Taxation Laws Amendment Act (No. 5) 1988 (Cth)
This compilation was prepared on 22 September 2010
taking into account amendments up to Act No. 75 of 2010
The text of any of those amendments not in force
on that date is appended in the Notes section
The operation of amendments that have been incorporated may be
affected by application provisions that are set out in the Notes section
Prepared by the Office of Legislative Drafting and Publishing,
Attorney-General’s Department, Canberra
TABLE OF PROVISIONS
PART I - PRELIMINARY
Section
Short title [
Commencement [
PART II - AMENDMENT OF THE FRINGE BENEFITS TAX ASSESSMENT ACT 1986
Principal Act
Reduction of taxable value - ''otherwise deductible'' rule
Reduction of taxable value - ''otherwise deductible'' rule
Interpretation
Application of amendments
PART III - AMENDMENT OF THE INCOME TAX ASSESSMENT ACT 1936
Principal Act
Exemptions
Exemption of certain income from sale of gold
Shares and rights acquired under schemes for the acquisition of
shares by employees
Expenditure on research and development activities
Gifts, pensions etc.
Interpretation
Interpretation
Insertion of new section:
Division applies subject to provisions terminating gold
mining exemptions
Insertion of new section:
Division applies subject to provisions terminating gold
mining exemptions
Interpretation
Interpretation
Provisional certificates
Final certificates
Insertion of new sections:
Delegation by Minister
Review of decisions of Minister
Deductions for capital expenditure under post-12 January 1983
contracts
Interpretation
Section 159GZZE not to apply in certain cases
Insertion of new Division:
Termination of paragraph 23 (o) exemption
Removal of exclusion of gold from subparagraph
23 (pa) (iv)
Termination of exemption under section 23C
Interpretation
Eligible gold mining expenditure - Division 10 applies
as if notional writing-down assumptions made
Eligible gold mining expenditure – proportionate
deduction for changeover year
Eligible gold mining expenditure - modified references
to changeover year
Eligible gold mining expenditure - election that
property be depreciated under section 57AL
Eligible gold mining expenditure - modified application
of section 122K
Eligible gold mining expenditure - modified application
of Part IIIA
Eligible gold exploration or prospecting expenditure –
Division 10 applies as if incurred on 1 January 1991
etc.
Eligible gold exploration or prospecting expenditure – 7
year limit on deductibility
Eligible gold exploration or prospecting expenditure –
effect of application of paragraph 23 (pa) before the
changeover year
Eligible gold exploration or prospecting expenditure –
modified application of sections 80 and 80G
Eligible gold mining and eligible gold exploration or
prospecting expenditure - effect of certain transfers of
mining rights etc.
Removal of paragraph 23 (o) exemption not to create
actual pre-1991 Division 10 deductions
Interpretation
Division 10AAA applies as if eligible gold transport
expenditure notionally written-down
Proportionate deduction for changeover year
Modified application of section 123C
Modified application of Part IIIA
Removal of paragraph 23 (o) exemption not to create
actual pre-1991 Division 10AAA deductions
Insertion of new Subdivision:
Interpretation
Eligibility for rebate
Calculation of rebate
Notional tax amount for recent accrual years
Notional tax amount for distant accrual years
Other interpretative provisions
Insertion of new section:
Meaning of ''reducing amount''
Consideration for acquisition of shares by employees
Consideration for acquisition of share rights by employees
Amendment of assessments
Deductions by employer from salary or wages
Provisional tax on estimated income
Deductions from certain withdrawals from film accounts
Application of amendments
Exemption of cash grants under the Defence Service Homes Scheme
Interpretation
Transitional provisions relating to deductions under subsection
124ZAFA (1) of the amended Act
Special provisions relating to producers' funds deposited in film
accounts after 25 May 1988 and before 1 July 1988
Declarations
Deductions from certain withdrawals from film accounts
Transitional provision - modification of dividend imputation
provisions resulting from reduction in the company tax rate
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988 - LONG TITLE
An Act to amend the law relating to taxation
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 1
Short title [
1. This Act may be cited as the Taxation Laws Amendment Act (No. 5)
1988.
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 2
Commencement [
2. (1) Subject to this section, this Act commences on the day on which it
receives the Royal Assent.
(2) Division 6 of Part III commences, or shall be taken to have commenced,
as the case requires, on 1 January 1989.
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 3
Principal Act
3. In this Part, "Principal Act" means the Fringe Benefits Tax Assessment
Act 1986*1*.
*1* No. 39, 1986, as amended. For previous amendments, see Nos. 48 and 112,
1986; Nos. 23 and 145, 1987; No. 139, 1987 (as amended by Nos. 11 and 78,
1988); and Nos. 78, 95 and 97, 1988.
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 4
Reduction of taxable value-''otherwise deductible'' rule
4. Section 44 of the Principal Act is amended:
by inserting in subparagraph (1) (b) (i) ", not being a foreign source
deduction," before "would, or";
by inserting in sub-subparagraph (1) (ba) (ii) (A) "other than a
foreign source deduction" after "once-only deduction";
by inserting in paragraph (1) (d) "(other than an international aircrew
property benefit)" after "extended travel property benefit".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 5
Reduction of taxable value-''otherwise deductible'' rule
5. Section 52 of the Principal Act is amended:
by inserting in subparagraph (1) (b) (i) ", not being a foreign source
deduction," before "would, or";
by inserting in sub-subparagraph (1) (ba) (ii) (A) "other than a
foreign source deduction" after "once-only deduction";
by inserting in paragraph (1) (d) "(other than an international aircrew
residual benefit)" after "extended travel residual benefit".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 6
Interpretation
6. Section 136 of the Principal Act is amended by inserting in subsection
(1) the following definitions:
" 'international aircrew property benefit' means a property fringe benefit
where the recipients property:
is in respect of travel by the recipient in the course of
performing
the duties of the recipient's employment as the pilot, flight engineer, flight
attendant or other member of the crew, of an aircraft, being property that
is:
food or drink;
in respect of accommodation; or
otherwise incidental to the travel; and
relates to travel by the recipient outside Australia;
'international aircrew residual benefit' means a residual fringe benefit
where the recipients benefit:
is in respect of travel by the recipient in the course of
performing
the duties of the recipient's employment as the pilot, flight engineer, flight
attendant or other member of the crew of an aircraft, being a benefit that is
in respect of accommodation or a benefit that is otherwise incidental to the
travel; and
relates to travel by the recipient outside Australia;".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 7
Application of amendments
7. (1) Subject to subsection (2), the amendments made by this Part apply
to:
assessments of the fringe benefits taxable amount of an employer of the
transitional year of tax and of each subsequent year of tax; and
instalments of tax in respect of the transitional year of tax.
(2) The amendments made by paragraphs (4) (a) and (b) and (5) (a) and (b)
apply where the recipients property, or the recipients benefit, as the case
requires, was provided after 3 November 1988.
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 8
Principal Act
8. In this Part, "Principal Act" means the Income Tax Assessment Act
1936*2*.
*2* No. 27, 1936, as amended. For previous amendments, see No. 88, 1936; No.
5, 1937; No. 46, 1938; No. 30, 1939; Nos. 17 and 65, 1940; Nos. 58 and 69,
1941; Nos. 22 and 50, 1942; No. 10, 1943; Nos. 3 and 28, 1944; Nos. 4 and 37,
1945; No. 6, 1946; Nos. 11 and 63, 1947; No. 44, 1948; No. 66, 1949; No. 48,
1950; No. 44, 1951; Nos. 4, 28 and 90, 1952; Nos. 1, 28, 45 and 81, 1953; No.
43, 1954; Nos. 18 and 62, 1955; Nos. 25, 30 and 101, 1956; Nos. 39 and 65,
1957; No. 55, 1958; Nos. 12, 70 and 85, 1959; Nos. 17, 18, 58 and 108, 1960;
Nos. 17, 27 and 94, 1961; Nos. 39 and 98, 1962; Nos. 34 and 69, 1963; Nos. 46,
68, 110 and 115, 1964; Nos. 33, 103 and 143, 1965; Nos. 50 and 83, 1966; Nos.
19, 38, 76 and 85, 1967; Nos. 4, 70, 87 and 148, 1968; Nos. 18, 93 and 101,
1969; No. 87, 1970; Nos. 6, 54 and 93, 1971; Nos. 5, 46, 47, 65 and 85, 1972;
Nos. 51, 52, 53, 164 and 165, 1973; No. 216, 1973 (as amended by No. 20,
1974); Nos. 26 and 126, 1974; Nos. 80 and 117, 1975; Nos. 50, 53, 56, 98, 143,
165 and 205, 1976; Nos. 57, 126 and 127, 1977; Nos. 36, 57, 87, 90, 123, 171
and 172, 1978; Nos. 12, 19, 27, 43, 62, 146, 147 and 149, 1979; Nos. 19, 24,
57, 58, 124, 133, 134 and 159, 1980; Nos. 61, 92, 108, 109, 110, 111, 154 and
175, 1981; Nos. 29, 38, 39, 76, 80, 106 and 123, 1982; Nos. 14, 25, 39, 49,
51, 54 and 103, 1983; Nos. 14, 42, 47, 63, 76, 115, 124, 165 and 174, 1984;
No. 123, 1984 (as amended by No. 65, 1985); Nos. 47, 49, 104, 123, 168 and
174, 1985; No. 173, 1985 (as amended by No. 49, 1986); Nos. 41, 46, 48, 51,
109, 112 and 154, 1986; No. 49, 1986 (as amended by No. 141, 1987); No. 52,
1986 (as amended by No. 141, 1987); No. 90, 1986 (as amended by No. 141,
1987); Nos. 23, 58, 61, 120, 145 and 163, 1987; No. 62, 1987 (as amended by
No. 108, 1987); No. 108, 1987 (as amended by No. 138, 1987); No. 138, 1987 (as
amended by No. 11, 1988); No. 139, 1987 (as amended by Nos. 11 and 78, 1988);
and Nos. 8, 11, 59, 75, 78, 80, 87, 95, 97 and 127, 1988.
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 9
Exemptions
9. Section 23 of the Principal Act is amended:
by inserting after paragraph (jf) the following paragraph:
income of Australian Film Finance Corporation Pty. Limited, being
a
company incorporated under the Companies Act 1981 on 12 July 1988;";
by inserting in paragraph (o) "subject to Division 16H," before
"income, other than income";
by inserting in paragraph (pa) "subject to Division 16H," before
"income derived".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 10
Exemption of certain income from sale of gold
10. Section 23C of the Principal Act is amended by omitting from subsection
(1) "Income" and substituting "Subject to Division 16H, income".
