House of Representatives
Tax Laws Amendment (2008 Measures No. 4) Bill 2008
Explanatory Memorandum
Circulated by the authority of the Treasurer, the Hon Wayne Swan MPChapter 3 - Minor amendments
Outline of chapter
3.1 Schedule 3 to this Bill makes various minor amendments to the taxation laws.
Context of amendments
3.2 Tax legislation is complex and wide-ranging. Therefore, errors can occur. Even minor errors can detract from the readability of the taxation laws and can confuse or mislead readers, so these errors need correcting.
3.3 These minor amendments are part of the Government's commitment to the care and maintenance of the taxation laws.
Summary of new law
3.4 These amendments deal with issues such as:
- •
- incorrect terminology;
- •
- grammatical or punctuation errors;
- •
- missing asterisks from defined terms;
- •
- inoperative material;
- •
- ambiguities in the law; and
- •
- adding non-operative notes to help readers navigate their way through law.
3.5 These amendments apply from the date of Royal Assent unless otherwise stated. Where a retrospective date is stated such retrospectivity does not disadvantage taxpayers.
Detailed explanation of new law
Table 3.1 : Amendments to the Fringe Benefits Tax Assessment Act 1986
| Provision being amended | What the amendment does |
| 135T(1)(a) and (h)
|
Fringe benefits tax applies to the state and territory bodies defined in subsection 135T(1). That definition relies on listed State and Territory Acts. Two of those Acts have been replaced by new Acts. The amendment replaces the existing references with references to the new Acts. [
Schedule 3, items 2 and 3, paragraphs 135T(1)(a) and (h)
]
These amendments apply to the first year of tax starting after Royal Assent. [ Schedule 3, item 4 ] |
Table 3.2: Amendments to the Income Tax Assessment Act 1936
| Provision being amended | What the amendment does |
| 6(2), 6(2AA) and 6(2A) | Repeals some inoperative subsections.
Subsections 6(2) and 6(2A) provide rules about 'years of income' that are already incorporated in the definition of 'income year' in the Income Tax Assessment Act 1997 (ITAA 1997) and are therefore redundant. [ Schedule 3, items 5 and 9, subsections 6(2) and 6(2A) ] Subsection 6(2AA) is amended as a consequence. [ Schedule 3, item 8, subsection 6(2AA) ] |
| 16(4AA) | Repeals the definition of 'research and development activities'. Subsection 16(4AA) defines the expression for the purposes of section 16, but section 16 no longer uses the expression. Therefore, the subsection is inoperative. [ Schedule 3, item 8, subsection 16(4AA) ] |
| 23E(3) | Replaces a reference to the Commonwealth Inscribed Stock Act 1911-1946 with one to the Commonwealth Inscribed Stock Act 1911 to conform to the modern way of citing Acts. [ Schedule 3, item 11, subsection 23E(3) ] |
| 23L(1A)
51AH(1)(c) |
Replaces references to section 15-75 with the correct reference to section 15-70.
Section 15-70 is a re-write of former paragraph 26(eaa) of the Income Tax Assessment Act 1936 (ITAA 1936). When references to paragraph 26(eaa) were replaced by references to the rewritten provision, a drafting error incorrectly referred to section 15-75 instead. [ Schedule 3, items 10 and 13, subsection 23L(1A) and paragraph 51AH(1)(c) ] The amendments apply retrospectively to when the error occurred. [ Schedule 3, items 11 and 14 ] |
| 47A(18)(d)(ii)(G) | Replaces an incorrect reference to 'ultimate beneficiary non-disclosure tax' with the correct reference to 'trustee beneficiary non-disclosure tax'. This reflects a change in terminology that was made with the 2007 amendments to the reporting requirements for trustees of closely held trusts. [ Schedule 3, item 12, sub-subparagraph 47A(18)(d)(ii)(G) ] |
| 73A(6) | Formalises the transfer of responsibility for approving an institution, association or organization to be an approved research institute from the Secretary to the Department of Health and Ageing, to the Chief Executive Officer of the National Health and Medical Research Council. [
Schedule 3, items 15 and 16, subsection 73A(6)
]
