Taxation Laws Amendment (Fringe Benefits and Substantiation) Act 1987 (Cth)
This compilation was prepared on 29 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
Exempt car benefits
Taxable value of car fringe benefits - statutory formula
Taxable value of car fringe benefits - cost basis
Insertion of new sections:
No reduction of operating cost in a log book year of tax unless
log book records and odometer records are maintained
No reduction of operating cost in a non-log book year of tax
unless log book records and odometer records are maintained in
log book year of tax
Nominated business percentage to be reduced if it exceeds
business percentage established during applicable log book
period or if it is unreasonable
Calculation of depreciation and interest
Taxable value of debt waiver fringe benefits
Exempt loan benefits
Taxable value of loan fringe benefits
Reduction of taxable value - ''otherwise deductible'' rule
Exempt accommodation expense payment benefits
Exempt car expense payment benefits
Insertion of new section:
Taxable value of in-house expense payment fringe benefits
Taxable value of external expense payment fringe benefits
Reduction of taxable value - ''otherwise deductible'' rule
Taxable value of non-remote housing fringe benefits
Indexation factor for valuation purposes - non-remote housing
Taxable value of remote area accommodation
Insertion of new section:
Indexation factor for valuation purposes - remote area
accommodation
Living-away-from-home allowance benefits
Taxable value of living-away-from-home allowance fringe benefits
Reduction of taxable value - ''otherwise deductible'' rule
Reduction of taxable value - ''otherwise deductible'' rule
Taxable value of tax-exempt body entertainment fringe benefits
Reduction of taxable value - ''otherwise deductible'' rule
Exempt residual benefits
Reduction of taxable value - ''otherwise deductible'' rule
Heading to Division 13 of Part III
Exempt benefits - employees of religious institutions
Repeal of section 57A and substitution of new section:
Exempt benefits - public benevolent institutions
Exempt benefits - live-in residential care workers
Insertion of new sections and heading:
Exempt benefits - employment interviews and selection tests
Exempt benefits - removals and storage of household effects
as a result of relocation
Exempt benefits - sale or acquisition of dwelling as a result of
relocation
Exempt benefits - connection or re-connection of certain
utilities as a result of relocation
Exempt benefits - leasing of household goods while living away
from home
Exempt benefits - relocation transport
Exempt benefits - motor vehicle parking
Exempt benefits - newspapers and periodicals used for business
purposes
Exempt benefits - compensable work-related trauma
Exempt benefits - in-house health care facilities
Exempt benefits - certain travel to obtain medical treatment
Exempt benefits - work-related medical examinations,
work-related medical screening, work-related preventative health
care, work-related counselling, migrant language training
Exempt benefits - emergency assistance
Exempt benefits - minor benefits
Exempt benefits - long service awards
Exempt benefits - safety awards
Exempt benefits - trainees engaged under Australian Traineeship
System
Exempt benefits - live-in domestic workers employed by religious
institutions or by religious practitioners
Exempt benefits - live-in help for elderly and disadvantaged
persons
Exempt benefits - food and drink for non-live-in domestic
employees
Reduction of taxable value - remote area residential fuel
Reduction of taxable value - remote area housing
Insertion of new section:
Reduction of taxable value - remote area holiday transport
fringe benefits subject to ceiling
Reduction of taxable value - remote area holiday transport fringe
benefits not subject to ceiling
Insertion of new sections:
Reduction of taxable value - overseas employment holiday
transport
Reduction of taxable value of certain expense payment fringe
benefits in respect of relocation transport
Reduction of taxable value - temporary accommodation relating to
relocation
Reduction of taxable value of temporary accommodation meal
fringe benefits
Reduction of taxable value of certain expense payment fringe
benefits in respect of employment interviews or selection tests
Reduction of taxable value of certain expense payment fringe
benefits associated with work-related medical examinations,
work-related medical screening, work-related preventative health
care, work-related counselling or migrant language training
Reduction of aggregate taxable value of certain fringe benefits
Reduction of taxable value of living-away-from-home food fringe
benefits
Insertion of new sections and Division:
Reduction of taxable value - education of children of overseas
employees
Reduction of taxable value of certain fringe benefits - section
23AF of the
Reduction of taxable value of certain fringe benefits - section
23AG of the
Car substantiation rules
No compliance with substantiation rules in log book year of tax
unless log book records and odometer records are maintained
No compliance with substantiation rules in non-log book year of
tax unless log book records kept in previous log book year of
tax
Car deduction percentage
Nominated business percentage to be reduced if it exceeds
business percentage established during applicable log book
period or if it is unreasonable
Application of payments of instalments of tax
Notional tax amount
Insertion of new section:
Penalty tax for over-estimating business percentage applicable
to car
Retention of statutory evidentiary documents
Insertion of new section:
Assessment on assumption
Interpretation
Insertion of new sections:
Benefit provided in respect of a year of tax
Benefit provided in respect of the employment of an employee
Application or use of benefit
Housing loans, prescribed interests in land or stratum units and
proprietary rights in respect of dwellings
Insertion of new section:
Benefits incidental to acquisition or sale of prescribed
interests in land or stratum units and proprietary rights in
respect of dwellings
Remote area housing
Insertion of new sections:
Benefits relating to transport
Employee's new place of employment
Eligible shared accommodation in a house, flat or home unit
Eligible accommodation in an employees hostel
Remote area holiday transport
Insertion of new sections:
Relocation transport
Overseas employees
Overseas employment holiday transport
Employment interviews and selection tests
Work-related medical examinations, work-related medical
screening, work-related preventative health care, work-related
counselling, migrant language training
Residual benefits to include provision of property in certain
circumstances
Associates and relatives
Business journeys in car
Holding of car
Insertion of new sections:
When car used for the purpose of producing assessable income
Holding period of car
Deemed specification of matters in employer's return
Unsigned or fraudulent entries in log book records
Reasonable estimate of underlying business percentage
Log book year of tax
Applicable log book period
Business percentage established during log book period
Replacement cars - car fringe benefits
Replacement cars - otherwise deductible provisions
Re-acquisition etc. of cars
Registration of motor vehicle
Application of amendments
Amendment of assessments
PART III - AMENDMENT OF THE INCOME TAX ASSESSMENT ACT 1936
Principal Act
Deductions not allowable for entertainment expenses
Deductions not allowable where expenses incurred by employee are
reimbursed
Insertion of new section:
Deductions not allowable for private component of contributions
for fringe benefits etc.
Interpretation
Insertion of new section:
82KTAA. Definition of ''eligible expense'' - extent to which transport
expenses relate to eligible transport payments
Log book year of income
Deduction for car expenses where income-producing use does not exceed
5,000 kilometres - statutory formula
Elections
Aggregate claims not exceeding a certain amount
Insertion of new sections:
82KZBA. No substantiation required for eligible expenses relating to
eligible transport payments in certain circumstances
82KZBB. Relief from certain substantiation requirements where taxpayer
had a reasonable expectation that substantiation would not be
required
Application of amendments
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987 - LONG TITLE
An Act to amend the law relating to taxation
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 1
Short title [
1. This Act may be cited as the Taxation Laws Amendment (Fringe Benefits
and Substantiation) Act 1987.
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 2
Commencement [
2. This Act shall come into operation on the day on which it receives the
Royal Assent.
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- 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; and No. 23, 1987.
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 4
Exempt car benefits
4. Section 8 of the Principal Act is amended:
by omitting paragraph (2) (b) and substituting the following
paragraph:
there was no private use of the car during the year of tax and at a
time when the benefit was provided other than:
work-related travel of the employee; and
other private use by the employee or an associate of the
employee, being other use that was minor, infrequent and irregular."; and
by adding at the end the following subsection:
"(3) Where:
a car benefit relating to a particular car is provided by a
particular person (in this subsection called the 'provider') in a year of tax
in respect of the employment of a current employee of an employer;
at all times during the year of tax when the car was held by the
provider, the car was unregistered; and
during the period in the year of tax when the car was held by the
provider, the car was wholly or principally used directly in connection with
business operations of:
the employer; or
if the employer is a company-the employer or a company that is
related to the employer;
the car benefit is an exempt benefit in relation to the year of tax.".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 5
Taxable value of car fringe benefits-statutory formula
5. Section 9 of the Principal Act is amended:
by omitting from subsection (1) "Subdivision" and substituting "Part";
by omitting from subparagraph (2) (e) (i) "and";
by inserting after subparagraph (2) (e) (i) the following
subparagraph:
"(ia) in a case where car expenses in respect of fuel or oil for the car
were incurred during the holding period by recipients of the car fringe
benefits and:
(A) the persons incurring those expenses give to the employer, before
the declaration date, declarations, in a form approved by the Commissioner, in
respect of those expenses; or
(B) documentary evidence of those expenses is obtained by the persons
incurring the expenses and given to the employer before the declaration date;
the amount of those expenses paid by the recipients less any amount
paid
or payable to the recipients by way of reimbursement of those expenses; and";
and
by inserting in sub-subparagraph (2) (e) (ii) (A) "(other than car
expenses in respect of fuel or oil for the car)" after "in respect of the
car".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 6
Taxable value of car fringe benefits-cost basis
6. Section 10 of the Principal Act is amended:
by omitting from subsection (2) "Where" and substituting "Subject to
this Part, where";
by omitting from subsection (2) "continuously";
by omitting from subsection (2) all the words after "amount calculated"
and substituting the following:
"in accordance with the formula:
(C X (100%-BP))-R
where:
is the operating cost of the car during the holding period;
is:
if, under section 10A or 10B, the employer is not entitled to a
reduction in the operating cost of the car on account of business journeys
undertaken in the car during the holding period-nil;
if, under section 10A or 10B, the employer is entitled to such a
reduction and the percentage calculated in accordance with the formula:
N-U
where:
is the percentage applicable to the car specified in the
employer's return for the year of tax as mentioned in section 10A or 10B; and
is the percentage (in this paragraph called the 'reasonable
percentage') that represents a reasonable estimate of the underlying business
percentage applicable to the car in relation to the provider for the holding
period;
is a percentage that:
if either of the following sub-subparagraphs applies:
(A) the year of tax is a log book year of tax of the employer in
relation to the car;
(B) the year of tax is not a log book year of tax of the
employer
in relation to the car and the car is a low business kilometre car of the
provider in relation to the year of tax;
exceeds nil; or
in any other case-exceeds 10%;
the reasonable percentage; or
in any other case-the percentage applicable to the car specified
in
the employer's return for the year of tax as mentioned in section 10A or 10B;
and
is the amount (if any) of the recipient's payment.";
by inserting in subparagraph (3) (a) (i) "insured repair expenses or"
after "other than";
by omitting from subparagraphs (3) (a) (iii), (iv) and (vi) "year of
tax" (wherever occurring) and substituting "holding period";
by adding at the end of paragraph (3) (a) "and";
by omitting paragraph (3) (b);
by omitting from subparagraph (3) (c) (i) "and";
by inserting after subparagraph (3) (c) (i) the following
subparagraph:
"(ia) in a case where car expenses in respect of fuel or oil for the car
were incurred during the holding period by recipients of the car fringe
benefits and:
(A) the persons incurring those expenses give to the employer, before
the declaration date, declarations, in a form approved by the Commissioner, in
respect of those expenses; or
(B) documentary evidence of those expenses is obtained by the persons
incurring the expenses and given to the employer before the declaration date;
the amount of those expenses paid by the recipients less any amount
paid
or payable to the recipients by way of reimbursement of those expenses; and";
by inserting in sub-subparagraph (3) (c) (ii) (A) "(other than car
expenses in respect of fuel or oil for the car)" after "in respect of the
car";
by inserting after subsection (3) the following subsections:
"(3A) A reference in subparagraph (3) (a) (i) to an insured repair
expense
relating to a car is a reference to:
so much of an expense incurred in respect of repairs to the car as
does not exceed an amount:
received by way of insurance in respect of the repairs by the
person incurring the expense;
paid by way of insurance in respect of the repairs in
discharge
of the obligation of the insured to pay the expense;
received by way of compensation in respect of the repairs by
the person incurring the expense from the person legally responsible for the
damage to the car; or
paid by way of compensation in respect of the repairs by the
person legally responsible for the damage to the car in discharge of the
obligation of the person incurring the expense to pay the expense; or
an expense incurred in respect of repairs to the car:
by an insurer under a contract of insurance; or
by way of compensation by the person legally responsible for
the
damage to the car.