Shares and rights acquired under schemes for the acquisition of shares
by employees
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 11
11. Section 26AAC of the Principal Act is amended:
by inserting after subsection (4) the following subsections:
"(4A) For the purposes of this section, a taxpayer shall be taken to
have
acquired an ESAS share in a company (in this section called the 'issuing
company'), or to have acquired an ESAS right to acquire a share in a company
(in this section also called the 'issuing company'), if:
the share or right was acquired under a scheme (in this subsection
called the 'acquisition scheme') for the acquisition of shares by employees;
in the case of a share-the share was acquired by the taxpayer on or
after 1 July 1988:
in respect of, or for or in relation directly or indirectly to,
any employment of the taxpayer by the issuing company or a related company;
or
as a result of the exercise or operation of a right to acquire
the share, being a right that was acquired, or first acquired, by the taxpayer
on or after 1 July 1988 in respect of, or for or in relation directly or
indirectly to, any employment of the taxpayer by the issuing company or a
related company;
in the case of a right-the right was acquired by being issued to
the
taxpayer on or after 1 July 1988 in respect of, or for or in relation directly
or indirectly to, any employment of the taxpayer by the issuing company or a
related company;
the Commissioner is satisfied that all of the following conditions
were satisfied in relation to the acquisition scheme as at the time the share
or right was acquired:
both:
(A) the acquisition scheme; and
(B) any scheme for the provision of financial assistance in
respect
of acquisitions of shares or rights under the acquisition scheme;
were operated on a non-discriminatory basis;
all the shares available for acquisition under the scheme were
ordinary shares;
all the rights available for acquisition under the scheme were
rights to acquire ordinary shares;
the scheme was operated so that no employee would be permitted
to
dispose of a share or right (whether by assignment, declaration of trust or
otherwise) before the earlier of the following times:
(A) the end of the period of 3 years after the time of the
acquisition of the share or right;
(B) the time when the employee ceased, or first ceased, to be
employed by a member of the group constituted by the issuing company and any
related companies;
neither shares nor rights were available for acquisition under
the
acquisition scheme by persons other than permanent employees of the issuing
company or of related companies; and
no deduction is allowable to the issuing company or a related
company
in any year of income in respect of expenditure incurred in relation to the
acquisition of shares or rights under the acquisition scheme.
"(4B) For the purposes of subsection (4A), a scheme shall be taken to be
operated on a non-discriminatory basis if, and only if:
participation in the scheme is open to all permanent employees of
the
issuing company and related companies;
in the case of an acquisition scheme-the following conditions are
satisfied in relation to all offers to acquire shares or rights under the
scheme:
the time for acceptance of each offer is reasonable;
the following features of each offer are the same for all
permanent employees of the issuing company and related companies:
(A) the consideration for the acquisition concerned (whether that
consideration is determined by reference to the value of the share or right or
otherwise);
(B) the number of shares or rights, the minimum number of shares
or
rights or the maximum number of shares or rights, offered to each employee, as
applicable;
(C) the time for acceptance of the offer;
(D) the steps taken for the circulation of information about the
offer; and
in the case of a scheme for the provision of financial assistance
by
way of the making of a loan to acquire shares or rights under the acquisition
scheme-the following conditions are satisfied in relation to all loans made to
acquire shares or rights to which a particular offer under the acquisition
scheme relates:
the time for taking up each loan is reasonable;
both of the following features of each loan are the same for
all
permanent employees of the issuing company and related companies:
(A) the terms and conditions of the loan;
(B) the loan amount, the minimum loan amount, or the maximum loan
amount, offered to each employee, as applicable.
"(4C) Subsection (4F) applies to a taxpayer in relation to a year of
income and in relation to:
all of the ESAS rights to acquire shares in a particular issuing
company, being rights acquired by the taxpayer during the year of income; and
all of the ESAS shares in a particular issuing company, being
shares
acquired by the taxpayer during the year of income;
unless:
the taxpayer elects that subsection (4F) does not apply to the
taxpayer in relation to that year of income; or
the taxpayer was not employed by the issuing company or a related
company on the last day of the year of income.
"(4D) Where, apart from this subsection, subsection (4F) would apply to
a
taxpayer in relation to a year of income and in relation to 2 or more issuing
companies:
if the taxpayer elects that subsection (4F) shall apply in relation
to only one of those companies-subsection (4F) does not apply in relation to
the remaining companies; or
in any other case-subsection (4F) does not apply in relation to any
of those companies.
"(4E) An election by a taxpayer under subsection (4C) or (4D):
shall be made by notice in writing to the Commissioner; and
shall be lodged with the Commissioner on or before the date of
lodgment of the return of income of the taxpayer for the year of income to
which the election relates, or before such later date as the Commissioner
allows.
"(4F) Where this subsection applies to a taxpayer in relation to a year
of
income:
the taxpayer shall be taken to have made an election under
subsection
(8A) in relation to all of the ESAS rights to acquire shares in a particular
company, being rights acquired by the taxpayer during the year of income;
the taxpayer shall be taken to have made an election under
subsection
in relation to all of the ESAS shares in a particular company, being
shares acquired by the taxpayer during the year of income; and
the aggregate of the amounts that would, apart from this
subsection,
be included in the assessable income of the taxpayer of the year of income
under subsection (5) and paragraph (8C) (a) in respect of those shares and
those rights (which aggregate is in this subsection called the 'aggregate
discount amount') shall be reduced by the amount obtained by multiplying
whichever is the lesser of the following amounts:
$2,000;
the aggregate of:
(A) in the case of shares-the values of the shares when they were
acquired by the taxpayer; and
(B) in the case of rights to acquire shares-the amounts that would
have been the value of the shares if they had been acquired by the taxpayer at
the time the rights were acquired by the taxpayer;
as the case requires (which aggregate is in this subsection called
the 'aggregate value');
by whichever is the lesser of the following percentages:
10%;
the percentage calculated by dividing the aggregate discount
amount by the aggregate value.";
by inserting in subsection (6) "(other than subsections (4A), (4B),
(4C), (4D) and (4F))" after "for the purposes of this section";
by inserting in subsection (15) "(other than subsections (4A), (4B),
(4C), (4D) and (4F))" after "for the purposes of this section";
by inserting after subsection (18) the following subsections:
"(18A) A reference in this section to the giving of financial assistance
includes a reference to the giving of financial assistance by way of the
making of a loan, the giving of a guarantee, the provision of security, the
release of an obligation or the forgiving of a debt or otherwise.
For the purposes of this section, the question whether a company
is related to another company shall be determined in the same manner as the
question whether a corporation is related to another corporation is determined
for the purposes of subsection 7 (5) of the Companies Act 1981.
In this section:
'employee', in relation to a company, includes a director of the
company;
'permanent employee', in relation to a company, means:
a full-time employee of the company; or
a permanent part-time employee of the company;
with at least 12 months service (whether continuous or
non-continuous).
"(18D) For the purposes of the definition of 'permanent employee' in
subsection (18C), the period during which a person is engaged in service
includes any period during which the person is, in accordance with the terms
and conditions of that service:
absent on recreation leave, other than:
long service leave, furlough, extended leave or leave of
similar
kind (however described); or
leave without pay or on reduced pay; or
absent from work because of accident or illness.
"(18E) Nothing in section 170 prevents the amendment of an assessment at
any time for the purposes of giving effect to paragraph (4A) (e).".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 12
Expenditure on research and development activities
12. Section 73B of the Principal Act is amended:
by inserting in subsection (1) the following definitions:
" 'accelerated expenditure', in relation to an eligible company, means:
contracted expenditure of the company; or
expenditure incurred by the company in respect of research and
development activities comprised or included in a project in relation to which
the company and another company or companies are jointly registered under
section 39P of the Industry Research and Development Act 1986;
'advance R and D expenditure' means research and development expenditure
in respect of which the following conditions are satisfied:
the expenditure is incurred after 20 November 1987 under an
agreement (whenever entered into);
the eligible service period in relation to the expenditure ends
more than 13 months after the day on which the expenditure is incurred;
the amount of the expenditure is equal to or greater than
$1,000;
and
the expenditure is not expenditure that is required to be
incurred
by a law, or by an order of a court, of the Commonwealth, a State or a
Territory;
'agreement' means any agreement, arrangement, understanding or scheme,
whether formal or informal, whether express or implied and whether or not
enforceable, or intended to be enforceable, by legal proceedings;
'eligible service period', in relation to an amount of expenditure under
an agreement, means so much of the service period in relation to the
expenditure as occurs after the expenditure is incurred;
'service period', in relation to an amount of expenditure under an
agreement, means the period during which the thing done under the agreement in
return for the amount of expenditure is done;";
by inserting after subsection (10) the following subsection:
"(11) For the purposes of this section:
subject to paragraph (b), advance R and D expenditure of an
eligible
company shall be taken to be incurred in equal proportions throughout its
eligible service period; and
where advance R and D expenditure of an eligible company is
accelerated expenditure and its eligible service period occurs in 2 or more
years of income-any part of that expenditure that would otherwise be taken by
paragraph (a) to be incurred in the second or a later year of income shall
instead be taken to be incurred in equal proportions throughout the part of
the eligible service period occurring in the year of income preceding that
second or later year of income.";
by inserting in subsection (33B) "in relation to research and
development activities referred to in the certificate that is" after
"expenditure".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 13
Gifts, pensions etc.
13. Section 78 of the Principal Act is amended by inserting after
subparagraph (1) (a) (xci) the following subparagraph:
the Australian National Gallery Foundation;".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 14
Interpretation
14. Section 102M of the Principal Act is amended by omitting "or (i)" from
paragraph (a) of the definition of "exempt entity" and substituting ", (i) or
(k)".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 15
Interpretation
15. Section 121F of the Principal Act is amended by omitting "and (jb)" from
paragraph (a) of the definition of "relevant exempting provision" in
subsection (1) and substituting ", (jb) and (k)".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 16
16. After section 122 of the Principal Act the following section is
inserted:
Division applies subject to provisions terminating gold mining exemptions
"122AA. The application of this Division is subject to Division 16H.".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 17
17. After section 123A of the Principal Act the following section is
inserted:
Division applies subject to provisions terminating gold mining exemptions
"123AA. The application of this Division is subject to Division 16H.".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 18
Interpretation
18. Section 124K of the Principal Act is amended:
by omitting from subsections (1) and (1A) "for Arts, Heritage and
Environment";
by inserting in subsection (1) the following definitions:
" 'Minister' means the Minister for the Arts, Sport, the Environment,
Tourism and Territories;
'Senior Executive Service office' has the same meaning as in the Public
Service Act 1922;";
by inserting after subsection (1A) the following subsections:
"(1B) The Minister may, by writing, delegate to the Secretary to the
Minister's Department, or to a person holding or performing the duties of a
Senior Executive Service office in the Minister's Department, all or any of
the Minister's powers under this section.
