Income Tax Management Act 1941 (NSW)
INCOME TAX MANAGEMENT ACT.
Act No. 48, 1941.
An Act to provide for the assessment and collec- tion of a tax on incomes; to make certain provisions for and in relation to the dis- continuance of the Unemployment Relief Tax (Management) Act, 1939-1941, and the Social Services Tax (Management) Act, 1939-1941; to amend the Income Tax (Management) Act, 1936, and certain other Acts; and for purposes connected therewith. [Assented to, 24th October, 1941.]
BE
BE it enacted by the King's Most Excellent Majesty, lative Council and Legislative Assembly of New South by and with, the advice and consent of the Legis Wales in Parliament assembled, and by the authority of the same, as follows :—
PART I.
PRELIMINARY.
1. (1) This Act may be cited as the "Income Tax Management Act, 1941."
(2) This Act with the exception of Par t IX shall commence upon the first day of November, one thousand nine hundred and forty-one.
2. (1) The Income Tax (Management) Act, 1912, as amended by subsequent Acts, including this Act, shall continue in force for all purposes in connection with income tax payable in respect of the income which has been received prior to the year ended on the thirtieth day of June, one thousand nine hundred and twenty- eight, or prior to such other period as may be or may have been accepted by the Commissioner in lieu of such year.
(2) The Income Tax (Management) Act, 1928, as amended by subsequent Acts, including this Act, shall continue in force for all purposes in connection with income tax payable in respect of the income which has been derived prior to the year ended on the thirtieth day of June, one thousand nine hundred and thirty-six, or prior to such other period as may be or may have been accepted by the Commissioner in lieu of that year, other than the income referred to in subsection one of
amended by subsequent Acts, including this Act, shall this section. (3) The Income Tax (Management) Act, 1936, as continue in force for all purposes in connection with income tax payable in respect of the income which has been derived prior to the year of income ended on the thirtieth day of June, one thousand nine hundred and forty-one, or the accounting period if any adopted under the said Act as so amended, in lieu of that year, other than the income referred to in subsections one and two of this section.
3 . or prescribed under the Income Tax (Management) Act,
( 1 ) All existing rules, regulations and forms made
1936 , as amended by subsequent Acts, or continuing in
force by virtue of such Acts shall continue in force and shall apply to proceedings under this Act, so far as such rules, regulations and forms may be applicable until rules, regulations and forms are made and prescribed under this Act.
( 2 ) All notices given and returns made during the
year one thousand nine hundred and forty-one under the Income Tax (Management) Act, 1936, as amended by subsequent Acts, in respect of income derived during the year of income ended on the thirtieth day of June, one thousand nine hundred and forty-one, or the accounting period if any adopted under the said Act as so amended, in lieu of that year, shall (without prejudice to the power of the Commissioner to give any notices which may be given or require any returns which may be required in respect of income derived during such year or accounting period under this Act) be deemed to have been made or given also under this Act.
4. This Act is divided into Par ts and Divisions, as
follows:—
PART I.—PRELIMINARY—ss. 1 -5 .
PART II.—ADMINISTRATION—ss. 6 - 1 0 . PART III.—LIABILITY TO TAXATION—ss. 1 1 - 2 0 5 .
DIVISION 1.—General—ss. 1 1 - 2 0 . DIVISION 2.—Income—ss. 2 1 - 5 5 . SUBDIVISION A.—Assessable income generally—
ss. 2 1 - 2 3 .
SUBDIVISION B.—Trading stock—ss. 2 4 - 3 2 . SUBDIVISION C.—Business carried on partly in
and partly out of this State—ss. 3 3 - 5 2 .
SUBDIVISION D.—Dividends—ss. 5 3 - 5 5 .
DIVISION 3.—Deductions—ss. 5 6 - 9 1 .
DIVISION 4.—Leases—ss. 9 2 - 1 0 3 .
DIVISION 5.—Casual profits—ss. 1 0 4 - 1 1 7 .
DIVISION 6.—Partnerships—ss. 1 1 8 - 1 2 2 . DIVISION 7.—Trustees—ss. 1 2 3 - 1 3 2 . DIVISION 8.—Assessment of income of husband and
wife—ss. 1 3 3 - 1 3 7 . DIVISION
DIVISION 9.—Further tax on undistributed income
of a company—ss. 1 3 8 - 1 4 0 .
DIVISION 10.—Private companies—ss. 1 4 1 - 1 4 9 . DIVISION 11.—Banks—ss. 1 5 0 - 1 5 5 . DIVISION 12.—Life assurance companies—ss. 1 5 6 -
162.
DIVISION 13.—Co-operative and mutual companies
—ss. DIVISION 14.—Interest and dividends paid by com 1 6 3 - 1 6 8 . panies—ss. 1 6 9 - 1 7 5 .
DIVISION 15.— Oversea ships—ss. 176-182 .
DIVISION 16.—Businesses with a foreign relation ship—ss. 1 8 3 - 1 8 6 . DIVISION 17.—Insurance with non-residents of
Australia—ss. 1 8 7 - 1 9 4 . DIVISION 18.—Averaging of incomes of primary
producers—ss. 1 9 5 - 2 0 3 . DIVISION 19.—Rebates of tax on income—ss. 204 ,
2 0 5 .
PART IV.—RETURNS AND ASSESSMENTS—ss. 2 0 6 - 2 2 3 . PART V.—OBJECTIONS AND APPEALS—ss. 2 2 4 - 2 5 8 . PART VI.—COLLECTION AND RECOVERY OF TAX—ss.
2 5 9 - 2 9 8 .
DIVISION 1.—General—ss. 2 5 9 - 2 7 5 . DIVISION 2.—Collection of income tax by instal
ments—ss. 2 7 6 - 2 9 8 . PART VII.—PENAL PROVISIONS AND PROSECUTIONS—
ss. 2 9 9 - 3 1 6 .
PART VIII.—MISCELLANEOUS—SS. 3 1 7 - 3 3 5 .
PART IX.—REGISTRATION OF TAX AGENTS—ss. 3 3 6 - 3 4 4 . SCHEDULES.
5. In this Act, unless the contrary intention appears—
" A S t a t e " means a State of the Commonwealth.
" A g e n t " includes—
(a) every person who in this State for or on behalf of any person out of this State holds or has the control, receipt or disposal of any money belonging to that person; and
(b)
(b)
every person declared by the Commis sioner to be an agent or the sole agent of any person for any of the purposes of this Act.
"Allowable deduction" means a deduction allowable under this Act.
"Assessable income" means all the amounts which under the provisions of this Act are included in the assessable income.
"Assessment" means the ascertainment of the amount of taxable income and of the tax pay able thereon.
"Assistant Commissioner" means Assistant Com missioner of Taxation.
"Aus t ra l i a " includes the whole of the Common wealth of Australia.
"Bus iness" includes any profession, trade, employ ment, vocation or calling, but does not include occupation as an employee.
"Commissioner" means the Commissioner of Taxa
tion.
"Company" includes all bodies or associations, cor porate or unincorporate, but does not include partnerships.
"Dependant" means a person who resides in Aus tralia and who is wholly maintained by the tax payer and who—(a) is the spouse of the taxpayer; or
(b)
is a child under the age of sixteen years; or
(c) is a child, brother or sister of the tax
payer of the age of sixteen years or over and is an invalid; or
(d) is a parent of the taxpayer; or
(e)
For the purposes of this definition a spouse or
a female relative referred to in paragraph (e)
shall be deemed to be wholly maintained by theis a female relative of the taxpayer having the care of any children under the age of sixteen years who are wholly maintained by the taxpayer.
taxpayer
taxpayer if the net income from all sources derived by such spouse or female relative during the year of income did not exceed one hundred pounds.
"Dividend" includes any distribution made by a company to its shareholders whether in money or other property, and any amount credited to them as shareholders, and includes the paid-up value of shares distributed by a company to its shareholders to the extent to which the paid-up value represents a capitalisation of profits but does not include a return of paid-up capital or a reversionary bonus on a policy of life assurance. "Exempt income" means income which is exempt
from income tax.
"Friendly society" means a society duly registered as a friendly society under any Act of the Com monwealth or of a State or under any law in force in a territory being part of the Common wealth.
" Income", without in any way limiting the ordinary meaning of the word, includes all amounts which, under this Act, are included in the assessable income."Income from personal exertion" or "income derived from personal exertion" means income consisting of earnings, salaries, wages, commis sions, fees, bonuses, pensions, superannuation allowances, retiring allowances and retiring gratuities, allowances and gratuities received in the capacity of employee or in relation
business carried on by the taxpayer either alone to any services rendered, the proceeds of any or as a partner with any other person, any amount received as a bounty or subsidy in carrying on a business, the income from any property where that income forms part of the emoluments of any office or employment of profit held by the taxpayer, and any profit arising from the sale by the taxpayer of any property acquired by him for the purpose of profit- making by sale or from the carrying on or
carrying
carrying out of any profit-making undertaking
or scheme, hut does not include—
(a)
interest unless the taxpayer's principal business consists of the lending of money, or unless the interest is received in respect of a trade debt; or
(b) rents or dividends.
"Income from proper ty" or "income derived from proper ty" means all income not being income from personal exertion.
"Income t a x " means the income tax imposed as such by any Act as assessed under this Act.
"Liquida tor" means the person who whether or not appointed as liquidator is the person required by law to carry out the winding-up of a company."Live stock" does not include animals used as beasts of burden or working beasts in a business other than a business of primary production.
"Mor tgage" includes any charge, lien or encum brance to secure the repayment of money.
"Mutual life assurance company" means a life assurance company none of the divisible profits of which are payable to persons other than policy-holders.
"Net assessable income" means the amount remain ing after deducting from any assessable income the allowable deductions incurred in gaining or producing that assessable income.
"Net exempt income" means the amount remaining losses and outgoings incurred in gaining or after deducting from any exempt income the producing that exempt income which would be allowable deductions if that exempt income were assessable income. "Net income" means the amount remaining after deducting from any gross income the losses and outgoings incurred in gaining or producing that gross income which would be allowable deductions if that gross income were assessable income.
"Net
" N e t income from all sources" means the total income of the taxpayer less the losses or out goings incurred in gaining or producing that income which would be allowable deductions if that income were assessable income.
"Net loss" means the amount by which any gross income is less than the losses and outgoings incurred in gaining or producing that gross income which would be allowable deductions if that gross income were assessable income.
"Non-resident" means a person who is not a resi
dent.
" P a i d " in relation to dividends includes credited or
distributed.
" P a r t n e r s h i p " means an association of persons carrying on business as partners or in receipt of income jointly but does not include a company.
" P e r s o n " includes a company. "Prescr ibed" means prescribed by this Act or by any rules or regulations made or in force under this Act, or the Income Tax (Management) Act, 1912, as amended by subsequent Acts, or the Income Tax (Management) Act, 1928, as amended by subsequent Acts, or the Income Tax (Management) Act, 1936, as amended by subsequent Acts.
"Previous Ac t " means the Income Tax (Manage ment) Act, 1936, and when considered in rela tion to any time means that Act, or if it has been amended, that Act as amended as in force at that time.
"Previous Ac t s " means all Acts passed prior to the commencement of this Act relating to the assess ment and collection of income tax in this State; and when any such Act is considered in relation to any time, means such Act, or if it has been amended, such Act as amended as in force at that time. "P r imary production" means production resulting directly from the cultivation of land or the main tenance of animals, poultry or bees for the purpose of selling them or their bodily produce
including
including natural increase and includes the manufacture of dairy produce by the person who produced the raw material used in that manu facture.
"Rateable income" means the amount remaining after deducting from the assessable income all allowable deductions except allowable gifts and the concessional deductions.
"Rela t ive" means a husband or wife or a relation by blood, marriage or adoption.