Gifts to an approved research institute are deductible (see item 3.1.1 in the table in subsection 30-40(1) of the ITAA 1997), so receiving approved research institute status is important to the many health and medical research institutes that raise funds from the private sector to support their research. Currently, the Secretary of the Department of Health and Ageing has statutory responsibility for approving universities, colleges, institutes, associations and organisations to be an approved research institute. In practice, that role was performed by the relevant Assistant Secretary when the National Health and Medical Research Council was part of that Department. When the Council became a separate statutory agency in 2006, it was appropriate for that role to be formally transferred to the Chief Executive Officer of the National Health and Medical Research Council but the necessary amendments were overlooked. The current amendments correct that oversight. The Secretary to the Department for Innovation, Industry, Science and Research also has responsibility for approving research institutes as a result of a substituted reference order made by the Governor-General on 30 May 2008. The current amendments align the text of the law with that legal position. [ Schedule 3, items 15 and 17, subsection 73A(6) ] The Commonwealth Scientific and Industrial Research Organisation is empowered to approve a body as an approved research institute under the law and that role continues. A transitional arrangement provides for the continuation of any approval of an approved research institute given before the amendments commence. [ Schedule 3, item 18 ] |
| 109Y(2) (paragraphs (a) and (b) of the definition of repayments of non-commercial loans ) | Fixes a punctuation error in the definition of 'repayments of non-commercial loans'. [ Schedule 3, item 20, subsection 109Y(2), paragraphs (a) and (b) of the definition of 'repayments of non-commercial loans' ] |
| 128B(3)(b)
202EE(1)(d) |
Repeals the redundant paragraph 128(3)(b). That paragraph deals with income that is exempt from income tax by virtue of subsection 23C(2), which was repealed in 2006. [
Schedule 3, item 23, paragraph 128B(3)(b)
]
A reference to 128B(3)(b) in paragraph 202EE(1)(d) is removed as a consequence. [ Schedule 3, item 36, paragraph 202EE(1)(d) ] |
| 159H(1)
159H(2) |
Repeals an inoperative provision that only applied to the 1975-76 income year, and renumbers subsection 159H(1) as a consequence. [ Schedule 3, items 27 and 28, subsections 159H(1) and (2) ] |
| 251U(1)(d)
251U(1A) 251U(1B) |
Rewrites the provisions that exclude residents of certain external territories from the Medicare levy.
The net effect of the current law is that only residents of Norfolk Island are excluded from the Medicare levy under paragraph 251U(1)(d). However, the provisions currently contain residual references to residents of Christmas Island and Cocos (Keeling) Islands, who became subject to the Medicare levy in 1985 and 1991 respectively. [ Schedule 3, items 37 and 38, paragraph 251U(1)(d), subsections 251U(1A) and 251U(1B) ] |
| 57-25(4)(la) of Schedule 2D | Removes a meaningless 'and' at the end of a list of provisions. [ Schedule 3, item 39, paragraph 57-25(4)(la) of Schedule 2D ] |
Table 3.3: Amendments to the Income Tax Assessment Act 1997
| Provision being amended | What the amendment does |
| 1-7 | Inserts a provision to make explicit that the Commissioner of Taxation (Commissioner) has the general administration of the ITAA 1997. Currently, it is not easy for readers to work out who has the general administration of that Act, as the power is contained in the ITAA 1936. [ Schedule 3, item 44, section 1-7 ] |
| 3-10(1)(b)
30-230(1) (note) 30-230(6) 58-65(3)(a) 61-405(a) 165-115A(1C)(a) 165-115E(4)(a) 165-115U(1D)(a) 165-235(2) 180-5(2) 180-10(7) 180-20(5) 210-115(2)(a) 292-100(2)(b)(i) 292-100 (7)(b)(i) 320-30(2)(a) 820-960(2)(a) 974-110(1A)(d)(i) and (ii) |
Corrects references to 'return', 'return of income' and 'tax return' so that they all refer to an 'income tax return', which is the term defined in the ITAA 1997. [
Schedule 3, items 45, 64, 65, 84, 119 to 122, 124, 136, 137, 158, 161, 162 and 189, subparagraphs 292-100(2)(b)(i) and (7)(b)(i) and 974-110(1A)(d)(i) and (ii), paragraphs 3-10(1)(b), 61-405(a), 210-115(2)(a), 320-30(2)(a) and 820-960(2)(a) and subsections 30-230(1) (note), 30-230(6), 165-235(2), 180-5(2), 180-10(7) and 180-20(5)
]