"(1C) Applications may be made to the Tribunal for review of a decision:
to refuse to give a certificate of the kind referred to in the
definition of 'Australian film' in subsection (1); or
to revoke such a certificate.
"(1D) Where the Minister makes a decision of the kind referred to in
subsection (1C) and gives to a person whose interests are affected by the
decision notice in writing of the decision, that notice shall:
in all cases-include a statement to the effect that, subject to the
Administrative Appeals Tribunal Act 1975, application may be made to the
Administrative Appeals Tribunal, by or on behalf of any person whose interests
are affected by the decision, for review of the decision; and
except where subsection 28 (4) of that Act applies-include a
statement to the effect that a request may be made under section 28 of that
Act by or on behalf of such a person for a statement setting out the findings
on material questions of fact, referring to the evidence or other material on
which those findings were based and giving the reasons for the decision.
"(1E) A failure to comply with the requirements of subsection (1D) in
relation to a decision does not affect the validity of the decision.".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 19
Interpretation
19. Section 124ZAA of the Principal Act is amended by omitting from
subsection (1) the definition of "Minister" and substituting the following
definition:
" 'Minister' means the Minister for the Arts, Sport, the Environment,
Tourism and Territories;".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 20
Provisional certificates
20. Section 124ZAB of the Principal Act is amended by inserting after
subsection (3) the following subsection:
"(3A) Where the Minister makes a decision refusing an application under
subsection (1), the Minister shall, as soon as practicable, give notice in
writing of the refusal to the applicant.".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 21
Final certificates
21. Section 124ZAC of the Principal Act is amended by adding at the end the
following subsection:
"(5) Where the Minister makes a decision refusing an application under
subsection (1), the Minister shall, as soon as practicable, give notice in
writing of the decision to the applicant.".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 22
22. After section 124ZAD of the Principal Act the following sections are
inserted:
Delegation by Minister
"124ZADAA. (1) The Minister may, by writing, delegate to the Secretary to
the Minister's Department, or to a person holding or performing the duties of
a Senior Executive Service office in the Minister's Department, all or any of
the Minister's powers under this Division.
"(2) In subsection (1):
'Senior Executive Service office' has the same meaning as in the Public
Service Act 1922.
Review of decisions of Minister
"124ZADAB. (1) Applications may be made to the Tribunal for review of a
decision of the Minister under this Division (other than a decision to
delegate a power under section 124ZADAA).
"(2) Where the Minister makes a decision of the kind referred to in
subsection (1) and gives to a person whose interests are affected by the
decision notice in writing of the decision, that notice shall:
in all cases-include a statement to the effect that, subject to the
Administrative Appeals Tribunal Act 1975, application may be made to the
Administrative Appeals Tribunal, by or on behalf of any person whose interests
are affected by the decision, for review of the decision; and
except where subsection 28 (4) of that Act applies-include a statement
to the effect that a request may be made under section 28 of that Act by or on
behalf of such a person for a statement setting out the findings on material
questions of fact, referring to the evidence or other material on which those
findings were based and giving the reasons for the decision.
"(3) A failure to comply with the requirements of subsection (2) in relation
to a decision does not affect the validity of the decision.".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 23
Deductions for capital expenditure under post-12 January 1983 contracts
23. Section 124ZAFA of the Principal Act is amended:
by omitting "or" from the end of paragraph (1) (f);
by omitting paragraph (1) (g) and substituting the following
paragraphs:
where the moneys were expended under a contract that was entered
into after 19 September 1985 and before 25 May 1988-120%; or
where the moneys were expended under a contract that was entered
into
on or after 25 May 1988-100%;";
by omitting subsections (1A), (1AA) and (1B).
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 24
Interpretation
24. Section 124ZA of the Principal Act is amended by omitting "or (jaa)"
from paragraph (a) of the definition of "exempt body" in subsection (1) and
substituting ", (jaa) or (k)".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 25
Section 159GZZE not to apply in certain cases
25. Section 159GZZF of the Principal Act is amended by inserting after
subsection (4) the following subsection:
"(4A) Subsection (4) does not apply to the acquisition of an asset if the
asset is a share in a company that was a resident immediately before the
acquisition.".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 26
26. After Division 16G of Part III of the Principal Act the following
Division is inserted:
"Division 16H-Termination of Gold Mining Exemptions
"Subdivision A-Paragraph 23 (o), subparagraph 23 (pa) (iv) and
section 23C
Termination of paragraph 23 (o) exemption
"159GZZG. (1) Paragraph 23 (o) does not apply to income derived after 31
December 1990, unless the income derived consists of a dividend to which
subsection 23C (2) applies.
"(2) For the purposes of applying paragraph 23 (o) in accordance with
subsection (1) of this section to income derived during the year of income in
which 31 December 1990 occurs, the reference in that paragraph to the end of
the year of income shall be taken to be a reference to the end of 31 December
1990.
Removal of exclusion of gold from subparagraph 23 (pa) (iv)
"159GZZH. Paragraph 23 (pa) applies to income derived after 31 December 1990
as if ", other than gold," were omitted from subparagraph (iv) of that
paragraph.
Termination of exemption under section 23C
"159GZZI. (1) Subsection 23C (1) does not apply to income derived after 31
December 1990.
"(2) For the purposes of applying subsection 23C (1) in accordance with
subsection (1) of this section to income derived during the year of income in
which 31 December 1990 occurs, the reference in that subsection to the last
day of the year of income shall be taken to be a reference to 31 December
1990.
"Subdivision B-Division 10 and related provisions
Interpretation
"159GZZJ. In this Subdivision:
'actual deduction', in relation to the changeover year or a subsequent year
of income of a taxpayer, in relation to an amount of eligible gold mining
expenditure of the taxpayer, means the deduction actually allowed or allowable
for the year in relation to the expenditure under Division 10 (other than
section 122K) in its application in accordance with this Subdivision;
'changeover year', in relation to a taxpayer, means the year of income of
the taxpayer in which 1 January 1991 occurs;
'deduction limiting provision' means subsection 122D (3), 122DB (3), 122DD
(3), 122DF (3) or 122DG (6);
'deemed gold exploration or prospecting expenditure' means expenditure that
is taken by section 159GZZQ to be incurred on 1 January 1991;
'eligible gold exploration or prospecting expenditure', in relation to a
taxpayer, means expenditure that:
is or was incurred by the taxpayer after 25 May 1988 and before 1
January 1991; and
is not expenditure of a kind referred to in subsection 122J (1) but
would, if paragraph 23 (o) or section 159GZZV had not been enacted, be
expenditure of a kind referred to in that subsection;
'eligible gold mining expenditure', in relation to a taxpayer, means:
expenditure that:
is or was incurred by the taxpayer before 1 January 1991; and
is not allowable capital expenditure of the taxpayer for the
purposes of Division 10 but would, for the purposes of that Division, be
allowable capital expenditure (other than by virtue of paragraph 122A (1) (d))
of the taxpayer if paragraph 23 (o) or section 159GZZV had not been enacted;
or
expenditure that the taxpayer is taken to have incurred under
subparagraph 159GZZU (3) (e) (i);
'notional deduction', in relation to the changeover year or a prior year of
income of a taxpayer, in relation to an amount of eligible gold mining
expenditure of the taxpayer, means:
in the case of a year of income before the changeover year-the
deduction that would be allowable to the taxpayer in respect of the
expenditure for the year of income if the notional writing-down assumptions
were made; and
in the case of the changeover year-a proportion of the deduction
that, apart from section 159GZZL and before the application of any deduction
limiting provision, would be allowable to the taxpayer in respect of the
expenditure for the changeover year, being a proportion ascertained in
accordance with the formula:
Pre-1 January part
Post-expenditure part
where:
Pre-1 January part means:
if the expenditure is incurred before the changeover year-the
number of days in the part of the changeover year ending at the end of 31
December 1990; or
if the expenditure is incurred in the changeover year-the
number
of days in the period from the beginning of the day on which the expenditure
is incurred until the end of 31 December 1990; and
Post-expenditure part means:
if the expenditure is incurred before the changeover year-the
number of days in the changeover year; or
if the expenditure is incurred in the changeover year-the
number
of days in the period from the beginning of the day on which the expenditure
is incurred until the end of the changeover year;
'notional writing-down assumptions' means the following assumptions:
that paragraph 23 (o) and sections 122P and 159GZZV were never
enacted;
that, for years of income before the changeover year, the deduction
limiting provisions and section 80 were not applicable in relation to
deductions for eligible gold mining expenditure;
that, for the purposes of applying section 122B in relation to the
acquisition, during or before the changeover year of the vendor referred to in
that section, of a mining or prospecting right or mining or prospecting
information, eligible gold mining expenditure were not expenditure referred to
in paragraph (2) (a) or (c) of that section;
that sections 122E, 122F, 122G, 122H and 122Q were not applicable
to
eligible gold mining expenditure; and
that section 122K were not applicable to property disposed of, lost
or destroyed, or whose use for purposes referred to in that section is or was
otherwise terminated, during or before the changeover year, to the extent that
eligible gold mining expenditure is or was incurred on the property.
Eligible gold mining expenditure-Division 10 applies as if notional
writing-down assumptions made
"159GZZK. Subject to this Subdivision, where a taxpayer incurs or incurred
eligible gold mining expenditure, Division 10 applies to the expenditure for
the changeover year and all subsequent years of income as if the notional
writing-down assumptions were made.
Eligible gold mining expenditure-proportionate deduction for changeover year
"159GZZL. Subject to the application of any deduction limiting provision, a
taxpayer is entitled under Division 10, in its application in accordance with
this Subdivision, to only a proportion of any deduction that, apart from this
section and before the application of any deduction limiting provision, would
be allowable to the taxpayer for the changeover year in respect of an amount
of eligible gold mining expenditure incurred by the taxpayer, being a
proportion ascertained in accordance with the formula:
Post-31 December part
Post-expenditure part
where:
Post-31 December part means the number of days in the part of the changeover
year occurring after 31 December 1990; and
Post-expenditure part means:
if the expenditure is incurred before the changeover year-the
number
of days in the changeover year; or
if the expenditure is incurred in the changeover year-the number of
days in the period from the beginning of the day on which the expenditure is
incurred until the end of the changeover year.
