxable supply; and
(c): any refund of that payment of excess made by the insurer were a reduction in the consideration for the supply.

26 Paragraph 78-50(1)(b)

After "the entity", insert ", or the ^*representative member of the ^*GST group of which the entity is a ^*member,".

27 Subparagraph 78-50(1)(c)(i)

Omit "that the entity was entitled", substitute "of the entitlement".

28 Subsection 78-65(1)

Omit "to the extent that the payment is made in settlement of a claim under an ^*insurance policy under which the entity is not insured", substitute:

to the extent that:

(a): the payment is made in settlement of a claim under an ^*insurance policy under which the entity is not insured; and
(b): the payment is to discharge a liability owed to that entity by the entity insured.

29 Subsection 78-65(2)

Omit "to the extent that the supply is made in settlement of a claim under an ^*insurance policy under which the entity is not insured", substitute:

to the extent that:

(c): the supply is made in settlement of a claim under an ^*insurance policy under which the entity is not insured; and
(d): the supply is to discharge a liability owed to that entity by the entity insured.

30 After section 84-13

Insert:

84-14 Supplies relating to employee share ownership schemes

This Division does not apply to a supply, to the extent that it is a supply relating to an ^*employee share scheme, if:

(a): the ^*recipient of the supply is not an entity that has acquired, or may in the future acquire, a share or right under the scheme; and
(b): Division 13A of Part III of the ^*ITAA 1936 applies to discounts (within the meaning of that Division) given in relation to any acquisitions of shares or rights under the scheme; and
(c): either:

(i): the ^*recipient of the supply is a ^*100% subsidiary of the supplier; or
(ii): the supply is a transfer that is taken to be a supply because of section 84-15.

31 Division 93

Repeal the Division.

32 At the end of Division 188

Add:

188-40 Supplies of employee services by overseas entities to be disregarded for the registration turnover threshold

(1): In working out a ^*non-resident's ^*current annual turnover or ^*projected annual turnover in order to determine whether it meets the ^*registration turnover threshold, if:

(a): the non-resident makes a supply of the services of an employee of the non-resident; and
(b): the ^*recipient of the supply is the non-resident's ^*100% subsidiary; and
(c): the services that the employee performs for the recipient are performed in Australia;

disregard the supply to the extent that the payments that the non-resident makes to the employee for performing those services would, if they were made by the recipient, be ^*withholding payments.

(2): This section does not affect how to work out any ^*turnover threshold other than the ^*registration turnover threshold.

33 Section 195-1

Insert:

100% subsidiary has the meaning given by section 975-505 of the ^*ITAA 1997.

34 Section 195-1 (after paragraph (d) of the definition of commercial residential premises)

Insert:

(da): a marina at which one or more of the berths are occupied, or are to be occupied, by ^*ships used as residences; or

35 Section 195-1

Insert:

employee share scheme has the meaning given by section 139C of the ^*ITAA 1936.

36 Section 195-1

Insert:

family member has the meaning given by subsection 48-15(2).

37 Section 195-1 (at the end of the definition of incapacitated entity)

Add:

; or (c) an entity that has a ^*representative.

38 Section 195-1 (after table item 4 of the definition of increasing adjustment)

Insert:

4AA
Section 78-18
Payments of excess under insurance policies

39 Section 195-1 (at the end of the definition of representative)

Add:

(e): a person appointed, or authorised, under an ^*Australian law to manage the affairs of an entity because it is unable to pay all its debts as and when they become due and payable; or
(f): an administrator of a deed of company arrangement executed by the entity.

40 Section 195-1 (definition of returnable container)

Repeal the definition.

A New Tax System (Goods and Services Tax Transition) Act 1999

41 Subsection 19(3)

Omit "value of the supply", substitute "price of the supply (less the amount of any GST payable on the supply)".

A New Tax System (Luxury Car Tax) Act 1999

42 At the end of section 5-20

Add:

Supply of car by lease or hire

(6): The ^*luxury car tax value of a ^*car that is supplied by way of lease or hire is the ^*GST inclusive market value of the car excluding:

(a): any luxury car tax payable on the supply; and
(b): any other ^*Australian tax, fee or charge, other than ^*GST and ^*customs duty; and
(c): the ^*price of any modifications referred to in subsection (5).

43 After subsection 13-15(1)

Insert:

(1A): The luxury car tax payable by you on a ^*taxable supply of a luxury car that is supplied by way of lease or hire is entirely attributable to the first ^*tax period to which the supply of the car is attributable. This subsection has effect despite section 156-5 of the ^*GST Act.

: Note: Under that section, the luxury car tax could otherwise be payable on a periodic basis.

A New Tax System (Wine Equalisation Tax and Luxury Car Tax Transition) Act 1999

44 After subsection 3(3A)

Insert:

(3B): However, if the amount of sales tax you have borne in respect of the wine changes after 1 July 2000, the amount of the special credit changes accordingly.

45 Subsection 3(4)

Omit "before 22 January 2001", substitute "for a tax period that ends before 7 January 2001".

46 After subsection 3(4)

Insert:

(4A): If the amount of the special credit changes under subsection (3B) after you lodged that return, you must lodge with the Commissioner an amended GST return for that tax period. You must lodge it on or before the 21st day of the month following the end of the tax period in which the change happens.

Income Tax Assessment Act 1997

47 Section 17-30 (heading)

Repeal the heading, substitute:

48 At the end of section 17-30

Add:

(2): A special credit under section 3 of the A New Tax System (Wine Equalisation Tax and Luxury Car Tax Transition) Act 1999 is assessable income at the time it is attributed to a ^*tax period.

49 Application

(1) The amendments made by items 1 to 8, 13 to 19, 22 to 35, 37, 39, 40, 42 and 43 apply, and are taken to have applied, in relation to net amounts for tax periods starting on or after 1 July 2000.
(2) The amendments made by items 20, 21, 25A and 38 apply, and are taken to have applied, in relation to net amounts for tax periods starting on or after 17 August 2000.
(3) The amendments made by items 47 and 48 apply to assessments for the 2000-2001 income year and later income years.

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