"Res ident" means—
(a) a person other than a company, who resides in this State, and includes a person— (i) whose domicile is in this State, unless the Commissioner is satis fied that his permanent place of abode is out of this State, or
(ii) who has actually been in this State, continuously or intermit tently, during more than one-half of the year of income, unless the Commissioner is satisfied that his usual place of abode is out of this State and that he does not intend to take up residence in this State; and
(b)
a company which is incorporated in this State or which, not being incorporated in this State, carries on business in this State and has either its central
management and control in this State, or its voting power controlled by share holders who are residents of this
State.
"Shareholder" includes member or stockholder.
"Taxable income" means the amount remaining
after deducting from the assessable income all
allowable deductions.
"Taxpaye r " means a person deriving income.
"The Commonwealth" means the Commonwealth
of Australia.
"This
"This Ac t " includes the regulations in force there
under.
' ' This S ta te ' ' means the State of New South Wales. "Trading stock" includes anything produced, manu
factured, acquired or purchased for purposes of manufacture, sale or exchange and also includes live stock.
" T r u s t e e " in addition to every person appointed or constituted trustee by act of parties, by order or declaration of a court, or by operation of law, includes—
(a)
an executor or administrator, guardian, committee, receiver, or liquidator; and
(b)
every person having or taking upon himself the administration or control of income affected by any express or implied trust or acting in any fiduciary capacity, or having the possession, control, or management of the income of a person under any legal or other disability.
"Year of income" means—
(a)
the year beginning on the first day of July and ending on the thirtieth day of June during which the income was derived; or
(b)
the accounting period, if any, adopted under this Act in lieu of that year.
PART II . ADMINISTRATION.
6. ( 1 ) For the due administration of this Act and the previous Acts, the Governor may, subject to the Public Service Act, 1902 , as amended by subsequent Acts, appoint a Commissioner of Taxation, who may sue and be sued by that name.
( 2 ) Any reference to the Commissioner of Taxation in the previous Acts, and the rules and regulations
thereunder,
thereunder, shall be read and construed as a reference to the Commissioner of Taxation charged with the administration of this Act.
(3) The Governor may, subject to the Public Ser vice Act, 1902, as amended by subsequent Acts, appoint two Assistant Commissioners of Taxation, one of whom may be appointed to act as the deputy of the Commissioner.
(4) The Assistant Commissioners shall, under the control of the Commissioner, perform such general official duties as they are required to perform by this Act or by the Commissioner.
(5) Such other persons may be appointed under the Public Service Act, 1902, as amended by subsequent Acts, as may be deemed necessary for the carrying out of this Act and the previous Acts.
(6) In the event of the absence, incapacity, or suspension of the Commissioner, his powers, authorities, duties, and functions may be exercised and performed during such absence, incapacity, or suspension, by the Assistant Commissioner appointed as deputy of the Commissioner, and in the event of the absence, incapacity, or suspension of both the Commissioner and that Assist ant Commissioner, the powers, authorities, duties and functions of the Commissioner may be exercised and performed during the absence, incapacity, or suspension of the Commissioner and that Assistant Commissioner by the other Assistant Commissioner.
(7) The Commissioner may, by writing under his hand, delegate to an Assistant Commissioner or any other person, any powers, authorities, duties, and functions conferred or imposed upon him by this Act,
| any of such Acts (except this power of delegation). | or the previous Acts, or the rules or regulations under |
| Every delegation under this section shall be revocable at will, but any delegation shall not prevent the exercise of any power, authority, duty, or function by the Com missioner. | |
| (8) A notification in the Gazette that any person has been appointed as Commissioner, Assistant Commis sioner, or other person for the purposes of this Act, or the previous Acts, shall be conclusive evidence of such appointment. |
(9)
(9) Where in or under this Act the exercise or discharge of any power, authority, duty or function by the Commissioner or the operation of any provision of this Act is dependent upon the opinion, belief, or state of mind of the Commissioner in relation to any matter, that power, authority, duty, or function may be exercised or discharged by the Assistant Commissioner appointed as deputy of the Commissioner when authorised to act by a delegation as aforesaid or during the absence, in capacity, or suspension of the Commissioner, or by the other Assistant Commissioner during the absence, in capacity, or suspension of the Commissioner and the Assistant Commissioner appointed to act as the deputy of the Commissioner, or that provision may operate (as the case may be) upon the opinion, belief or state of mind in relation to that matter of the Assistant Com missioner appointed as the deputy of the Commissioner when so authorised to act, or during the absence, in capacity, or suspension of the Commissioner, or upon the opinion, belief, or state of mind in relation to that matter of the other Assistant Commissioner during the absence, incapacity, or suspension of the Commissioner and the Assistant Commissioner appointed to act as the deputy of the Commissioner.
7. (1) The Commissioner shall furnish to the Colonial Treasurer annually for presentation to Parliament a report on the working of this Act.
(2) In the report the Commissioner shall draw attention to any breaches or evasions of this Act which have come under his notice.
8. (1) For the purposes of this section "officer"
means a person who is or has been appointed or employed
by the Commonwealth or by a State, and who by reason of that appointment or employment, or in the course of that employment, may acquire or has acquired informa tion respecting the affairs of any other person disclosed or obtained under the provisions of this Act or the previous Acts.
(2) Subject to this section, an officer shall not either directly or indirectly, except in the performance of any duty as an officer, and either while he is, or after he ceases to be an officer, make a record of, or divulge or communicate to any person any such information so
acquired by him. (3)
(3) An officer shall not be required to produce in any court any return, assessment or notice of assessment, or to divulge or communicate to any court any matter or thing coming under his notice in the performance of his duties as an officer, except when it is necessary to do so for the purpose of carrying into effect the provisions of this Act or the previous Acts.
(4) Nothing in this section shall be deemed to pro hibit the Commissioner, or an Assistant Commissioner, or any person thereto authorised by him, from com municating any information to—
(a)
any person performing, in pursuance of any appointment or employment by this State or by the Commonwealth, any duty arising under any Act administered by the Commissioner of Taxa tion of the Commonwealth or the Commissioner of Land Tax of the Commonwealth for the purpose of enabling that person to carry out any such duty;
(b)
the Commissioner of Income Tax for a State, or the authority administering any Act of a State relating to stamp duties, succession duties, or estate duties, if that authority is authorised by law to afford similar information to the Commissioner or an Assistant Com missioner; or
(c) a Board of Appeal under this Act.
( 5 ) Any person to whom information is communi cated under subsection four of this section and any person or employee under his control shall, in respect of that
| information, be subject to the same rights, privileges, | obligations and liabilities, under subsections two and |
| three of this section, as if he were an officer. | |
| ( 6 ) Any officer shall, if and when required by the Commissioner or an Assistant Commissioner to do so, make an oath or declaration in the manner and form pre scribed to maintain secrecy in conformity with the provisions of this section. | |
| Penalty: Two hundred and fifty pounds or imprison ment for twelve months. |
9. (1) Notwithstanding anything contained in this Act, the Commissioner may furnish to the Government Statistician for New South Wales any information dis closed by the returns under section two hundred and nine of this Act.
(2) Before any such information is so furnished, the Government Statistician and every officer or employee of the Bureau of Statistics and Economics shall take and subscribe before a justice of the peace such oath of fidelity and secrecy as may be prescribed.
( 3 ) The Government Statistician or any such officer or employee shall not act in the execution of his office in relation to any such return before he has taken the prescribed oath.Penalty: Not less than ten and not more than one hundred pounds.
(4) The Government Statistician or any such officer or "employee shall not without lawful excuse make a record of or reveal the name of any employer who has furnished a return pursuant to section two hundred and nine of this Act, or the particulars contained in any such return.
Penalty: Two hundred and fifty pounds or imprison ment for twelve months.
(5) A person who has held the office of Govern ment Statistician, or who has been an officer or employee of the Bureau of Statistics and Economics, or who has performed any duty under this Act in the said Bureau shall not reveal any information as to any employer who has furnished a return pursuant to section two hundred and nine of this Act, or as to any of the particulars con
person to whom he has been authorised by the Commis tained in any such return, to any person other than a sioner to communicate it. Penalty: Two hundred and fifty pounds or imprison ment for twelve months.
(6) The Government Statistician shall not, nor shall the Commissioner or any officer or employee of the Bureau of Statistics and Economics, or any officer appointed to act in the administration of this Act, be required to produce in any Court any return made pur suant to section two hundred and nine of this Act, or
to
to divulge or communicate to any Court the name of any employer who has made any such return, or any of the particulars contained in any such return, except as may be necessary for the purpose of carrying into effect the provisions of this Act.
(7) Nothing in this section shall prevent the Government Statistician from compiling from such re turns, and publishing statistics based on the particulars contained in such returns; but such statistics shall not disclose the name of any employer who has made any such return nor the particulars contained in any par ticular return.
10. (1) Nothing in this Act shall affect the operation or continuance of the Income Tax (Commonwealth) Collection Act, 1923, or of the Commonwealth Taxation Collection Act, 1941.
(2) (a) Where, by any Act of the Parliament of the Commonwealth, provision is made for the collec tion of income tax by instalments, this State may enter into an agreement with the Commonwealth for the deduction, by this State or by any authority of this State, from periodical payments of wages or salaries paid to any employee of this State or of such authority of any tax payable by the employee on those salaries or wages, and for the payment to the Commonwealth of any amount deducted in pursuance of such agreement in such manner and at such times as are provided by the agreement.
(b) Expressions used in paragraph (a) of
this subsection shall have the meanings which those
expressions bear in the Act of the Parliament of the Com
| monwealth referred to in that paragraph. |
(c) Any agreement made under section 9A of the previous Act and in force immediately before the com mencement of this Act shall continue in force in all respects as if it had been made under this subsection.
PART
P A R T I I I . LIABILITY TO TAXATION.
DIVISION 1.—General.
11 . (1) Subject to this Act income tax at such rates as may be fixed by any Act shall be levied and paid to the Commissioner upon the taxable income derived by any person whether a resident or a non-resident during the year of income ended on the thirtieth day of June, one thousand nine hundred and forty-one (or the account ing period, if any, accepted by the Commissioner in lieu of that year) and for each year of income thereafter.
(2) Where a company is wound up, or an indi vidual person dies or ceases to be a taxpayer, in any year, and the same income of that company or person has, under the provisions of this Act or the previous Acts, been included in the assessable income of that company or person for more than one year of income, and no adjustment in regard thereto has previously been made, the Commissioner shall make such adjustment as is just if he is satisfied that over-taxation has resulted.
12. (1) Any person may, with the leave of the Com missioner, adopt an accounting period being the twelve months ending on some date other than the thirtieth day of June. His accounting period in each succeeding year shall end on the corresponding date of that year, unless with the leave of the Commissioner some other date is adopted.
(2) Where the Commissioner has under the pre
vious Act accepted returns from any person made up to
which that Act applied that person shall be deemed to pose of assessment for the last year to the income of a date other than the thirtieth day of June for the pur have adopted an accounting period under this section
ending on the corresponding date.13. Income shall be deemed to have been derived by a person although it is not actually paid over to him but is reinvested, accumulated, capitalized, carried to any reserve, sinking fund or insurance fund however desig nated, or otherwise dealt with on his behalf or as he directs.
14. For all the purposes of this Act income wherever derived, and any expense wherever incurred, shall be expressed in terms of Australian currency.
15. Where upon any transaction any consideration is paid or given otherwise than in cash, the money value of that consideration shall for the purposes of this Act be deemed to have been paid or given.
16. Where any income is received in the year of in come as a result of a transaction entered into before the commencement of this Act, and that income would have been assessable income under the previous Act if it had been received in the year in which the transaction was entered into, that income shall be assessable under this Act notwithstanding that the transaction was entered into before such commencement.