Eligible gold mining expenditure-modified references to changeover year
"159GZZM. In applying Division 10 in accordance with this Subdivision, for
years of income after the changeover year, in relation to an amount of
eligible gold mining expenditure, the following provisions have effect:
for the purposes of references in subsections 122DG (4) and (5) to the
amount that, but for any deduction limiting provision, would have been
allowable as a deduction for the changeover year, section 159GZZL shall be
disregarded;
for the purposes of other references in Division 10, the deduction
allowed or allowable in respect of the changeover year shall be taken to have
been the sum of the actual deduction and the notional deduction for the
changeover year.
Eligible gold mining expenditure-election that property be depreciated under
section 57AL
"159GZZN. (1) Where eligible gold mining expenditure incurred by a taxpayer
on a unit of property is expenditure in respect of which depreciation would be
allowable to the taxpayer in accordance with section 57AL if paragraph 23 (o),
subsection 57AL (7) and Division 10 had not been enacted, the following
provisions have effect:
the taxpayer may, in accordance with subsection (2), elect that this
subsection shall apply in relation to all such expenditure incurred by the
taxpayer on the unit of property;
where such an election is made:
depreciation is allowable to the taxpayer in respect of the
expenditure on the unit in accordance with section 57AL for the part of the
changeover year occurring after 31 December 1990, and for all subsequent years
of income, as if paragraph 23 (o), subsection 57AL (7) and Division 10 had not
been enacted; and
the expenditure is not, and shall be taken never to have been,
eligible gold mining expenditure of the taxpayer for the purposes of this
Subdivision.
"(2) An election under subsection (1) shall:
be made in writing signed by or on behalf of the taxpayer; and
be delivered to the Commissioner on or before the last day for the
furnishing of the return of income of the changeover year or within such
further time as the Commissioner allows.
Eligible gold mining expenditure-modified application of section 122K
"159GZZO. Where, apart from this section:
subsection 122K (2), in its application in accordance with this
Subdivision, would require an amount to be included in the assessable income
of a taxpayer of a year of income after the changeover year; or
subsection 122K (3), in its application in accordance with this
Subdivision, would require an amount to be allowable as a deduction to a
taxpayer in relation to a year of income after the changeover year; being an
amount to the extent to which it is attributable to eligible gold mining
expenditure of the taxpayer, then there shall be included or allowable only
such proportion of that amount as is ascertained in accordance with the
formula:
Actual deductions
Actual deductions + Notional deductions
where:
Actual deductions is the sum of all actual deductions of the taxpayer in
relation to the expenditure;
Notional deductions is the sum of all notional deductions of the taxpayer in
relation to the expenditure.
Eligible gold mining expenditure-modified application of Part IIIA
"159GZZP. (1) Where:
a taxpayer owns an asset at the end of 31 December 1990 (in this
section called the 'changeover time');
before that time, the taxpayer incurred eligible gold mining
expenditure in relation to the asset;
the only use of the asset by the taxpayer before the changeover time
was solely for the purpose of producing exempt income; and
the market value of the asset at the changeover time is greater than
the amount that would be the indexed cost base to the taxpayer in respect of
the asset if the taxpayer disposed of the asset at that time;
the following provisions have effect:
for the purposes of any application of Part IIIA, the taxpayer shall be
taken to have disposed of the asset at the changeover time for a consideration
equal to the amount of the indexed cost base referred to in paragraph (d);
for the purposes of ascertaining under that Part whether a capital gain
accrues to the taxpayer in the event of a subsequent disposal of the asset by
the taxpayer-the taxpayer shall be taken to have immediately re-acquired the
asset for a consideration equal to the market value of the asset at the
changeover time;
the reference in subsection 160Z (3) to the day on which the asset was
acquired by the taxpayer shall be taken to be a reference to the day on which
the asset was actually acquired by the taxpayer.
"(2) If the asset is disposed of within 12 months of the time of its actual
acquisition by the taxpayer, subsection (1) of this section has effect as if
the references in that subsection to the indexed cost base to the taxpayer in
respect of the asset were references to the cost base to the taxpayer in
respect of the asset.
"(3) Expressions used in subsections (1) and (2) that are also used in Part
IIIA have the same respective meanings in those subsections as they have in
that Part.
"(4) For the purposes of any application of subsection 160ZK (1):
notional deductions shall be taken to be deductions that have been
allowed in respect of eligible gold mining expenditure; and
where an amount is included in, or allowable as a deduction from, the
assessable income of a taxpayer of a year of income in relation to eligible
gold mining expenditure under section 122K in its application in accordance
with section 159GZZO-the amount that would have been included in the
assessable income or allowable as a deduction under section 122K in relation
to that expenditure if section 159GZZO were disregarded shall instead be taken
to have been so included in the assessable income or allowable as a deduction.
Eligible gold exploration or prospecting expenditure-Division 10 applies as
if
incurred on 1 January 1991 etc.
"159GZZQ. Subject to this Subdivision, where a taxpayer incurs or incurred
eligible gold exploration or prospecting expenditure, Division 10 applies to
the expenditure for the changeover year and all subsequent years of income as
if:
the expenditure had been incurred on 1 January 1991 instead of when it
was actually incurred;
the mining operations referred to in applying subsection 122J (1) to
the expenditure were prescribed mining operations; and
section 122H did not apply to deemed gold exploration or prospecting
expenditure.
Eligible gold exploration or prospecting expenditure-7 year limit on
deductibility
"159GZZR. (1) Where:
an excess amount referred to in subsection 122J (4C) would, apart from
this subsection, be deemed for the purposes of subsection 122J (1) to have
been incurred by a taxpayer in a year of income;
the excess amount consists wholly or partly of an amount of deemed gold
exploration or prospecting expenditure; and
the year of income begins more than 7 years after the day on which the
eligible gold exploration or prospecting expenditure that gave rise to the
deemed gold exploration or prospecting expenditure was incurred; the excess
amount shall not, to the extent to which it consists of the amount of deemed
gold exploration or prospecting expenditure, be deemed to have been incurred
as mentioned in paragraph (a).
"(2) Where:
in applying section 122B in relation to a transaction taking place
during a year of income, paragraph (2) (b) of that section would, apart from
this subsection, refer to an amount of expenditure of a vendor under section
122J that has not been allowed and is not allowable as a deduction;
the amount of expenditure consists wholly or partly of an amount of
deemed gold exploration or prospecting expenditure; and
the year of income begins more than 7 years after the day on which the
eligible gold exploration or prospecting expenditure that gave rise to the
deemed gold exploration or prospecting expenditure was incurred;
paragraph 122B (2) (b) shall be taken not to refer to the expenditure to the
extent to which it consists of such an amount of deemed gold exploration or
prospecting expenditure.
Eligible gold exploration or prospecting expenditure-effect of application of
paragraph 23 (pa) before the changeover year
"159GZZS. (1) Where:
an amount of income derived by a taxpayer before the changeover year
from the sale, transfer or assignment of rights to mine on any mining tenement
is or has been exempt from income tax in a year of income (in this subsection
called the 'year of sale') by virtue of paragraph 23 (pa);
the whole or part (which whole or part is in this subsection called the
'unapplied exempt income') of that amount has not been applied under
subsection 122J (4E) (in any application apart from this Subdivision); and
any amounts of eligible gold exploration or prospecting expenditure
incurred by the taxpayer in relation to that tenement would, apart from this
subsection, be taken by section 159GZZQ to be incurred on 1 January 1991; the
following provisions have effect:
section 159GZZQ does not operate so as to require the taxpayer to be
taken to have incurred any part of those amounts of eligible gold exploration
or prospecting expenditure that does not exceed the unapplied exempt income;
subsection 122J (4E) does not apply to any amounts of deemed gold
exploration or prospecting expenditure incurred by the taxpayer in relation to
the tenement;
for the purposes of subsection (2) of this section, the amounts of
eligible gold exploration or prospecting expenditure shall be taken to be
reduced in equal proportions by the application of paragraph (d) of this
subsection.
"(2) Where:
the whole or a part of an amount of eligible gold exploration or
prospecting expenditure incurred by a taxpayer is specified in a notice or
notices under subsection 159GZZU (3); and
if no such amount or amounts had been specified, the amount of the
eligible gold exploration or prospecting expenditure that the taxpayer is
taken to have incurred under section 159GZZQ would have been reduced by a
proportion under paragraph (1) (f) of this section; the following provisions
have effect:
for the purposes of section 159GZZQ, the amount of eligible gold
exploration or prospecting expenditure not specified in the notice or notices
shall be taken to be reduced by that proportion;
for the purposes of subsection 159GZZU (3), the amount specified in the
notice or notices shall be taken to be reduced by that proportion.
Eligible gold exploration or prospecting expenditure-modified application of
sections 80 and 80G
"159GZZT. (1) Where a loss referred to in paragraph 80G (6) (a) is
attributable in whole or part to an amount of deemed gold exploration or
prospecting expenditure, the loss shall not, to the extent that it is so
attributable, be taken into account for the purposes of that paragraph unless
the loss company referred to in subsection 80G (6) was, for the purposes of
section 80G, a group company in relation to the income company referred to in
subsection 80G (6) in relation to:
the year of income in which the eligible gold exploration or
prospecting expenditure that give rise to the deemed gold exploration or
prospecting expenditure was incurred; and
each subsequent year of income before the loss year referred to in that
subsection.
"(2) For the purposes of the application of subsection 80 (3) in relation to
the changeover year and any preceding year of income, any eligible gold
exploration or prospecting expenditure incurred in deriving the exempt income
referred to in that subsection shall be disregarded.
Eligible gold mining and eligible gold exploration or prospecting
expenditure-effect of certain transfers of mining rights etc.
"159GZZU. (1) This section applies to an acquisition by a taxpayer (in this
section called the 'purchaser') from another taxpayer (in this section called
the 'vendor') of a mining or prospecting right, where the acquisition is for
the purpose of carrying on, or of exploration or prospecting for minerals
obtainable by, prescribed mining operations or what would, if paragraph 23 (o)
and section 159GZZV had not been enacted, be prescribed mining operations.
"(2) Where:
this section applies to the acquisition of a mining or prospecting
the acquisition occurs or occurred during or before the changeover
year of the vendor; and
before the acquisition, the vendor incurred (including by virtue of a
previous application of this section in relation to another acquisition)
eligible gold mining expenditure, to the extent that it was not on plant, in
relation to the area that is the subject of the right; then, for the purposes
of the application of Division 10 in accordance with this Subdivision, the
purchaser, instead of the vendor, shall be taken to have incurred the
expenditure.
