Income Tax (Companies and Superannuation Funds) Act 1980

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Income Tax (Companies and Superannuation Funds) Act 1980

No. 126 of 1980

 

An Act to impose a tax upon incomes of companies and superannuation funds

[Assented to 17 September 1980]

BE IT ENACTED by the Queen, and the Senate and the House of Representatives of the Commonwealth of Australia, as follows:

Short title

1. This Act may be cited as the Income Tax (Companies and Superannuation Funds) Act 1980.

Commencement

2. This Act shall come into operation on the day on which it receives the Royal Assent.

Interpretation

3. (1) In this Act, unless the contrary intention appears—

“Assessment Act” means the Income Tax Assessment Act 1936;

“friendly society dispensary” means a friendly society dispensary to which Division 9a of Part III of the Assessment Act applies;

“investment income” has the same meaning as in Division 9b of Part III of the Assessment Act;

“non-profit company” means—

(a) a company that is not carried on for the purposes of profit or gain to its individual members and is, by the terms of the company’s constituent document, prohibited from making any distribution, whether in money, property or otherwise, to its members; or

(b) a friendly society dispensary;

“superannuation fund” means a provident, benefit, superannuation or retirement fund;

“tax” means income tax referred to in sub-section 5(1).

(2) In this Act, a reference to investment income or taxable income shall be read as a reference to investment income or taxable income, as the case may be, of the year of income.


Incorporation

4. The Assessment Act is incorporated, and shall be read as one, with this Act.

Imposition of income tax

5. (1) Income tax is imposed in accordance with this Act and at the rates declared in this Act.

(2) This Act does not impose tax payable in accordance with section 128b, 128t, 128v or 136a of the Assessment Act.

(3) This Act does not impose tax payable by—

(a) a natural person (other than a person in the capacity of a trustee of a superannuation fund); or

(b) a company in the capacity of a trustee (other than a company in the capacity of a trustee of a superannuation fund).

(4) This Act does not impose tax upon the taxable income of a non-profit company where that taxable income does not exceed $416.

Rates of tax payable by companies

6. (1) The rates of tax payable by a company, other than a company in the capacity of a trustee, are as set out in the following provisions of this section.

(2) The rate of tax in respect of the taxable income of a company not being—

(a) a private company; or

(b) a non-profit company that is a friendly society dispensary,

is 46%.

(3) In the case of a company that is a private company, the rates of tax are—

(a) in respect of the taxable income—46%; and

(b) in respect of the undistributed amount in respect of which the company is liable under section 104 of the Assessment Act to pay additional tax—50%.

(4) The rate of tax in respect of the taxable income of a non-profit company that is a friendly society dispensary is 41%.

(5) Where the taxable income of a non-profit company other than a friendly society dispensary does not exceed $2,542, the amount of tax payable by the company shall not exceed 55% of the amount by which the taxable income exceeds $416 less any rebate or credit to which the company is entitled.

(6) Where the taxable income of a non-profit company that is a friendly society dispensary does not exceed $2,311, the amount of tax payable by the company shall not exceed 50% of the amount by which the taxable income exceeds $416 less any rebate or credit to which the company is entitled.

Rates of tax payable by trustees of superannuation funds

7. (1) The rate of tax payable by a trustee of a superannuation fund in respect of the taxable income of the fund in respect of which the trustee is liable, in pursuance of section 121ca or 121cb of the Assessment Act, to be assessed and to pay tax is 50%.

(2) The rate of tax payable by a trustee of a superannuation fund in respect of investment income of the fund in respect of which the trustee is liable, in pursuance of section 121d of the Assessment Act, to be assessed and to pay tax is 46%.

(3) The rate of tax payable by a trustee of a superannuation fund in respect of the taxable income of the fund in respect of which the trustee is liable, in pursuance of section 121da of the Assessment Act, to be assessed and to pay tax is 60%.

Adjustment where amount payable does not exceed 49 cents

8. (1) This section applies for the purposes of the making of an assessment of tax under this Act in respect of the income of a taxpayer of a year of income where, upon the making of the assessment and the serving of notice of the assessment upon the taxpayer, there would, but for this section, be a net amount of not more than 49 cents payable by the Commissioner to the taxpayer, or by the taxpayer to the Commissioner, under the law relating to income tax, after taking into account all liabilities of the taxpayer, and all rebates and credits allowable to the taxpayer, under that law.

(2) Where this section applies in relation to the making of an assessment—

(a) if the amount of not more than 49 cents would be an amount payable to the taxpayer—additional tax equal to that amount is imposed by this Act in respect of the income of the taxpayer of the year of income; and

(b) if the amount of not more than 49 cents would be an amount payable to the Commissioner—the amount that, but for this section, would be the amount of income tax imposed by this Act in respect of the income of the taxpayer of the year of income, before the allowance of any rebates to which the taxpayer is entitled, is reduced by so much of that amount of not more than 49 cents as does not exceed the amount calculated by deducting the amount of any such rebates from the amount that is to be so reduced.