"(3B) Where, in accordance with subsection 162K (2), the identity of a
car
changes one or more times during the period (in this subsection called the
'overall holding period') that, apart from that subsection, would be the
holding period, the operating cost of the car during each period (in this
subsection called a 'statutory holding period') that is a holding period in
relation to the car when the car had a separate identity is so much of the
amount that would have been the operating cost of the car during the overall
holding period (assuming that the identity of the car had not changed during
the overall holding period) as is attributable to the statutory holding
period.
"(3C) Where, in accordance with subsection 162K (2), the identity of a
car
changes one or more times during the period (in this subsection called the
'overall holding period') that, apart from that subsection, would be the
holding period, the recipient's payment in relation to each period (in this
subsection called a 'statutory holding period') that is a holding period in
relation to the car when the car had a separate identity is so much of the
amount that would have been the recipient's payment in relation to the overall
holding period (assuming that the identity of the car had not changed during
the overall holding period) as is attributable to the statutory holding
period.
"(3D) In determining, for the purposes of this section, whether:
an expense is paid or payable in respect of the registration of, or
insurance in respect of, a car;
a charge is paid or payable under a lease agreement in respect of a
car; or
a lessor of a car is entitled to privileges or exemptions in
relation
to sales tax or customs duty in respect of a transaction by which the lessor
purchased the car;
a change, in accordance with subsection 162K (2) or 162M (2), to the
identity of the car shall be disregarded."; and
by omitting subsections (5) and (6) and substituting the following
subsections:
"(5) Where:
an employer elects that this section apply in relation to all the
car
fringe benefits in relation to the employer in relation to a year of tax that
relate to a particular car; and
the taxable value, or the aggregate of the taxable values, as the
case requires, of the car fringe benefits that relate to the car ascertained
under subsection (2) of this section exceeds the taxable value, or the
aggregate of the taxable values, as the case requires, that would have been
ascertained under section 9 if that election had not been made;
this Act (other than section 162G) applies, and shall be deemed always to
have applied, for the purposes of ascertaining that taxable value, or the
aggregate of those taxable values, as the case requires, as if that election
had not been made.
"(6) Nothing in section 74 prevents the amendment of an assessment for
the
purpose of giving effect to subsection (5).".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 7
7. After section 10 of the Principal Act the following sections are
inserted:
No reduction of operating cost in a log book year of tax unless log book
records and odometer records are maintained
"10A. Where one or more car fringe benefits in relation to an employer in
relation to a year of tax relate to a car while it was held by a particular
person (in this section called the 'provider') during a particular period (in
this section called the 'holding period') in a year of tax that is a log book
year of tax of the employer in relation to the car, the employer is entitled
to a reduction in the operating cost of the car on account of business
journeys undertaken in the car during the holding period if, and only if:
if either of the following subparagraphs applies:
the provider commenced to hold the car during the last 12 weeks of
the year of tax;
the Commissioner is satisfied, having regard to the provider's
circumstances, that it would be unreasonable to expect log book records and
odometer records in relation to the car to have been maintained by or on
behalf of the provider for an applicable log book period in relation to the
car;
the employer, in his or her return for the year of tax, specifies a
percentage as the nominated business percentage applicable to the car in
relation to the provider for the holding period; or
in any other case-both of the following conditions are satisfied:
log book records and odometer records are maintained by or on
behalf
of the provider for the applicable log book period in relation to the car and,
if the provider is not the employer, are given to the employer before the
declaration date; and
the employer, in his or her return for the current year of tax,
specifies a percentage as the nominated business percentage applicable to the
car in relation to the provider for the holding period, not being a percentage
that exceeds the business percentage established during the applicable log
book period.
No reduction of operating cost in a non-log book year of tax unless log book
records and odometer records are maintained in log book year of tax
"10B. Where one or more car fringe benefits in relation to an employer in
relation to a year of tax relate to a car while it was held by a particular
person (in this section called the 'provider') during a particular period (in
this section called the 'holding period') in a year of tax that is not a log
book year of tax of the employer in relation to the car, the employer is
entitled to a reduction in the operating cost of the car on account of
business journeys undertaken during the holding period in the car if, and only
if:
odometer records are maintained by or on behalf of the provider in
relation to the car for the holding period and, if the provider is not the
employer, are given to the employer before the declaration date; and
the employer, in his or her return for the year of tax, specifies
whichever of the following percentages is applicable:
the percentage that was:
(A) the nominated business percentage applicable to the car in
relation
to the provider for the period that was the holding period in the year of tax
that was the last log book year of tax of the employer in relation to the car;
and
(B) specified in the employer's return for that last log book year of
tax;
if the percentage referred to in subparagraph (i) would otherwise
be applicable but the employer is of the opinion that the percentage
calculated in accordance with the formula:
N-U
where:
N is the percentage referred to in subparagraph (i); and
U is the percentage that represents a reasonable estimate of the
underlying business percentage applicable to the car in relation to the
provider for the holding period;
is a percentage that:
(A) if the car is a low business kilometre car of the provider in
relation to the year of tax-exceeds nil; or
(B) in any other case-exceeds 10%;
a percentage as the nominated business percentage applicable to the
car
in relation to the provider for the holding period.
Nominated business percentage to be reduced if it exceeds business percentage
established during applicable log book period or if it is unreasonable
"10C. (1) Where:
(a) an employer, in his or her return for a year of tax, specifies, or
purports to specify, a percentage (in this subsection called the 'excessive
percentage') of the kind mentioned in subparagraph 10A (b) (ii) in respect of
a car held by the provider of a car fringe benefit in relation to the employer
in respect of the car during a period (in this subsection called the 'holding
period') in the year of tax; and
the excessive percentage exceeds the percentage (in this subsection
called the 'reduced percentage') that is the lesser of the following
percentages:
the business percentage applicable to the car that was established
during the applicable log book period referred to in subparagraph 10A (b)
(ii);
the percentage that represents a reasonable estimate of the
to the car in relation to the
provider for the holding period;
the following provisions have effect:
the employer shall be treated as if he or she had, in the return,
specified, in respect of the car, the reduced percentage instead of the
excessive percentage;
if the employer, in his or her return for a subsequent year of tax,
specifies, or purports to specify, in respect of the car, the excessive
percentage in accordance with the condition set out in subparagraph 10B (b)
(i)-the employer shall be treated as if he or she had, in the return for
that subsequent year of tax, specified, in respect of the car, the reduced
percentage instead of the excessive percentage.
"(2) For the purposes of this Act, where:
subparagraph 10B (b) (ii) applies in relation to a car held by a
provider of a car fringe benefit during a period (in this subsection called
the 'holding period') in a year of tax; and
the employer concerned fails to specify, in his or her return for the
year of tax, a percentage as the nominated business percentage applicable to
the car in relation to the provider for the holding period;
the employer shall be treated as if he or she had, in the return, specified,
in respect of the car, as that nominated business percentage, the percentage
that represents a reasonable estimate of the underlying business percentage
applicable to the car in relation to the provider for the holding period.".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 8
Calculation of depreciation and interest
8. Section 11 of the Principal Act is amended:
by inserting before subsection (1) the following subsection:
"(1A) For the purposes of this Subdivision, the amount of depreciation
that is deemed to have been incurred by a person in respect of a car in
respect of the period (in this subsection called the 'holding period') during
a year of tax while the car was held by the person is the amount calculated in
accordance with the formula:
DEP X DHP
DEP X DCO
where:
DEP
is the amount of depreciation that is deemed to have been
incurred by the person in respect of the car in respect of
the
year of tax;
DHP
is the number of days in the holding period during which the
car
was owned by the person; and
DCO
is the number of days in the period in the year of tax during
which the car was owned by the person.''; and
by inserting after subsection (1) the following subsection:
"(1B) For the purposes of this Subdivision, the amount of interest that
is
deemed to have been incurred by a person in respect of a car in respect of the
period (in this subsection called the 'holding period') during a year of tax
while the car was held by the person is the amount calculated in accordance
with the formula:
INT X DHP
INT X DCO
where:
INT
is the amount of interest that is deemed to have been
incurred
by the person in respect of the car in respect of the year of
tax;
DHP
is the number of days in the holding period during which the
car
was owned by the person; and
DCO
is the number of days in the period in the year of tax during
which the car was owned by the person.''.
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 9
Taxable value of debt waiver fringe benefits
9. Section 15 of the Principal Act is amended by omitting "The taxable" and
substituting "Subject to this Part, the taxable".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 10
Exempt loan benefits
10. Section 17 of the Principal Act is amended:
by omitting from subparagraph (3) (b) (i) "his or her" and substituting
"that"; and
by adding at the end the following subsection:
"(4) Where:
the making of a loan consisting of an advance by an employer to an
employee of the employer constitutes a benefit in respect of the employment of
the employee in respect of a year of tax (in this subsection called the
'current year of tax');
the sole purpose of the making of the loan is to enable the
employee
to pay any of the following amounts payable by the employee in respect of
accommodation:
a rental bond;
a security deposit in respect of electricity, gas or telephone
services;
any similar amount;
the employee is required to repay (whether by set-off or otherwise)
the loan not later than 12 months after the loan is made;
any of the following benefits is provided in, or in respect of, any
year of tax to the employee in respect of that employment:
an expense payment benefit where the recipients expenditure is
in
respect of a lease or licence in respect of that accommodation;
a housing benefit where the housing right is in respect of that
accommodation;
a residual benefit where the recipients benefit is constituted
by the subsistence of a lease or licence in respect of that accommodation;
and
either of the following subparagraphs apply:
by virtue of section 21 or subsection 47 (5), the benefit
referred to in paragraph (d) is an exempt benefit in relation to the year of
tax referred to in that paragraph;
the benefit referred to in paragraph (d) is a fringe benefit in
relation to the year of tax referred to in that paragraph and, under section
61C, the taxable value of the fringe benefit is reduced by the extent to which
that taxable value is attributable to the subsistence of a lease or licence in
respect of the accommodation during a particular period in that year of tax;