17. For the purposes of this Act where any property is sold together with other assets, the amount of the consideration attributable to that property shall, subject to subsection three of section thirty-one and subsection three of section sixty-eight of this Act, be—
(a) where a separate amount is allocated to that property in any contract of sale or arrangement and the Commissioner is satisfied that that separate amount is fair and reasonable—the amount so allocated; or (b)
where no separate amount is so allocated or the Commissioner is not satisfied that the amount allocated is fair and reasonable—the amount determined by the Commissioner.
18. Notwithstanding anything contained in this Act, where any business carried on by a taxpayer is carried on in such manner or in such circumstances that in the opinion of the Commissioner—
(a)
the acquisition of profit is not the primary object of that business; or
(b)
(b)
a profit is not likely to arise, under normal conditions, from the carrying on of that business,
any income derived from the carrying on of that busi ness shall not be included in the assessable income of the taxpayer, and any expenditure incurred in the carry ing on of that business shall not be an allowable deduction.
19. The following income shall be exempt from income
tax:— (a) the official salary of any person being—
(i) the Governor-General or the Governor of this State;
(ii) the representative in Australia of the government of another country;
(iii) a foreign consul;
(iv) a trade commissioner of any part of the British Empire other than Aus tralia ;
(v) a member of the staff of any such repre sentative, foreign consul or trade com missioner if the member is domiciled in the country represented by the repre sentative, foreign consul or commis sioner and is temporarily resident in this State by direction of the govern ment of the country so represented for the purpose of performing his official duties, and if the official salary of
officials (if any) of the Government of this State temporarily resident for similar purposes in the country so represented is exempted from income tax by that country; or (vi) an officer of the government of any country outside Australia which is part of the British Empire, who is tempor arily in this State to render service on behalf of that country or the Common wealth or this State in accordance with
any
any arrangement between the govern ments of that country and of the Com monwealth or of this State, if the salaries of officers of the Government of this State temporarily in that coun try for similar purposes in accordance with a similar arrangement are ex empted from income tax by that country;
(b)
the remuneration paid by the Government of the Commonwealth or of this State to a person who is not a resident of Australia for expert advice to that Government or as a member of a Royal Commission;
(c) income derived—
(i) in the capacity of representative of an association or club established in any country for the control of any out-door athletic sport or game in that country by any person visiting Australia in that capacity for the purpose of engaging in contests in Australia in that sport or game;
(ii)
by any club or association in any other part of the British Empire as its share of the proceeds of cricket, football, or similar matches played in Australia by a team controlled by that club or asso ciation visiting Australia from that part of the British Empire, and recognised by the authority controlling that class of match in Australia as being rep resentative of that part of the British Empire;
(iii) by the representative of any govern ment, visiting Australia on behalf of that government, or by any member of the entourage of that representative, in his official capacity as such represen tative or member;
(iv) in the capacity of representative of any society or association established for
educational
educational, scientific, religious or phil anthropic purposes, by any person visiting Australia in that capacity for the purpose of attending international or Empire conferences or for the pur pose of carrying on investigation or research for such society or associa tion;
(v) in the capacity of representative of the press outside Australia by any person visiting Australia in that capacity for the purpose of reporting the proceed ings relating to any matters referred to in subparagraphs (i), (ii), (iii), and (iv) of this paragraph;
(vi) by any person visiting Australia, from an occupation carried on by him while in Australia, if in the opinion of the Colonial Treasurer that visit and occu pation are primarily and principally directed to assisting the Commonwealth Government or a State Government in the settlement or development of Australia; and
(vii) as remuneration during a visit to Australia by a non-resident who is a director, manager or other adminis trative officer for some place outside Australia of a manufacturing, mercan tile or mining business or of a business of primary production, where the visit of the non-resident to Australia does not exceed six months and the remun
eration is not an allowable deduction in any assessment under this Act of the person paying it, and such non-resident satisfies the Commissioner that during such visit he did not act as a director, manager, or other administrative officer for or in relation to the conduct of such business in this State; (d)
the revenue of a municipal corporation or other local governing body or of a public authority;
(e)
(e)
the income of a religious, scientific, charitable or public educational institution;
(f)
the income of a trade union and the income of an association of employers or employees regis tered under any Act of the Commonwealth or of a State, or under any law in force in a territory being part of the Commonwealth, relating to the settlement of industrial disputes;
(g)
the income of a society or association not carried on for the purposes of profit or gain to the individual members thereof, and being a friendly society, or a society or association established for musical purposes, or for the encouragement of music, art, science or literature;
(h)
the income of a society or association not carried on for the purposes of profit or gain to the individual members thereof, established for the purpose of promoting the development of aviation or of the agricultural, pastoral, horti cultural, viticultural, manufacturing or indus trial resources of Australia;
(i) the income of the Rural Bank of New South Wales;
(j) the incomes of the following funds, provided that the particular fund is being applied for the purpose for which it was established— (i) a provident, benefit or superannuation fund established for the benefit of
employees; (ii) a fund established by will or instrument of trust for public charitable puposes; and
(iii) a fund established for the purpose of enabling scientific research to be con ducted by or in conjunction with a public university or public hospital;
(k)
interest on bonds, debentures, stock or other securities issued by the Government of New
South
South Wales or the Government of the Com monwealth and interest on bonds, debentures, stock or other securities issued by the Rural Bank of New South Wales prior to the commencement of this Act where such interest was exempt under the previous Acts, or issued by that bank after the commencement of this Act where, with the approval of the Governor, such interest has been declared to be free of State income tax:
Provided that this paragraph shall not extend to interest on any bonds, debentures, stock or other securities in cases where by this Act, or any Act of the Parliament of the Commonwealth or of this State, such interest is made liable to the payment of income tax;
(1) income which is—
(i) a pension or payment of a like nature paid under the Australian Soldiers' Repatriation Act 1920-1940, or the Seamen's War Pensions and Allow ances Act 1940, of the Parliament of the Commonwealth;
(ii) a wounds and disability pension of the kind specified in subsection two of section sixteen of the Finance Act, 1919, of the United Kingdom;
(iii) a pension paid under the Widows' Pensions Act, 1925, as amended by subsequent Acts;
(iv) a pension paid to a non-resident who is a resident of Australia to the extent to which such pension is liable to income tax under the law of any other State of Australia; (v) a pension derived by any person domi ciled in this State whose net income from all sources during the year of in come does not exceed two hundred pounds;
(m)
(m) income which is—
(i) a payment in respect of any children under the Child Endowment Act 1941, of the Parliament of the Common wealth;
(ii) a payment made in respect of children under the Child Welfare Act, 1939;
(iii) a payment made to any person as charitable relief by any Government department or agency;
(n)
the income received by way of periodical pay ments in the nature of alimony or maintenance by a woman from her husband or former hus band provided that for the purpose of making such payments the husband, or former husband, has not divested himself of any income-produc ing assets or diverted from himself income upon which he would otherwise have been liable to tax;
(o)
the income of a co-operative building society, and the income of a rural society registered as such under the Co-operation Act, 1923-1941, as amended by subsequent Acts, if the principal business of that rural society is the manufac ture, treatment or disposal of the agricultural products (as defined in that Act) or livestock of its members;
(p)
the income derived by a resident of any terri tory or island in the Pacific Ocean other than New Zealand, which is governed, controlled or held under mandate by the Government of any part of the British Empire, or by a condominium
in which any part of the British Empire is con
cerned, from the sale in this State by or on
behalf of that person of produce of the terri
tory or island of which he is a resident;(q)
the income derived prior to the first day of July, one thousand nine hundred and forty-two, by a person from the working of a mining property in Australia or in the territories of Papua and New Guinea principally for the purpose of obtaining gold, or gold and copper,
provided
provided that in this case the value of the output of gold is not less than forty per centum of the total value of the output of the mine;
(r) income derived by a bona fide prospector from the sale, transfer or assignment by him of his rights to mine for gold in a particular area in Australia or in the territories of Papua and New Guinea. For the purpose of this paragraph "bona fide prospector" means a person other than a com pany who has personally carried out the whole or major part of the field work of prospecting for gold in the particular area, or who has con tributed to the expenditure incurred in the work of prospecting and development in that area, and includes a company which has itself carried out the whole or major part of such work;
(s)
interest received from a company by a non resident of Australia on money raised out of Australia and secured by debentures of the com pany ;
(t)
interest received from any municipal corpora tion or other local governing body or from a public authority by a non-resident of Australia on money raised out of Australia and secured by stock or debentures which have been issued by such corporation, body, or authority, where such interest is payable out of Australia;
(u)
in the case of any person enlisted in or appointed to the naval, military or air forces of the Com monwealth or any part of the King's dominions
side Australia during the present war between or of any Ally of Great Britain for service out His Majesty the King and Germany and her Allies—the pay and allowances earned by him as a member of those forces during the period commencing on the third day of September, one thousand nine hundred and thirty-nine, or on the date of his enlistment or appointment (whichever is the later date) and terminating on the date of his discharge or the termination of his appointment:
Provided
Provided that this paragraph shall not apply to any pay or allowance so earned during the year of income by a member of the forces who does not at any time during the period commencing on the third day of September, one thousand nine hundred and thirty-nine, and terminating one year after the close of that year of income—
(i) in the case of a member of the naval forces of the Commonwealth—serve in a sea-going ship; or
(ii) in the case of a member of the military or air forces of the Commonwealth— embark for service outside Australia.
The exemption provided by this paragraph shall continue in force until twelve months after the date of the issue of a proclamation that the war between His Majesty the King and Germany and her Allies has ceased, and no longer;
(v) in the case of any person enlisted in or appointed or called to the naval, military or air forces of the Commonwealth for service in Australia during the present war between His Majesty the King and Germany and her Allies —the pay derived by him as a member of those forces, where his total income from all sources during the year of income does not exceed two hundred pounds;
(w) income derived by a non-resident from sources wholly out of this State; (x) the income of any person (other than a company
income does not exceed one hundred and fifty-six or a trustee) domiciled in this State whose net income from all sources during the year of pounds or where the person has a dependant does not exceed two hundred and fifty pounds.
20. (1) Where any income is exempt from income tax the exemption shall be limited to the specified or original recipient of the income, and shall not extend to persons receiving payments from that recipient although the payments may be made wholly or in part out of that income.
R (2) (2) The exemption of any income from income tax shall not exempt any person from furnishing any return or information which may be required by the Commissioner, or from including in his return such information as is prescribed or as is required by the Commissioner.
DIVISION 2.—Income.
SUBDIVISION A.—Assessable income generally.
2 1 . (1) The assessable income of a taxpayer shall include—
(a) where the taxpayer is a resident—the gross income derived directly or indirectly from all sources whether in or out of this State, and (b) where the taxpayer is a non-resident—the gross income derived directly or indirectly from all sources in this State.
(2) (a) Subject to paragraph (b) of this sub section interest on money loaned in this State shall be deemed to be income derived in this State.
(b) In the case of money loaned in this State upon the security of a mortgage of property, the follow ing provisions shall apply:—
(i) where the whole of such property is out of this State but in Australia the interest on the money so loaned shall be deemed to be income derived out of this State;
(ii) where part of such property is out of this State but in Australia, a proportionate part of the interest on the money so loaned shall be deemed to be income derived out of this State.
( 3 ) (a) Subject to paragraph (b) of this subsec
tion interest on money loaned out of this State shall be deemed to be income derived out of this State.
(b) In the case of money loaned out of this State upon the security of a mortgage of property, the following provisions shall apply:—(i) where the whole of such property is in this State the interest on the money so loaned shall be deemed to bo income derived in this State;
(ii) where part of such property is in this State, a proportionate part of the interest on the money so loaned shall be deemed to be income derived
in this State. (4)
(4) Notwithstanding anything contained in this Act, exempt income shall not be included in the assessable income of a taxpayer.
