Tax Laws Amendment (Interest on Non‑Resident Trust Distributions) (Temporary Budget Repair Levy) Act 2014
No. 47, 2014
An Act to amend the Income Tax Assessment Act 1936, and for related purposes
Contents
1 Short title
2 Commencement
3 Schedule(s)
Schedule 1—Temporary budget repair levy
Income Tax Assessment Act 1936
Tax Laws Amendment (Interest on Non-Resident Trust Distributions) (Temporary Budget Repair Levy) Act 2014
No. 47, 2014
An Act to amend the Income Tax Assessment Act 1936, and for related purposes
[Assented to 25 June 2014]
The Parliament of Australia enacts:
1 Short title
This Act may be cited as the Tax Laws Amendment (Interest on Non‑Resident Trust Distributions) (Temporary Budget Repair Levy) Act 2014.
2 Commencement
(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.
Commencement information |
Column 1 | Column 2 | Column 3 |
Provision(s) | Commencement | Date/Details |
1. Sections 1 to 3 and anything in this Act not elsewhere covered by this table | The day this Act receives the Royal Assent. | 25 June 2014 |
2. Schedule 1 | At the same time as Schedule 1 to the Tax Laws Amendment (Temporary Budget Repair Levy) Act 2014 commences. | 25 June 2014 |
Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.
(2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.
3 Schedule(s)
Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.
Schedule 1—Temporary budget repair levy
Income Tax Assessment Act 1936
1 After subsection 102AAM(10)
Insert:
(10A) Paragraph (10)(b) has effect as if the maximum rate specified as mentioned in that paragraph was increased by 2 percentage points for assessment years of income that correspond to the temporary budget repair levy years (within the meaning of section 4‑11 of the Income Tax (Transitional Provisions) Act 1997).
[Minister’s second reading speech made in—
House of Representatives on 14 May 2014
Senate on 16 June 2014]
Overview
The Tax Laws Amendment (Interest on Non-Resident Trust Distributions) (Temporary Budget Repair Levy) Act 2014 was enacted by the Parliament of Australia to amend the Income Tax Assessment Act 1936, and for related purposes. This legislation was introduced to address a gap in the taxation of non-resident trust distributions by imposing an additional temporary budget repair levy on such distributions. The Act received Royal Assent on 25 June 2014 and commenced on the same day, aligning with the commencement of Schedule 1 to the Tax Laws Amendment (Temporary Budget Repair Levy) Act 2014. The policy objective is to increase the maximum rate specified in the relevant provision of the Income Tax Assessment Act 1936 by 2 percentage points for assessment years corresponding to the temporary budget repair levy years.
Scope and Application
The Tax Laws Amendment (Interest on Non-Resident Trust Distributions) (Temporary Budget Repair Levy) Act 2014 is an Australian legislative measure that amends the Income Tax Assessment Act 1936 to introduce a temporary budget repair levy, specifically targeting the interest on non-resident trust distributions. This Act applies to non-resident beneficiaries receiving distributions from Australian trusts during the specified temporary budget repair levy years. The changes introduced by this Act are effective from the date of Royal Assent, which is 25 June 2014, as outlined in the commencement provisions. The amendments are designed to increase the maximum rate of tax on the interest portion of these distributions by 2 percentage points. The Act does not specify exclusions or exemptions within its primary text, though the detailed application of the levy may be subject to further clarification or modification through subordinate instruments or related legislation.
Key Provisions
The Tax Laws Amendment (Interest on Non-Resident Trust Distributions) (Temporary Budget Repair Levy) Act 2014 (sections 1-3) amends the Income Tax Assessment Act 1936 to increase the maximum rate of interest on non-resident trust distributions for specific assessment years. The Act specifies that this increase applies during the temporary budget repair levy years, as defined in section 4-11 of the Income Tax (Transitional Provisions) Act 1997. This adjustment is made by inserting a new subsection (10A) after subsection 102AAM(10) in the Income Tax Assessment Act 1936.
The Act imposes obligations on taxpayers and trustees who are subject to the provisions of the amended Income Tax Assessment Act 1936. Specifically, trustees of non-resident trusts must calculate and pay interest on distributions to non-resident beneficiaries at the increased rate during the specified assessment years. This requirement ensures compliance with the new legislative framework aimed at managing the temporary budget repair levy.
Breaching the obligations set out in the Act can result in penalties. Although the specific penalties are not detailed in the provided text, it is reasonable to assume that they would be consistent with the general penalties outlined in the Income Tax Assessment Act 1936. These penalties could include fines, interest on unpaid taxes, and potentially legal action for non-compliance. The maximum penalties for tax-related offences under the Income Tax Assessment Act 1936 can be significant, reflecting the seriousness with which tax evasion and non-compliance are treated under Australian law.