the making of the loan is an exempt benefit in relation to the current
year
of tax.".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 11
Taxable value of loan fringe benefits
11. Section 18 of the Principal Act is amended by omitting subsection (2).
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 12
Reduction of taxable value-''otherwise deductible'' rule
12. Section 19 of the Principal Act is amended:
by omitting paragraph (1) (b) and substituting the following
paragraphs:
if the recipient had, on the last day of the period (in this
subsection called the 'loan period') during the year of tax when the recipient
was under an obligation to repay the whole or any part of the loan, incurred
and paid unreimbursed interest (in this subsection called the 'gross
interest'), in respect of the loan, in respect of the loan period, equal to
the notional amount of interest in relation to the loan in relation to the
year of tax-both of the following conditions would have been satisfied:
a once-only deduction (in this subsection called the 'gross
deduction') would, or would but for section 82A, and Subdivisions F and G of
Division 3 of Part III, of the Income Tax Assessment Act 1936, have been
allowable to the recipient under that Act in respect of the gross interest;
in the case of the transitional year of tax-the gross deduction
would not be:
(A) a deduction in respect of rental property loan interest within
the meaning of Subdivision G of Division 3 of Part III of that Act; or
(B) an eligible rental property deduction within the meaning of
Subdivision G of Division 3 of Part III of that Act;
the amount (in this subsection called the 'notional deduction')
calculated in accordance with the formula:
GD - RD
where:
GD is the gross deduction; and
RD is:
if no interest accrued on the loan in respect of the loan
period-nil; or
if interest accrued on the loan in respect of the loan
period-the amount (if any) that would, or that would but for section 82A, and
Subdivisions F and G of Division 3 of Part III, of the Income Tax Assessment
Act 1936, have been allowable:
(A) as a once-only deduction; and
(B) in the case of the transitional year of tax-otherwise than
as
a deduction in respect of rental property loan interest within the meaning of
Subdivision G of Division 3 of Part III of that Act and otherwise than as an
eligible rental property deduction within the meaning of Subdivision G of
Division 3 of Part III of that Act;
to the recipient under that Act in respect of that interest if
that interest had been incurred and paid by the recipient on the last day of
the loan period;
exceeds nil;";
by omitting paragraph (1) (c) and substituting the following
paragraphs:
except where the fringe benefit is:
an employee credit loan benefit in relation to the year of
tax;
or
an employee share loan benefit in relation to the year of
tax;
the recipient gives to the employer, before the declaration date, a
declaration, in a form approved by the Commissioner, in respect of the loan
concerned;
where:
in the case of the transitional year of tax or the first
standard
a car held by the
recipient during a period (in this subsection called the 'holding period') in
the year of tax;
in the case of the second standard year of tax or a subsequent
year of tax-the loan fringe benefit is a car loan benefit in respect of a car
held by the recipient during a period (in this subsection also called the
'holding period') in the year of tax; and
the substantiation rules set out in Division 15 have been
complied with in relation to the car in relation to the holding period;
the following conditions are satisfied:
the recipient gives to the employer, before the declaration
date,
a car substantiation declaration for the car for the year of tax;
in a case where the substantiation rules require log book
records
or odometer records to be maintained by or on behalf of the recipient in
relation to the car-the car substantiation declaration is accompanied by a
copy of those documents; and";
by omitting from paragraph (1) (d) all the words from and including
"where the loan" to "declaration date -" and substituting the following:
"where paragraph (ca) does not apply and:
in the case of the transitional year of tax or the first
standard
year of tax-the loan was used by the recipient to purchase a car held by the
recipient during a period (in this subsection also called the 'holding
period') in the year of tax; or
in the case of the second standard year of tax or a subsequent
year of tax-the loan fringe benefit is a car loan benefit in respect of a car
held by the recipient during a period (in this subsection also called the
'holding period') in the year of tax;
the recipient gives to the employer, before the declaration date:";
by omitting from subsection (1) "section 60" (first occurring) and
substituting "Division 14";
by omitting from subsection (1) all the words after "the amount
calculated" and substituting the following words and paragraphs:
"in accordance with the formula:
TV - ND
where:
is the amount that, but for this subsection and Division 14, would
be
the taxable value of the loan fringe benefit in relation to the year of tax;
and
is:
if neither paragraph (ca) nor (d) applies-the notional
deduction;
if paragraph (ca) applies-whichever of the following amounts is
applicable:
if it would be concluded that the amount of interest that
has
accrued on the loan in respect of the loan period would have been the same
even if the loan fringe benefit were not applied or used in producing
assessable income of the recipient-the car deduction percentage, ascertained
under section 65G, of the amount that, but for this subsection and Division
14, would be the taxable value of the loan fringe benefit in relation to the
year of tax;
if subparagraph (i) does not apply-the car deduction
percentage, ascertained under section 65G, of the notional amount of interest
in relation to the loan in relation to the year of tax;
where:
paragraph (d) applies; and
a declaration referred to in subparagraph (d) (i) has been
given to the employer;
whichever of the following amounts is the least:
the notional deduction;
if it would be concluded that the amount of interest that
has
accrued on the loan in respect of the loan period would have been the same
even if the loan fringe benefit were not applied or used in producing
assessable income of the recipient-331/3% of the amount that, but for this
subsection and Division 14, would be the taxable value of the loan fringe
benefit in relation to the year of tax;
if subparagraph (iv) does not apply-331/3% of the notional
amount of interest in relation to the loan in relation to the year of tax; or
where:
subparagraph (d) (ii) applies; and
a declaration referred to in subparagraph (d) (i) has not
been
given to the employer;
whichever of the following amounts is applicable:
if it would be concluded that the amount of interest that
has
accrued on the loan in respect of the loan period would have been the same
even if the loan fringe benefit were not applied or used in producing
assessable income of the recipient-331/3% of the amount that, but for this
subsection and Division 14, would be the taxable value of the loan fringe
benefit in relation to the year of tax;
if subparagraph (iii) does not apply-331/3% of the notional
amount of interest in relation to the loan in relation to the year of tax.";
and
by omitting subsection (2) and substituting the following subsections:
"(2) Where a part of a loan to which a loan fringe benefit relates is
used
by an employee to:
in all cases-purchase a particular car; or
in the case of the second standard year of tax or a subsequent year
of tax-pay a car expense within the meaning of Subdivision F of Division 3 of
Part III of the Income Tax Assessment Act 1936;
subsection (1) and the definition of 'car loan benefit' in subsection 136
(1) apply as if that part of the loan had been a separate loan.
"(3) Where:
apart from this subsection, paragraph (1) (ca) applies in relation
to
a fringe benefit in relation to an employer in respect of a car held by the
recipient during a period in the year of tax; and
whichever of the following amounts is the greater exceeds the
amount
that, apart from this subsection, would be ascertained under paragraph (1) (f)
as representing the component ND in the formula in subsection (1):
in all cases-the amount that would have been ascertained under
paragraph (1) (g) as representing that component if:
(A) paragraph (1) (d) had applied in relation to the fringe
benefit;
and
(B) a declaration of the kind referred to in subparagraph (1) (d)
(i) had been given to the employer;
in a case where the average number of business kilometres per
week travelled by the car during the holding period exceeded 96-the amount
that would have been ascertained under paragraph (1) (h) as representing that
component if:
(A) subparagraph (1) (d) (ii) had applied in relation to that
fringe
benefit;
(B) a declaration of the kind referred to in subparagraph (1) (d)
(i) had not been given to the employer; and
(C) a declaration of the kind referred to in sub-subparagraph (1)
(d) (ii) (B) had been given to the employer;
this Act applies, and shall be deemed always to have applied, as if the
amount represented by that component had been calculated as mentioned in
whichever of subparagraphs (b) (i) or (ii) of this subsection is applicable.
"(4) Nothing in section 74 prevents the amendment of an assessment for
the
purpose of giving effect to subsection (3).".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 13
Exempt accommodation expense payment benefits
13. Section 21 of the Principal Act is amended:
by omitting from paragraph (b) "and is not expenditure to which
paragraph 24 (1) (b) applies";
by inserting after paragraph (b) the following paragraph:
the accommodation is not provided while the employee is
undertaking
travel in the course of performing the duties of that employment;"; and
by omitting from paragraph (c) "his or her employment" and substituting
"that employment".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 14
Exempt car expense payment benefits
14. Section 22 of the Principal Act is amended by omitting paragraph (c) and
substituting the following paragraphs:
the benefit is not in respect of relocation transport;
the benefit is not in respect of an employment interview or selection
test;
the benefit is not associated with:
a work-related medical examination of the employee;
work-related medical screening of the employee;
work-related preventative health care of the employee;
work-related counselling of the employee or of an associate of the
employee; or
migrant language training of the employee or of an associate of the
employee;
neither of the following subparagraphs applies in relation to the
transport to which the benefit relates:
the transport was provided wholly or partly to enable the
employee,
or an associate of the employee, to have a holiday;
the transport was provided at a time when the employee had ceased
to
perform the duties of that employment; and".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 15
15. Before section 23 of the Principal Act the following section is inserted
in Subdivision B of Division 5 of Part III:
Taxable value of in-house expense payment fringe benefits
"22A. (1) Subject to this Part, the taxable value in relation to a year of
tax of an in-house property expense payment fringe benefit (in this subsection
called the 'actual fringe benefit') provided during the year of tax is the
amount that, if:
the provision of property to which the actual fringe benefit relates
were an in-house property fringe benefit (in this subsection called the
'notional fringe benefit'); and
the recipients contribution in relation to the notional fringe benefit
were equal to the recipients expenditure reduced by whichever of the following
amounts is applicable:
the amount of the payment referred to in paragraph 20 (a) reduced
by
the amount of the recipients contribution in relation to the actual fringe
benefit;
the amount of the reimbursement referred to in paragraph 20 (b);
would have been calculated under section 42 as the taxable value, but for
section 44 and Division 14, of the notional fringe benefit in relation to the
year of tax.
"(2) Subject to this Part, the taxable value in relation to a year of tax of
an in-house residual expense payment fringe benefit (in this subsection called
the 'actual fringe benefit') provided during the year of tax is the amount
that, if:
the provision of the residual benefit to which the actual fringe
benefit relates were an in-house residual fringe benefit (in this subsection
called the 'notional fringe benefit'); and
the recipients contribution in relation to the notional fringe benefit
were equal to the recipients expenditure reduced by whichever of the following
amounts is applicable:
the amount of the payment referred to in paragraph 20 (a) reduced
by
the amount of the recipients contribution in relation to the actual fringe
benefit;
the amount of the reimbursement referred to in paragraph 20 (b);
would have been calculated under whichever of sections 48 and 49 is applicable
as the taxable value, but for section 52 and Division 14, of the notional
fringe benefit in relation to the year of tax.
"(3) For the purposes of subsection (2), section 49 has effect as if:
'the current identical benefit in relation to' were omitted from
paragraph 49 (a);
the reference in paragraph 49 (b) to the recipients current benefit
were a reference to the recipients overall benefit; and
'insofar as it relates to the recipients current benefit' were omitted
from section 49.
Where the recipients expenditure in relation to each of 2 or more
in-house expense payment fringe benefits (whether or not in relation to the
same year of tax) is the same expenditure, this Act applies, and shall be
deemed to have applied, as if all the payments or reimbursements to which
those fringe benefits relate had been made at the time when the first of those
payments or reimbursements was made and not otherwise.