2 2 . The assessable income of a taxpayer shall, subject to subsection one of section twenty-one of this Act, include—
(a)
the gross profit derived from any business. In ascertaining the amount thereof the value of trading stock shall be taken into account as provided in Subdivision B of this Division;
(b)
profit arising from the sale by the taxpayer of any property acquired by him for the purpose of profit-making by sale, or from the carrying on or carrying out of any profit-making under taking or scheme;
(c)
beneficial interests in income derived under any will, settlement, deed of gift or instrument of trust;
(d)
the amount of any annuity, excluding in the case of an annuity which has been purchased that part of the annuity which represents the purchase price to the extent to which that price has not been allowed or is not allowable as a deduction in assessments for income tax under this Act or the previous Acts;
(e)
five per centum of the capital amount of an allowance or gratuity paid in a lump sum upon retirement from any office or employment: Pro vided that this paragraph shall not apply in respect of any amount which, under any pro vision of this Act, is deemed to be a dividend
paid to the recipient; (f)
any sum (in this paragraph referred to as "compensation") paid by way of compensa tion or damages in consequence of the termina tion of any office or employment (held for a fixed or indeterminate period) otherwise than by retirement pursuant to any understanding, arrangement or contract regulating the tenure of such office or employment, and whether so paid voluntarily, by agreement, or by com pulsion of law: Provided that where such
compensation
compensation is paid in a lump sum, and the office or employment so terminated was for a fixed period, and the part of such period unex pired at the date of such termination is not less than twenty-five complete months, the rate of tax to be applied to the taxable income of the tax payer (except where the provisions of Division 18 of this Par t are applied in his assessment) shall be—
(i) where the rateable income exceeds the amount of that compensation—the rate which is applicable to a rateable income equal to the amount obtained by deducting such compensation from the rateable income and adding to the result the amount ascertained by divid ing such compensation by one twenty- fourth of the number of complete months in such unexpired part of the period of the office or employment, or by five, whichever is the less;
(ii) where the rateable income does not ex ceed the amount of that compensation— the rate which would be applicable to a rateable income equal to the amount ascertained by dividing the actual rateable income by one twenty-fourth of the number of complete months in such unexpired part of the period of the office or employment, or by five, whichever is the less:
which under any provision of this Act shall not apply to any compensation Provided further that this paragraph is deemed to be a dividend paid to the
recipient;(g)
the value to the taxpayer of all allowances, gratuities, compensations, benefits, bonuses and premiums allowed, given or granted to him in respect of or for or in relation directly or in directly to any employment of or services ren dered by him, whether so allowed, given or
granted
granted in money, goods, land, meals, susten ance, the use of premises or quarters or other wise: Provided that this paragraph shall not apply to any allowance or gratuity which is included in paragraph (e) of this subsection or which, under any provision of this Act, is deemed to be a dividend paid to the recipient;
(h) any amount received as or by way of royalty;
(i) any bounty or subsidy to the extent to which it is received in or in relation to the carrying on of a business;
(j) the amount of any fee or commission received for procuring a loan of money; (k) any amount received as or by way of bonus other than a reversionary bonus on a policy of life assurance; (1) any amount received by way of insurance or indemnity for or in respect of any loss—
(i) of trading stock which would have been taken into account in computing taxable income; or
(ii) of profit or income which would have been assessable income,
if the loss had not occurred and any amount so received for or in respect of any loss or outgoing which is an allowable deduction;
(m) the amount or value of any consideration received in connection with a right to remove standing timber from land less the amount, if any, by which the value of the land is or will be
diminished by the removal of the timber.2 3 . (1) The interest on loans raised in this State after the thirty-first day of December, one thousand nine hundred and twenty-three, by the Government of any country or dominion out of Australia or by any authority constituted by or under any law of any such country or dominion and received directly or indirectly
by
by a resident shall be deemed to be derived by him from a source in this State and shall be included in his assess able income.
(2) For the purposes of this section a loan shall be deemed to have been raised in this State if subscrip tions to the loan were invited in this State by public advertisement, by the issue of a prospectus or otherwise.
SUBDIVISION B.—Trading stock.
24. (1) Whore a taxpayer carries on any business the value, ascertained under this Subdivision, of all trading stock on hand at the beginning of the year of income, and of all trading stock on hand at the end of that year shall be taken into account in ascertaining whether or not the taxpayer has a taxable income.
(2) Where the value of all trading stock on hand at the end of the year of income exceeds the value of all trading stock on hand at the beginning of that year, the assessable income of the taxpayer shall include the amount of the excess.
( 3 ) Where the value of all trading stock on hand
at the beginning of the year of income exceeds the value of all trading stock on hand at the end of that year, the amount of the excess shall bo an allowable deduction.
25 . Subject to this Act the value of live stock and of each article of other trading stock to be taken into account at the beginning of the year of income shall be its value as ascertained under this or the previous Act at the end of the year immediately preceding the year of income.
(1) Where the value of live stock at the beginning tained under section twenty-five of this Act, and it wealth differs from its corresponding value as ascerassessment to income tax under the law of the Common appears to the Commissioner that if those values were equal the corresponding values would remain equal in subsequent years, the taxpayer may, subject to this section, take his live stock into account at the beginning of the year of income at a value equal to its correspond ing value under the law of the Commonwealth. (2) Where the value at which that live stock is
taken into account at the beginning of the year of income26. of the year of income as ascertained for the purpose of
exceeds
exceeds the value as ascertained under section twenty- five of this Act, amounts in the aggregate equal to the excess, shall be included in the assessable income of the taxpayer of one or more of the years being the year of income and the four years next succeeding that year.
( 3 ) Where the value of live stock as ascertained
under section twenty-five of this Act exceeds its value as taken into account at the beginning of the year of income, amounts in the aggregate equal to the excess shall be deducted from the assessable income of the taxpayer of one or more of the years being the year of income and the four years next succeeding that year.
( 4 ) The amounts referred to in subsections two
and three of this section, and the years in respect of which they are to be taken into account, shall be such amounts and years as are agreed upon by the taxpayer and the Commissioner.
Unless and until those amounts and years are so agreed upon this section shall not apply to the assessments of that taxpayer.
27. The value of each article of trading stock (not being live stock) to be taken into account at the end of the year of income shall be, at the option of the tax payer, its cost price or market selling value or the price at which it can be replaced.
28 . The value of live stock to be taken into account at the end of the year of income shall be at the option of the taxpayer its cost price or market selling value, and where a taxpayer does not exercise his option within the time and in the manner prescribed, the value so to be taken into account shall be the cost price:
| Provided that where a taxpayer satisfies the Commis adoption by him of some value other than cost price or | sioner that there are circumstances which justify the | |
| market selling value for the whole or part of his live stock, he may with the leave of the Commissioner adopt that other value. | ||
| 29. A taxpayer shall not, except with the leave of the Commissioner, adopt a basis of valuation of his live stock taken into account at the end of the year of income different from the basis on which the valuation of his live stock was made when it was last taken into account at the end of a previous year, whether under this or the | ||
|
30. (1) The cost price per head of natural increase of any class of live stock of a taxpayer shall be—
(a) where the cost price of natural increase of that class has been previously taken into account under this or the previous Act by the taxpayer —the cost price per head at which natural increase of that class was last taken into account unless, with the leave of the Commissioner, the taxpayer selects another cost price; and (b) where the cost price of natural increase of that class has not been previously taken into account under this or the previous Act by the taxpayer —the cost price selected by him within the limits prescribed in respect of live stock of that class.
(2) Where a taxpayer does not so select within the time and in the manner prescribed he shall be deemed to have selected, as the cost price, the lower of the prescribed limits.
31 . (1) Subject to this section, where the whole or any part of the assets of a business carried on by a tax payer is disposed of by sale or otherwise howsoever, whether for the purpose of putting an end to the business or any part thereof or not, and the assets disposed of include any property being trading stock, standing timber (where the growing of or dealing in timber formed part of the business of the taxpayer), standing or grow ing crops or crop-stools, the value of that property shall be included in his assessable income, and any person acquiring that property shall be deemed to have pur chased it at the amount of that value.
(2) Where a taxpayer sells the whole of the business carried on by him—
(a) for the purpose of putting an end to that business; or (b) in consequence of the acquisition or resumption of land, used by him for that business, under the provisions of any law of this State or of the Commonwealth which contains provisions for the compulsory acquisition or resumption of land,
the value of any live stock included in the sale, being natural increase bred by him which was on hand at the beginning of the first year to the assessment of the income
of
of which the previous Act applied and which was, in the opinion of the Commissioner, ordinarily used by him in that business for breeding purposes, shall not be included in his assessable income, and no deduction shall be allowed to him in respect of any such live stock, and no such live stock shall be taken into account in computing his taxable income.
(3) For the purposes of this section, the value of any property or live stock shall be—
(a) the market value of the property or live stock on the day of the disposal; or (b) if in the opinion of the Commissioner there is insufficient evidence of the market value on that day—the value which in his opinion is fair and reasonable.
(4) For the purposes of this section " s a l e " includes a change of ownership of or the distribution of the assets of a business owing to—
(a) the dissolution of a partnership; or
(b) a variation of the members constituting a partnership:
Provided that if such of the persons interested as at the time have capacity so to do unanimously agree and give notice of their agreement to the Commissioner at the time and in the manner prescribed the property or live stock may be valued at the amount which would have been included in respect of that property or live stock if no change or distribution had taken place and the new owners of the assets shall be deemed to have purchased them at that value.
| 32. (1) Where the assets of a business carried on by a taxpayer devolve by reason of his death, and those assets include any properly being trading stock, stand ing timber (where the growing of or dealing in timber formed part of the business of the taxpayer), standing or growing crops or crop-stools, the value of that pro perty shall, subject to this Act, be included in the assess able income derived by the deceased up to the date of his death and the person upon whom the property devolves shall be deemed to have purchased it at that value. | (2) |
(2) For the purpose of subsection one of this section the value of the property so to be included shall be the amount which would have been included in respect of that property in the assessable income of the deceased person under section thirty-one of this Act, if he had not died but had disposed of the property on the day of his death for the purpose of putting an end to the whole of the business carried on by him:
Provided that if the trustee of the estate of the deceased and the beneficiaries (if any) who are liable to be assessed in respect of the income of the business or of a share in that income unanimously so agree and give notice of their agreement to the Commissioner at the time and in the manner prescribed, that value shall be the value, if any, at which that property would have been taken into account at the date of the death of the deceased person if he had not died, but an assessment had been made in respect of the income derived by him up to that date.
SUBDIVISION C.—Business carried on partly in and partly
out of this State.
33. In this Subdivision—
"Goods" includes wares, merchandise and any sub stance, product or commodity.
34. Where a person sells goods by means of anything done by himself when in this State, or by means of an agent or representative in this State, and those goods are in this State or are to be brought into this State for the purpose or in pursuance or in consequence of such sale he shall be deemed to have sold them in this State.
35. Where a person sells goods by means of anything
done by himself when out of this State, or by means of anagent or representative out of this State, and those goods are out of this State or are to be taken out of this State for the purpose or in pursuance or in consequence of such sale, he shall be deemed to have sold them out of this State.
36. A sale is deemed to be made by means of a person or of something done when such person or thing done is instrumental in bringing about the sale.
37. Except as otherwise provided in this Subdivision—
(a) where goods are sold in this State by any person, the whole of the profit arising from the sale, or where such person is the producer or manu facturer of the goods, the whole of the profit arising from the production or manufacture and sale, shall be deemed to be income derived in this State; (b) where goods are sold out of this State but in Australia by any person, the whole of the profit arising from the sale, or where such person is the producer or manufacturer of the goods, the whole of the profit arising from the production or manufacture and sale, shall be deemed to be income derived out of this State.