Asterisks marking the term as a defined term are added where necessary. [ Schedule 3, items 65, 119 to 122, 124, 136, 137, 158, 161 and 189, subparagraphs 292-100(2)(b)(i) and (7)(b)(i) and 974-110(1A)(d)(i), paragraphs 58-65(3)(a), 210-115(2)(a), 320-30(2)(a), 165-115A(1C)(a), 165-115E(4)(a), 165-115U(1D)(a) and 820-960(2)(a) and subsections 30-230(6), 165-235(2), 180-5(2), 180-10(7) and 180-20(5) ] |
| 4-10(1) | Replaces a definition of 'financial year' with an asterisked reference to the existing dictionary definition of that expression. This reduces the risk of confusing readers by defining the same expression several times. [ Schedule 3, item 46, subsection 4-10(1) ] |
| 9-1, items 12 and 13 in the table | Corrects the format of provisions referred to in the table. The table uses bolding to distinguish between provisions in the ITAA 1997 and provisions in the ITAA 1936. The provisions being corrected are in the ITAA 1936 but are not bolded. [ Schedule 3, items 47 and 48, section 9-1 (items 12 and 13 in the table) ] |
| ITAA 1997
11-15 ( family assistance and social security or like payments ) 13-1 ( farm household support and social security and other benefit payments ) 11-15 ( welfare ) 51-30 (items 3.2 and 3.3 in the table) 52-10 (items 7.1 and 7.2 in the table) 52-15 (item 1 in the table) 52-25(1) (in the table) 52-40 (item 7 in the table) 52-65(1)(b) and (ba) 52-65(1) (note) 52-65(1B) and (1C) 52-75 (table items 1A and 1B) 52-150(1) 53-10 (item 4A in the table) 53-15(1) and (2) 53-25 995-1(1) ('supplementary amount', item 2 in the table) ITAA 1936 159J(6) (paragraphs (ac), (adaa), (adab), (adac), (adad) and (ae) of 'separate net income') 160AAA(1) (paragraph (db) of 'rebatable benefit') |
Removes inoperative references to Government payments that are no longer paid, or that will stop being paid before the amendment is made. [ Schedule 3, items 29 to 35, 49, 50, 53 to 55, 59 to 61, 70 to 83 and 173, paragraphs 52-65(1)(b) and (ba), subsections 52-25(1) (table), 52-65(1) (note), 52-65(1B) and (1C), 52-150(1), 53-15(1) and (2) and 995-1(1) ('supplementary amount', item 2 in the table) and sections 11-15 ('family assistance', 'social security or like payments' and 'welfare'), 13-1 ('farm household support' and 'social security and other benefit payments'), 51-30 (items 5.2 and 5.3 in the table), 52-10 (items 7.1 and 7.2 in the table), 52-15 (item 1 in the table), 52-40 (item 7 in the table), 52-75 (items 1A and 1B in the table), 53-10 (item 4A in the table) and 53-25 of the ITAA 1997 and subsections 159J(6) (paragraphs (ac), (adaa), (adab), (adac), (adad) and (ae) of 'separate net income') and 160AAA(1) (paragraph (db) of 'rebatable benefit') of the ITAA 1936 ] |
| 11-15 ('education...' entry under foreign aspects of income taxation ) | Corrects the misspelling of 'representative'. [ Schedule 3, item 51, section 11-15 ('education ...' entry under 'foreign aspects of income taxation') ] |
| 11-15 ('non-resident' entry under foreign aspects of income taxation ) | Removes the reference to paragraph 23(r). That paragraph was repealed in 2006, so the entry is inoperative. [ Schedule 3, item 52, section 11-15 ('non-resident' entry under 'foreign aspects of income taxation') ] |
| 11-15 ( social security or like payments ) | Rewrites the social security payments entry in the non-operative list of exempt income amounts. This makes it clearer that the payments are amounts received by the taxpayer, not paid by the taxpayer. [ Schedule 3, item 56, section 11-15 ('social security payments' entry under 'social security or like payments') ] |
| 11-15 ( social security or like payments and welfare ) | Adds cross-references from the social security entry to the welfare entry in the list of amounts of exempt income and vice versa. This increases the likelihood of readers finding the item they are looking for. [ Schedule 3, items 57 and 59, section 11-15 ('social security or like payments' and 'welfare') ] |
| 11-15 ( vice regal ) | Deletes references to the provision that made the official salaries of the Governor-General and the State Governors exempt income. That provision (and the exemption it provided) was repealed in 2001, so the references to it are inoperative. [ Schedule 3, item 58, section 11-15 ('vice regal') ] |