"(5) Nothing in section 74 prevents the amendment of an assessment for the
purpose of giving effect to subsection (4).".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 16
Taxable value of external expense payment fringe benefits
16. Section 23 of the Principal Act is amended by inserting "external"
before "expense".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 17
Reduction of taxable value-''otherwise deductible'' rule
17. Section 24 of the Principal Act is amended:
by omitting paragraph (1) (b) and substituting the following
paragraphs:
if the recipient had, at the time when the recipients expenditure
was
incurred, incurred and paid unreimbursed expenditure (in this subsection
called the 'gross expenditure'), in respect of the same matter in respect of
which the recipients expenditure was incurred, equal to:
in the case of an in-house expense payment fringe benefit-the
amount that, but for this subsection and Division 14 and the recipients
contribution, would be the taxable value of the expense payment fringe benefit
in relation to the year of tax; or
in the case of an external expense payment fringe benefit-the
amount of the recipients expenditure;
both of the following conditions would have been satisfied:
a once-only deduction (in this subsection called the 'gross
deduction') would, or would but for section 82A, and Subdivisions F and G of
Division 3 of Part III, of the Income Tax Assessment Act 1936, have been
allowable to the recipient under that Act in respect of the gross
expenditure;
in the case of the transitional year of tax-the gross deduction
would not be:
(A) a deduction in respect of rental property loan interest within
the meaning of Subdivision G of Division 3 of Part III of that Act; or
(B) an eligible rental property deduction within the meaning of
Subdivision G of Division 3 of Part III of that Act;
the amount (in this subsection called the 'notional deduction')
calculated in accordance with the formula:
GD-RD
where:
GD is the gross deduction; and
RD is:
if there is no recipients portion in relation to the expense
payment fringe benefit-nil; or
if there is a recipients portion in relation to the expense
payment fringe benefit-the amount (if any) that would, or that would but for
section 82A, and Subdivisions F and G of Division 3 of Part III, of the Income
Tax Assessment Act 1936, have been allowable:
(A) as a once-only deduction; and
(B) in the case of the transitional year of tax-otherwise than
as
a deduction in respect of rental property loan interest within the meaning of
Subdivision G of Division 3 of Part III of that Act and otherwise than as an
eligible rental property deduction within the meaning of Subdivision G of
Division 3 of Part III of that Act;
to the recipient under that Act in respect of the recipients
expenditure (assuming that any payment of that expenditure by the recipient
had been paid by the recipient at the time when the recipients expenditure was
incurred);
exceeds nil;";
by inserting before subparagraph (1) (c) (i) the following
subparagraph:
"(ia) where the recipients expenditure is in respect of fuel or oil for
a
motor vehicle owned by, or leased to, the recipient:
(A) where the fringe benefit is an eligible small expense payment
fringe benefit or an undocumentable expense payment fringe benefit-substitute
documentary evidence of the recipients expenditure is maintained by or on
behalf of the provider and, if the provider is not the employer, that
documentary evidence, or a copy, is given to the employer before the
declaration date;
(B) in any case-documentary evidence of the recipients expenditure
is
obtained by the recipient and that documentary evidence, or a copy, is given
to the employer before the declaration date; or
(C) in any case-the recipient gives to the employer, before the
declaration date, a declaration, in a form approved by the Commissioner, in
respect of the recipients expenditure;";
by inserting in subparagraph (1) (c) (i) "subparagraph (ia) does not
apply and" after "where";
by inserting in subparagraph (1) (c) (i) "an undocumentable expense
payment fringe benefit or" before "an eligible";
by inserting in subparagraph (1) (c) (i) "fringe" before "benefit"
(last occurring);
by omitting from paragraph (1) (e) "and";
by inserting after paragraph (1) (e) the following paragraph:
where:
the expense payment fringe benefit is a car expense payment
benefit in respect of a car held by the recipient during a period (in this
section called the 'holding period') in the year of tax; and
the substantiation rules set out in Division 15 have been
complied with in relation to the car in relation to the holding period;
the following conditions are satisfied:
the recipient gives to the employer, before the declaration
date, a car substantiation declaration for the car for the year of tax;
in a case where the substantiation rules require log books or
odometer records to be maintained by or on behalf of the recipient in relation
to the car-the car substantiation declaration is accompanied by a copy of
those documents; and";
by omitting from paragraph (f) "the expense" and substituting
"paragraph (ea) does not apply and the expense payment";
by omitting from paragraph (1) (f) "owned by, or leased to," and
substituting "held by";
by omitting from paragraph (1) (f) "in this paragraph referred to as"
and substituting "in this subsection also called";
by omitting from subsection (1) all the words after "and Division" and
substituting the following words and paragraphs:
"14, of the expense payment fringe benefit in relation to the year of tax
shall be reduced by:
if neither paragraph (ea) nor paragraph (f) applies-the notional
deduction;
if paragraph (ea) applies-whichever of the following amounts is
applicable:
if it would be concluded that the amount of the providers
portion
would have been the same even if the recipients expenditure were not incurred
in producing assessable income of the recipient-the car deduction percentage,
ascertained under section 65G, of the amount that, but for this subsection and
Division 14, would be the taxable value of the expense payment fringe benefit
in relation to the year of tax;
if subparagraph (i) does not apply:
(A) in the case of an in-house expense payment fringe benefit-the
car deduction percentage, ascertained under section 65G, of the amount that,
but for this subsection and Division 14 and the recipients contribution, would
be the taxable value of the expense payment fringe benefit in relation to the
year of tax; or
(B) in the case of an external expense payment fringe benefit-the
car deduction percentage, ascertained under section 65G, of the recipients
expenditure;
where:
paragraph (f) applies; and
a declaration referred to in subparagraph (f) (i) has been
given
to the employer;
whichever of the following amounts is the least:
the notional deduction;
if it would be concluded that the amount of the providers
portion
would have been the same even if the recipients expenditure were not incurred
in producing assessable income of the recipient-331/3% of the amount that, but
for this subsection and Division 14, would be the taxable value of the expense
payment fringe benefit in relation to the year of tax;
if subparagraph (iv) does not apply:
(A) in the case of an in-house expense payment fringe
benefit-331/3%
of the amount that but for this subsection and Division 14 and the recipients
contribution, would be the taxable value of the expense payment fringe benefit
in relation to the year of tax; or
(B) in the case of an external expense payment fringe
benefit-331/3%
of the recipients expenditure;
where:
subparagraph (f) (ii) applies; and
a declaration referred to in subparagraph (f) (i) has not been
given to the employer;
whichever of the following amounts is applicable:
if it would be concluded the amount of the providers portion
would have been the same even if the recipients expenditure were not incurred
in producing assessable income of the recipient-331/3% of the amount that, but
for this subsection and Division 14, would be the taxable value of the expense
payment fringe benefit in relation to the year of tax;
if subparagraph (iii) does not apply:
(A) in the case of an in-house expense payment fringe
benefit-331/3%
of the amount that, but for this Subdivision and Division 14 and the
recipients contribution, would be the taxable value of the expense payment
fringe benefit in relation to the year of tax; or
(B) in the case of an external expense payment fringe
benefit-331/3%
of the recipients expenditure.";
by inserting after subsection (3) the following subsection:
"(3A) For the purposes of this section, where the Commissioner is
satisfied, having regard to the nature of the recipients expenditure in
respect of an expense payment fringe benefit, that it would be unreasonable to
expect the recipient to have obtained documentary evidence of the recipients
expenditure, the expense payment fringe benefit shall be deemed to be, and
always to have been, an undocumentable expense payment fringe benefit."; and
by adding at the end the following subsections:
"(6) For the purposes of the application of this section to an in-house
expense payment fringe benefit, a reference to the recipients contribution in
relation to the fringe benefit is a reference to the amount ascertained under
whichever of paragraphs 22A (1) (b) or (2) (b) is applicable.
"(7) Where:
apart from this subsection, paragraph (1) (ea) applies in relation
to
a fringe benefit in relation to an employer in respect of a car held by the
recipient during a period in a year of tax; and
whichever of the following amounts is the greater exceeds the
amount
that, apart from this subsection, would be ascertained under paragraph (1) (h)
as the amount (in this subsection called the 'reducing amount') by which the
taxable value, but for subsection (1) and Division 14, of the fringe benefit
is reduced under subsection (1):
in all cases-the amount that would have been ascertained under
paragraph (1) (j) as the reducing amount if:
(A) paragraph (1) (f) had applied in relation to the fringe
benefit;
and
(B) a declaration of the kind referred to in subparagraph (1) (f)
(i) had been given to the employer;
in a case where the average number of business kilometres per
week travelled by the car during the holding period exceeded 96-the amount
that would have been ascertained under paragraph (1) (k) as the reducing
amount if:
(A) subparagraph (1) (f) (ii) had applied in relation to that
fringe
benefit;
(B) a declaration of the kind referred to in subparagraph (1) (f)
(i) had not been given to the employer; and
(C) a declaration of the kind referred to in sub-subparagraph (1)
(f) (ii) (B) had been given to the employer;
this Act applies, and shall be deemed always to have applied, as if the
had been calculated as mentioned in whichever of
subparagraphs (b) (i) or (ii) of this subsection is applicable.
"(8) Nothing in section 74 prevents the amendment of an assessment for
the
purpose of giving effect to subsection (7).".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 18
Taxable value of non-remote housing fringe benefits
18. Section 26 of the Principal Act is amended:
by omitting from subsection (1) "The taxable" and substituting "Subject
to this Part, the taxable".
by inserting in subparagraph (1) (b) (iii) "identical or similar
caravans or mobile homes or in respect of" after "in respect of";
by inserting after paragraph (3) (a) the following paragraph:
"(aa) the employer elects that the current year of tax be treated as a
base year of tax in relation to the recipients overall housing right or an
equivalent housing right;"; and
by adding at the end the following subsection:
An election by an employer under paragraph (3) (aa) in relation to
a
year of tax:
shall be made by notice in writing to the Commissioner; and
shall be lodged with the Commissioner on or before the declaration
date in relation to the year of tax.".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 19
Indexation factor for valuation purposes-non-remote housing
19. Section 28 of the Principal Act is amended by omitting from subsection
(1) "this Subdivision" and substituting "section 26".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 20
Taxable value of remote area accommodation
20. Section 29 of the Principal Act is amended:
by omitting subsections (1), (2) and (3) and substituting the following
subsections:
"(1) Subject to this Part, the taxable value of a remote area housing
fringe benefit in relation to an employer in relation to a year of tax (in
this subsection called the 'current year of tax') is:
if the employer has made an election under subsection (2) in
relation
to the recipients unit of accommodation in relation to the current year of
tax-the amount calculated in accordance with the formula:
DTP
SA X---
DYT
where:
is:
if the recipients unit of accommodation is:
eligible shared accommodation in a house, flat or home unit
in
relation to the year of tax;
accommodation in a bunkhouse, dormitory or similar living
quarters; or
eligible accommodation in an employees hostel in relation to
the year of tax;
the single quarters statutory amount in relation to the year of
tax;
or
in any other case-the standard statutory amount in relation to
the year of tax;
DTP is the number of whole days in the tenancy period; and
DYT is:
in the case of the transitional year of tax-365; and
in any other case-the number of days in the current year of
tax;
reduced by the recipients rent;
where:
paragraph (a) does not apply; and
if the housing fringe benefit were not a remote area housing
fringe benefit, the taxable value of the fringe benefit would be calculated
under paragraph 26 (1) (b);
the amount that would be calculated under that paragraph if component
B
in the formula in that paragraph were 0.5; or
in any other case-the amount that would be calculated under
paragraph
26 (1) (c) if the amount represented by component A in the formula in that
paragraph were reduced by 50%.