38. Where goods produced, manufactured or partly manufactured out of Australia are sold in this State by the producer or manufacturer of the goods, and the profit arising from the production or manufacture and sale is deemed to be income derived in this State, the Commis sioner shall ascertain the profit from the sale of the goods on the basis of the actual cost of the production or manu facture of the goods and in any case where it appears to the Commissioner to bo difficult to ascertain such actual cost he may adopt as the cost any amount which he con siders reasonable arrived at in such manner and by such means as he considers just and the Commissioner shall, if he is satisfied that portion of the profit from the sale is attributable to the operations of production or manu facture carried on out of this State, and that such profit is liable to income tax in the country of production or
| manufacture, allow a rebate as follows:— |
(a)
where the goods are wholly produced or manu factured out of Australia—a rebate of one-half of the tax otherwise payable under this Act on the profit; or
(b)
where the goods are subject to further pro cesses of manufacture in Australia—a rebate of an amount determined by the Commissioner not exceeding one-half of the tax otherwise payable under this Act on the profit.
39. (1) Where goods manufactured out of this State but in Australia are sold in this State by the manufac turer, the profit arising from the manufacture and sale shall be deemed to be income derived in this State.
(2) In respect of that part of his income which is equivalent to two-thirds of the profit referred to in this section a taxpayer shall be entitled to a rebate in his assessment of an amount equal either to the tax payable on that part under the laws of the State in which the goods are manufactured or to the tax payable on that part under this Act, whichever is the less.
40 . Where goods manufactured in this State are sold out of this State but in Australia by the manufacturer, two-thirds of the profit arising from the manufacture and sale shall be deemed to be income derived in this State.
41 . ( 1 ) Where goods are sold in this State in the course of a business carried on out of this State but in Australia by a person not being the manufacturer of the goods, the profit arising from the sale shall be deemed to be income derived in this State.
(2) In respect of that part of his income which is equivalent to one-half of the profit referred to in this section a taxpayer shall be entitled to a rebate in his assessment of an amount equal either to the tax payable on that part under the laws of the State in which the business is carried on or to the tax payable on that part under this Act, whichever is the less.
42 . Where goods are sold out of this State but in Aus
tralia in the course of a business carried on in this Stateby a person not being the manufacturer of the goods,
one-half of the profit arising from the sale shall be deemed to be income derived in this State. 4 3 . Notwithstanding anything contained in this Sub division, the following provisions shall in the cases therein mentioned apply to the profit derived from the sale any where in Australia of goods which are the produce of a business of primary production or of coal-mining carried on in Australia:—
(a)
where the goods are produced in this State and are sold by or on behalf of a person carrying on
the
the business of which the goods are the produce, the profit shall be deemed to be income derived in this State;
(b) where the goods are produced out of this State and are sold by or on behalf of a person carry ing on the business of which the goods are the produce, the profit shall be deemed to be income derived out of this State. 44. The amount of any profit referred to in this Sub division shall be ascertained by adding to the proceeds of sale any bounty or subsidy received in respect of the goods sold, and deducting therefrom all losses and out goings incurred in deriving the profit which would have been allowable deductions in respect of those proceeds if those proceeds had been included in the assessable income of the person deriving the profit, and those losses and outgoings had been wholly incurred in this State.
45. The assessable income of a taxpayer shall include
any profit or net income derived by him in the year ofincome which under the provisions of this Subdivision—
(a) where the taxpayer is a resident—is deemed to be derived in or out of this State; and (b) where the taxpayer is a non-resident—is deemed to be derived in this State, and no amount which is taken into account in ascer taining the amount of any such profit or net income shall otherwise be an allowable deduction.
46. (1) Sections thirty-four to forty-five (both inclu sive) of this Act shall not apply for the purpose of determining the income derived or deemed to be derived from a source in or out of this State by any person from
mining). the carrying on of a business of mining (other than coal (2) Where, for any of the reasons stated in sec tion forty-seven of this Act, the source of any profit from the carrying on of any such business as is referred to in subsection one of this section is not exclusively in this State, the part of the profit deemed to be derived from a source in this State and the part of the profit deemed to be derived from a source out of this State, shall be deter mined in accordance with section forty-seven of this Act.
47. Where goods are exported from this State and either before or after export are sold out of Australia and—
(a)
by reason of the manufacture, extraction from the earth, winning, production or purchase of such goods in this State; or
(b)
by reason of successive steps of extraction, win ning, production, or manufacture in and out of this State; or
(c)
by reason of the making of contracts out of this State; or
(d) for any other reason whatever;
the source of any profit is not exclusively in this State, the part of the profit deemed to be derived from a source in this State and the part of the profit deemed to be derived from a source out of this State shall be deter mined in accordance with the regulations, or, if there are no regulations applying to the case, shall be determined by the Commissioner.
48. (1) Where a person carries on business (other than a business to which Division 11, Division 12, or Division 15 of this Par t applies) in and out of this State, and the net income derived from sources in this State is not kept separate and apart from the net income derived from sources out of this State that person shall furnish the Commissioner with a return setting out the net income from all sources. Such return shall be accompanied by a statement setting out—
(a)
the part of the net income from all sources which can be definitely ascertained as having been derived from sources in this State; and
(b)
the part of the net income from all sources which can be definitely ascertained as having been
derived from sources out of this State; and(c)
the part of the net income from all sources which consists of profit on the sale of goods and which is not capable of being set out under para graph (a) or paragraph (b) of this subsection, together with an apportionment of that profit to sources in this State and sources out of this State determined in accordance with the preced ing provisions of this Subdivision; and
(d)
(d)
an apportionment of the remainder of such net income to sources in this State and sources out of this State together with full particulars of the manner in which and the basis upon which such apportionment is made.
(2) The return referred to in subsection one of this section shall also be accompanied by a full and com plete statement of income and expenditure and assets and liabilities in connection with the business in and out of this State.
49. (1) The Commissioner may, subject to such altera tions as he considers necessary, accept any statement referred to in section forty-eight of this Act or may, without limitation of any of his powers under this Act, allocate to a source in or out of this State any part of the net income from all sources which, in his opinion, can be so allocated.
Any part of the net income from all sources derived from sales shall be apportioned between sources in and out of this State in accordance with the preceding pro visions of this Subdivision and the balance may be apportioned between sources in and out of this State according to the remaining income in this State as com pared with the remaining income from all sources.
The part of the net income from all sources allocated or apportioned to a source in this State shall be deemed to be net income derived from a source in this State, and the part of the net income from all sources allocated or apportioned to sources out of this State shall be deemed to be net income derived from sources out of this State.
(2) Notwithstanding anything contained in this
section, the Commissioner may apportion the net income
upon the basis of the assets used in this State in the from all sources between sources in and out of this State production of assessable income as compared with the total assets employed in the production of the net income from all sources.
50. Where, in the opinion of the Commissioner, it is difficult or impracticable to determine whether income is assessable under one section or under another section of this Act, or where, in the opinion of the Commissioner, the income is assessable under more than one section of
this
this Act, he may at his option assess the income under the provisions of the section or sections which is or are the most appropriate to the circumstances of the case.
51 . Where the net assessable income cannot to the
satisfaction of the Commissioner be ascertained under the preceding provisions of this Subdivision it shall be deemed to be such amount of the assessable income as the Commissioner determines.
52. Where in the year of income a taxpayer incurs a net loss in a business or transaction of such a nature that had the business or transaction yielded a profit or net assessable income the whole or part of that profit or net assessable income would under this Subdivision have been included in his assessable income, the whole or part of that net loss shall to a corresponding extent be an allowable deduction:
Provided that where any net loss which is an allow able deduction under this section is incurred out of this State such net loss shall be deducted in the first place from net assessable income, if any, derived out of this State.
SUBDIVISION D.—Dividends.
53 . ( 1 ) The assessable income of a shareholder in a
company (whether the company is a resident or a non
resident) shall—
(a) if he is a resident—include all dividends paid to him by the company; and
(b) if he is a non-resident—include dividends paid to him by the company out of profits derived by
it from sources in this State.
(2) Where a company derives income from
sources in this State, and from sources out of this
State, a dividend shall be deemed to be paid out of profits
derived by the company from sources in this State to the
extent of so much of the dividend as bears to the whole dividend the same proportion as the profits derived by the company from sources in this State bear to the total profits of the company.54. ( 1 ) A shareholder, being a company which is a
resident, or is incorporated in Australia and has its central management and control in Australia, shall be entitled to a rebate in its assessment of the amount
obtained
obtained by applying to that part of the dividends included in its taxable income the rate of tax payable for the year of income by companies which are residents.
(2) For the purposes of subsection one of this section the rate of tax to be applied in accordance with that subsection shall be the rate of tax payable by a company which is not liable to tax under Division 9 or Division 10 or Division 14 of this Par t of this Act.
(3) Subsection one of this section shall not apply to allow a rebate to a company (in this subsection referred to as the shareholder company) in respect of any dividend paid by another company out of any profit or income derived by such other company prior to the acquisition by the shareholder company of the shares in respect of which the dividend is paid where the con sideration given by the shareholder company for such shares is satisfied directly or indirectly by the issue of shares of the shareholder company, except to the extent to which the shareholder company has, not later than six months after the close of the year of income, distributed that dividend by way of a dividend to its shareholders.(4) Where a shareholder (other than a company) who is a non-resident but is a resident of Australia has paid tax under the laws of the State in which he resides in respect of the part of any dividends included in his taxable income, he shall be entitled to a rebate in his assessment of an amount equal either to the tax so paid or to the tax payable under this Act on the part of those dividends so included, whichever is the less.
(5) The part of the dividends included in the taxable income of the shareholder shall for the purposes of subsections one and four of this section be the amount remaining after deducting from the amount of dividends
included in such shareholder's assessable income deduc tions allowable to such shareholder under this Act from income from dividends. (6) For the purposes of this section—
(a)
where the allowable deductions of the year of income from income from personal exertion exceed the amount of that income the excess shall be deemed to be allowable proportionately from the net assessable income from dividends and from the net assessable income from property
other than dividends; (b)
(b)
where there is a net loss from any class of income from property other than dividends that net loss shall be deemed to be allowable propor tionately from the net assessable income from dividends and from the net assessable income from property other than dividends;
(c)
where expenditure which is an allowable deduc tion is not directly applicable to any class of income that expenditure shall be deemed to be allowable proportionately from the net assess able income from dividends and from the net assessable income other than dividends except where an amount applicable to the net assessable income from dividends is otherwise fixed by the Commissioner.
55. Distributions to shareholders of a company by a
liquidator in the course of winding up the company, to the extent to which they represent income derived by the company (whether before or during liquidation) other than income which has been properly applied to replace a loss of paid-up capital, which has not been created by a revaluation of assets shall for the purposes of this Act be deemed to be dividends paid to the share holders by the company.
DIVISION 3.—Deductions.
56. In calculating the taxable income of a taxpayer, the total assessable income derived by him during the year of income shall be taken as a basis, and from it there shall be deducted all allowable deductions.
57. Where by this Act it is provided that any deduc tion shall be made successively from two classes of income the deduction shall be set off against the income
of that class the excess shall be set off against the income of the first of those classes, and if it exceeds the income of the second class. 58. (1) Where the assessable income is derived from more than one class of income, that is to say, income from personal exertion, and income from property, the follow ing provisions shall apply to all allowable deductions:—
(a)
where a deduction relates directly to the income from property, it shall be made successively from that income, and from the income from
personal exertion; (b)
(b)
in all other cases the deduction shall be made successively from the income from personal exertion, and from the income from property.
(2) Where any net loss incurred out of this State during the year of income is an allowable deduction the deduction shall be made successively from net assess able income derived out of this State and from income derived in this State in the order provided in subsection one of this section.