| 20-30(1) (item 1.8 in the table) | Replaces the reference to section 25-80 with a reference to 'the former' section 25-80, as it was repealed in 2006. [ Schedule 3, item 62, subsection 20-30(1) (item 1.8 in the table) ] |
| ITAA 1997
27-10(3)(a) 995-1(1) ( registration ) TAA 1953 110-50(2) of Schedule 1 to the TAA 1953 |
Removes the definition of 'registration' from the dictionary. 'Registration' is defined in the ITAA 1997 as being registration for the purposes of the goods and services tax (GST) law. There are many uses of the word in the ITAA 1997 that clearly refer to something other than GST registration. To reduce the risk of confusion, the ITAA 1997 aims to define each term in only one way and to only use it in the defined way. Therefore, the amendment removes the definition so that 'registration' will take its ordinary meaning. Provisions intended to refer to GST registration are amended to make that intention clear. [
Schedule 3, items 63 and 170, paragraph 27-10(3)(a) and subsection 995-1(1) ('registration')
]
Since the word is no longer defined, asterisks that mark it as a defined term are removed. [ Schedule 3, items 63 and 181, paragraph 27-10(3)(a) of the ITAA 1997 and subsection 110-50(2) of Schedule 1 to the TAA 1953 (items 3 to 7, 42 to 7, 50 and 54 in the table) ] |
| 30-15(2) (items 1 and 2 in the table)
104-10(4) 104-15(3) 104-20(3) 104-25(3) 104-30(3) 104-35(3) 104-40(3) 104-45(3) 104-55(3) 104-60(3) 104-110(3) 104-115(3) 104-130(3) 104-155(3) 116-45(1) 116-50(1) 149-15(4) and (5) 166-3(2)(b)(ii) 240-20(2)(b) |
Removes excess asterisking from defined terms. In the ITAA 1997, the protocol is to mark defined terms with an asterisk but to do so only for the first occurrence of the term in each subsection. [ Schedule 3, item 189, subparagraph 166-3(2)(b)(ii), paragraph 240-20(2)(b), subsections 30-15(2) (items 1 and 2 in the table), 104-10(4), 104-15(3), 104-20(3), 104-25(3), 104-30(3), 104-35(3), 104-40(3), 104-45(3), 104-55(3), 104-60(3), 104-110(3), 104-115(3), 104-130(3), 104-155(3), 116-45(1), 116-50(1) and 149-15(4) and (5) ] |
| 30-255
30-270(4) 30-280(1) 30-285(1) |
Replaces the expression 'Secretary to the Department of Environment, Sport and Territories' with the equivalent defined expression 'Environment Secretary'. [ Schedule 3, items 66 to 69, subsections 30-270(4), 30-280(1) and 30-285(1) and section 30-255 ] |
| 65-10
208-45(4)(b) 375-805(3) and (5) 717-230(3) 717-265(4) 960-120(1) (item 2 in the table) |
Updates uses of the older term, 'year of income' to the modern equivalent 'income year'. [ Schedule 3, items 85, 123, 138, 149, 150 and 159, paragraph 208-45(4)(b), subsections 375-805(3) and (5), 717-230(3), 717-265(4) and 960-120(1) (item 2 in the table) and section 65-10 ] |
| 102-20 (notes 3 to 5) | Inserts a non-operative note that points readers to the possibility of their making a capital gain or loss as a result of a CGT event happening to another entity. Some existing notes are renumbered as a consequence. [ Schedule 3, item 86, section 102-20 (notes 3 to 5) ]. This amendment makes it easier for readers to find the provisions that are relevant for them. |
| 109-60 (table)
112-97 (items 24 to 24F in the table) |
Inserts additional items in the non-operative tables that list CGT acquisition and cost base modification rules that can be found outside the CGT provisions.
These lists are intended to help readers find all the provisions relevant for them but they do not include references to CGT acquisition and cost base modification rules in the consolidation provisions. The amendments add those references. [ Schedule 3, items 87 and 93, sections 109-60 (table) and 112-97 (items 24 to 24F in the table) ] The entries in the table in section 109-60 are also reordered to put them into numerical order. [ Schedule 3, item 87, section 109-60 (table) ] That reordered table incorporates items proposed to be added by the First Home Saver Accounts (Consequential Amendments) Bill 2008. Therefore, the amendment that updates and reorders that table commences only after that Bill commences. [ Schedule 3, Clause 2, item 4 in the table ] |
| 110-40(1) (notes)
110-43(1) (note) |
Removes inoperative references to subsection 110-53(3), which was repealed in 2000. [ Schedule 3, items 88 and 89, subsections 110-40(1) (notes) and 110-43(1) (note) ] |
| 110-53 (heading) | Updates a section heading.