"(3) Where:
this section applies to the acquisition of a mining or prospecting
the acquisition occurs or occurred before 1 January 1991; and
before the acquisition, the vendor incurred eligible gold exploration
or prospecting expenditure, to the extent that it was not on plant in use by
the vendor at the date of the acquisition; the following provisions have
effect:
the vendor and the purchaser may, in accordance with subsection (4),
give notice to the Commissioner that they have agreed to the application of
this subsection in relation to an amount specified in the notice, being the
whole or part of the eligible gold exploration or prospecting expenditure;
where such notice is given:
the amount specified in the notice shall, for the purposes of the
application of Division 10 in accordance with this Subdivision, be taken to be
expenditure incurred by the purchaser in acquiring the mining or prospecting
right concerned from the vendor and be taken to have been specified in a
notice under section 122B duly given to the Commissioner by the vendor and the
purchaser; and
the amount specified in the notice shall not be taken into account
as eligible gold exploration or prospecting expenditure of the vendor for the
purposes of section 159GZZQ or of applying this subsection to any later
acquisition of a mining or prospecting right from the vendor.
"(4) A notice under subsection (3) shall:
be in writing signed by or on behalf of the vendor and the purchaser;
be lodged with the Commissioner not later than:
if the acquisition occurred before the commencement of this
section-12 months after the commencement of this section; or
in any other case-2 months after the end of the year of income of
the purchaser in which the acquisition occurs;
or within such further time as the Commissioner allows.
Removal of paragraph 23 (o) exemption not to create actual pre-1991 Division
10
deductions
"159GZZV. It shall be assumed for the purposes of Division 10, in its
application apart from this Subdivision in relation to expenditure incurred
before 1 January 1991, that paragraph 23 (o) applies to income derived on or
after that day.
"Subdivision C-Division 10AAA and related provisions
Interpretation
"159GZZW. In this Subdivision:
'actual deduction', in relation to the changeover year or a subsequent year
of income of a taxpayer, in relation to an amount of eligible gold transport
expenditure of the taxpayer, means the deduction actually allowed or allowable
for the year in relation to the expenditure under Division 10AAA (other than
section 123C) in its application in accordance with this Subdivision;
'changeover year', in relation to a taxpayer, means the year of income of
the taxpayer in which 1 January 1991 occurs;
'eligible gold transport expenditure', in relation to a taxpayer, means
expenditure that:
is or was incurred by the taxpayer before 1 January 1991; and
is not expenditure of the taxpayer to which Division 10AAA applies
but would be expenditure of the taxpayer to which that Division applies if
paragraph 23 (o) or section 159GZZZB had not been enacted;
'notional deduction', in relation to the changeover year or a prior year of
income of a taxpayer, in relation to an amount of eligible gold transport
expenditure of the taxpayer, means:
in the case of a year of income before the changeover year-the
deduction that would be allowable to the taxpayer in respect of the
expenditure for the year of income if paragraph 23 (o) and sections 123BA,
123BB and 159GZZZB had not been enacted; and
in the case of the changeover year-a proportion of the deduction
that, apart from section 159GZZY, would be allowable to the taxpayer in
respect of the expenditure for the changeover year, being a proportion
ascertained in accordance with the formula:
Pre-1 January part
------------------------
Post-expenditure part
where:
Pre-1 January part means:
if the expenditure is incurred before the changeover year-the
number of days in the part of the changeover year ending at the end of 31
December 1990; or
if the expenditure is incurred in the changeover year-the
number
of days in the period from the beginning of the day on which the expenditure
is incurred until the end of 31 December 1990;
Post-expenditure part means:
if the expenditure is incurred before the changeover
year-the
number of days in the changeover year; or
if the expenditure is incurred in the changeover year-the
number
of days in the period from the beginning of the day on which the expenditure
is incurred until the end of the changeover year.
"159GZZX. Subject to this Subdivision, where a taxpayer incurs or incurred
eligible gold transport expenditure, Division 10AAA applies to the expenditure
for the changeover year and all subsequent years of income as if paragraph 23
(o) and sections 123BA, 123BB and 159GZZZB had not been enacted.
Proportionate deduction for changeover year
"159GZZY. A taxpayer is entitled under Division 10AAA, in its application in
accordance with this Subdivision, to only a proportion of any deduction that,
apart from this section, would be allowable to the taxpayer for the changeover
year in respect of an amount of eligible gold transport expenditure incurred
by the taxpayer, being a proportion ascertained in accordance with the
formula:
Post-31 December part
------------------------
Post-expenditure part
where:
Post-31 December part means the number of days in the part of the changeover
year occurring after 31 December 1990;
Post-expenditure part means:
if the expenditure is incurred before the changeover year-the
number
of days in the changeover year; or
if the expenditure is incurred in the changeover year-the number of
days in the period from the beginning of the day on which the expenditure is
incurred until the end of the changeover year.
Modified application of section 123C
"159GZZZ. Where, apart from this section:
subsection 123C (2), in its application in accordance with this
Division, would require an amount to be included in the assessable income of a
taxpayer of a year of income after the changeover year; or
subsection 123C (3), in its application in accordance with this
Division, would require an amount to be allowable as a deduction to a taxpayer
in relation to a year of income after the changeover year;
being an amount to the extent to which it is attributable to eligible gold
transport expenditure of the taxpayer, then there shall be included or
allowable only such proportion of that amount as is ascertained in accordance
with the formula:
Actual deductions
------------------------
Actual deductions + Notional deductions
where:
Actual deductions is the sum of all actual deductions of the taxpayer in
relation to the expenditure;
Notional deductions is the sum of all notional deductions of the taxpayer in
relation to the expenditure.
Modified application of Part IIIA
"159GZZZA. (1) Where:
a taxpayer owns an asset at the end of 31 December 1990 (in this
section called the 'changeover time');
before that time, the taxpayer incurred eligible gold transport
expenditure in relation to the asset;
the only use of the asset by the taxpayer before the changeover time
was solely for the purpose of producing exempt income; and
the market value of the asset at the changeover time is greater than
the amount that would be the indexed cost base to the taxpayer in respect of
the asset if the taxpayer disposed of the asset at that time; the following
provisions have effect:
for the purposes of any application of Part IIIA, the taxpayer shall be
taken to have disposed of the asset at the changeover time for a consideration
equal to the amount of the indexed cost base referred to in paragraph (d);
for the purposes of ascertaining under that Part whether a capital gain
accrues to the taxpayer in the event of a subsequent disposal of the asset by
the taxpayer-the taxpayer shall be taken to have immediately re-acquired the
asset for a consideration equal to the market value of the asset at the
changeover time;
the reference in subsection 160Z (3) to the day on which the asset was
acquired by the taxpayer shall be taken to be a reference to the day on which
the asset was actually acquired by the taxpayer.
"(2) If the asset is disposed of within 12 months of the time of its actual
acquisition by the taxpayer, subsection (1) of this section has effect as if
the references in that subsection to the indexed cost base to the taxpayer in
respect of the asset were references to the cost base to the taxpayer in
respect of the asset.
"(3) Expressions used in subsections (1) and (2) that are also used in Part
IIIA have the same respective meanings in those subsections as they have in
that Part.
"(4) For the purposes of any application of subsection 160ZK (1):
notional deductions shall be taken to be deductions that have been
allowed in respect of eligible gold transport expenditure; and
where an amount is included in, or allowable as a deduction from, the
assessable income of a taxpayer of a year of income in relation to eligible
gold transport expenditure under section 123C in its application in accordance
with section 159GZZZ-the amount that would have been included in the
assessable income or allowable as a deduction under section 123C in relation
to that expenditure if section 159GZZZ were disregarded shall instead be taken
to have been so included in the assessable income or allowable as a deduction.
Removal of paragraph 23 (o) exemption not to create actual pre-1991 Division
10AAA deductions
"159GZZZB. It shall be assumed for the purposes of Division 10AAA, in its
application apart from this Subdivision in relation to expenditure incurred
before 1 January 1991, that paragraph 23 (o) applies to income derived on or
after that day.".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 27
27. After section 159ZQ of the Principal Act the following Subdivision is
inserted:
"Subdivision AB-Lump Sum Payments in Arrears
Interpretation
"159ZR. (1) In this Subdivision, unless the contrary intention appears:
'accrual year', in relation to the total arrears amount, means a year of
income in which any part of the total arrears amount accrued;
'annual arrears amount', in relation to an accrual year, means so much of
the total arrears amount as accrued in that year;
'associate' has the same meaning as in section 26AAB, as affected by
subsection (2) of this section;
'current year' means the year of income for which the rebate is being
calculated;
'distant accrual year' means an accrual year that is not a recent accrual
year;
'eligible income' means:
salary or wages to the extent to which they accrued during a period
ending more than 12 months before the date on which they are paid;
salary or wages paid to a person after re-instatement to duty
following a period of suspension of the person from duty, to the extent to
which the salary or wages accrued during the period of suspension;
a payment to which paragraph (c) or (f) of the definition of
'salary
or wages' in subsection 221A (1) applies;
an educational or training allowance paid by the Commonwealth; or
a payment that is an excepted payment for the purposes of section
23AD, or a similar payment under a law of a foreign country;
but does not include so much of any such amount as was taken into account
in calculating the amount of a tax reimbursement payment by the Commonwealth
that was authorised under section 34A of the Audit Act 1901;
'eligible lump sum', in relation to a year of income, means a lump sum
payment of eligible income received on or after 1 July 1986 that is included
in the assessable income of the year of income and accrued, in whole or in
part, in an earlier year or years of income;
'gross tax' means the tax payable before the allowance of any rebates or
credits;
'law of a foreign country' includes a law of any part of, or place in, a
foreign country;
'normal taxable income' is the amount that would be the taxable income if:
no amount were included in assessable income under section 26AC,
26AD
or 27B;
the taxable income were reduced by any abnormal income amount taken
to be included in the taxable income under section 158L; and
no amount were included in assessable income under section 160ZO;
'notional tax amount' has the meaning given by sections 159ZRC and 159ZRD;
'rebated tax' means the tax payable after the allowance of any rebate under
section 156 or 160AA but before the allowance of any other rebates or any
credits;
'rebate year' means a year of income for which the conditions in paragraphs
159ZRA (1) (a) and (b) are satisfied;
'recent accrual year', in relation to the total arrears amount, means:
if there are 3 or more accrual years for the total arrears
amount-the
most recent 2 of those years; or
in any other case-the accrual year, or each of the accrual years,
for
the total arrears amount;
'salary or wages' has the same meaning as in Division 2 of Part VI, but does
not include:
an amount to which paragraph 26 (eb) or section 26AC applies;
an amount that is an assessable retirement amount for the purposes
of
the definition of 'salary or wages' in subsection 221A (1);
an eligible termination payment within the meaning of Subdivision
AA
of Division 2 of Part III in relation to the person who receives, or is
entitled to receive, the payment;
a payment that is salary or wages within the meaning of Division 2
of
Part VI only because of paragraph (a) of the definition of 'salary or wages'
in subsection 221A (1);
a payment to which paragraph (d) of the definition of 'salary or
wages' in subsection 221A (1) applies; or
a payment by a company by way of remuneration to a director of the
company who is an associate of the company;
'total arrears amount', in relation to a year of income, means the aggregate
of the eligible lump sums included in the assessable income of the year of
income to the extent to which those eligible lump sums accrued in an earlier
year or years of income.