(1) All losses and outgoings to the extent to which they are incurred in gaining or producing the assessable income, or are incurred in carrying on a business for the purpose of gaining or producing such income shall be allowable deductions except to the extent to which they are losses or outgoings of capital or of a capital, private or domestic nature, or are incurred in relation to the gaining or production of exempt income.
59.
(2) Expenditure incurred or deemed to have been incurred in the purchase of stock used by the taxpayer as trading stock shall be deemed not to be an outgoing of capital or of a capital nature.
60. Head office expenses of a company deriving income from sources in and out of this State shall not be an allowable deduction beyond an amount which bears the same proportion to the total head office expenses as the assessable income derived by the company bears to the total income of the company or beyond an amount to be fixed by the Commissioner.
| (1) Any loss incurred by the taxpayer in the year carrying on or carrying out of any undertaking or | for the purpose of profit-making by sale, or from the of income from the sale of any property acquired by him |
| scheme, the profit (if any) from which sale, undertaking or scheme would, under paragraph (b) of section twenty- two of this Act have been included in his assessable income, shall be an allowable deduction. | |
| (2) Subsection one of this section shall not apply to any loss incurred out of this State prior to the first year to the assessment of the income of which this Act applies. |
61 .
62 . (1) Expenditure incurred by the taxpayer in the year of income for repairs, not being expenditure of a capital nature, to any premises, or part of premises, plant, machinery, implements, utensils, rolling stock or articles held, occupied or used by him for the purpose of producing assessable income, or in carrying on a business for that purpose, shall be an allowable deduction.
(2) Expenditure incurred upon repairs to any pre mises or part of premises not so held, occupied or used shall not be an allowable deduction.
(1) Depreciation during the year of income of any property, being plant or articles owned by a taxpayer and used by him during that year for the purpose of pro ducing assessable income, and of any property being plant or articles owned by the taxpayer which has been installed ready for use for that purpose and is during that year held in reserve by him shall, subject to this Act, be an allowable deduction.
63 .
(2) In this section " p l a n t " includes animals used as beasts of burden or working beasts in a business other than a business of primary production, and machinery, implements, utensils and rolling stock.
64. In the first calculation of the depreciation to be allowed in respect of any unit of property, an estimate shall be made by the Commissioner of the effective life of the unit assuming that it is maintained in reasonably good order and condition, and the annual depreciation per centum shall be fixed accordingly.
(1) Subject to this section, the depreciation allow able under this Act in respect of any unit of property
65.
shall be—
(a)
the percentage fixed under section sixty-four of this Act or under the previous Acts of the depre ciated value of that unit at the beginning of the year of income; or
(b)
at the option of the taxpayer (to be exercised within the time in the manner and subject to the conditions prescribed), the percentage so fixed of the cost of that unit.
b y t h i s s e c t i o n i s r e q u i r e d t o b e d e a l t w i t h b y t h e B o a r d of
A p p e a l c o n s t i t u t e d u n d e r P a r t V of t h e I n c o m e T a x
M a n a g e m e n t A c t , 1 9 4 1 , a r e i n t h e p o s s e s s i o n of t h e B o a r d
of A p p e a l c o n s t i t u t e d u n d e r t h e I n c o m e T a x ( M a n a g e m e n t )
A c t , 1 9 3 6 , a l l s u c h d o c u m e n t s s h a l l b e f o r w a r d e d t o t h e
f i r s t - m e n t i o n e d B o a r d of A p p e a l .
( 6 ) T h i s s e c t i o n s h a l l c o m m e n c e u p o n a d a t e t o b e
a p p o i n t e d b y t h e G o v e r n o r a n d n o t i f i e d by p r o c l a m a t i o n
p u b l i s h e d i n t h e G a z e t t e .
( 4 ) b y i n s e r t i n g i n P a r t V I n e x t a f t e r s e c t i o n 06A t h e f o l l o w i n g
n e w s e c t i o n : —
66B . ( 1 ) T h e p r o v i s i o n s of s e c t i o n 66A of t h i s A c t s h a l l c e a s e t o h a v e effect u p o n t h e c o m m e n c e m e n t of t h e I n c o m e
T a x
T a x M a n a g e m e n t A c t , 1 9 4 1 , e x c e p t i n r e s p e c t of n o t i c e s g i v e n u n d e r t h e a u t h o r i t y of t h a t e n a c t m e n t b e f o r e s u c h c o m m e n c e m e n t .
( 2 ) T h e p r o v i s i o n s of s e c t i o n t w o h u n d r e d a n d
s e v e n t y - f o u r of t h e I n c o m e T a x M a n a g e m e n t A c t , 1 9 4 1 , s h a l l
a p p l y i n r e s p e c t of a n y t a x a s s e s s e d u n d e r t h i s A c t , w h i c h
a t t h e c o m m e n c e m e n t of t h e I n c o m e T a x M a n a g e m e n t A c t ,
1 9 4 1 , h a d n o t b e e n p a i d a n d i n r e s p e c t of w h i c h a n o t i c e
u n d e r t h e a u t h o r i t y of s e c t i o n t w o h u n d r e d a n d s i x t y - e i g h t
of t h e I n c o m e T a x ( M a n a g e m e n t ) A c t , 1 9 3 0 , h a d n o t , b e f o r e
s u c h c o m m e n c e m e n t , b e e n g i v e n , a n d of a n y t a x w h i c h m a y , a f t e r s u c h c o m m e n c e m e n t , b e a s s e s s e d u n d e r t h i s A c t .
( 3 ) I n t h i s s e c t i o n t h e e x p r e s s i o n " t a x " i n c l u d e s a n y
j u d g m e n t d e b t a n d c o s t s i n r e s p e c t of t a x .
( 5 ) b y i n s e r t i n g a t t h e e n d of s e c t i o n e i g h t y - n i n e t h e f o l l o w i n g s u b s e c t i o n : —
( 5 ) T h e p r o v i s i o n s of s e c t i o n t h r e e h u n d r e d a n d t h i r t y
a n d of s e c t i o n t h r e e h u n d r e d a n d t h i r t y - o n e of t h e I n c o m e T a x M a n a g e m e n t A c t , 1 9 4 1 , s h a l l a p p l y t o a n y t a x a s s e s s e d
u n d e r t h i s A c t w h i c h h a s n o t b e e n p a i d b e f o r e t h e c o m
m e n c e m e n t of t h e I n c o m e T a x M a n a g e m e n t A c t , 1 9 4 1 , o r
w h i c h m a y a f t e r s u c h c o m m e n c e m e n t b e a s s e s s e d u n d e r
t h e p r o v i s i o n s of t h i s A c t a n d t h e p r o v i s i o n s of s e c t i o n
t h r e e h u n d r e d a n d o n e a n d of s e c t i o n t h r e e h u n d r e d a n d t w o
of t h e I n c o m e T a x ( M a n a g e m e n t ) A c t , 1 9 3 6 , s h a l l t h e r e u p o n
c e a s e t o h a v e effect .
T H E T H I R D S C H E D U L E .
T h e I n c o m e T a x ( M a n a g e m e n t ) A c t , 193G, a s a m e n d e d b y s u b s e
q u e n t A c t s , i s a m e n d e d —
( 1 ) b y i n s e r t i n g a t t h e e n d of s e c t i o n t w o h u n d r e d a n d t e n t h e
f o l l o w i n g n e w s u b s e c t i o n : —
( 5 ) T h e p r o v i s i o n s of s e c t i o n t w o h u n d r e d a n d s i x t e e n of
t h e I n c o m e T a x M a n a g e m e n t A c t , 1 9 4 1 , s h a l l , a s f r o m t h e c o m m e n c e m e n t of t h a t A c t , a p p l y t o a s s e s s m e n t s m a d e
u n d e r t h i s A c t .
( 2 ) b y i n s e r t i n g i n P a r t V a f t e r s e c t i o n t w o h u n d r e d a n d fifty-
t w o t h e f o l l o w i n g n e w s e c t i o n : —
252A . ( 1 ) T h e p r e c e d i n g p r o v i s i o n s of t h i s P a r t of t h i s A c t s h a l l c e a s e t o h a v e effect u p o n t h e c o m m e n c e m e n t of
t h i s s e c t i o n e x c e p t f o r t h e p u r p o s e of c o m p l e t e l y d i s p o s i n g
of a n y a p p e a l t h e h e a r i n g of w h i c h h a d b e e n c o m m e n c e d
b y t h e S u p r e m e C o u r t o r t h e B o a r d of A p p e a l u n d e r t h o s e
p r o v i s i o n s b e f o r e s u c h c o m m e n c e m e n t .
( 2 ) T h e p r o v i s i o n s of P a r t V of t h e I n c o m e T a x
M a n a g e m e n t A c t , 1 9 4 1 , s h a l l a p p l y t o a l l a s s e s s m e n t s w h i c h
m a y
m a y a f t e r t h e c o m m e n c e m e n t of t h i s s e c t i o n b e m a d e u n d e r
t h i s o r t h e p r e v i o u s A c t s a n d s u b j e c t t o t h i s s e c t i o n t o a l l
a s s e s s m e n t s h e r e t o f o r e m a d e u n d e r t h i s o r t h e p r e v i o u s A c t s
w h e r e t h e h e a r i n g of a n a p p e a l f r o m t h e a s s e s s m e n t h a s
n o t b e e n c o m m e n c e d by t h e S u p r e m e C o u r t o r t h e B o a r d of
A p p e a l b e f o r e t h e c o m m e n c e m e n t of t h i s s e c t i o n .
( 3 ) W h e r e t h e C o m m i s s i o n e r h a s d e c i d e d a n o b j e c -
t i o n a g a i n s t a n a s s e s s m e n t m a d e b e f o r e t h e c o m m e n c e m e n t
of t h i s s e c t i o n a n d f o r w a r d e d i t t o t h e S u p r e m e C o u r t t o b e
d e a l t w i t h a s a n a p p e a l a n d t h a t C o u r t h a s n o t c o m m e n c e d
t h e h e a r i n g of t h e a p p e a l , t h e a p p e a l s h a l l b e d e a l t w i t h b y
t h a t C o u r t u n d e r P a r t V of t h e I n c o m e T a x M a n a g e m e n t A c t , 1 9 4 1 .
( 4 ) W h e r e t h e C o m m i s s i o n e r h a s d e c i d e d a n o b j e c
t i o n a g a i n s t a n a s s e s s m e n t m a d e b e f o r e t h e c o m m e n c e m e n t
of t h i s s e c t i o n a n d f o r w a r d e d i t t o t h e B o a r d of A p p e a l t o b e
d e a l t w i t h a s a n a p p e a l a n d t h a t B o a r d h a s n o t c o m m e n c e d
t h e h e a r i n g of t h e a p p e a l , t h e a p p e a l s h a l l b e d e a l t w i t h b y
t h e B o a r d of A p p e a l c o n s t i t u t e d u n d e r P a r t V of t h e I n c o m e
T a x M a n a g e m e n t A c t , 1 9 4 1
( 5 ) I f a n y d o c u m e n t s r e l a t i n g t o a n y m a t t e r w h i c h
b y t h i s s e c t i o n i s r e q u i r e d t o b e d e a l t w i t h b y t h e B o a r d of
A p p e a l c o n s t i t u t e d u n d e r P a r t V of t h e I n c o m e T a x M a n a g e
m e n t A c t , 1 9 4 1 , a r e i n t h e p o s s e s s i o n of t h e B o a r d of A p p e a l
a p p o i n t e d u n d e r t h i s A c t , a l l s u c h d o c u m e n t s s h a l l b e f o r
w a r d e d t o t h e f i r s t - m e n t i o n e d B o a r d of A p p e a l .
( 6 ) T h i s s e c t i o n s h a l l c o m m e n c e u p o n a d a t e t o b e
a p p o i n t e d b y t h e G o v e r n o r a n d n o t i f i e d b y p r o c l a m a t i o n
p u b l i s h e d i n t h e G a z e t t e .