Since the repeal of subsection (3) in 2000, section 110-53 no longer provides an exception to section 110-40 but it does provide one to section 110-45. Therefore, the amendment replaces the reference in the section heading to section 110-40 with one to section 110-45. [ Schedule 3, item 90, section 110-53 (heading) ] |
| 112-87 (items 1 and 2 in the table) | Updates references to provisions that were relocated in 2006. [ Schedule 3, items 91 and 92, section 112-87 (items 1 and 2 in the table) ] |
| 112-110 (note 3)
112-145 (note 2) 122-70(2) (note 2) 122-200(1) (note 2) 124-10(3) (note 5) 126-15(4) (note) 126-60(2) (note 2) |
Replaces mistaken references to 'section 125-175' (which does not exist) with the correct references to 'section 125-170'. [ Schedule 3, items 94, 96, 99 to 101, 108 and 109, subsections 122-70(2) (note 2), 122-200(1) (note 2), 124-10(3) (note 5), 126-15(4) (note), and 126-60(2) (note 2) and sections 112-110 (note 3) and 112-45 (note 2) ] |
| 112-115 (item 6 in the table) | Replaces a mistaken reference to 'Subdivision 124-CD' (which does not exist) with the correct reference to 'Subdivision 124-D'. [ Schedule 3, item 95, section 112-115 (item 6 in the table) ] |
| 115-280(3) (formula)
396-15(2) (formula) 396-25(1) (formula) 703-15(2) (items 1 and 2 in the table) 705-65(5A)(d) 705-75(1) (formula) 705-75(5)(d) 705-110(1) 707-310(3A)(c) 719-10(1)( (table) 719-20(1) (item 2 in the table) 802-30(4)(c) (formula) 802-40 (formula) 995-1(1) ( general company tax rate ) |
Removes the defined expression 'general company tax rate'. The ITAA 1997 has two defined expressions that identify the tax rate for companies - 'general company tax rate' and 'corporate tax rate'. As they do the same job, one of them is redundant. Repealing redundant definitions reduces the risk of confusing readers. [
Schedule 3, item 169, subsection 995-1(1) ('general company tax rate')
]
References to 'general company tax rate' are replaced with references to 'corporate tax rate'. [ Schedule 3, items 97, 139 to 145, 148, 151, 152, 156 and 157, paragraphs 705-65(5A)(d), 705-75(5)(d), 707-310(3A)(c), 802-30(4)(c), subsections 115-280(3), 396-15(2), 396-25(1), 703-15(2) (items 1 and 2 in the table), 705-75(1), 705-110(1), 719-10(1) (table), 719-20(1) (item 2 in the table) and section 802-40 ] |
| ITAA 1997
115-290(1)(b) 124-780(6) (note 2) 124-781(5) (note) ITAA 1936 109UC(4) (paragraph (b) of excluded trust ) 121AQ ( first trading day price and listed ) 139DSA 139DSH(b) 139GCD(1)(d) 326-15(1) in Schedule 2H 326-130(2) in Schedule 2H ( first trading day of demutualisation shares ) Schedule 3 |
Updates references to the Australian Stock Exchange, which changed its name to ASX Limited in December 2006. [ Schedule 3, items 19, 21, 22, 24 to 26, 40, 41, 43, 98, 103 and 105, paragraph 115-290(1)(b) and subsections 124-780(6) (note 2) and 124-781(5) (note) of the ITAA 1997 and paragraphs 139DSH(b) and 139GCD(1)(d), subsections 109UC(4) (paragraph (b) of 'excluded trust'), 326-15(1) in Schedule 2H and 326-130(2) in Schedule 2H ('first trading day of demutualisation shares'), sections 121AQ ('first trading day of demutualisation shares') and 139DSA and Schedule 3 to the ITAA 1936 ] |
| 124-780(1) (note 2)
124-781(1) (note 2) 124-790(1) |
Corrects grammatical errors by replacing the word 'includes' with 'include'. [ Schedule 3, items 102, 104 and 106, subsections 124-780(1) (note 2), 124-781(1) (note 2) and 124-790(1) ] |
| 124-782(4) | Asterisks the word 'arrangement' to indicate that it is a defined term. [ Schedule 3, item 189, subsection 124-782(4) ] |
| 125-80(8) | Inserts this heading before subsection 125-80(8): 'Partial roll-over'. Because the last heading in the section was 'Pre-CGT interests' (before subsection (4)), readers may not realise that subsection 125-80(8) applies to post -CGT interests as well as pre -CGT interests. [ Schedule 3, item 107, subsection 125-80(8) ] |
