Taxation Laws Amendment Act 1994 (56 of 1994)

Part 3   AMENDMENT OF THE INCOME TAX ASSESSMENT ACT 1936

Division 10   Life assurance companies and registered organizations

86   Period allowed for furnishing amended returns without incurring penalty

(1) If:

(a) a taxpayer furnished a return of income before the commencement of this section; and

(b) the return included a claim for a deduction under Division 8 or 8A of the Principal Act; and

(c) when the return was made it was reasonably arguable that the deduction was allowable under that Division; and

(d) that deduction is taken by the Principal Act as amended by this Division not to have been allowable; and

(e) within 6 months (or such further period as the Commissioner allows) after the day on which this Act received the Royal Assent the taxpayer furnishes an amended return that does not include a claim for the deduction;

no penalty is payable by the taxpayer because of the claim for the deduction but the Income Tax (Interest on Underpayments) Act 1986 applies in respect of any underpayment of tax as a result of any increase in tax that is payable because the deduction is not allowable.

(2) The question whether a matter was reasonably arguable as mentioned in paragraph (1)(c) is to be determined in the same way as the question would be determined under section 222C of the Income Tax Assessment Act 1936 if that section were applicable.