"(2) An employer may elect that paragraph (1) (a) be applied in
determining the taxable values of all remote area housing fringe benefits in
relation to the employer in relation to a particular unit of accommodation in
relation to a year of tax.
"(3) An election by an employer under subsection (2) in relation to a
year
of tax:
shall be made by notice in writing to the Commissioner; and
shall be lodged with the Commissioner on or before the declaration
date in relation to the year of tax.
"(3A) For the purposes of this section:
the single quarters statutory amount in relation to a year of tax
(in
this paragraph called the 'current year of tax') is:
in the case of the transitional year of tax-$780; or
in the case of a standard year of tax-the amount calculated:
(A) by multiplying the single quarters statutory amount in
relation
to the immediately preceding year of tax by the indexation factor for the
current year of tax; or
(B) if the amount ascertained in accordance with sub-subparagraph
(A) is not a number of whole dollars-by increasing or decreasing the
amount to the nearest number of whole dollars or, if the amount is a number of
whole dollars plus 50 cents, by increasing the amount by 50 cents; and
the standard statutory amount in relation to a year of tax (in this
paragraph called the 'current year of tax') is:
in the case of the transitional year of tax-$3,120; or
in the case of a standard year of tax-the amount calculated:
(A) by multiplying the standard statutory amount in relation to
the
immediately preceding year of tax by the indexation factor for the current
year of tax; or
(B) if the amount ascertained in accordance with sub-subparagraph
(A) is not a number of whole dollars-by increasing or decreasing the
amount to the nearest number of whole dollars or, if the amount is a number of
whole dollars plus 50 cents, by increasing the amount by 50 cents."; and
by omitting subparagraph (4) (e) (i) and substituting the following
subparagraph:
a non-arm's length arrangement; or".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 21
21. After section 29 of the Principal Act the following section is inserted
in Division 6 of Part III:
Indexation factor for valuation purposes-remote area accommodation
"29A. (1) For the purposes of section 29, the indexation factor in respect
of a year of tax (in this subsection called the 'current year of tax') is the
number (calculated to 3 decimal places) ascertained, as at the date on which
the rent index number for Australia for the December quarter immediately
preceding the current year of tax was first published, by dividing the sum
of:
the rent index number for Australia in respect of the December quarter
immediately preceding the current year of tax; and
the rent index number for Australia in respect of the 3 quarters that
immediately preceded that quarter;
by the sum of:
the rent index number for Australia in respect of the December quarter
immediately preceding the year of tax that next preceded the current year of
tax; and
the rent index number for Australia in respect of the 3 quarters that
immediatley preceded the last-mentioned quarter.
"(2) Subject to subsection (3), if at any time, whether before or after the
commencement of this section, the Australian Statistician has published or
publishes a rent index number in respect of a quarter in substitution for a
rent index number previously published by the Australian Statistician in
respect of that quarter, the publication of the later rent index number shall
be disregarded for the purposes of this section.
If at any time, whether before or after the commencement of this
section, the Australian Statistician has changed or changes the reference base
for the rent sub-group of the Consumer Price Index, then, for the purposes of
the application of this section after the change took place or takes place,
regard shall be had only to the index numbers published in terms of the new
reference base.
"(4) Where the factor ascertained in accordance with subsection (1) in
relation to a year of tax would, if it were calculated to 4 decimal places,
end with a number greater than 4, the factor ascertained in accordance with
that subsection in relation to that year of tax shall be taken to be the
factor calculated to 3 decimal places in accordance with that subsection and
increased by 0.001.".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 22
Living-away-from-home allowance benefits
22. Section 30 of the Principal Act is amended by omitting from paragraph
(b) "his or her employment" and substituting "that employment".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 23
Taxable value of living-away-from-home allowance fringe benefits
23. Section 31 of the Principal Act is amended by omitting "The taxable" and
substituting "Subject to this Part, the taxable".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 24
Reduction of taxable value-''otherwise deductible'' rule
24. Section 34 of the Principal Act is amended:
by omitting paragraph (1) (b) and substituting the following
paragraphs:
if the recipient had, at the comparison time, incurred and paid
unreimbursed expenditure (in this subsection called the 'gross expenditure'),
in respect of the provision of the recipients transport, equal to the amount
that, but for this subsection and Division 14 and the recipients contribution,
would be the taxable value of the airline transport fringe benefit in relation
to the year of tax-a once-only deduction (in this subsection called the 'gross
deduction') would, or would but for section 82A, and Subdivision F of Division
3 of Part III, of the Income Tax Assessment Act 1936, have been allowable to
the recipient under that Act in respect of the gross expenditure;
the amount (in this subsection called the 'notional deduction')
calculated in accordance with the formula:
GD-RD
where:
GD is the gross deduction; and
RD is:
if there is no recipients contribution in relation to the
airline transport fringe benefit-nil; or
if there is a recipients contribution in relation to the
airline transport fringe benefit equal to, or calculated by reference to, an
amount of consideration paid by the recipient to the provider or to the
employer in respect of the provision of the recipients transport-the amount
(if any) that would, or that would but for section 82A, and Subdivision F of
Division 3 of Part III, of the Income Tax Assessment Act 1936, have been
allowable as a once-only deduction to the recipient under that Act in respect
of that consideration if that consideration had been incurred and paid by the
recipient at the comparison time;
exceeds nil; ";
by omitting from subsection (1) "Division 13" and substituting
"Division 14"; and
by omitting from subsection (1) "deductible percentage" (last
occurring) and substituting "notional deduction".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 25
Reduction of taxable value-''otherwise deductible'' rule
25. Section 37 of the Principal Act is amended:
by omitting from paragraph (a) "and";
by omitting paragraph (b) and substituting the following paragraphs:
if the recipient had, at the time when the benefit was provided,
incurred and paid unreimbursed expenditure (in this section called the 'gross
expenditure'), in respect of the provision of the recipients meal, equal to
the amount that, but for this subsection and Division 14 and the recipients
contribution, would be the taxable value of the board fringe benefit in
relation to the year of tax-a deduction (in this subsection called the 'gross
deduction') would, or would but for section 82A, and Subdivision F of Division
3 of Part III, of the Income Tax Assessment Act 1936, have been allowable to
the recipient under section 51 of that Act in respect of the whole or a part
of the gross expenditure; and
the amount (in this section called the 'notional deduction')
calculated in accordance with the formula:
GD-RD
where:
GD is the gross deduction; and
RD is:
if there is no recipients contribution in relation to the
board fringe benefit-nil; or
if there is a recipients contribution in relation to the
board
fringe benefit equal to, or calculated by reference to, an amount of
consideration paid by the recipient to the provider or to the employer in
respect of the provision of the recipients meal-the amount (if any) that
would, or that would but for section 82A, and Subdivision F of Division 3 of
Part III, of the Income Tax Assessment Act 1936, have been allowable to the
recipient under section 51 of that Act in respect of the whole or a part of
that consideration if that consideration had been incurred and paid by the
recipient at the time when the benefit was provided;
exceeds nil;";
by omitting "but for this section" and substituting "but for this
section and Division 14"; and
by omitting "deductible percentage" (last occurring) and substituting
"notional deduction".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 26
Taxable value of tax-exempt body entertainment fringe benefits
26. Section 39 of the Principal Act is amended by omitting "The taxable" and
substituting "Subject to this Part, the taxable".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 27
Reduction of taxable value-''otherwise deductible'' rule
27. Section 44 of the Principal Act is amended:
by omitting paragraph (1) (b) and substituting the following
paragraphs:
if the recipient had, at the provision time, incurred and paid
unreimbursed expenditure (in this subsection called the 'gross expenditure'),
in respect of the purchase of the recipients property, equal to the amount
that, but for this subsection and Division 14 and the recipients contribution,
would be the taxable value of the property fringe benefit in relation to the
year of tax-both of the following conditions would have been satisfied:
a once-only deduction (in this subsection called the 'gross
deduction') would, or would but for section 82A, and Subdivisions F and G of
Division 3 of Part III, of the Income Tax Assessment Act 1936, have been
allowable to the recipient under that Act in respect of the gross
expenditure;
in the case of the transitional year of tax-the gross deduction
would not be an eligible rental property deduction within the meaning of
Subdivision G of Division 3 of Part III of that Act;
the amount (in this subsection called the 'notional deduction')
calculated in accordance with the formula:
GD-RD
where:
GD is the gross deduction; and
RD is:
if there is no recipients contribution in relation to the
property fringe benefit-nil; or
if there is a recipients contribution in relation to the
property fringe benefit equal to, or calculated by reference to, an amount of
consideration paid by the recipient to the provider or to the employer in
respect of the provision of the recipients property-the amount (if any) that
would, or that would but for section 82A, and Subdivisions F and G of Division
3 of Part III, of the Income Tax Assessment Act 1936, have been allowable:
(A) as a once-only deduction; and
(B) in the case of the transitional year of tax-otherwise than
as
an eligible rental property deduction within the meaning of Subdivision G of
Division 3 of Part III of that Act;
to the recipient under that Act in respect of that consideration
if that consideration had been incurred and paid by the recipient at the
provision time;
exceeds nil;";
by omitting from paragraph (1) (d) "and";
by inserting after paragraph (1) (d) the following paragraph:
where:
the property fringe benefit is a car property benefit in
respect
of a car held by the recipient during a period (in this section called the
'holding period') in the year of tax; and
the substantiation rules set out in Division 15 have been
complied with in relation to the car in relation to the holding period;
the following conditions are satisfied:
the recipient gives to the employer, before the declaration
date, a car substantiation declaration for the car for the year of tax;
in a case where the substantiation rules require log books or
odometer records to be maintained by or on behalf of the recipient in relation
to the car-the car substantiation declaration is accompanied by a copy of
those documents; and";
by inserting in paragraph (1) (e) "paragraph (da) does not apply and"
after "where" (first occurring);
by omitting from paragraph (1) (e) "owned by, or leased to," and
substituting "held by";
by omitting from paragraph (1) (e) "referred to as" and substituting
"also called";
by omitting from subsection (1) "Division 13" (first occurring) and
substituting "Division 14";
by omitting from subsection (1) all the words after "the amount
calculated" and substituting the following words and paragraphs:
"in accordance with the formula:
TV-ND
where:
is the amount that, but for this subsection and Division 14,
would
be the taxable value of the property fringe benefit in relation to the year of
tax; and
is:
if neither paragraph (da) nor paragraph (e) applies-the
notional deduction;
where paragraph (da) applies-whichever of the following
amounts
is applicable:
if it would be concluded that the amount of the
recipients
contribution would have been the same even if the property fringe benefit were
not applied or used in producing assessable income of the recipient-the car
deduction percentage, ascertained under section 65G, of the amount that, but
for this subsection and Division 14, would be the taxable value of the
property fringe benefit in relation to the year of tax;
if subparagraph (i) does not apply-the car deduction
percentage, ascertained under section 65G, of the amount that, but for this
subsection and Division 14 and the recipients contribution, would be the
taxable value of the property fringe benefit in relation to the year of tax;
where:
paragraph (e) applies; and
a declaration referred to in subparagraph (e) (i) has
been
given to the employer;
whichever of the following amounts is the least:
the notional deduction;
if it would be concluded that the amount of the
recipients
contribution would have been the same even if the property fringe benefit were
not applied or used in producing assessable income of the recipient-331/3% of
the amount that, but for this subsection and Division 14, would be the taxable
value of the property fringe benefit in relation to the year of tax;
if subparagraph (iv) does not apply-331/3% of the amount
that, but for this subsection and Division 14 and the recipients contribution,
would be the taxable value of the property fringe benefit in relation to the
year of tax; or
where:
subparagraph (e) (ii) applies; and
a declaration referred to in subparagraph (e) (i) has not
been given to the employer;
whichever of the following amounts is applicable:
if it would be concluded that the amount of the
recipients
contribution would have been the same even if the property fringe benefit were
not applied or used in producing assessable income of the recipient-331/3% of
the amount that, but for this subsection and Division 14, would be the taxable
value of the property fringe benefit in relation to the year of tax;
if subparagraph (iii) does not apply-331/3% of the amount
that, but for this subsection and Division 14 and the recipients contribution,
would be the taxable value of the property fringe benefit in relation to the
year of tax."; and
by adding at the end the following subsections:
"(3) Where:
apart from this subsection, paragraph (1) (da) applies in relation
to
a fringe benefit in relation to an employer in respect of a car held by the
recipient during a period in a year of tax; and
whichever of the following amounts is the greater exceeds the
amount
that, apart from this subsection, would be ascertained under paragraph (1) (g)
as representing the component ND in the formula in subsection (1):
in all cases-the amount that would have been ascertained under
paragraph (1) (h) as representing that component if:
(A) paragraph (1) (e) had applied in relation to the fringe
benefit;
and
(B) a declaration of the kind referred to in subparagraph (1) (e)
(i) had been given to the employer;
in a case where the average number of business kilometres per
week travelled by the car during the holding period exceeded 96-the amount
that would have been ascertained under paragraph (1) (j) as representing that
component if:
(A) subparagraph (1) (e) (ii) had applied in relation to that
fringe
benefit;
(B) a declaration of the kind referred to in subparagraph (1) (e)
(i) had not been given to the employer; and
(C) a declaration of the kind referred to in sub-subparagraph (1)
(e) (ii) (B) had been given to the employer;
this Act applies, and shall be deemed always to have applied, as if the
amount represented by that component had been calculated as mentioned in
whichever of subparagraphs (b) (i) or (ii) of this subsection is applicable.
