New Business Tax System (Venture Capital Deficit Tax) Act 2003

Administered by Department of the Treasury

Legislation au C2004A01123 In force Act

Legislation content

New Business Tax System (Venture Capital Deficit Tax) Act 2003

No. 17, 2003 as amended

Compilation start date:  28 June 2013

Includes amendments up to: Act No. 88, 2013

 

About this compilation

The compiled Act

This is a compilation of the New Business Tax System (Venture Capital Deficit Tax) Act 2003 as amended and in force on 28 June 2013. It includes any amendment affecting the compiled Act to that date.

This compilation was prepared on 19 August 2013.

The notes at the end of this compilation (the endnotes) include information about amending Acts and instruments and the amendment history of each amended provision.

Uncommenced provisions and amendments

If a provision of the compiled Act is affected by an uncommenced amendment, the text of the uncommenced amendment is set out in the endnotes.

Application, saving and transitional provisions for amendments

If the operation of an amendment is affected by an application, saving or transitional provision, the provision is identified in the endnotes.

Modifications

If a provision of the compiled Act is affected by a textual modification that is in force, the text of the modifying provision is set out in the endnotes.

Provisions ceasing to have effect

If a provision of the compiled Act has expired or otherwise ceased to have effect in accordance with a provision of the Act, details of the provision are set out in the endnotes.

 

 

 

Contents

1 Short title

2 Commencement

3 Definitions

4 Imposition of tax

5 Amount of tax

Endnotes

Endnote 1—Legislation history

Endnote 2—Amendment history

Endnote 3—Uncommenced amendments [none]

Endnote 4—Misdescribed amendments [none]

 

An Act to impose a tax in respect of venture capital sub‑account deficits of pooled development funds, and for related purposes

1  Short title

  This Act may be cited as the New Business Tax System (Venture Capital Deficit Tax) Act 2003.

2  Commencement

 (1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, on the day or at the time specified in column 2 of the table.

 

Commencement information

Column 1

Column 2

Column 3

Provision(s)

Commencement

Date/Details

1.  Sections 1 and 2 and anything in this Act not elsewhere covered by this table

The day on which this Act receives the Royal Assent

11 April 2003

2.  Sections 3 to 5

At the same time as Schedule 27 to the New Business Tax System (Consolidation and Other Measures) Act 2003

29 June 2002

Note: This table relates only to the provisions of this Act as originally passed by the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.

 (2) Column 3 of the table is for additional information that is not part of this Act. This information may be included in any published version of this Act.

3  Definitions

  In this Act:

entity has the same meaning as in the Income Tax Assessment Act 1997.

income year has the same meaning as in the Income Tax Assessment Act 1997.

PDF has the same meaning as in the Income Tax Assessment Act 1997.

venture capital deficit has the same meaning as in the Income Tax Assessment Act 1997.

venture capital deficit tax means venture capital deficit tax payable under section 210‑135 of the Income Tax Assessment Act 1997.

4  Imposition of tax

  Venture capital deficit tax is imposed.

5  Amount of tax

  The amount of venture capital deficit tax is equal to:

 (a) in a case where an entity is liable to pay venture capital deficit tax because the entity has a venture capital deficit at the end of an income year—the amount of the entity’s venture capital deficit at the end of the income year; and

 (b) in a case where an entity is liable to pay venture capital deficit tax because the entity has a venture capital deficit immediately before it ceases to be a PDF—the amount of the entity’s venture capital deficit immediately before it ceases to be a PDF.

Endnotes

 

Endnote 1—Legislation history

This endnote sets out details of the legislation history of the New Business Tax System (Venture Capital Deficit Tax) Act 2003.

 

Act

Number and year

Assent date

Commencement
date

Application, saving and transitional provisions

New Business Tax System (Venture Capital Deficit Tax) Act 2003

17, 2003

11 Apr 2003

ss. 3–5: 29 June 2002 (see s. 2(1))
Remainder: Royal Assent

 

Tax and Superannuation Laws Amendment (2013 Measures No. 1) Act 2013

88, 2013

28 June 2013

Schedule 7 (item 223): Royal Assent

—

 

Endnote 2—Amendment history

This endnote sets out the amendment history of the New Business Tax System (Venture Capital Deficit Tax) Act 2003.

 

ad. = added or inserted    am. = amended    rep. = repealed    rs. = repealed and substituted    exp. = expired or ceased to have effect

Provision affected

How affected

s. 2.....................

am. No. 88, 2013

 

Endnote 3—Uncommenced amendments [none]

There are no uncommenced amendments.

 

Endnote 4—Misdescribed amendments [none]

There are no misdescribed amendments.

 

Overview

The New Business Tax System (Venture Capital Deficit Tax) Act 2003, enacted by the Australian Parliament, was introduced to address a specific fiscal issue concerning venture capital deficits within pooled development funds. This Act imposes a tax on entities with venture capital deficits, ensuring that such deficits are accounted for within the broader tax system. The policy objective of this legislation is to provide a structured approach to managing and taxing venture capital deficits, thereby maintaining fiscal integrity and encouraging responsible financial practices within the venture capital sector. The Act came into effect on 11 April 2003, with certain sections commencing earlier on 29 June 2002, as outlined in the commencement provisions of the Act. The definitions and scope of the Act are aligned with those in the Income Tax Assessment Act 1997, ensuring consistency and coherence across related tax legislation.

Scope and Application

The New Business Tax System (Venture Capital Deficit Tax) Act 2003 applies to entities defined under the Income Tax Assessment Act 1997, specifically targeting those entities that are pooled development funds (PDFs) and have a venture capital deficit at the end of an income year or immediately before ceasing to be a PDF. The Act imposes a tax on these venture capital deficits, with the amount of the tax being equivalent to the deficit amount in either scenario. The Act operates on a Commonwealth level, as it is a federal statute, and is not restricted by state or territory boundaries. The tax is triggered when an entity has a venture capital deficit, and the application of the tax is determined by reference to the definitions and provisions of the Income Tax Assessment Act 1997. The Act includes specific commencement provisions, with certain sections coming into effect on the date of Royal Assent and others on 29 June 2002. The Act has been subject to amendments, such as those made by the Tax and Superannuation Laws Amendment (2013 Measures No. 1) Act 2013, but there are no uncommenced or misdescribed amendments noted in the compilation.

Key Provisions

The New Business Tax System (Venture Capital Deficit Tax) Act 2003 (sections 4 and 5) imposes a tax on entities that have a venture capital deficit at the end of an income year or immediately before they cease to be a Pooled Development Fund (PDF). The tax is known as venture capital deficit tax and its amount is calculated based on the entity's venture capital deficit (section 5(a) and (b)). Definitions in section 3 align with terms used in the Income Tax Assessment Act 1997, ensuring consistency across related tax legislation. Entities governed by this Act must determine their venture capital deficit at the relevant times and ensure they pay the applicable venture capital deficit tax. This includes maintaining accurate records and making appropriate tax payments in accordance with the requirements set out in the Act. The obligations extend to ensuring that the definitions of key terms are correctly applied in the context of the tax calculation and reporting. Breach of the obligations under this Act may result in civil or criminal consequences. For example, failure to report or pay venture capital deficit tax can lead to penalties. The specific penalties and enforcement actions are detailed in other relevant tax legislation, such as the Income Tax Assessment Act 1997, which may include fines or imprisonment depending on the severity of the breach.

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Taxation Law
Instrument
Act
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Definitions & Interpretation
Commencement Provisions
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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.