Income Tax (Partnerships and Trusts) Act 1968

Legislation au C1968A00073 Not in force Act

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Income Tax (Partnerships and Trusts)

No. 73 of 1968

An Act to impose a Tax upon certain Income derived from Partnerships and Trusts.

[Assented to 31 October 1968]

BE it enacted by the Queen’s Most Excellent Majesty, 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 (Partnerships and Trusts) Act 1968.

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—

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

“tax” means income tax referred to in section 5 of this Act;

“the Assessment Act” means the Income Tax Assessment Act 1936–1968.

(2.) A reference in this Act to net income or taxable income shall be read as a reference to net 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. Income tax is imposed in accordance with this Act, and at the rates declared in this Act, upon—

(a) the taxable income of a person in respect of which the person is liable, in pursuance of sub-section (9.) of section 94 of the Assessment Act, to pay further tax;

(b) the net income of a trust estate in respect of which the trustee is liable, in pursuance of sub-section (11.) or sub-section (12.) of section 94 of the Assessment Act, to pay further tax;

(c) the net income of a trust estate in respect of which the trustee is liable, in pursuance of section 99a of the Assessment Act, to be assessed and to pay tax; and

(d) the taxable income of a superannuation fund in respect of which the trustee of the fund is liable, in pursuance of section 121cb, section 121cb or section 121da of the Assessment Act, to be assessed and to pay tax.

Rates of tax.

6.—(1.) The rate of further tax payable by a person in pursuance of sub-section (9.) of section 94 of the Assessment Act is such amount, if any, per dollar as is ascertained by dividing an amount equal to one-half of the taxable income of the person, less the amount of income tax, if any, that, but for this Act and but for any rebate or credit to which the person is entitled, would be payable by the person, by a number equal to the number of whole dollars in that taxable income.

(2.) The rate of further tax payable by a trustee in pursuance of sub-section (11.) or sub-section (12.) of section 94 of the Assessment Act is such amount, if any, per dollar as is ascertained by dividing an amount equal to one-half of the net income of the trust estate in respect of which the trustee is liable to be assessed and to pay tax under section 98 or section 99 of that Act, less the amount of income tax, if any, that, but for this Act and but for any rebate or credit to which the trustee is entitled, would be payable by the trustee in respect of that net income, by a number equal to the number of whole dollars in that net income.


(3.) The rate of tax payable by a trustee in respect of the net income of the trust estate in respect of which the trustee is liable, in pursuance of section 99a of the Assessment Act, to be assessed and to pay tax is fifty per centum.

(4.) 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, section 121cb or section 121da of the Assessment Act, to be assessed and to pay tax is fifty per centum.

Further tax under section 94 of Assessment Act not payable by certain aged persons.

7.—(1.) This section applies to a taxpayer who—

(a) being a man, has attained the age of sixty-five years, or, being a woman, has attained the age of sixty years, on or before the last day of the year of income; and

(b) is a resident of Australia during the whole of the year of income, but does not apply to a taxpayer in the capacity of a trustee.

(2.) Where the taxable income of a taxpayer to whom this section applies does not exceed One thousand five hundred and thirty-two dollars, no further tax is payable by him in pursuance of sub-section (9.) of section 94 of the Assessment Act.

(3.) Where the taxable income of a taxpayer to whom this section applies does not exceed Three thousand five hundred and fourteen dollars and during the year of income the taxpayer contributes to the maintenance of his spouse, being a person who is a resident of Australia during the whole of the year of income, no further tax is payable by the taxpayer in pursuance of sub-section (9.) of section 94 of the Assessment Act.

(4.) In this section, “resident of Australia” includes a person who is a resident of the Territory of Papua and New Guinea, of Norfolk Island, of the Territory of Cocos (Keeling) Islands or of the Territory of Christmas Island.

Levy of tax.

8. The tax imposed by this Act is levied, and shall be paid, for the financial year that commenced on the first day of July, One thousand nine hundred and sixty-eight, and, until the Parliament otherwise provides, for the next succeeding financial year.

Overview

The Income Tax (Partnerships and Trusts) Act 1968 was enacted to address the need for a specific legislative framework governing the taxation of income derived from partnerships and trusts. This Act was assented to on 31 October 1968 by the Queen’s Most Excellent Majesty, the Senate, and the House of Representatives of the Commonwealth of Australia. Its primary objective was to impose income tax on certain income derived from partnerships and trusts, ensuring that these income streams were subject to appropriate taxation, thereby contributing to the national revenue. The Act incorporated the provisions of the Income Tax Assessment Act 1936–1968, thereby providing a comprehensive legislative structure for the taxation of income from these entities. This Act introduced a systematic approach to the taxation of partnerships and trusts, establishing clear rates and conditions under which income tax would be applied. The Act's policy objective was to ensure that income from partnerships and trusts was taxed in a manner consistent with other forms of income, thereby maintaining fairness and equity in the tax system. The imposition of tax on the net income of trusts and superannuation funds, along with specific provisions for further tax rates, reflects the intent to regulate and control income distribution within these entities, ensuring compliance with national tax laws.

Scope and Application

The Income Tax (Partnerships and Trusts) Act 1968 applies to the imposition of income tax on specific income derived from partnerships, trusts, and superannuation funds within the Commonwealth of Australia. It specifically targets individuals, trustees, and trustees of superannuation funds who are liable to pay further tax as per the Income Tax Assessment Act 1936–1968. The act applies to net income or taxable income of individuals over certain age thresholds, trust estates where trustees are liable to pay tax, and superannuation funds where trustees are liable to be assessed and to pay tax. The act does not apply to taxpayers in the capacity of a trustee concerning certain aged persons who meet specific residency and income criteria. The act extends its jurisdiction nationally across Australia and is incorporated with the Income Tax Assessment Act 1936–1968, thereby providing a cohesive legislative framework for tax imposition and collection.

Key Provisions

The Income Tax (Partnerships and Trusts) Act 1968 (hereafter referred to as the "Act") primarily imposes income tax on certain income derived from partnerships, trusts, and superannuation funds. According to section 5, income tax is levied on the taxable income of individuals, the net income of trust estates, and the taxable income of superannuation funds, as outlined in the Income Tax Assessment Act 1936–1968 (hereafter referred to as the "Assessment Act"). This imposition is executed at the rates specified within the Act, with particular rates designated for individuals, trustees, and superannuation funds, as delineated in section 6. Under the Act, the obligations and requirements are clear and precise. Individuals, trustees, and superannuation fund trustees must ensure they comply with the specified tax rates and obligations. For individuals, the Act mandates the payment of further tax based on the rates stipulated in section 6(1). Trustees of trust estates are obligated to pay further tax as per sections 6(2) and 6(3), while trustees of superannuation funds are required to pay tax at a flat rate of fifty percent, as per section 6(4). The Act also incorporates the Assessment Act, making the provisions of the latter integral to the former, as noted in section 4. The Act also delineates the consequences for non-compliance. While specific civil or criminal penalties are not explicitly stated within the provided excerpt, breaches of the tax obligations and requirements set forth in the Act could potentially result in financial penalties, interest, and possibly legal action as per the Assessment Act. The precise penalties and consequences would typically be determined by the relevant provisions of the Assessment Act and other applicable laws, including any subsequent amendments or related statutes.

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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.