Taxation Administration Act 1953

SCHEDULE 1 - COLLECTION AND RECOVERY OF INCOME TAX AND OTHER LIABILITIES  

Note: See section 3AA .

Chapter 2 - Collection, recovery and administration of income tax  

PART 2-5 - PAY AS YOU GO (PAYG) WITHHOLDING  

Division 12 - Payments from which amounts must be withheld  

Subdivision 12-FB - Payments to foreign residents etc.  

SECTION 12-315   PAYMENT TO FOREIGN RESIDENT ETC.  

12-315(1)    

An entity (the payer ) that *carries on an *enterprise must withhold an amount from a payment it makes to another entity, or to other entities jointly, in the course or furtherance of the enterprise if:

(a) the entity receiving the payment, or any of the entities receiving the payment, is an entity covered by subsection (2); and

(b) the payment is of a kind set out in the regulations; and

(c) the payment is not:

(i) a *dividend of a company; or

(ii) interest (within the meaning of Division 11A of Part III of the Income Tax Assessment Act 1936 ); or

(iii) a *royalty; or

(iv) a *departing Australia superannuation payment; or

(v) a payment worked out wholly or partly by reference to the value or quantity of *natural resources produced or recovered in Australia; or

(vi) a *mining payment; or

(vii) an amount represented by or reasonably attributable to a *fund payment; and

(d) the entity receiving the payment is not covered by an exemption in force under subsection 12-319(1) , or at least one of the entities receiving the payment is not covered by an exemption in force under that subsection.

12-315(2)    
An entity is covered by this subsection if any of the following conditions is satisfied:

(a) the entity is a foreign resident;

(b) the payer believes, or has reasonable grounds to believe, that the entity is a foreign resident;

(c) the payer has no reasonable grounds to believe that the entity is an Australian resident, and either:

(i) the entity has an address outside Australia (according to any record that is in the payer ' s possession, or is kept or maintained on the payer ' s behalf, about the transaction to which the payment relates); or

(ii) the payer is authorised to make the payment at a place outside Australia (whether to the entity or to anyone else);

(d) the entity has a connection outside Australia of a kind set out in the regulations.

12-315(3)    
Before the Governor-General makes a regulation for the purposes of paragraph (1)(b), the Minister must be satisfied that each payment set out in the regulation is a payment of a kind that could reasonably be related to assessable income of foreign residents.