A New Tax System (Goods and Services Tax) Amendment Regulations 2000 (No. 1) (49 of 2000)

Schedule 1   Amendments

1   After Part 3-1

insert

Part 4-1 Special rules mainly about particular ways entities are organised

Division 48 GST groups

Subdivision 48-A Approval of GST groups

48-10.01 Definitions for Subdivision

In this Subdivision:

family , in relation to a person, has the meaning given by section 272-95 of Schedule 2F to the Income Tax Assessment Act 1936, as if the person were the test individual mentioned in that section.

GST group includes a proposed GST group.

48-10.02 Membership requirements for partnerships

(1) For the purposes of subparagraph 48-10 (1) (a) (ii) of the Act, this regulation sets out requirements that must be satisfied for a partnership to be a member of a GST group.

Note   The partnership must also satisfy other membership requirements set out in section 48-10 of the Act.

(2) The partnership must satisfy the requirements of subregulation (3) or (4).

(3) The partnership satisfies the requirements of this subregulation if, for at least 1 company that is a member of the GST group:

(a) the partnership has at least a 90% stake in the company (worked out in accordance with section 190-5 of the Act as if the partnership were a company); or

(b) the membership of the company consists only of:

(i) for a company with 1 member  - a partner in the partnership or a family member of a partner; and

(ii) for a company with more than 1 member  - partners in the partnership, or family members of the partners, in a way that ensures that at least 2 partners are represented, either personally or by a family member.

(4) The partnership satisfies the requirements of this subregulation if, for at least 1 trust that is a member of the GST group, the beneficiaries include partners in the partnership, or family members of the partners, in a way that ensures that at least 2 partners are represented:

(a) either personally or by a family member; and

(b) either directly, or indirectly through 1 or more interposed trusts.

48-10.03 Membership requirements for trusts

(1) For the purposes of subparagraph 48-10 (1) (a) (ii) of the Act, this regulation sets out requirements that must be satisfied for a trust to be a member of a GST group.

Note   The trust must also satisfy other membership requirements set out in section 48-10 of the Act.

(2) The trustee:

(a) must have at least a 90% stake in a company that is a member of the GST group (worked out in accordance with section 190-5 of the Act as if the trustee were a company); or

(b) must not distribute any income or capital of the trust to a beneficiary that is not a permitted beneficiary (whether or not a distribution of that kind could be lawfully made).

(3) Each of the following is a permitted beneficiary :

(a) a company that is a member of the GST group;

(b) a charitable institution, a trustee of a charitable fund, or a gift-deductible entity.

(4) A member or members of a company that is a member of the GST group, and their family members, are also permitted beneficiaries if:

(a) for a company with 1 member  - the member, or a family member of the member, is a beneficiary of the trust (either directly, or indirectly through 1 or more interposed trusts); and

(b) for a company with more than 1 member  - the beneficiaries of the trust include members of the company, or family members of the members, in a way that ensures that at least 2 members of the company are represented:

(i) either personally or by a family member; and

(ii) either directly, or indirectly through 1 or more interposed trusts.

(5) Partners in a partnership that is a member of the GST group, and their family members, are also permitted beneficiaries if the beneficiaries of the trust include partners, or family members of the partners, in a way that ensures that at least 2 partners are represented:

(a) either personally or by a family member; and

(b) either directly, or indirectly through 1 or more interposed trusts.