Taxation (Deficit Reduction) Act (No. 1) 1993 (57 of 1993)

Part 3   Amendment of the Income Tax Assessment Act 1936

Division 5   Amendments relating to credit unions

30   Insertion of new section

After section 6G of the Principal Act the following section is inserted:

6H Recognised small credit unions, recognised medium credit unions and recognised large credit unions

Recognised small credit union in relation to a year of income

(1) For the purposes of this Act, a credit union is a recognised small credit union in relation to a year of income if:

(a) both:

(i) the year of income is the 1994-95 year of income; and

(ii) either:

(A) the credit union is not a designated credit union; or

(B) the credit union’s notional taxable income of the year of income is less than $50,000; or

(b) both:

(i) the year of income is the 1995-96 year of income or a later year of income; and

(ii) the credit union’s notional taxable income of the year of income is less than $50,000.

Recognised medium credit union in relation to a year of income

(2) For the purposes of this Act, a credit union is a recognised medium credit union in relation to a year of income if:

(a) the year of income is the 1994-95 year of income or a later year of income; and

(b) the credit union is not a recognised small credit union in relation to the year of income; and

(c) the credit union’s notional taxable income of the year of income is less than $150,000.

Recognised large credit union in relation to a year of income

(3) For the purposes of this Act, a credit union is a recognised large credit union in relation to a year of income if:

(a) the year of income is the 1994-95 year of income or a later year of income; and

(b) the credit union is neither:

(i) a recognised small credit union in relation to the year of income; nor

(ii) a recognised medium credit union in relation to the year of income.

Designated credit union

(4) For the purposes of this section, a credit union is a designated credit union if:

(a) it was in existence on 1 July 1993; and

(b) assuming that its accounts for the last accounting period that ended before 1 July 1993 had been prepared in accordance with generally accepted accounting principles - the amount that would have been shown in those accounts as the gross value of its assets as at the end of that accounting period is more than $30 million.

Notional taxable income

(5) For the purposes of this section, the notional taxable income of a credit union of a year of income is the sum of the following amounts (worked out on the assumption that subsections 23G(2A) and 117(3) had not been enacted):

(a) the credit union’s taxable income of the year of income;

(b) so much of the total income derived during the year of income by the credit union as is exempt from income tax because of subsection 23G(2).

Definitions

(6) In this section:

accounts , in relation to a credit union, means accounts prepared for the purposes of reporting annually to the shareholders in the credit union.

accounting period , in relation to a credit union, means a period at the end of which the balance of its accounts is struck.

credit union has the same meaning as in section 23G, but does not include:

(a) a life assurance company within the meaning of Division 8 of Part III; or

(b) a registered organization within the meaning of Division 8A of Part III.