Taxation Laws Amendment (Infrastructure Borrowings) Act 1994 (163 of 1994)

Part 3   AMENDMENT OF THE INCOME TAX ASSESSMENT ACT 1936

25   Insertion of new sections

After section 159GZZZZF of the Principal Act the following sections are inserted in Division 16L of Part III:

Rebate election

Basic case

"159GZZZZG.(1) If:

(a) if subsections 159GZZZZE(1) and (2) did not apply to IB amounts, the assessable income of a year of income of a taxpayer who is:

(i) a company or a natural person (other than a company or natural person in the capacity of a trustee); or

(ii) a corporate unit trust within the meaning of Division 6B in relation to the year of income; or

(iii) a public trading trust within the meaning of Division 6C in relation to the year of income; or

(iv) an eligible entity within the meaning of Part IX in relation to the year of income;

would include one or more IB amounts; and

(b) the taxpayer's return of income of the year of income includes all of the IB amounts; then:

(c) all of the IB amounts are included in the taxpayer's assessable income of the year of income; and

(d) the taxpayer is entitled to a rebate in the taxpayer's assessment for that year of an amount equal to 33% of the IB amounts.

Beneficiary assessment

"(2) If:

(a) apart from this subsection, a share of the net income of a trust estate of a year of income is included in a taxpayer's assessable income under section 97; and

(b) if subsections 159GZZZZE(1) and (2) did not apply to IB amounts included in the assessable income of the trust estate, or of any other trust estate or partnership, that share of the net income would be increased by an amount (the 'IB attributable amount'); and

(c) the taxpayer's return of income of the year of income is prepared on the basis that all of the IB amounts are included in the assessable income of the trust estate, or of the other trust estate or partnership; then:

(d) for the purposes only of working out the share of the net income to be included in the taxpayer's assessable income, the assessable income of the trust estate, or of the other trust estate or partnership, includes all of the IB amounts; and

(e) the taxpayer is entitled to a rebate in the taxpayer's assessment for the year of income of an amount equal to 33% of the IB attributable amount.

Trustee assessment

"(3) If:

(a) apart from this subsection, the trustee of a trust estate is assessed and liable to pay tax:

(i) in respect of a share of the net income of the trust estate of a year of income under section 98; or

(ii) in respect of the whole or part of the net income of the trust estate under section 99 or 99A; and

(b) if subsections 159GZZZZE(1) and (2) did not apply to IB amounts included in the assessable income of the trust estate, or of any other trust estate or partnership, of the year of income, the amount of the share, or of the whole or the part, of the net income would be increased by an amount (the 'IB attributable amount'); and

(c) the trustee's return of income in respect of the share, or the whole or the part of the net income, of the year of income is prepared on the basis that all of the IB amounts are included in the assessable income of the trust estate, or of the other trust estate or partnership; then:

(d) for the purposes only of working out the amount of:

(i) the share, or of the whole or the part, of the net income; and

(ii) the individual interest of a beneficiary in the net income of the trust estate that is to be included in the beneficiary's assessable income under section 100, where the share of the net income to which subparagraph (a)(i) of this subsection applies is that of the beneficiary;

the assessable income of the trust estate, or of the other trust estate or partnership, includes all of the IB amounts; and

(e) the trustee is entitled to a rebate in the trustee's assessment in respect of the share, or of the whole or the part, of the net income of the year of income to an amount equal to 33% of the IB attributable amount.

Partner assessment

"(4) If:

(a) apart from this subsection, a share of the net income of a partnership of a year of income is included in a taxpayer's assessable income under section 92; and

(b) if subsections 159GZZZZE(1) and (2) did not apply to IB amounts included in the assessable income of the partnership, or of any other partnership or trust estate, that share of the net income would be increased by an amount (the 'IB attributable amount'); and

(c) the taxpayer's return of income of the year of income is prepared on the basis that all of the IB amounts are included in the assessable income of the partnership, or of the other partnership or trust estate;

then:

(d) for the purposes only of working out the share of the net income included in the taxpayer's assessable income, the assessable income of the partnership, or of the other partnership or trust estate, includes all of the IB amounts; and

(e) the taxpayer is entitled to a rebate in the taxpayer's assessment for the year of income of an amount equal to 33% of the IB attributable amount.

"(5) The inclusion of an IB amount in the assessable income of a person under this section does not affect the denial of allowability of a deduction to another person in respect of the same amount under subsection 159GZZZZE(1) or (2).

Tax payable where infrastructure borrowing certificate cancelled

Tax payable

"159GZZZZH.(1) If:

(a) the DAA cancels a certificate in relation to an infrastructure borrowing; and

(b) for any year of income (whether the one in which the cancellation takes place or an earlier or later one), there is a tax benefit amount in relation to the certificate;

the holder of the certificate at the time of the cancellation is liable to pay tax on an amount (an 'infrastructure certificate cancellation amount') worked out using the formula:

15% x Tax benefit amount x Factor

where

'Factor' means:

(a) if the year of income to which the tax benefit amount relates is:

(i) the year of income in which the act or omission that was the ground, or the first act or omission that was a ground, relied on by the DAA for cancelling the certificate occurred; or

(ii) an earlier year of income;

the fraction worked out using the formula:

Part of infrastructure period occurring after the act or omission / Infrastructure period; or

(b) in any other case-the number 1.

Assessment of amount

"(2) The Commissioner may make an assessment of the tax payable by a taxpayer under this section. In making or amending the assessment, and in dealing with any objection, appeal or review in relation to the assessment or amended assessment, the Commissioner may rely in whole or in part on advice given by the DAA under section 93ZF of the DAA Act.

Incorporation in other notices

"(3) This Act does not prevent notice of the assessment being incorporated in a notice of any other assessment made in respect of the taxpayer under this Act.

References in other provisions

"(4) Unless the contrary intention appears, in sections 170, 172, 174, 204, 205, 206, 207, 207A, 208, 209, 214, 215, 216, 254, 255, 258, 259 and 265, but not in any other section of this Act, 'income tax' or 'tax' includes tax payable under this section.".