( 3 ) b y i n s e r t i n g i n P a r t V I n e x t a f t e r s e c t i o n t w o h u n d r e d
a n d s i x t y - e i g h t t h e f o l l o w i n g n e w s e c t i o n : —
268A . ( 1 ) T h e p r o v i s i o n s of s e c t i o n t w o h u n d r e d a n d s i x t y -
e i g h t of t h i s A c t s h a l l c e a s e t o h a v e effect u p o n t h e c o m
m e n c e m e n t of t h e I n c o m e T a x M a n a g e m e n t A c t , 1 9 4 1 , e x c e p t
i n r e s p e c t o f n o t i c e s g i v e n u n d e r t h e a u t h o r i t y of t h a t
e n a c t m e n t b e f o r e s u c h c o m m e n c e m e n t .
( 2 ) T h e p r o v i s i o n s of s e c t i o n t w o h u n d r e d a n d
s e v e n t y - f o u r o f t h e I n c o m e T a x M a n a g e m e n t A c t , 1 9 4 1 ,
s h a l l a p p l y i n r e s p e c t of a n y t a x a s s e s s e d u n d e r t h i s A c t ,
w h i c h a t t h e c o m m e n c e m e n t of t h e I n c o m e T a x M a n a g e
m e n t A c t , 1 9 4 1 , h a d n o t b e e n p a i d a n d i n r e s p e c t of w h i c h
a n o t i c e s i x t y - e i g h t u n d e r t h e a u t h o r i t y of s e c t i o n t w o h u n d r e d a n d
of t h i s A c t h a d n o t , b e f o r e s u c h c o m m e n c e m e n t ,
b e e n g i v e n , a n d of a n y t a x w h i c h m a y , a f t e r s u c h c o m m e n c e
m e n t , b e a s s e s s e d u n d e r t h i s A c t .
( 3 ) I n t h i s s e c t i o n t h e e x p r e s s i o n " t a x " i n c l u d e s a n y
j u d g m e n t d e b t a n d c o s t s i n r e s p e c t of t a x .
( 4 ) b y i n s e r t i n g i n P a r t V I I I n e x t a f t e r s e c t i o n t h r e e h u n d r e d
a n d t w o t h e f o l l o w i n g n e w s e c t i o n : —
302A . T h e p r o v i s i o n s o f s e c t i o n t h r e e h u n d r e d a n d t h i r t y
a n d of s e c t i o n t h r e e h u n d r e d a n d t h i r t y - o n e o f t h e I n c o m e
T a x
T a x M a n a g e m e n t A c t , 1 9 4 1 , s h a l l a p p l y t o a n y t a x a s s e s s e d
u n d e r t h i s A c t w h i c h h a s n o t b e e n p a i d b e f o r e t h e c o m
m e n c e m e n t of t h e I n c o m e T a x M a n a g e m e n t A c t , 1 9 4 1 , o r w h i c h m a y a f t e r s u c h c o m m e n c e m e n t b e a s s e s s e d u n d e r t h e
p r o v i s i o n s of t h i s A c t a n d t h e p r o v i s i o n s of s e c t i o n t h r e e
h u n d r e d a n d o n e a n d of s e c t i o n t h r e e h u n d r e d a n d t w o of
t h i s A c t s h a l l t h e r e u p o n c e a s e t o h a v e effect .
T H E F O U R T H S C H E D U L E .
T h e a m e n d e d —
U n e m p l o y m e n t
R e l i e f
T a x
( M a n a g e m e n t )
A c t ,
1 9 3 9 - 1 9 4 1 ,
i s
( a ) b y i n s e r t i n g a f t e r s e c t i o n s e v e n t h e f o l l o w i n g n e w s e c
t i o n s : —
7A . ( 1 ) T h i s s e c t i o n s h a l l b e d e e m e d t o h a v e c o m m e n c e d
u p o n t h e first d a y of J u l y , o n e t h o u s a n d n i n e h u n d r e d a n d f o r t y - o n e .
( 2 ) U p o n t h e c o m m e n c e m e n t of t h i s s e c t i o n s e c t i o n s
s i x a n d s e v e n of t h i s A c t s h a l l c e a s e t o h a v e effect .
( 3 ) A n y d e b i t o r c r e d i t b a l a n c e i n t h e U n e m p l o y m e n t
R e l i e f F u n d i m m e d i a t e l y b e f o r e s u c h c o m m e n c e m e n t s h a l l
b e t r a n s f e r r e d t o t h e d e b i t o r c r e d i t of t h e C o n s o l i d a t e d
R e v e n u e F u n d .
( 4 ) A l l m o n e y s r e c e i v e d a f t e r s u c h c o m m e n c e m e n t
w h i c h w o u l d h a v e b e e n p a i d t o t h e c r e d i t of t h e U n e m p l o y m e n t R e l i e f F u n d if t h i s s e c t i o n h a d n o t b e e n e n a c t e d s h a l l
b e p a i d t o t h e c r e d i t of t h e C o n s o l i d a t e d R e v e n u e F u n d . 7 B . ( 1 ) U n e m p l o y m e n t R e l i e f T a x p a i d b y a n e m p l o y e e i n
r e s p e c t of i n c o m e f r o m e m p l o y m e n t d e r i v e d a f t e r t h e t h i r
t i e t h d a y of J u n e , o n e t h o u s a n d n i n e h u n d r e d a n d f o r t y - o n e ,
a n d b e f o r e t h e c o m m e n c e m e n t of t h e I n c o m e T a x M a n a g e
m e n t A c t , 1 9 4 1 , s h a l l be a p p l i e d i n p a y m e n t o r i n p a r t p a y
m e n t of a n y t a x f o r w h i c h h e i s l i a b l e u n d e r a n y A c t of
t h i s S t a t e i m p o s i n g a t a x u p o n i n c o m e , a n d w h e r e h e i s
n o t so l i a b l e , o r w h e r e t h e a m o u n t of U n e m p l o y m e n t R e l i e f
T a x so p a i d e x c e e d s t h e a m o u n t of t a x u p o n i n c o m e f o r
w h i c h h e i s
so l i a b l e t h e C o m m i s s i o n e r s h a l l r e f u n d t h e
a m o u n t of U n e m p l o y m e n t R e l i e f T a x so p a i d , o r t h e a m o u n t
o f t h e e x c e s s , a s t h e c a s e m a y b e .
( 2 ) A n e m p l o y e e w h o c l a i m s t o b e e n t i t l e d t o a n y
c r e d i t o r r e f u n d r e f e r r e d t o i n s u b s e c t i o n o n e of t h i s s e c t i o n
s h a l l f u r n i s h t o t h e C o m m i s s i o n e r s u c h i n f o r m a t i o n a s t h e
C o m m i s s i o n e r m a y r e q u i r e i n r e l a t i o n t o U n e m p l o y m e n t R e l i e f T a x so p a i d b y t h e e m p l o y e e .
( b )
b y
a d d i n g s u b s e c t i o n s : —
a t
t h e
e n d
of
s e c t i o n
s e v e n t e e n
t h e
f o l l o w i n g
n e w
( 3 ) E v e r y e m p l o y e r s h a l l , if r e q u i r e d b y t h e C o m m i s s i o n e r
b y n o t i c e p u b l i s h e d i n t h e G a z e t t e o r u p o n n o t i c e i n w r i t i n g
f r o m t h e C o m m i s s i o n e r , f u r n i s h t o t h e C o m m i s s i o n e r w i t h i n
t h e t i m e spec i f i ed i n t h e n o t i c e , o r w i t h i n s u c h e x t e n d e d t i m e
t i m e a s t h e C o m m i s s i o n e r m a y a l l o w , a r e t u r n fo r t h e p e r i o d
c o m m e n c i n g o n t h e first d a y of J u l y , o n e t h o u s a n d n i n e
h u n d r e d a n d f o r t y - o n e , a n d e n d i n g o n t h e t h i r t y - f i r s t d a y
of O c t o b e r i n t h a t y e a r , s e t t i n g o u t s u c h i n f o r m a t i o n a s
m a y b e r e q u i r e d r e l a t i n g t o n a m e s a n d a d d r e s s e s of
e m p l o y e e s , a m o u n t s of i n c o m e f r o m e m p l o y m e n t , a m o u n t a
of t a x c o l l e c t e d u p o n i n c o m e f r o m e m p l o y m e n t , a m o u n t s
of s u c h t a x p a i d t o t h e C o m m i s s i o n e r a n d s u c h o t h e r m a t t e r s
a s m a y be r e q u i r e d b y t h e n o t i c e .
( 4 ) E v e r y e m p l o y e r r e q u i r e d b y s e c t i o n t w e n t y of t h i s
A c t t o affix t a x s t a m p s t o h i s r e c o r d s s h a l l f u r n i s h w i t h
t h e r e t u r n f u r n i s h e d u n d e r s u b s e c t i o n t h r e e of t h i s s e c t i o n
t h e E m p l o y e r s ' S c h e d u l e p r e s c r i b e d b y r e g u l a t i o n s m a d e
u n d e r t h i s A c t i n r e s p e c t of s u c h p e r i o d a s i s c o v e r e d b y
t h e r e t u r n .
( c ) b y i n s e r t i n g a f t e r s e c t i o n t w e n t y - o n e t h e f o l l o w i n g n e w s e c t i o n : —
21A . ( 1 ) W h e r e i t i s s h o w n t o t h e s a t i s f a c t i o n of t h e B o a r d r e f e r r e d t o i n s e c t i o n t h r e e h u n d r e d a n d t h i r t y of t h e I n c o m e T a x M a n a g e m e n t A c t , 1 9 4 1 , t h a t b y r e a s o n of h i s
r e t i r e m e n t f r o m o r loss of a n y e m p l o y m e n t t h e i n c o m e f r o m e m p l o y m e n t d e r i v e d b y a n e m p l o y e e d u r i n g - t h e y e a r
e n d e d o n t h e t h i r t i e t h d a y of J u n e , o n e t h o u s a n d n i n e
h u n d r e d a n d f o r t y - o n e , i s a p p r e c i a b l y g r e a t e r t h a n t h e
i n c o m e f r o m e m p l o y m e n t , i f a n y , d e r i v e d b y h i m d u r i n g
t h e n e x t s u c c e e d i n g y e a r , a n d t h a t h i s i n c o m e f r o m e m p l o y
m e n t h a s b e e n p e r m a n e n t l y r e d u c e d a n d t h a t s e r i o u s
h a r d s h i p w o u l d r e s u l t u n l e s s a n a d j u s t m e n t i s m a d e i n t h e
a m o u n t of u n e m p l o y m e n t r e l i e f t a x p a i d b y h i m u p o n
i n c o m e f r o m e m p l o y m e n t d e r i v e d d u r i n g t h e y e a r e n d e d
o n t h e t h i r t i e t h d a y of J u n e , o n e t h o u s a n d n i n e h u n d r e d
a n d f o r t y - o n e , t h e B o a r d m a y d i r e c t t h a t t h e w h o l e o r p a r t
of t h e t a x so p a i d s h a l l b e r e f u n d e d t o t h a t e m p l o y e e o r
a p p l i e d i n p a y m e n t o r i n p a r t p a y m e n t of a n y t a x p a y a b l e
b y h i m u n d e r a n y A c t of t h i s S t a t e i m p o s i n g a t a x u p o n
i n c o m e a n d t h e C o m m i s s i o n e r m a y m a k e s u c h e n t r i e s a s
a r e n e c e s s a r y f o r t h a t p u r p o s e .
