Treasury Laws Amendment (Combating Multinational Tax Avoidance) Act 2017 (27 of 2017)

Schedule 1   Diverted profits tax

Taxation Administration Act 1953

49   After section 280-102B in Schedule 1

Insert:

280-102C Liability to shortfall interest charge - diverted profits tax

(1) Subsection (2) applies if:

(a) the Commissioner has given an entity an assessment of income tax for an income year; and

(b) the Commissioner subsequently gives the entity a *DPT assessment for that income year.

(2) The entity is liable to pay *shortfall interest charge equal to the amount of shortfall interest charge that the entity would be liable to pay under section 280-100 if:

(a) the Commissioner amended the assessment of income tax mentioned in paragraph (1)(a) on the day that the Commissioner gave the entity the *DPT assessment mentioned in paragraph (1)(b); and

(b) the entity were liable to pay an additional amount of income tax because of that amendment; and

(c) the Commissioner made that amendment on the basis that the *tax benefit or tax benefits to which the DPT assessment related were cancelled.

(3) An entity is also liable to pay *shortfall interest charge on an additional amount of *diverted profits tax that the entity is liable to pay because the Commissioner amends the entity's *DPT assessment in respect of an income year.

(4) The liability is for each day in the period:

(a) beginning at the start of the day on which *diverted profits tax under the entity's first *DPT assessment for that income year was due to be paid, or would have been due to be paid if there had been any; and

(b) ending at the end of the day before the day on which the Commissioner gave the entity notice of the amended *DPT assessment.

(5) However, if an amended *DPT assessment reinstates all or part of a liability in relation to a particular that had been reduced by an earlier amended DPT assessment, the period for the reinstated liability begins at the start of the day on which *diverted profits tax under the earlier amended DPT assessment was due to be paid.

Note 1: See subsection 177P(3) of the Income Tax Assessment Act 1936 for when the amount of diverted profits tax becomes due and payable.

Note 2: Section 177Q of the Income Tax Assessment Act 1936 provides for general interest charge on any part of the additional amount (plus any shortfall interest charge) that remains unpaid after the additional amount is due and payable.

Note 3: See section 177R of the Income Tax Assessment Act 1936 for when the amount of shortfall interest charge becomes due and payable.