| 128-15(1) (notes)
128-25(2) (notes) |
Amends the note to subsection 128-15(1) to refer readers to provisions that deal with related rules. These notes are to help readers find provisions relevant for them. [
Schedule 3, item 110, subsections 128-15(1) (notes)
]
Omits similar notes to section 128-25 because the provisions they refer to are not relevant to section 128-25. [ Schedule 3, item 111, subsection 128-25(2) (notes) ] |
| 130-80(4) (note 1)
130-83(4) (note) 292-20(2) (note 1) |
Renames the first note to subsections 130-80(4) and 292-20(2) from 'Note' to 'Note 1' and the solitary note to subsection 130-83(4) from 'Note 1' to 'Note'. [ Schedule 3, items 112, 113 and 135, subsections 130-80(4) (note 1), 130-83(4) (note) and 292-20(2) (note 1) ] |
| 152-310(2)(a) | Corrects the way the provision makes an amount exempt income so that it conforms to the requirements specified in subsection 6-20(1). There is no change to the result. [ Schedule 3, item 114, paragraph 152-310(2)(a) ] |
| 165-37 (heading)
165-37(1) 165-55(6) |
Corrects the way the defined terms 'more than a 50% stake' and 'full year deduction' appear in the definitions of those terms. [
Schedule 3, items 115 to 117, subsections 165-37(1) and 165-55(6) and section 165-37 (heading)
]
The drafting protocol for the ITAA 1997 is that a defined term appears in bold italics in its actual definition, and does not include the asterisk that normally marks a defined term. |
| 165-115H(2) (flowchart) | Corrects incorrect cross-references to other provisions. [ Schedule 3, item 118, subsection 165-115H(2) (flowchart) ] |
| 214-5(5)
214-20(3) 214-55 214-105(1)(b) 214-185 |
Replaces potentially confusing references to 'return' with the more precise 'franking return'. [
Schedule 3, items 125 to 129, paragraph 214-105(1)(b), subsections 214-5(5) and 214-20(3) and sections 214-55 and 214-85
]
Asterisks to mark 'franking return' as a defined term are added where necessary. [ Schedule 3, items 126 and 128, paragraph 214-105(1)(b) and subsection 214-20(3) ] |
| 250-15(c)(iii)
250-55(b) 250-60(2)(b)(ii) 250-60(4)(b)(iii) 250-115(3)(b) |
Replaces the older expressions 'non-resident' and 'not an Australian resident' with the defined term 'foreign resident'. There is no change in result. [ Schedule 3, items 130 to 134, subparagraphs 250-15(c)(iii), 250-60(2)(b)(ii) and 250-60(4)(b)(iii) and paragraphs 250-55(b) and 250-115(3)(b) ] |
| 707-310(3) (item 6 in the table) | Corrects an inadvertent change the 2007 foreign income tax offset reforms made to the rules about how much of an entity's losses are available to a consolidated group the entity joins.
The 2007 amendment was intended to repeal an item in the table in subsection 707-310(3), and replace it with a new item, to reflect changes in terminology arising from the reforms. The amendment repealed the item but failed to insert the replacement item. The current amendment inserts that replacement item. [ Schedule 3, item 146, subsection 707-310(3) (item 6 in the table) ] To achieve the outcome intended when the original amendment was made, the current amendment applies to income years, statutory accounting periods and notional accounting periods starting on or after 1 July 2008 - the start date for the foreign income tax offset rules. [ Schedule 3, item 147 ] |
| 770-15(1) (note) | Adds a non-operative note to help readers.
Subsection 770-15(1) defines the 'foreign income taxes' that count towards the tax offset for paying foreign income tax. The note alerts readers that only an amount of foreign tax correctly imposed, under either a foreign law or a tax treaty with Australia, can be foreign income tax. [ Schedule 3, item 153, subsection 770-15(1) (note) ] |
| 770-75(4)(b)(ii) | Clarifies an ambiguity in the rules that limit the amount of a taxpayer's foreign income tax offset.