( 2 ) W h e r e , i n t h e c a s e of a n e m p l o y e e t o w h o m s u b
s e c t i o n o n e of t h i s s e c t i o n d o e s n o t a p p l y , i t i s s h o w n t o t h e
s a t i s f a c t i o n of t h e B o a r d r e f e r r e d t o i n s e c t i o n t h r e e h u n d r e d a n d t h i r t y of t h e I n c o m e T a x M a n a g e m e n t A c t , 1 9 4 1 , t h a t
s e r i o u s h a r d s h i p w o u l d r e s u l t u n l e s s a n a d j u s t m e n t i s m a d e
i n t h e a m o u n t of u n e m p l o y m e n t r e l i e f t a x p a i d b y h i m u p o n
i n c o m e f r o m e m p l o y m e n t d e r i v e d d u r i n g t h e y e a r e n d e d o n
t h e t h i r t i e t h d a y of J u n e , o n e t h o u s a n d n i n e h u n d r e d a n d
f o r t y - o n e , t h e B o a r d m a y d i r e c t t h a t t h e w h o l e o r p a r t of
t h e t a x so p a i d s h a l l bo r e f u n d e d t o t h a t e m p l o y e e o r a p p l i e d i n p a y m e n t o r i n p a r t p a y m e n t of a n y t a x p a y a b l e b y h i m
u n d e r a n y A c t o f t h i s S t a t e i m p o s i n g a t a x u p o n i n c o m e a n d
t h e C o m m i s s i o n e r m a y m a k e s u c h e n t r i e s a s a r e n e c e s s a r y
f o r t h a t p u r p o s e .
(3)
( 3 ) T h e C o m m i s s i o n e r m a y e x e r c i s e a l l t h e p o w e r s
of t h e B o a r d u n d e r t h i s s e c t i o n w h e r e t h e a m o u n t of t a x
i n v o l v e d d o e s n o t e x c e e d t w e n t y p o u n d s .
T H E F I F T H S C H E D U L E .
T h e a m e n d e d —
S o c i a l
S e r v i c e s
T a x
( M a n a g e m e n t )
A c t ,
1 9 3 9 - 1 9 4 1 ,
i s
( a ) b y i n s e r t i n g a f t e r s e c t i o n s e v e n t h e f o l l o w i n g n e w s e c t i o n s : —
7A. ( 1 ) T h i s s e c t i o n s h a l l b e d e e m e d t o h a v e c o m m e n c e d
u p o n t h e f i rs t d a y of J u l y , o n e t h o u s a n d n i n e h u n d r e d a n d f o r t y - o n e .
( 2 ) U p o n t h e c o m m e n c e m e n t of t h i s s e c t i o n s e c t i o n s
s i x a n d s e v e n of t h i s A c t s h a l l c e a s e t o h a v e effect .
( 3 ) A n y d e b i t o r c r e d i t b a l a n c e i n t h e S o c i a l S e r v i c e s
F u n d i m m e d i a t e l y b e f o r e s u c h c o m m e n c e m e n t s h a l l b e
t r a n s f e r r e d t o t h e d e b i t o r c r e d i t of t h e C o n s o l i d a t e d R e v e n u e F u n d .
( 4 ) A l l m o n e y s r e c e i v e d a f t e r s u c h c o m m e n c e m e n t
w h i c h w o u l d h a v e b e e n p a i d t o t h e c r e d i t of t h e S o c i a l
S e r v i c e s F u n d if t h i s s e c t i o n h a d n o t b e e n e n a c t e d s h a l l b e p a i d t o t h e c r e d i t of t h e C o n s o l i d a t e d R e v e n u e F u n d .
7 B . ( 1 ) S o c i a l S e r v i c e s T a x p a i d b y a n e m p l o y e e i n r e
s p e c t of i n c o m e f r o m e m p l o y m e n t d e r i v e d a f t e r t h e t h i r t i e t h
d a y of J u n e , o n e t h o u s a n d n i n e h u n d r e d a n d f o r t y - o n e , a n d
b e f o r e t h e c o m m e n c e m e n t of t h e I n c o m e T a x M a n a g e m e n t
A c t , 1 9 4 1 , s h a l l b e a p p l i e d i n p a y m e n t o r i n p a r t p a y m e n t
of a n y t a x f o r w h i c h h e i s l i a b l e u n d e r a n y A c t of t h i s
S t a t e , i m p o s i n g a t a x u p o n i n c o m e , a n d w h e r e h e is n o t so
l i a b l e , o r w h e r e t h e a m o u n t of S o c i a l S e r v i c e s T a x so p a i d
e x c e e d s t h e a m o u n t of t a x upon i n c o m e f o r w h i c h h e i s so
l i a b l e t h e C o m m i s s i o n e r s h a l l r e f u n d t h e a m o u n t of S o c i a l
S e r v i c e s T a x so p a i d , o r t h e a m o u n t of t h e e x c e s s , a s t h e
c a s e m a y b e . ( 2 )
A n e m p l o y e e w h o c l a i m s t o b e e n t i t l e d t o a n y c r e d i t o r
r e f u n d r e f e r r e d t o i n s u b s e c t i o n o n e of t h i s s e c t i o n
s h a l l f u r n i s h t o t h e C o m m i s s i o n e r s u c h i n f o r m a t i o n a s t h e
C o m m i s s i o n e r m a y r e q u i r e i n r e l a t i o n t o S o c i a l S e r v i c e s
T a x so p a i d b y t h e e m p l o y e e .
( b ) b y
a d d i n g s u b s e c t i o n s : —
a t
t h e
e n d
of
s e c t i o n
s e v e n t e e n
t h e
f o l l o w i n g
n e w
( 3 ) E v e r y e m p l o y e r s h a l l , i f r e q u i r e d b y t h e C o m m i s
s i o n e r by n o t i c e p u b l i s h e d i n t h e G a z e t t e o r u p o n n o t i c e
i n w r i t i n g f r o m t h e C o m m i s s i o n e r , f u r n i s h t o t h e C o m
m i s s i o n e r w i t h i n t h e t i m e spec i f i ed i n t h e n o t i c e , o r w i t h i n s u c h e x t e n d e d t i m e a s t h e C o m m i s s i o n e r m a y a l l o w , a r e t u r n
f o r t h e p e r i o d c o m m e n c i n g o n t h e first d a y o f J u l y , o n e
t h o u s a n d n i n e h u n d r e d a n d f o r t y - o n e , a n d e n d i n g i n f o r m a t i o n o n t h e
t h i r t y - f i r s t d a y of O c t o b e r i n t h a t y e a r , s e t t i n g o u t s u c h
i n f o r m a t i o n a s m a y b e r e q u i r e d r e l a t i n g t o n a m e s a n d
a d d r e s s e s of e m p l o y e e s , a m o u n t s of i n c o m e f r o m e m p l o y
m e n t , a m o u n t s of t a x c o l l e c t e d u p o n i n c o m e f r o m e m p l o y
m e n t , a m o u n t s of s u c h t a x p a i d t o t h e C o m m i s s i o n e r a n d s u c h o t h e r m a t t e r s a s m a y b e r e q u i r e d b y t h e n o t i c e .
( 4 ) E v e r y e m p l o y e r r e q u i r e d b y s e c t i o n t w e n t y of t h i s
A c t t o affix t a x s t a m p s t o h i s r e c o r d s s h a l l f u r n i s h w i t h
t h e r e t u r n f u r n i s h e d u n d e r s u b s e c t i o n t h r e e of t h i s s e c t i o n
t h e E m p l o y e r s ' S c h e d u l e p r e s c r i b e d b y r e g u l a t i o n s m a d e
u n d e r t h i s A c t i n r e s p e c t of s u c h p e r i o d a s i s c o v e r e d b y t h e r e t u r n .
( c ) b y i n s e r t i n g a f t e r s e c t i o n t w e n t y - o n e t h e f o l l o w i n g n e w s e c t i o n : —
2 1 A . r e f e r r e d
( 1 )
W h e r e
i t
i s s h o w n
t o
t h e
s a t i s f a c t i o n
of
t h e
B o a r d
t o i n s e c t i o n t h r e e h u n d r e d a n d t h i r t y of t h e I n c o m e
T a x M a n a g e m e n t A c t , 1 9 4 1 , t h a t b y r e a s o n of h i s r e t i r e m e n t
f r o m o r l o s s of a n y e m p l o y m e n t t h e i n c o m e f r o m e m p l o y
m e n t d e r i v e d b y a n e m p l o y e e d u r i n g t h e y e a r e n d e d o n t h e
t h i r t i e t h d a y of J u n e , o n e t h o u s a n d n i n e h u n d r e d a n d f o r t y -
o n e , i s a p p r e c i a b l y g r e a t e r t h a n t h e i n c o m e f r o m e m p l o y
m e n t , i f a n y , d e r i v e d b y h i m d u r i n g t h e n e x t s u c c e e d i n g y e a r , a n d t h a t b i s i n c o m e f r o m e m p l o y m e n t h a s b e e n p e r
m a n e n t l y r e d u c e d a n d t h a t s e r i o u s h a r d s h i p w o u l d r e s u l t
u n l e s s a n a d j u s t m e n t i s m a d e i n t h e a m o u n t of S o c i a l
S e r v i c e s T a x p a i d b y h i m u p o n i n c o m e f r o m e m p l o y m e n t
d e r i v e d d u r i n g t h e y e a r e n d e d o n t h e t h i r t i e t h d a y of J u n e ,
o n e t h o u s a n d n i n e h u n d r e d a n d f o r t y - o n e , t h e B o a r d m a y
d i r e c t t h a t t h e w h o l e o r p a r t of t h e t a x so p a i d s h a l l b e
r e f u n d e d t o t h a t e m p l o y e e o r a p p l i e d i n p a y m e n t o r i n p a r t
p a y m e n t of a n y t a x p a y a b l e b y h i m u n d e r a n y A c t of t h i s
S t a t e i m p o s i n g a t a x u p o n i n c o m e a n d t h e C o m m i s s i o n e r
m a y m a k e s u c h e n t r i e s a s a r e n e c e s s a r y f o r t h a t p u r p o s e .
( 2 ) W h e r e , i n t h e c a s e of a n e m p l o y e e t o w h o m s u b
s e c t i o n o n e of t h i s s e c t i o n d o e s n o t a p p l y , i t i s s h o w n t o
t h e s a t i s f a c t i o n of t h e B o a r d r e f e r r e d t o i n s e c t i o n t h r e e
h u n d r e d a n d t h i r t y of t h e I n c o m e T a x M a n a g e m e n t A c t , 1 9 4 1 , t h a t s e r i o u s h a r d s h i p w o u l d r e s u l t u n l e s s a n a d j u s t
m e n t i s m a d e i n t h e a m o u n t o f s o c i a l s e r v i c e s t a x p a i d b y
h i m u p o n i n c o m e f r o m e m p l o y m e n t d e r i v e d d u r i n g t h e y e a r
e n d e d o n t h e t h i r t i e t h d a y of J u n e , o n e t h o u s a n d n i n e h u n d r e d a n d f o r t y - o n e , t h e B o a r d m a y d i r e c t t h a t t h e w h o l e
o r p a r t o f t h e t a x so p a i d s h a l l b e r e f u n d e d t o t h a t e m p l o y e e o r a p p l i e d i n p a y m e n t o r i n p a r t p a y m e n t of a n y t a x p a y a b l e b y h i m u n d e r a n y A c t of t h i s S t a t e i m p o s i n g a t a x
u p o n i n c o m e a n d t h e C o m m i s s i o n e r m a y m a k e s u c h e n t r i e s
a s a r e n e c e s s a r y f o r t h a t p u r p o s e .
( 3 ) T h e C o m m i s s i o n e r m a y e x e r c i s e a l l t h e p o w e r s of
t h e B o a r d u n d e r t h i s s e c t i o n w h e r e t h e a m o u n t o f t a x
i n v o l v e d d o e s n o t e x c e e d t w e n t y p o u n d s .
C H U R C H
0
0
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