"(2) For the purpose of determining whether a person is an associate of
another person within the meaning of this Subdivision, the definition of
'relative' in subsection 6 (1) and the definition of 'associate' in subsection
26AAB (14) applies if a reference in the definition concerned to the spouse of
the person included a reference to another person who, although not legally
married to the person, lives with the person on a bona fide domestic basis as
the husband or wife of the person.
"(3) In the application of the definition of 'salary or wages' in subsection
221A (1) for the purposes of this Subdivision, it is to be assumed that
arrangements under section 221B are in force in respect of all the States.
Eligibility for rebate
"159ZRA. (1) Where:
the assessable income of the taxpayer of a year of income (in this
Subdivision called the 'current year') includes one or more eligible lump
sums; and
the total arrears amount is not less than 10% of the amount (if any)
remaining after deducting that total arrears amount from the normal taxable
income of the current year;
the taxpayer is entitled to a rebate of tax, in the taxpayer's assessment for
the current year, of the amount (if any) calculated in accordance with this
Subdivision.
"(2) The rebate is only available to a natural person (otherwise than in the
capacity of a trustee).
Calculation of rebate
"159ZRB. The rebate is calculated in accordance with the formula:
Tax on arrears-Notional tax on arrears
where:
Tax on arrears is the amount by which the rebated tax on the taxable income
of the current year exceeds the rebated tax on the taxable income of the
current year, being that taxable income reduced by the total arrears amount;
Notional tax on arrears is the total of the notional tax amounts for the
accrual years.
Notional tax amount for recent accrual years
"159ZRC. The notional tax amount for a recent accrual year is calculated in
accordance with the formula:
Tax on increased income-Tax on actual income
where:
Tax on increased income is the rebated tax on the taxable income of the
accrual year, being that taxable income adjusted as follows:
the annual arrears amount for the accrual year is to be added;
if the accrual year is also a rebate year-the total arrears amount
for the accrual year is to be deducted; and
if, during the accrual year, there accrued an amount that is, or is
part of, the total arrears amount for a rebate year before the current
year-the amount that so accrued during the accrual year is to be added;
Tax on actual income is the rebated tax on the taxable income of the accrual
year, being that taxable income adjusted as follows (if applicable):
if the accrual year is also a rebate year-the total arrears amount
for the accrual year is to be deducted; and
if, during the accrual year, there accrued an amount that is, or is
part of, the total arrears amount for a rebate year before the current
year-the amount that so accrued during the accrual year is to be added.
Notional tax amount for distant accrual years
"159ZRD. (1) The notional tax amount for a distant accrual year is
calculated in accordance with the formula:
Arrears amount X Average tax rate on recent arrears
Increased normal tax-Normal tax
Arrears amount
where:
Arrears amount is the annual arrears amount in relation to the accrual
year;
Average tax rate on recent arrears is the average of the rates calculated in
accordance with the following formula in respect of each of the recent accrual
years: where:
Increased normal tax is the gross tax on the normal taxable income of
the
recent accrual year, being that normal taxable income adjusted as follows:
the annual arrears amount for the recent accrual year is to be
added;
if the recent accrual year is also a rebate year-the total
arrears
amount for the recent accrual year is to be deducted; and
if, during the recent accrual year, there accrued an amount that
is, or is part of, the total arrears amount for a rebate year before the
current year-the amount that so accrued during the recent accrual year is to
be added;
Normal tax is the gross tax on the normal taxable income of the recent
accrual year, being that normal taxable income adjusted as follows (if
applicable):
if the recent accrual year is also a rebate year-the total
arrears
amount for the recent accrual year is to be deducted; and
if, during the recent accrual year, there accrued an amount that
is, or is part of, the total arrears amount for a rebate year before the
current year-the amount that so accrued during the recent accrual year is to
be added;
Arrears amount is the annual arrears amount for the recent accrual year.
"(2) A rate calculated for the purposes of subsection (1) in respect of a
recent accrual year shall be calculated as a decimal fraction to 3 decimal
places.
"(3) If a rate so calculated would end with a number greater than 4 if it
were calculated to 4 decimal places, the rate shall be increased by 0.001.".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 28
Other interpretative provisions
28. Section 160K of the Principal Act is amended by omitting "and (jaa)"
from paragraph (a) of the definition of "relevant exempting provision" in
subsection (1) and substituting ", (jaa) and (k)".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 29
29. Before section 160ZYI of the Principal Act the following section is
inserted in Division 9 of Part IIIA:
Meaning of ''reducing amount''
"160ZYHD. A reference in this Division to the reducing amount is a reference
to the amount by which the aggregate of the amounts included in the assessable
income of a taxpayer under subsection 26AAC (5) and paragraph 26AAC (8C) (a)
is reduced in accordance with paragraph 26AAC (4F) (c).".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 30
Consideration for acquisition of shares by employees
30. Section 160ZYI of the Principal Act is amended by adding at the end ",
reduced by so much of the reducing amount (if any) as is attributable to those
shares".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 31
Consideration for acquisition of share rights by employees
31. Section 160ZYJ of the Principal Act is amended by adding at the end ",
reduced by so much of the reducing amount (if any) as is attributable to that
right".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 32
Amendment of assessments
32. Section 170 of the Principal Act is amended by omitting from subsection
(10) ", subsection 73B (8), (28), (30), (33), (33A) or (33C)" and substituting
"or 73B".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 33
Deductions by employer from salary or wages
33. Section 221C of the Principal Act is amended by inserting after
subsection (1AD) the following subsection:
"(1AE) Regulations made for the purposes of subsection (1) may prescribe
rates of deductions in respect of payments of eligible lump sums within the
meaning of Subdivision AB of Division 17 of Part III that are different from
the rates of deductions that are prescribed in respect of payments of other
salary or wages.".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 34
Provisional tax on estimated income
34. Section 221YDA of the Principal Act is amended by omitting from
paragraph (1) (da) and subparagraph (2) (a) (ii) "or AA" and substituting ",
AA or AB".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 35
Deductions from certain withdrawals from film accounts
35. Section 221ZN of the Principal Act is amended:
(a) by omitting from subparagraph (1) (a) (i) "55%" and substituting "39%";
by omitting from subparagraph (1) (a) (ii) and paragraph (1) (b) "72%"
and substituting "49%".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 36
Application of amendments
36. (1) In this section, "amended Act" means the Principal Act as amended by
this Act.
(2) The amendment made by paragraph 9 (a) applies to assessments in respect
of income of the year of income in which 12 July 1988 occurred and of all
subsequent years of income.
(3) Subparagraph 78 (1) (a) (xcii) of the amended Act applies to gifts made
on or after 26 September 1988.
(4) The amendments made by sections 14, 15, 24 and 28 apply in relation to
Australian Film Finance Corporation Pty. Limited in relation to the year of
income of that company in which 12 July 1988 occurred and in relation to all
subsequent years of income.
(5) Subsections 124K (1C), (1D) and (1E) and section 124ZADAB of the amended
Act apply to decisions made on or after the commencement of this subsection.
(6) The amendment made by section 25 applies to interest incurred in respect
of an amount owing in connection with the acquisition of an asset if:
(a) the interest was incurred after 3 November 1988; and
(b) the acquisition occurred after 3 November 1988 (otherwise than under a
contract entered into on or before that date).
(7) The amendments made by section 34 apply to the ascertainment of
provisional tax (including instalments) payable in respect of income of the
year of income commencing on 1 July 1988 and of all subsequent years of
income.
(8) The amendments made by section 35 apply to amounts withdrawn from film
accounts after the twenty-eighth day after the date of commencement of this
subsection.
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 37
Exemption of cash grants under the Defence Service Homes Scheme
37. For the purposes of the Principal Act, where the following conditions
are satisfied in relation to a payment received by a taxpayer:
the payment was made in lieu of an advance under the Defence Service
Homes Act 1918;
the taxpayer:
applied for the payment; or
elected to receive the payment;
after 15 September 1987 and before 10 December 1987;
the payment is exempt income.
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 38
Interpretation
38. In this Division:
"amended Act" means the Principal Act as amended by this Act.
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 39
Transitional provisions relating to deductions under subsection 124ZAFA (1)
of
the amended Act
39. (1) Where:
the conditions specified in paragraphs (a) to (e) of former 124ZAFA
(1A) are satisfied in relation to moneys expended by a taxpayer (in this
subsection called the "taxpayer's moneys"); and
before 1 July 1988, the whole or a part of the taxpayer's moneys were
deposited in a film account opened in relation to the film;
the amount of the deduction allowable under subsection 124ZAFA (1) of the
amended Act in respect of the taxpayer's moneys is an amount equal to:
if the amount of the taxpayer's moneys does not exceed the amount of
the excess referred to in paragraph (e) of former 124ZAFA (1A)-the sum of:
150% of the sum of:
(A) so much of the taxpayer's moneys as were deposited before 25 May
1988 in a film account opened in relation to the film; and
(B) if the statutory lodgment condition is satisfied-so much of the
taxpayer's moneys as were deposited after 24 May 1988 and before 1 July 1988
in a film account opened in relation to the film; and
100% of the remainder of the taxpayer's moneys;
if paragraph (c) does not apply and the contract referred to in
paragraph (a) of former 124ZAFA (1A) was entered into after 23 August 1983 and
on or before 19 September 1985-the sum of:
150% of so much of the taxpayer's moneys as is equal to the excess
referred to in paragraph (e) of former 124ZAFA (1A) or, if the sum of:
(A) so much of the taxpayer's moneys as were deposited before 25 May
1988 in a film account opened in relation to the film; and
(B) if the statutory lodgment condition is satisfied-so much of the
taxpayer's moneys as were deposited after 24 May 1988 and before 1 July 1988
in a film account opened in relation to the film;
is a lesser amount, 150% of that lesser amount;
if subparagraph (i) applies in relation to so much of the
taxpayer's
moneys as is equal to the excess referred to in paragraph (e) of former
124ZAFA (1A)-133% of the sum of:
(A) so much of the remainder of the taxpayer's moneys as was
deposited
before 25 May 1988 in a film account opened in relation to the film; and
(B) if the statutory lodgment condition is satisfied-so much of the
remainder of the taxpayer's moneys as was deposited after 24 May 1988 and
before 1 July 1988 in a film account opened in relation to the film; and
100% of the remainder of the taxpayer's moneys; or
if paragraph (c) does not apply and the contract referred to in
paragraph (a) of former 124ZAFA (1A) was entered into after 19 September
1985-the sum of:
150% of so much of the taxpayer's moneys as is equal to the excess
referred to in paragraph (e) of former 124ZAFA (1A) or, if the sum of:
(A) so much of the taxpayer's moneys as were deposited before 25 May
1988 in a film account opened in relation to the film; and
(B) if the statutory lodgment condition is satisfied-so much of the
taxpayer's moneys as were deposited after 24 May 1988 and before 1 July 1988
in a film account opened in relation to the film;
is a lesser amount, 150% of that lesser amount;
if subparagraph (i) applies in relation to so much of the
taxpayer's
moneys as is equal to the excess referred to in paragraph (e) of former
124ZAFA (1A)-120% of the sum of:
(A) so much of the remainder of the taxpayer's moneys as was
deposited
before 25 May 1988 in a film account opened in relation to the film; and
(B) if the statutory lodgment condition is satisfied-so much of the
remainder of the taxpayer's moneys as was deposited after 24 May 1988 and
before 1 July 1988 in a film account opened in relation to the film; and
100% of the remainder of the taxpayer's moneys.
