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Foreign income

Last updated 21 December 2020

22 Attributed foreign income

For more information on calculating the amounts shown at M and X, see the Foreign income return form guide 2020.

Where a return is required because the partnership had a period in the income year when it was not a member of a consolidated group or MEC group (a non-membership period), the partnership should complete an International dealings schedule where it has derived foreign income attributable to any non-membership period.

Did you have overseas branch operations or a direct or indirect interest in a foreign trust, foreign company, controlled foreign entity or transferor trust?

Overseas branch operations include:

  • business operations carried on by an Australian resident entity at or through a fixed place of business in another country
  • business operations carried on by a foreign resident entity at or through a fixed place of business in Australia.

Direct or indirect interests in a controlled foreign company or a foreign trust are taken to have the same meaning as set out in Division 3 of Part X of the ITAA 1936.

A partnership has an interest in a transferor trust if the partnership has ever made, or caused to be made, a transfer of property or services to a non-resident trust. Transfer of property and services is defined in section 102AAB of the ITAA 1936.

Sections 102AAJ and 102AAK of the ITAA 1936 provide guidance on whether there was a transfer, or a deemed transfer, of property or services to a non-resident trust.

Yes Print X in the Yes box at S and complete an International dealings schedule 2020.

No Print X in the No box at S.

For more information, see the International dealings schedule instructions 2020.

If you answered Yes and the partnership had foreign source business income and is a small business entity see Small business income tax offset.

Listed country

Show at M the amount of gross attributed foreign income from controlled foreign entities and transferor trusts of listed countries. Listed countries are set out in Regulation 19 of the Income Tax Assessment (1936 Act) Regulation 2015.

Attributed foreign income is the income attributed to the taxpayer from controlled foreign entities, calculated in accordance with Division 7 of Part X of the ITAA 1936, and includes an amount grossed-up under section 392 of the ITAA 1936, to the extent of any foreign taxes paid.

Show at M the amount of income attributed from a transferor trust that is a listed country trust estate, calculated in accordance with Subdivision D of Division 6AAA of the ITAA 1936.

A listed country trust estate is defined in section 102AAE of the ITAA 1936.

Unlisted country

Show at X the amount of attributed foreign income from controlled foreign entities in unlisted countries. Unlisted countries are countries that are not listed in Regulation 19 of the Income Tax Assessment (1936 Act) Regulation 2015.

Show at X the amount of income attributed from a transferor trust if the amount has not been shown at M.

Small business income tax offset

If the partnership is a small business entity and has attributed net business income, any individual partners may be entitled to the small business income tax offset.

Refer to the instructions for item 5 Business income and expenses and complete Worksheet 1A Net small business income.

The individual partners will need to know their share of net small business income from the partnership to work out their entitlement to the small business income tax offset.

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