"(4) Nothing in section 74 prevents the amendment of an assessment for
the
purpose of giving effect to subsection (3).".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 28
Exempt residual benefits
28. Section 47 of the Principal Act is amended:
by omitting from sub-subparagraph (1) (a) (i) (B) "his or her" and
substituting "that";
by omitting from subsection (3) ", on a working day, of property that
is" and substituting "of property (other than a motor vehicle) that is
ordinarily";
by inserting after subsection (4) the following subsection:
"(4A) For the purposes of subsection (3), a building site, construction
site or any similar place where a person carries on business operations shall
be taken to be business premises of the person.";
by omitting from paragraph (5) (b) "his or her employment" and
substituting "that employment";
by omitting paragraphs (5) (c) and (d) and substituting the following
paragraphs:
the accommodation is not provided while the employee is
undertaking
travel in the course of performing the duties of that employment; and
either of the following conditions is satisfied:
subsection (7) applies in relation to the provision of
transport
for the employee in connection with travel in the period in the year of tax
when the lease or licence subsisted, being travel between the employee's usual
place of residence and the employee's usual place of employment;
the employee gives to the employer, before the declaration date,
a declaration, in a form approved by the Commissioner, purporting to set out:
(A) the employee's usual place of residence; and
(B) the place at which the employee actually resided while living
away from his or her usual place of residence;";
by omitting from paragraph (6) (a) "and";
by inserting after paragraph (6) (a) the following paragraph:
in the case of a standard year of tax-the motor vehicle is not:
a taxi let on hire to the provider; or
a car, not being:
(A) a panel van or utility truck; or
(B) any other road vehicle designed to carry a load of less than
1
tonne (other than a vehicle designed for the principal purpose of carrying
passengers); and";
by omitting paragraph (6) (b) and substituting the following
paragraph:
there was no private use of the motor vehicle during the year of
tax
and at a time when the benefit was provided other than:
(i) work-related travel of the employee; and
(ii) other private use of the motor vehicle by the employee or an
associate of the employee, being other use that was minor, infrequent and
irregular;"; and
by inserting after subsection (6) the following subsections:
"(6A) Where:
a residual benefit consisting of the provision or use of a motor
vehicle is provided by a particular person (in this subsection called the
'provider') in a year of tax in respect of the employment of a current
employee of an employer;
at all times during the year of tax when the motor vehicle was held
by the provider, the motor vehicle was unregistered; and
during the period in the year of tax when the motor vehicle was
held
by the provider, the motor vehicle was wholly or principally used directly in
subsection 10 (5) or section 11 or 12.
Registration of motor vehicle
"162N. For the purposes of this Act, a motor vehicle shall be taken to be
registered in a particular place if it may be driven on a public road in that
place without contravening the law in force in that place.".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 61
Application of amendments
61. (1) In this section, "amended Act" means the Principal Act as amended by
this Part.
(2) Subject to this section, 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.
(3) Section 115A of the amended Act applies in relation to returns furnished
after 29 October 1987.
(4) For the purposes of the application of subsection 17 (4) of the amended
Act to a loan benefit provided in respect of the transitional year of tax or
in respect of the first standard year of tax to an employee in respect of his
or her employment:
the period commencing on 1 April 1986 and ending on 30 June 1986 shall
be taken to be a period in the transitional year of tax;
the year commencing on 1 April 1985 shall be taken to be a year of tax;
and
if the benefit referred to in paragraph 17 (4) (d) of that Act was not
provided after 31 March 1986 to the employee in respect of that
employment-paragraph 21 (d) and 47 (5) (d) of that Act shall be disregarded in
determining whether the benefit is an exempt benefit by virtue of section 21
or subsection 47 (5) of that Act.
(5) An approval given by the Commissioner under paragraph 19 (1) (c) or 47
(5) (d) of the Principal Act before the commencement of this subsection has
effect, for the purposes of the amended Act, as if it had been given under
paragraph 19 (1) (c) or 47 (5) (d), as the case requires, of the amended Act.
(6) The first approval of a form given by the Commissioner after the
commencement of this subsection for the purposes of a provision of the amended
Act that was inserted in that Act by this Act (other than paragraph 19 (1) (c)
or 47 (5) (d)) has effect, for the purposes of the amended Act, as if it had
been given immediately before the commencement of the transitional year of
tax.
(7) Where:
a residual benefit consisting of the provision or use of a motor
vehicle is provided in the first standard year of tax in respect of the
employment of a current employee; and
if:
paragraph 47 (6) (aa) of the amended Act had not been enacted; and
the first standard year of tax had ended on 29 October 1987;
the benefit would have been an exempt benefit in relation to the year of
tax;
subsection 47 (6) of the amended Act applies to each residual benefit
consisting of the provision or use of the motor vehicle provided in the first
standard year of tax in respect of the employment of the employee as if
paragraph 47 (6) (aa) had not been enacted.
(8) Where the date of lodgment of the return of the fringe benefits taxable
amount of an employer of the transitional year of tax is an earlier day than
the day (in this subsection called the "post-commencement day") that is the
twenty-eighth day after the date of commencement of this subsection, the
definition of "declaration date" in subsection 136 (1) of the amended Act,
insofar as that definition applies for the purposes of a provision of the
amended Act that was inserted in that Act by this Act, has effect, in relation
to the employer in relation to the transitional year of tax, as if the
reference in that definition to the date of lodgment of that return were a
reference to the post-commencement day.
(9) For the purposes of the amended Act, where:
one or more car fringe benefits in relation to an employer in relation
to the transitional year of tax or the first standard year of tax relate to a
car while it was held by a particular person (in this subsection called the
"provider") during a particular period (in this subsection called the "holding
period") in the year of tax;
apart from this subsection, odometer records in relation to the car
were not maintained by or on behalf of the provider for:
if the year of tax is a log book year of tax of the employer in
relation to the car-the applicable log book period referred to in subparagraph
10A (b) (i); or
in any other case-the holding period; and
before the date of lodgment of the employer's return for the year of
tax, or within such further time as the Commissioner allows, the employer sets
out in a document, in the English language:
reasonable estimates of the odometer readings of:
(A) the car; and
(B) if paragraph 162K (2) (b) of that Act applies-both the
replacement
car and the original car referred to in that paragraph;
as at the dates or times referred to in the definition of "odometer
records" in subsection 136 (1) of that Act; and
a declaration signed by or on behalf of the employer that, to the
best of his or her knowledge and belief, the estimates are reasonable;
the following provisions have effect:
the document shall be deemed to be and to have been, at all times after
the commencement of the holding period:
if the provider is the employer-odometer records maintained by or
on
behalf of the provider in relation to the car for the period mentioned in
paragraph (b); or
in any other case-odometer records maintained by or on behalf of
the
provider in relation to the car for the period referred to in paragraph (b)
and given to the employer before the declaration date;
the retention period in relation to the document shall be deemed to
commence when the declaration is signed.
(10) For the purposes of the amended Act, where:
a car is held by the recipient of a loan fringe benefit, expense
payment fringe benefit, property fringe benefit or residual fringe benefit in
relation to an employer during a particular period (in this subsection called
the "holding period") in the transitional year of tax or the first standard
year of tax;
apart from this subsection, odometer records in relation to the car
were not maintained by or on behalf of the recipient for:
if the year of tax is a log book year of tax of the recipient in
relation to the car-the applicable log book period referred to in subparagraph
65E (b) (i); or
in any other case-the holding period; and
before the date of lodgment of the employer's return for the year of
tax, or within such further time as the Commissioner allows, the employer sets
out in a document, in the English language:
reasonable estimates of the odometer readings of:
(A) the car; and
(B) if paragraph 162L (2) (b) of that Act applies-both the
replacement
car and the original car referred to in that paragraph;
as at the dates or times referred to in the definition of "odometer
records" in subsection 136 (1) of that Act; and
a declaration signed by or on behalf of the employer that, to the
best of his or her knowledge and belief, the estimates are reasonable;
the following provisions have effect:
the document shall be deemed to be and to have been, at all times after
the commencement of the holding period, odometer records maintained by or on
behalf of the recipient in relation to the car for the period mentioned in
paragraph (b) and given to the employer before the declaration date;
the retention period in relation to the document shall be deemed to
commence when the declaration is signed.
(11) For the purposes of the application of section 19, 24, 44 or 52 of the
amended Act in relation to a loan fringe benefit, an expense payment fringe
benefit, a property fringe benefit or a residual fringe benefit, as the case
requires, in relation to an employer in relation to a particular car held by
the recipient of the fringe benefit during a particular period (in this
subsection called the "holding period") in a year of tax, where:
on or before 29 October 1987, the recipient gave to the employer a
declaration in a form approved by the Commissioner for the purposes of
paragraph 19 (1) (d), 24 (1) (f), 44 (1) (e) or 52 (1) (e) of the Principal
Act, as the case may be, being a declaration relating to the car in respect of
a particular period (in this subsection called the "declaration period") that
ended on or before 29 October 1987; and
the declaration period is the same as, or includes, the holding period;
the declaration shall be treated as if it were a car substantiation
declaration in relation to the car in relation to the holding period.