(2) Where:
the conditions specified in paragraphs (a) to (e) of former 124ZAFA
(1AA) are satisfied in relation to moneys expended by a taxpayer (in this
subsection called the "taxpayer's moneys"); and
before 1 July 1988, the whole or a part of the taxpayer's moneys were
deposited in a film account opened in relation to the film;
the amount of the deduction allowable under subsection 124ZAFA (1) of the
amended Act in respect of the taxpayer's moneys is an amount equal to:
if the amount of the taxpayer's moneys does not exceed the amount of
the excess referred to in paragraph (e) of former 124ZAFA (1AA)-the sum of:
133% of the sum of:
(A) so much of the taxpayer's moneys as were deposited before 25 May
1988 in a film account opened in relation to the film; and
(B) if the statutory lodgment condition is satisfied-so much of the
taxpayer's moneys as were deposited after 24 May 1988 and before 1 July 1988
in a film account opened in relation to the film; and
100% of the remainder of the taxpayer's moneys; or
if paragraph (c) does not apply-the sum of:
133% of so much of the taxpayer's moneys as is equal to the excess
referred to in paragraph (e) of former 124ZAFA (1AA) or, if the sum of:
(A) so much of the taxpayer's moneys as were deposited before 25 May
1988 in a film account opened in relation to the film; and
(B) if the statutory lodgment condition is satisfied-so much of the
taxpayer's moneys as were deposited after 24 May 1988 and before 1 July 1988
in a film account opened in relation to the film;
is a lesser amount, 133% of that lesser amount;
if subparagraph (i) applies in relation to so much of the
taxpayer's
moneys as is equal to the excess referred to in paragraph (e) of former
124ZAFA (1AA)-120% of the sum of:
(A) so much of the remainder of the taxpayer's moneys as was
deposited
before 25 May 1988 in a film account opened in relation to the film; and
(B) if the statutory lodgment condition is satisfied-so much of the
remainder of the taxpayer's moneys as was deposited after 24 May 1988 and
before 1 July 1988 in a film account opened in relation to the film; and
100% of the remainder of the taxpayer's moneys.
(3) Where:
a taxpayer has, under a contract entered into before 25 May 1988,
expended capital moneys (in this subsection called the "taxpayer's moneys") in
producing, or by way of contribution to the cost of producing, a film;
apart from this subsection, an amount equal to 150%, 133% or 120% of
the taxpayer's moneys (which percentage is in this subsection called the
"deductible percentage") would be allowable as a deduction under subsection
124ZAFA (1) of the amended Act in respect of the taxpayer's moneys in an
assessment of the taxpayer; and
before 25 May 1988, no underwriting agreement had been entered into in
relation to the film;
the amount of the deduction allowable under subsection 124ZAFA (1) of the
amended Act in respect of the taxpayer's moneys is an amount equal to:
to the extent that the taxpayer's moneys were expended in producing the
film-the sum of:
the deductible percentage of the sum of:
(A) so much of the taxpayer's moneys as were expended before 26 May
1988; and
(B) so much of the taxpayer's moneys as is taken, by virtue of
subsection 40 (1) of this Act, to have been expended after 25 May 1988 and
before 9 June 1988 in producing the film; and
100% of the remainder of the taxpayer's moneys; or
to the extent that the taxpayer's moneys were expended by way of
contribution to the cost of producing the film-the sum of:
the deductible percentage of so much of the taxpayer's moneys as
were deposited before 9 June 1988 in a film account opened in relation to the
film; and
100% of the remainder of the taxpayer's moneys.
(4) Where:
a taxpayer has, under a contract entered into on or after 25 May 1988,
expended capital moneys (in this subsectioncalled the "taxpayer's moneys") in
producing, or by way of contribution to the cost of producing, a film;
apart from this subsection, an amount equal to 100% of the taxpayer's
moneys would be allowable as a deduction under subsection 124ZAFA (1) of the
amended Act in respect of the taxpayer's moneys in an assessment of the
taxpayer;
before 25 May 1988, no underwriting agreement was entered into in
relation to the film;
there is in force a notice under subsection (8) of this section stating
that, at a particular time before 25 May 1988, the film was substantially in
production; and
either or both of the following subparagraphs applies:
to the extent that the taxpayer's moneys were expended in
producing
the film-either or both of the following sub-subparagraphs applies:
(A) the whole or a part of the taxpayer's moneys were expended on 25
May 1988 in producing the film;
(B) by virtue of subsection 40 (1) of this Act, the whole or a part
of
the taxpayer's moneys is taken to have been expended after 25 May 1988 and
before 9 June 1988 in producing the film;
to the extent that the taxpayer's moneys were expended by way of
contribution to the cost of producing the film-the whole or a part of the
taxpayer's moneys were deposited before 9 June 1988 in a film account opened
in relation to the film;
the amount of the deduction allowable under subsection 124ZAFA (1) of the
amended Act in respect of the taxpayer's moneys is an amount equal to:
to the extent that the taxpayer's moneys were expended in producing the
film-the sum of:
120% of so much of the taxpayer's moneys as were expended, or
taken
to have been expended, as mentioned in subparagraph (e) (i); and
100% of the remainder of the taxpayer's moneys; or
to the extent that the taxpayer's moneys were expended by way of
contribution to the cost of producing the film-the sum of:
120% of so much of the taxpayer's moneys as were deposited as
mentioned in subparagraph (e) (ii); and
100% of the remainder of the taxpayer's moneys.
(5) Where:
a taxpayer has, under a contract entered into after 13 January 1983,
expended capital moneys (in this subsection called the "taxpayer's moneys") in
producing, or by way of contribution to the cost of producing, a film;
neither subsection (1) nor (2) applies in relation to the taxpayer's
moneys;
apart from this subsection, an amount equal to 150%, 133%, 120% or 100%
of the taxpayer's moneys (which percentage is in this subsection called the
"deductible percentage") would be allowable as a deduction under subsection
124ZAFA (1) of the amended Act in respect of the taxpayer's moneys in an
assessment of the taxpayer; and
an underwriting agreement in relation to the film was entered into
before 25 May 1988;
the amount of the deduction allowable under subsection 124ZAFA (1) of the
amended Act in respect of the taxpayer's moneys is an amount equal to:
to the extent that the taxpayer's moneys were expended in producing the
film-the sum of:
120% (or the deductible percentage if it is greater) of the sum
of:
(A) so much of the taxpayer's moneys as were expended before 26 May
1988; and
(B) if the statutory lodgment condition is satisfied-so much of the
taxpayer's moneys as is taken, by virtue of subsection 40 (1) of this Act, to
have been expended after 25 May 1988 and before 1 July 1988 in producing the
film; and
100% of the remainder of the taxpayer's moneys; or
to the extent that the taxpayer's moneys were expended by way of
contribution to the cost of producing the film-the sum of:
120% (or the deductible percentage if it is greater) of the sum
of:
(A) so much of the taxpayer's moneys as were deposited before 25 May
1988 in a film account opened in relation to the film; and
(B) if the statutory lodgment condition is satisfied-so much of the
taxpayer's moneys as were deposited after 24 May 1988 and before 1 July 1988
in a film account opened in relation to the film; and
100% of the remainder of the taxpayer's moneys.
(6) Subsection 124ZAFA (1) of the amended Act has effect subject to this
section.
(7) Where:
apart from this subsection, there would be one or more underwriting
agreements in relation to a film entered into before 25 May 1988; and
the statutory lodgment condition is not satisfied;
subsections (3), (4) and (5) have effect as if there were no underwriting
agreement entered into in relation to the film before 25 May 1988.
(8) The Secretary may, by notice in writing, certify that, at a particular
time before 25 May 1988, a particular film was substantially in production.
(9) In determining whether a film was substantially in production at a
particular time, the Secretary shall have regard to:
the extent to which written contracts had been entered into at or
before that time with the persons who took part, or who were to take part, in
the making of the film (including authors, composers, actors, scriptwriters,
editors, producers, directors and technicians); and
any other matters that the Secretary considers to be relevant.
(10) Where a notice under subsection (8) is revoked:
the notice shall be taken never to have been in force; and
nothing in section 170 of the amended Act prevents the amendment of an
assessment at any time for the purpose of giving effect to the revocation.
(11) For the purposes of this section, where the following conditions are
satisfied in relation to moneys (in this subsection called the "taxpayer's
moneys") expended by a taxpayer under a contract entered into after 13 January
1983 by way of contribution to the cost of producing a film:
the taxpayer's moneys were contributed before 1 July 1983;
the taxpayer's moneys were expended before 1 July 1983 in producing the
film;
the taxpayer's moneys shall be taken to have been deposited before 25 May 1988
in a film account opened in relation to the film.
(12) The Secretary may, by writing, delegate to a person holding or
performing the duties of a Senior Executive Service office in the Department
of the Arts, Sport, the Environment, Tourism and Territories all or any of the
Secretary's powers under this section.
(13) Applications may be made to the Administrative Appeals Tribunal for
review of a decision:
to refuse to give a notice under subsection (8); or
to revoke such a notice.
(14) Where the Secretary makes a decision of the kind referred to in
subsection (13) and gives to a person whose interests are affected by the
decision notice in writing of the decision, that notice shall:
in all cases-include a statement to the effect that, subject to the
Administrative Appeals Tribunal Act 1975, application may be made to the
Administrative Appeals Tribunal, by or on behalf of any person whose interests
are affected by the decision, for review of the decision; and
except where subsection 28 (4) of that Act applies-include a statement
to the effect that a request may be made under section 28 of that Act by or on
behalf of such a person for a statement setting out the findings on material
questions of fact, referring to the evidence or other material on which those
findings were based and giving the reasons for the decision.