In most cases, the limit is the difference between the Australian income tax that would normally be payable on the taxpayer's entire taxable income and the tax that would be payable if the taxable income included neither foreign income nor related deductions. The provisions describing the ignored deductions talk about 'debt deductions' (broadly, interest) attributable to an overseas permanent establishment and then talk about 'other deductions' related to foreign income. There is an ambiguity about whether the 'other deductions' include debt deductions that are not attributable to an overseas permanent establishment. The 'other deductions' were intended to mean deductions other than debt deductions and the amendment resolves the ambiguity that way. [ Schedule 3, item 154, subparagraph 770-75(4)(b)(ii) ] To ensure the original intention is achieved, the amendment applies to income years, statutory accounting periods and notional accounting periods starting on or after 1 July 2008 - the start date for the new foreign income tax offset rules. [ Schedule 3, item 155 ] |
| 974-10(5)(e)
974-112(1)(e) 974-150(1), (2), (3) and (4) |
Repeals an unnecessary cross-reference to the dictionary for the meaning of the word 'scheme'. The asterisk attached to the word is linked to a footnote that directs readers to the definition in the dictionary. Therefore, the further cross-reference in subsection 974-150(1) is redundant. [
Schedule 3, item 164, subsection 974-150(1)
]
The section's remaining subsections are renumbered and references to the renumbered subsections are updated. [ Schedule 3, items 160, 163 and 165, paragraphs 974-10(5)(e) and 974-112(1)(e) and subsections 974-150(2) to (4) ] |
| 995-1(1) (subparagraph (b)(i) of copyright collecting society ) | Replaces the expression 'a law of a State or Territory' with the equivalent defined expressions 'State law' and 'Territory law'. [
Schedule 3, item 166, subsection 995-1(1) (subparagraph (b)(i) of 'copyright collecting society')
]
This measure removes the confusion caused by saying the same thing in different ways but does not change the result. |
| 995-1(1) (paragraphs (b) to (d) of friendly society ) | Replaces the expression 'a law in force in a State or Territory' with the equivalent defined expression 'Australian law'. [
Schedule 3, item 167, subsection 995-1(1) (paragraphs (b) to (d) of 'friendly society')
]
This measure removes the confusion caused by saying the same thing in different ways but does not change the result. |
| 995-1(1) ( full year deductions ) | Adds a reference to subsection 165-55(6) in the signpost to the definition of 'full year deduction'. [
Schedule 3, item 168, subsection 995-1(1) ('full year deduction')
]
'Full year deduction' is defined in part in subsection 165-55(5) and in part in subsection (6). The signpost in subsection 995-1(1) to the definition only mentions the first of those. The amendment corrects the omission. |
| 995-1(1) ( scheme ) | Adds a non-operative note to the definition of 'scheme' to draw readers' attention to the effect of subsection 974-150(2) (which deems what would otherwise be a single scheme to be multiple schemes in some cases). [
Schedule 3, item 171, subsection 995-1(1) ('scheme')
]
This helps readers locate all the provisions that are relevant to them. |
| 995-1(1) ( short-term hire agreement ) | Removes a repeated definition of the same expression. As the two definitions are the same, one is redundant and is removed. [ Schedule 3, item 172, subsection 995-1(1) ('short-term hire agreement') ] |
Table 3.4: Amendments to the Income Tax ( Transitional Provision ) Act 1997
| Provision being amended | What the amendment does |
| 1-7 | Inserts a provision to make explicit that the Commissioner has the general administration of this Act. Currently the ITAA 1936 provides the Commissioner with the general administration of both the ITAA 1936 and the ITAA 1997 but it is only by implication that this would include the Income Tax (Transitional Provisions) Act 1997 . [ Schedule 3, item 175, section 1-7 ] |
Table 3.5: Amendments to the Taxation Administration Act 1953
| Provision being amended | What the amendment does |
| 8AAB(5) (item 2B in the table) | Omits the word 'section' to make item 2B in the table consistent with the other items in the table that list the provision number without the noun. [ Schedule 3, item 177, subsection 8AAB(5) (item 2B in the table) ] |
| 8AAB(5) (item 17K in the table) | Renumbers one of the two table items numbered as 17K. Having two items numbered as 17K is potentially confusing. [ Schedule 3, items 178 and 179, subsection 8AAB(5) (item 17K in the table) ]. |
| 14ZQ | Removes the word 'section', as the provision currently reads 'section Division 359'. [ Schedule 3, item 180, section 14ZQ ] |
| 250-10(2) of Schedule 1 (items 38A, 38B and 67 in the table) | Omits the word 'section' to make items 38A, 38B and 67 in the table consistent with the other items in the table that list the provision number without the noun. [ Schedule 3, item 182, subsection 250-10(2) of Schedule 1 (items 38A, 38B and 67 in the table) ] |
| 284-220(1)(a) and (b) of Schedule 1 | Removes an ambiguity by removing 'shortfall amount' from the opening words to subsection 284-220(1).