(12) An amendment made by section 13, paragraph 18 (b), section 22,
paragraph 28 (a), (d) or (e), section 32, paragraph 35 (d), 36 (d) or 48 (e),
(k), (m), (n) or (p) or section 56 does not apply, in relation to the
transitional year of tax or the first standard year of tax, to a benefit
provided, or commenced to be provided, on or before 29 October 1987 if the
application of the amendment would increase the liability of an employer to
fringe benefits tax in respect of that benefit.
(13) Where:
the application of a provision of the amended Act depends on a
condition requiring that documentary evidence of an expense be obtained and
given to an employer; and
the application of that provision is dependent on that condition
because of the amendments made by this Part;
that provision applies as if the condition were satisfied in all cases where
the benefit concerned was provided on or before 29 October 1987.
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 62
Amendment of assessments
62. Nothing in section 74 of the Principal Act prevents the amendment of an
assessment made before the commencement of this section for the purpose of
giving effect to the amendments made by this Act.
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 63
Principal Act
63. 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 and 168,
1985; No. 173, 1985 (as amended by No. 49, 1986); Nos. 41, 46, 48, 49, 51, 52,
90, 109, 112 and 154, 1986; and Nos. 23, 58, 61 and 62, 1987.
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 64
Deductions not allowable for entertainment expenses
64. Section 51AE of the Principal Act is amended:
by inserting in paragraph (5A) (b) ", 58, 58N, 58S or 58T" after "54";
by omitting from paragraph (5A) (b) "or" (last occurring);
by adding at the end of subsection (5A) the following paragraphs:
the provision of a meal where the provision of the meal would, but
for section 58A, 58F, 58L or 58M of the Fringe Benefits Tax Assessment Act
1986, constitute a fringe benefit within the meaning of that Act;
the provision of a fringe benefit, within the meaning of the Fringe
Benefits Tax Assessment Act 1986, where section 61D or 65A of that Act applies
in relation to the fringe benefit;
the provision of a remote area holiday fringe benefit within the
meaning of the Fringe Benefits Tax Assessment Act 1986; or
the provision of a fringe benefit, within the meaning of the Fringe
Benefits Tax Assessment Act 1986, where the fringe benefit is in respect of
overseas employment holiday transport within the meaning of that Act."; and
by inserting after subsection (5B) the following subsection:
"(5C) Section 58P of the Fringe Benefits Tax Assessment Act 1986 shall
be
disregarded in applying paragraphs (5A) (a), (b), (c) and (d).".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 65
Deductions not allowable where expenses incurred by employee are reimbursed
65. Section 51AH of the Principal Act is amended by omitting from subsection
(1) all the words after "outgoing" (last occurring) and substituting the
following words and paragraphs:
"shall be:
if it would be concluded that the amount of the payment or
reimbursement would have been the same even if the loss or outgoing were not
incurred in producing assessable income of the taxpayer-calculated as if the
loss or outgoing were reduced by the amount of the payment or reimbursement;
or
in any other case-reduced by the amount of the payment or
reimbursement.".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 66
66. After section 51AH of the Principal Act the following section is
inserted:
Deductions not allowable for private component of contributions for fringe
benefits etc.
"51AJ. (1) Where:
any of the following benefits is provided in respect of the employment
of an employee of an employer:
an airline transport benefit;
a board benefit;
a loan benefit;
a property benefit;
a residual benefit;
the benefit is:
a fringe benefit; or
a benefit that, but for paragraph (g) of the definition of 'fringe
benefit' in subsection 136 (1) of the Fringe Benefits Tax Assessment Act 1986,
would be a fringe benefit;
in the case of a loan benefit-the taxpayer, being the recipient or the
employee, incurs interest (in this section called the 'recipients interest')
in respect of the loan;
in the case of a benefit other than a loan benefit-the taxpayer, being
the recipient or the employee, incurs consideration (in this section called
the 'recipients contribution') to the provider or to the employer in respect
of the provision of the recipients transport, the recipients meal, the
recipients property or the recipients benefit, as the case may be;
it would be concluded that, in calculating the amount of the recipients
interest, or the amount of the recipients contribution, as the case may be,
the provider or the employer made an allowance for a particular level of
application or use of the benefit in producing assessable income of the
taxpayer; and
it would be concluded that the amount of the recipients interest, or
the amount of the recipients contribution, as the case may be, would have been
greater if it had been calculated without making that allowance;
the following provisions have effect:
if the extent of the application or use of the benefit concerned in
producing assessable income of the taxpayer is equal to, or less than, that
level-a deduction is not allowable to the taxpayer under this Act in respect
of the recipients interest or the recipients contribution;
if the extent of the application or use of the benefit concerned in
producing assessable income of the taxpayer exceeds that level-the amount of
the deduction that, but for this section, has been allowed or would be
allowable to the taxpayer under this Act in respect of the recipients interest
or the recipients contribution shall not exceed the amount calculated in
accordance with the formula:
D - A
where:
is the amount of the deduction that, but for this section, would
have
been allowable to the taxpayer under this Act in respect of the amount of the
recipients interest or the amount of the recipients contribution if it had
been calculated without making that allowance; and
is the amount of that allowance.
"(2) Expressions (other than 'recipients contribution') used in this section
and in the Fringe Benefits Tax Assessment Act 1986 have the same respective
meanings in this section as they have in that Act.".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 67
Interpretation
67. Section 82KT of the Principal Act is amended:
by omitting "or" (last occurring) from paragraph (a) of the definition
of "eligible expense" in subsection (1);
by adding at the end of the definition of "eligible expense" in
subsection (1) the following word and paragraph:
(c) in relation to an eligible transport payment-a transport
expense
to the extent that it is related to the eligible transport payment, being an
expense that was incurred by a taxpayer to whom the eligible transport payment
was paid or is payable;";
by inserting in subsection (1) the following definitions in their
respective appropriate alphabetical positions (determined on a
letter-by-letter basis):
" 'car expense reimbursement payment' means a payment by way of a
reimbursement to which paragraph 26 (eaa) applies, being a reimbursement
that:
is in respect of the whole or a part of a car expense; and
is paid by an employer to an employee in respect of travel by
the
employee in the course of performing duties as an employee of the employer;
'eligible transport payment' means a payment (in this definition
called
the 'current payment') in respect of which all of the following conditions are
satisfied:
the current payment is a transport allowance payment, or a car
expense reimbursement payment, paid in respect of particular travel (in this
definition called the 'current travel') of an employee;
the current payment was paid under an industrial instrument that
was in force on 29 October 1986;
the aggregate of:
the current payment; and
any other transport allowance payments or car expense
reimbursement payments, as the case may be, payable under the industrial
instrument in respect of the current travel;
does not exceed the total amount of transport allowance payments or
car expense reimbursement payments, as the case may be, that would have been
payable in respect of the current travel under the industrial instrument if no
alterations had been made to the industrial instrument after 29 October 1986;
if the aggregate of:
the current payment; and
any other transport allowance payments or car expense
reimbursement payments, as the case may be, payable under the industrial
instrument in respect of the current travel;
exceeds the total amount of transport allowance payments or car
expense reimbursement payments, as the case may be, that would have been
payable in respect of the current travel if the amounts had been determined at
the rates applicable on 29 October 1986-the whole of the excess is
attributable to increases determined solely by reference to matters contained
in the industrial instrument on 29 October 1986;
'substantiation sections' means sections 82KUA, 82KUB, 82KUC, 82KUD,
82KW
(other than subsection (3)), 82KZ and 82KZA;
'transport allowance payment' means:
a payment by way of an allowance paid or payable by an employer
to
an employee for the sole purpose of enabling the employee to incur transport
expenses in respect of travel in the course of performing duties as an
employee of the employer; or
so much of a payment by way of an allowance paid or payable by
an
employer to an employee for the principal purpose of enabling the employee to
incur such expenses as is paid or payable for that purpose;
but does not include any part of any payment by way of a travel
allowance;
'transport expense' means an outgoing incurred in connection with
transport and includes depreciation in respect of property used in connection
with transport, but does not include an outgoing in respect of accommodation,
in respect of the purchase of food or drink or in respect of expenditure
incidental to transport;";
by inserting after subsection (1) the following subsection:
"(1A) For the purposes of the definition of 'eligible transport payment'
in subsection (1):
where an industrial instrument (in this paragraph called the
'substituted instrument') has come into force in substitution for another
industrial instrument (in this paragraph called the 'original instrument'),
the substituted instrument shall be taken to be a continuation of the original
instrument;
alterations made to an industrial instrument after 29 October 1986
shall be taken to have been made on 29 October 1986 if:
the alterations were made pursuant to an application made on or
before 29 October 1986 that sought increases in transport allowance payments
or car expense reimbursement payments; and
if the application was amended after 29 October 1986-the
alterations made to the industrial instrument did not result in increases in
transport allowance payments or car expense reimbursement payments that were
greater than increases in those payments sought by the application as at 29
October 1986; and
where, as a result of alterations after 29 October 1986 to an
industrial instrument (not being alterations that are deemed by paragraph (b)
to have been made on 29 October 1986), an additional amount is paid to an
employee under the instrument as a transport allowance payment or car expense
reimbursement payment in respect of travel undertaken before the date on which
the alterations were made:
the additional amount is not an eligible transport payment; and
the question of whether any other transport allowance payment
or
car expense reimbursement payment in respect of that travel is an eligible
transport payment shall be determined as if the additional amount had not been
paid or payable in respect of the travel.";
by omitting from subsection (3) "or an employment-related expense" and
substituting ", an employment-related expense or a transport expense"; and
by inserting after subsection (5) the following subsection:
"(5A) A reference in this Subdivision to section 82KUD being applied
includes a reference to that section being applied by virtue of subparagraph
82KZBA (1) (e) (iii).".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 68
68. After section 82KT of the Principal Act the following section is
inserted:
Definition of ''eligible expense''-extent to which transport expenses relate
to
eligible transport payments
"82KTAA. For the purposes of the definition of 'eligible expense' in
subsection 82KT (1), where:
a taxpayer incurs a transport expense in a year of income; and
the transport expense relates partly to the travel to which a
particular eligible transport payment relates and partly to other travel;
the transport expense shall be taken to relate to the eligible transport
payment to the same extent to which it would, apart from this Subdivision,
have been allowable to the taxpayer as a deduction in respect of the year of
income if none of that other travel had been travel in the course of producing
assessable income of the taxpayer.".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 69
Log book year of income
69. Section 82KTG of the Principal Act is amended:
by omitting from paragraph (g) "or" (last occurring); and
by adding at the end the following word and paragraph:
(j) both of the following conditions are satisfied:
the whole or a part of at least one car expense incurred by
the taxpayer in the preceding year of income in relation to the deductible car
is an eligible expense in relation to which subsection 82KZBA (1) applies or
has applied;
section 82KUD was not applied for the purpose of determining
the amount of any deduction allowable under this Act in respect of car
expenses incurred by the taxpayer in relation to the deductible car in the
preceding year of income.".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 70
Deduction for car expenses where income-producing use does not exceed 5,000
kilometres-statutory formula
70. Section 82KX of the Principal Act is amended:
by inserting in paragraph (1) (b) "the whole or a part of" after "in
respect of"; and
by adding at the end of paragraph (1) (b) "unless the whole, or the
part, of the car expense is or was an eligible expense in relation to which
subsection 82KZBA (1) applies or has applied".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 71
Elections
71. Section 82KY of the Principal Act is amended by omitting from
subparagraph (2) (b) (i) "those car expenses" and substituting "car expenses
relating to the car incurred by the taxpayer in the year of income".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 72
Aggregate claims not exceeding a certain amount
72. Section 82KZB of the Principal Act is amended by omitting from
subsection (2) "sections 82KV" and substituting "sections 82KUA, 82KUB, 82KUC,
82KUD".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 73
73. After section 82KZB of the Principal Act the following sections are
inserted in Subdivision F of Division 3 of Part III:
No substantiation required for eligible expenses relating to eligible
transport
payments in certain circumstances
"82KZBA. (1) Where:
one or more eligible transport payments are paid to a taxpayer in a
year of income; and
the total of the eligible expenses in relation to the eligible
transport payment or payments incurred by the taxpayer during any year of
income and claimed by the taxpayer as deductions in respect of any year of
income does not exceed the amount of the eligible transport payment, or the
total of the amounts of the eligible transport payments, as the case may be;
then, unless the taxpayer elects that this section not apply in relation to
the eligible transport payment or eligible transport payments, the following
provisions have effect:
subject to subparagraph (e) (iii), the substantiation sections do not
apply, and shall be deemed never to have applied, in relation to the taxpayer
in relation to any of those eligible expenses;
those eligible expenses shall not be treated as relevant expenses for
the purposes of section 82KZB;
if those eligible expenses consist of, or include, car expenses, or
parts of car expenses, incurred in a year of income that relate to a car:
nothing in this section prevents the taxpayer making an election
that section 82KX apply in relation to the car in relation to the year of
income;
the taxpayer is not entitled to elect that subsection 82KW (2) or
(3) apply in relation to the car in relation to the year of income;
if:
(A) the taxpayer does not elect that section 82KX apply in relation
to
the car in relation to the year of income; and
(B) a part (in this paragraph called the 'eligible expense part') of
a
car expense incurred by the taxpayer in the year of income relating to the car
is one of those eligible expenses;
the amount of a deduction allowable under this Act to the taxpayer in
respect of the car expense is the sum of:
(C) if, apart from this paragraph, section 82KUD would be applied for
the purpose of determining the amount of a deduction allowable under this Act
in respect of so much of that car expense as is not an eligible expense-the
amount of the deduction that would have been calculated under section 82KUD if
that section had applied to the whole of the car expense; and
(D) the amount of the deduction that, apart from this Subdivision,
would have been allowable under this Act to the taxpayer in respect of the
eligible expense part of that car expense; and
for the purposes of this Subdivision (including section 82KUD as
applied by subparagraph (iii) of this paragraph), the number of kilometres
travelled by the car during the year of income in the course of travel to
which the eligible transport payment or eligible transport payments relate
shall not be counted as travel by the car in the course of producing
assessable income of the taxpayer.