(15) A failure to comply with the requirements of subsection (14) in
relation to a decision does not affect the validity of the decision.
(16) In this section:
"former 124ZAFA (1A)" means subsection 124ZAFA (1A) of the Principal Act,
notionally modified by including a reference to 100% in paragraph (b) of that
subsection;
"former 124ZAFA (1AA)" means subsection 124ZAFA (1AA) of the Principal Act,
notionally modified by including a reference to 100% in paragraph (b) of that
subsection;
"Secretary" means the Secretary to the Department of the Arts, Sport, the
Environment, Tourism and Territories;
"Senior Executive Service office" has the same meaning as in the Public
Service Act 1922;
"statutory lodgment condition", in relation to a film, means the lodging
with the Secretary, before 2 June 1988, of a copy of at least one underwriting
agreement that was entered into in relation to the film before 25 May 1988;
"underwriting agreement", in relation to a film, means:
an underwriting contract in relation to the film; or
a production contract in relation to the film under which a person
has, or persons have, conditionally agreed to expend capital moneys by way of
contribution to the cost of producing the film.
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 40
Special provisions relating to producers' funds deposited in film accounts
after 25 May 1988 and before 1 July 1988
40. (1) Subject to this section, where the following conditions are
satisfied in relation to moneys deposited by a taxpayer in a film account
opened in relation to a film:
the moneys were deposited by the taxpayer after 25 May 1988 and before
1 July 1988;
the Commissioner is satisfied that, at the time of the deposit, the
taxpayer intended to expend the moneys in producing the film under a
particular contract (including a contract to be entered into at a future
date);
the taxpayer shall be treated, for the purposes of this Division and Division
10BA of Part III of the amended Act, as if the taxpayer had, upon the making
of the deposit, expended the moneys in producing the film under that contract.
(2) Where:
apart from this subsection and sections 124ZAL and 124ZAMof the amended
Act, an amount (in this subsection called the "producer's amount") would, by
virtue of subsection (1) of this section, be taken for the purposes of this
Division and Division 10BA of Part III of the amended Act to have been
expended before 1 July 1988 by a taxpayer in producing a film; and
the whole or a part of the producer's amount is included in an amount
that was withdrawn from a film account opened in relation to the film and was
not, upon withdrawal, dealt with in the prescribed manner;
the following provisions have effect:
where the whole of the producer's amount was included in the amount
withdrawn from the film account-no part of the producer's amount shall be
10BA of Part III of the
amended Act to have been expended by the taxpayer;
where part only of the producer's amount was included in the amount
withdrawn from the film account-the producer's amount shall be reduced by that
part of the producer's amount that was so included.
(3) Where:
an amount (in this subsection called the "producer's amount") would, by
virtue of subsection (1), be taken for the purposes of this Division and
Division 10BA of Part III of the amended Act to have been expended before 1
July 1988 by a taxpayer in producing a film;
an amount is withdrawn from a film account opened in relation to the
film, being the film account into which the producer's amount has been paid;
the amount withdrawn from the film account was not, upon withdrawal,
dealt with in the prescribed manner;
then, for the purposes of this Division and Division 10BA of Part III of the
amended Act, so much (if any) of the producer's amount as the Commissioner
determines shall be taken to be included in the amount withdrawn from the film
account.
(4) Where:
apart from this subsection, an amount (in this subsection called the
"producer's amount") would, by virtue of subsection (1), be taken for the
purposes of this Division and Division 10BA of Part III of the amended Act to
have been expended before 1 July 1988 by a taxpayer in producing a film under
a particular contract; and
the whole or a part of the producer's amount is included in an amount
that was withdrawn from a film account opened in relation to the film and was
expended in producing the film under another contract;
then, for the purposes of this Division and Division 10BA of Part III of the
amended Act, so much (if any) of the producer's amount as the Commissioner
determines shall be taken to have been expended by the taxpayer in producing
the film under that other contract.
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 41
Declarations
41. If subsection 40 (1) of this Act applies to a deposit made to a film
account, section 124ZADA of the amended Act has effect, in relation to
declarations lodged after the commencement of this section, as if:
paragraph (1) (h) of that section were omitted and the following
paragraph were substituted:
that all moneys withdrawn from the relevant film account after the
time the declaration is made will, upon withdrawal, be:
dealt with in the prescribed manner;
paid to persons as refunds of capital moneys expended by way
of
contribution to the cost of producing the film; or
if subsection 40 (1) of the Taxation Laws Amendment Act (No.
5)
1988 applies to a deposit made to the film account-paid to a person as a
repayment of that deposit."; and
paragraph (5) (d) of that section were omitted and the following
paragraph were substituted:
that all moneys withdrawn from the relevant film account after the
time the declaration is made will, upon withdrawal, be:
dealt with in the prescribed manner;
paid to persons as refunds of capital moneys expended by way
of
contribution to the cost of producing the film; or
if subsection 40 (1) of the Taxation Laws Amendment Act (No.
5) 1988 applies to a deposit made to the film account-paid to a person as a
repayment of that deposit.".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 42
Deductions from certain withdrawals from film accounts
42. If subsection 40 (1) of this Act applies in relation to a deposit made
to a film account, section 221ZN of the amended Act applies, in relation to
amounts withdrawn from the film account after the twenty-eighth day after the
date of commencement of this section, as if paragraph (1) (a) of that section
were omitted and the following paragraph were substituted:
if the relevant amount is, upon withdrawal, to be:
paid to a person as a refund of capital moneys expended by way of
contribution to the cost of producing the film; or
if subsection 40 (1) of the Taxation Laws Amendment Act (No. 5)
1988
applies in relation to a deposit made to the film account-paid to a person as
a repayment of that deposit;
upon withdrawal, deduct from the relevant amount an amount equal to:
if the person to whom the refund or repayment is to be made is a
company (other than a company in the capacity of trustee of a trust
estate)-39% of the relevant amount; and
in any other case-49% of the relevant amount;".
TAXATION LAWS AMENDMENT ACT (No. 5) 1988 No. 153 of 1988
- SECT 43
Transitional provision-modification of dividend imputation provisions
resulting
from reduction in the company tax rate
43. (1) Notwithstanding paragraph (c) of the definition of "applicable
general company tax rate" in section 160APA of the amended Act, where:
a franking year of a company is a period that:
commences after 31 December 1988 and before 1 July 1989; and
ends after 30 June 1989; and
a franked dividend is paid during that franking year by the company to
a shareholder in the company; a reference in Part IIIAA of the amended Act to
the applicable general company tax rate in relation to:
the payment of that dividend; or
a trust amount or partnership amount that relates, directly or
indirectly, to the payment of that dividend;
is a reference to 39%.
(2) Subject to subsection (4), where the following conditions are satisfied
in relation to the payment of a franked dividend to a shareholder being a
company:
the dividend is paid on a day (in this section called the "actual
payment day") during:
the period commencing on 1 January 1989 and ending on 30 June
1989;
and
a 49% franking year of the shareholder;
apart from this subsection, there would arise on the actual payment day
a franking credit of the shareholder under section 160APP of the amended Act
in respect of the payment of the dividend;
the applicable general company tax rate in relation to the payment of
the dividend is 39%;
Part IIIAA of the amended Act applies as if that franking credit arises at the
beginning of the first 39% franking year of the shareholder instead of on the
actual payment day.
(3) Subject to subsection (4), where the following conditions are satisfied
in relation to a trust amount or partnership amount that is included in, or in
relation to a partnership amount that is allowed as a deduction from, the
assessable income of a company:
apart from this subsection, there arises at a particular time (in this
section called the "actual credit time") during:
the period commencing on 1 January 1989 and ending on 30 June
1989;
and
a 49% franking year of the company;
a franking credit of the company under section 160APQ of the amended Act
in
respect of the trust amount or partnership amount, as the case may be;
the applicable general company tax rate for the purposes of the
calculation of the franking credit is 39%;
Part IIIAA of the amended Act applies as if that franking credit arises at the
beginning of the first 39% franking year of the company instead of at the
actual credit time.
(4) Where:
apart from this subsection, Part IIIAA of the amended Act applies, by
virtue of this section, as if one or more franking credits arose at the
beginning of the first 39% franking year of a company; and
the company has, or would, apart from this subsection, have a franking
deficit at the end of the immediately preceding franking year (in this
subsection called the "previous franking year") of the company; the following
provisions have effect for the purposes of the application of Part IIIAA of
the amended Act:
if the sum of those franking credits does not exceed 150% of the
franking deficit-each of those franking credits shall be:
reduced by one-third; and
taken to arise on the last day of the previous franking year of
the
franking year of the
company;
if the sum of those franking credits exceeds 150% of the franking
deficit:
so much of each of those franking credits as is calculated in
accordance with the formula:
Franking credit X 150% franking deficit
Total franking credits
where:
Franking credit is the amount of the franking credit;
150% franking deficit is the number of dollars in 150% of the
franking
deficit;
Total franking credits is the number of dollars in the sum of those
franking credits;
(which amount so calculated is in this paragraph called the
"proportional franking credit") shall be:
(A) reduced by one-third; and
(B) taken to arise on the last day of the previous franking year of
the
company instead of at the beginning of the first 39% franking year of the
company;
so much of each of those franking credits as remains after
subtracting the proportional franking credit shall be taken to arise at the
beginning of the first 39% franking year of the company.
(5) A reference in subsection (2), (3) or (4) of this section to Part IIIAA
of the amended Act does not include a reference to section 160AR of the
amended Act.
(6) In this section:
"amended Act" means the Principal Act as amended by this Act;
"39% franking year", in relation to a company, means a franking year of the
company where, assuming that the company were liable to pay franking deficit
tax for that franking year, the applicable general company tax rate in
relation to that liability is 39%;
"49% franking year", in relation to a company, means a franking year of the
company where, assuming that the company were liable to pay franking deficit
tax for that franking year, the applicable general company tax rate in
relation to that liability is 49%.
The
Act No. 153, 1988 amended as indicated in the Tables below.
Act | Number and year | Date of Assent | Date of commencement | Application, saving or transitional provisions |
153, 1988 | 26 Dec 1988 | |||
75, 2010 | 28 June 2010 | Schedule 6 (item 82): 29 June 2010 | — |
| |
Provision affected | How affected |
Div. 7 of Part III......................... | rep. No. 75, 2010 |
S. 44......................................... | rep. No. 75, 2010 |
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