Section 284-220 provides for an increase in penalty in a number of repeat offender cases. One of those cases is covered by paragraph (1)(e). It deals with a taxpayer who fails to provide a document after having failed to provide one on an early occasion. The section provides for an increase of 20 per cent of 'the base penalty amount for your shortfall amount'. There is a base penalty amount for the situation covered by paragraph (1)(e) but it is not worked out by reference to a shortfall amount. If the section were read to only apply in situations where there is a shortfall amount, and as there can be no shortfall amount under subsection 284-75(3), paragraph 284-220(1)(e) could never apply. The amendment removes the ambiguity by removing the reference to shortfall amount. [ Schedule 3, item 183, section 284-220 of Schedule 1 ] Consequential amendments are made to other paragraphs in the section. [ Schedule 3, items 184 and 185, paragraphs 284-220(1)(a) and (b) of Schedule 1 ] |
Table 3.6: Amendments to the Superannuation Guarantee ( Administration ) Act 1992
| Provision being amended | What the amendment does |
| 35(1)(d)(iv) | Adds an 'and' to the end of paragraph 35(1)(d) to be consistent with other paragraphs in the same subsection. [ Schedule 3, item 176, subparagraph 35(1)(d)(iv) ] |
Table 3.7: Amendments to the A New Tax System ( Goods and Services Tax ) Act 1999
| Provision being amended | What the amendment does |
| 87-25 (note) | Adds a note to section 87-25 alerting readers that choosing not to apply section 87-25 will result in their supplies, other than GST-free supplies, being input taxed under section 40-35.
Paragraphs 40-35(1)(b) and (1A)(b) refer to a supplier having a choice to make taxable supplies of long-term accommodation in commercial residential premises under section 87-25 at a reduced value rather than as input taxed supplies. However section 87-25 does not tell readers that a supplier who chooses not to apply Division 87 will have the supply input taxed under section 40-35. The amendment removes the potential for the current situation to lead to confusion for taxpayers. [ Schedule 3, item 1, section 87-25 (note) ] |
Table 3.8: Amendments to the Tax Laws Amendment (2007 Measures No. 5) Act 2007
| Provision being amended | What the amendment does |
| Item 40 of Schedule 10 | Adds the word 'former' before subsection 124K(2).
Item 40 will attempt to amend paragraph 82KH(1T)(b) in the ITAA 1936 by adding 'former' before 'subsection 124KA(2)' when that item commences on 1 July 2010. The amendment will fail because paragraph 82KH(1T)(b) does not mention subsection 124KA(2). Instead, it mentions subsection 124K(2). The amendment updates the item to refer to the correct provision. [ Schedule 3, item 187; item 40 of Schedule 10 to the Tax Laws Amendment (2007 Measures No. 5) Act 2007 ] |
| Item 56 of Schedule 10 | Repeals the note to the definition of 'tax loss' in subsection 272-140(1) of Schedule 2F.
Item 56 will attempt to repeal the note to the definition of 'tax loss' in 'Paragraph 272-140 in Schedule 2F' when that item commences on 1 July 2010. That amendment was misdescribed because 272-140 is a section, not a paragraph, and will therefore fail. [ Schedule 3, item 188; item 56 of Schedule 10 to the Tax Laws Amendment (2007 Measures No. 5) Act 2007 ] |
Table 3.9: Amendments to the Taxation ( Interest on Overpayments and Early Payments ) Act 1983
| Provision being amended | What the amendment does |
| 3A(2) | Removes a redundant reference to 'Income tax crediting amount', a concept that was removed from the law as part of the new foreign income tax offset rules in 2007. [ Schedule 3, item 186, subsection 3A(2) ] |
Table 3.10: Amendments to the Income Tax ( Deferred Interest Securities ) ( Tax File Number Withholding Tax ) Act 1991
| Provision being amended | What the amendment does |
| 4 | Removes an excess 'section' as the provision reads 'section section 14-55'. [ Schedule 3, item 174, section 4 ] |