(3) A reference in this section to a liability of the taxpayer shall be read as including a reference to a liability in respect of income tax notified to the taxpayer by the Commissioner, notwithstanding that the amount of the liability has not become due and payable.


(4) For the purposes of any calculation under the law relating to income tax that depends upon the amount of tax paid or payable by, or assessed in respect of the income of, a taxpayer, the tax assessed and payable under an assessment in relation to which this section applies shall be deemed to be the tax that would have been so assessed and payable if this section had not applied.

Levy of tax

9. (1) The tax imposed by this Act is levied, and shall be paid, for the financial year that commenced on 1 July 1980.

(2) Until the Parliament otherwise provides, the tax imposed by this Act is also levied, and shall be paid, for the financial year commencing on 1 July 1981.

Act to be deemed to be the Act declaring rates of income tax

10. For the purposes of sub-section 104(1) of the Assessment Act, this Act shall be deemed to be the Act declaring the rates of income tax payable for the financial year that commenced on 1 July 1980.

Instalments of tax

11. Instalments of tax are payable by a company, in accordance with the provisions of Division 1a of Part VI of the Assessment Act, in respect of the year of income that commenced on 1 July 1980.

Overview

The Income Tax (Companies and Superannuation Funds) Act 1980 was enacted by the Queen, the Senate, and the House of Representatives of the Commonwealth of Australia to impose income tax on companies and superannuation funds. This legislation aims to ensure that corporate entities and superannuation funds contribute to the national revenue through a structured taxation system. The Act specifies the rates of tax applicable to different types of companies and superannuation funds, ensuring that the tax imposed is equitable and consistent with the broader income tax framework. The Income Tax Assessment Act 1936 is incorporated into this Act, which means that the provisions of both Acts are to be read together. The Act also establishes that the income tax imposed by this Act applies to the financial year commencing on 1 July 1980 and mandates that instalments of tax are to be paid in accordance with the provisions of the Income Tax Assessment Act 1936.

Scope and Application

The Income Tax (Companies and Superannuation Funds) Act 1980 applies to the imposition of income tax on companies and superannuation funds in Australia. Specifically, the Act imposes income tax on companies, excluding natural persons and companies in the capacity of a trustee unless they are trustees of a superannuation fund. The Act also imposes income tax on superannuation funds and their trustees, with specific rates applicable to different categories of companies and funds. The Act’s application is limited to the financial year commencing on 1 July 1980 and the financial year commencing on 1 July 1981, unless otherwise specified by Parliament. Non-profit companies with taxable incomes not exceeding $416 are exempt from the tax. Additionally, the Act incorporates the Income Tax Assessment Act 1936, and it includes provisions for the adjustment of tax amounts that are not more than 49 cents. The Act’s application may be extended or restricted through subordinate instruments, such as regulations or amendments to the Act itself.

Key Provisions

The Income Tax (Companies and Superannuation Funds) Act 1980 (sections 5 and 6) imposes income tax on companies and superannuation funds at specified rates. The tax is not applicable to natural persons or companies in the capacity of a trustee of a superannuation fund. For companies that are not private companies and not non-profit companies functioning as friendly society dispensaries, the tax rate is set at 46%. Private companies are taxed at 46% on their taxable income and 50% on undistributed amounts. Non-profit companies that are friendly society dispensaries are taxed at 41%, while other non-profit companies face a rate that does not exceed 55% of taxable income over $416, less any applicable rebates or credits. Trustees of superannuation funds face tax rates of 50% on taxable income, 46% on investment income, and 60% on certain other income. The Act (sections 10 and 11) imposes obligations on companies and superannuation fund trustees to comply with the tax rates specified and to make instalment payments in accordance with the Income Tax Assessment Act 1936. Companies must ensure their tax is paid for the financial year starting on 1 July 1980 and, until otherwise directed by Parliament, for the subsequent financial year. Trustees of superannuation funds must also comply with the instalment payment provisions outlined in the Assessment Act. These obligations necessitate accurate calculation and timely payment of tax to avoid penalties. Breaching the provisions of this Act can result in significant penalties. While the specific penalties are not detailed in the Act, under the Income Tax Assessment Act 1936, penalties for non-compliance can include fines and, in severe cases, imprisonment. Companies and trustees who fail to meet their obligations may face additional scrutiny, audits, and interest on unpaid taxes, compounding the financial consequences of non-compliance. It is crucial for entities governed by this Act to adhere strictly to the stipulated tax rates and payment schedules to avoid these potential penalties.

Legal classification tags

Area of Law
Taxation Law
Instrument
Act
Concepts
Definitions & Interpretation
Commencement Provisions
Imposition of income tax
Rates of tax payable by companies
Rates of tax payable by trustees of superannuation funds
Adjustment where amount payable does not exceed 49 cents

Interactions

Authorises

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.