"(2) Where:
a taxpayer has incurred a transport expense during a year of income;
and
at the time of making an assessment in respect of income of the person
of the year of income, the Commissioner is of the opinion that, at a later
time, circumstances will exist because of which subsection (1) will apply in
relation to the whole or a part of the transport expense;
the Commissioner may, in making the assessment, apply this Act as if those
circumstances existed at the time of making the assessment.
"(3) Where this Act has, because of subsection (2), been applied on the
basis that a circumstance that did not exist at the time of making the
assessment would exist at a later time and the Commissioner, after making the
assessment, becomes satisfied that the circumstance will not exist, then,
notwithstanding section 170, the Commissioner may amend the assessment at any
time for the purposes of ensuring that this Act shall be taken always to have
applied on the basis that that circumstance did not exist.
Relief from certain substantiation requirements where taxpayer had a
reasonable
expectation that substantiation would not be required
"82KZBB. (1) Where:
any of the following subparagraphs applies in relation to an expense
incurred by a taxpayer in a year of income:
documentary evidence of the expense was not obtained by, or on
behalf of, the taxpayer;
the taxpayer did not make, as mentioned in subsection 82KZ (2), an
entry in a travel diary in relation to the expense;
the taxpayer did not retain, for the retention period:
documentary evidence of the expense; or
a travel diary relating to the travel to which the expense
relates;
the failure to obtain or retain the documentary evidence, to make the
entry, or to retain the travel diary, occurred only because:
if the expense is a car expense-the taxpayer, at the time the
expense was incurred, had a reasonable expectation that he or she would be
entitled to claim a deduction under section 82KX in relation to the car to
which the expense relates in relation to the year of income;
if the expense is a relevant expense within the meaning of section
82KZB-the taxpayer, at the time the expense was incurred, had a reasonable
expectation that the total amount that would be allowable as deductions under
this Act in respect of relevant expenses, within the meaning of section 82KZB,
incurred by the taxpayer during the year of income would not exceed $300 or
such higher amount as is prescribed for the purposes of subsection 82KZB (2);
or
if the expense is a transport expense-the taxpayer, at the time
the
expense was incurred, had a reasonable expectation that subsection 82KZBA (1)
would apply in relation to the whole or a part of the expense;
all of the following conditions are satisfied:
a special circumstance occurred:
(A) after the expense was incurred; and
(B) during the year of income;
at the time the expense was incurred, the taxpayer did not know,
and
could not reasonably have been expected to have known, that the special
circumstance would occur;
it is reasonable to assume that, if the special circumstance had
not occurred:
(A) if subparagraph (b) (i) applies-the taxpayer would have been
entitled to claim a deduction under section 82KX as mentioned in that
subparagraph;
(B) if subparagraph (b) (ii) applies-the total amount that would be
allowable as deductions under this Act in respect of relevant expenses, within
the meaning of section 82KZB, incurred by the taxpayer during the year of
income would not have exceeded $300 or such higher amount as is prescribed for
the purposes of subsection 82KZB (2); or
(C) if subparagraph (b) (iii) applies-subsection 82KZBA (1) would
have
applied in relation to the whole or a part of the expense referred to in that
subparagraph;
if subparagraph (b) (i) applies-the taxpayer is not entitled to claim a
deduction under section 82KX in relation to the car to which the expense
relates in relation to the year of income; and
the Commissioner is satisfied that, because of the circumstances
referred to in paragraphs (b) and (c), it would be unreasonable to expect the
taxpayer:
to have obtained or retained documentary evidence in relation to
the
expense; or
to have made an entry in a travel diary in relation to the expense
or to have retained the travel diary relating to the travel to which the
expense relates;
as the case may be;
the following provisions have effect:
if the expense is a car expense-section 82KUA and paragraphs 82KW (2)
(b) and (ba) and 82KZA (1) (aa) and (a) and (3) (ba), (c) and (d) do not
apply, and shall be deemed never to have applied, in relation to the expense;
if the expense is an expense other than a car expense-section 82KZ and
paragraphs 82KZA (1) (a) and (c) and (3) (c), (d) and (f) do not apply, and
shall be deemed never to have applied, in relation to the expense.
"(2) For the purposes of this Subdivision, where:
odometer records maintained by or on behalf of a taxpayer in relation
to a car in relation to a period during a year of income would, apart from
this subsection, be incomplete because of a failure to enter particulars of
the odometer reading at the commencement of the period or, if the first use of
the car in the course of producing assessable income of the taxpayer occurred
during that period, at the commencement of that use;
the failure occurred only because:
the taxpayer, at the commencement of that period or use, had a
reasonable expectation that the taxpayer would be entitled to claim a
deduction under section 82KX in relation to the car in relation to the year of
income;
the taxpayer, at the commencement of that period or use, had a
reasonable expectation that the total amount that would be allowable as
deductions under this Act in respect of relevant expenses, within the meaning
of section 82KZB, incurred by the taxpayer during the year of income would not
exceed $300 or such higher amount as is prescribed for the purposes of
subsection 82KZB (2); or
the taxpayer, at the commencement of that period or use, had a
reasonable expectation that subsection 82KZBA (1) would apply in relation to
the whole or a part of all of the car expenses incurred, in gaining or
producing assessable income of the taxpayer, in relation to the car after the
commencement of that period or use and during the year of income;
all of the following conditions are satisfied:
a special circumstance occurred:
(A) after the commencement of that period or use; and
(B) during the year of income;
at the time the expense was incurred, the taxpayer did not know,
and
could not reasonably have been expected to have known, that the special
circumstance would occur;
it is reasonable to assume that, if the special circumstance had
not occurred:
(A) if subparagraph (b) (i) applies-the taxpayer would have been
entitled to claim a deduction under section 82KX as mentioned in that
subparagraph;
(B) if subparagraph (b) (ii) applies-the total amount that would be
allowable as deductions under this Act in respect of relevant expenses, within
the meaning of section 82KZB, incurred by the taxpayer during the year of
income would not have exceeded $300 or such higher amount as is prescribed for
the purposes of subsection 82KZB (2); or
(C) if subparagraph (b) (iii) applies-subsection 82KZBA (1) would
have
applied as mentioned in that subparagraph;
if subparagraph (b) (i) applies-the taxpayer is not entitled to claim a
deduction under section 82KX in relation to the car in relation to the year of
income;
the Commissioner is satisfied that, because of the circumstances
referred to in paragraphs (b) and (c), it would be unreasonable to expect the
taxpayer to have recorded the odometer reading at the commencement of that
period or use; and
before the date of lodgment of the taxpayer's return for the year of
income, or within such further time as the Commissioner allows, the taxpayer
sets out in the odometer records:
a reasonable estimate of the odometer reading; and
a declaration signed by the taxpayer that, to the best of his or
her
knowledge and belief, the estimate is reasonable;
the following provisions have effect:
the odometer records shall be deemed to be, and to have been, at all
times after the commencement of that period, complete odometer records
maintained by or on behalf of the taxpayer in relation to the car for that
period;
the retention period in relation to the odometer records shall be
deemed to commence at the time the first entry was made in the odometer
records.
"(3) In this section, a reference to the time a taxpayer incurred an
expense, being an expense constituted by depreciation in respect of property
is, notwithstanding subsection 82KT (3), a reference to the time when the
taxpayer acquired the property.".
TAXATION LAWS AMENDMENT (FRINGE BENEFITS AND SUBSTANTIATION) ACT 1987
No. 139 of 1987
- SECT 74
Application of amendments
74. (1) The amendments made by section 64 apply to assessments in respect of
income of the year of income in which 20 September 1985 occurred and of all
subsequent years of income.
(2) The amendments made by sections 65 and 66 apply to assessments in
respect of income of the year of income commencing on 1 July 1986 and of all
subsequent years of income.
(3) The amendments made by sections 67 to 73 (inclusive) apply in relation
to an expense incurred by a taxpayer in a year of income commencing on or
after 1 July 1986.
The
compilation comprises Act No. 139, 1987 amended as indicated in the Tables below.
Act | Number and year | Date of Assent | Date of commencement | Application, saving or transitional provisions |
139, 1987 | 18 Dec 1987 | 18 Dec 1987 | ||
11, 1988 | 26 Apr 1988 | S. 50: 18 Dec 1987 ( | — | |
78, 1988 | 24 June 1988 | S. 66: 18 Dec 1987 | — | |
75, 2010 | 28 June 2010 | Schedule 6 (item 101): 29 June 2010 | — |
| |
Provision affected | How affected |
S. 6........................................... | am. No. 78, 1988 |
S. 35......................................... | am. No. 11, 1988 |
S. 75......................................... | rep. No. 75, 2010 |
0
0
0