(d) in any other case - no capital gain is taken for the purposes of this Part to have accrued to the taxpayer during a year of income in respect of the disposal of the asset.".

28   Before Division 5 of Part IX

Insert:

"Division 4A - Resident superannuation fund that was previously a non-resident superannuation fund

Liability to taxation of resident fund that was previously a non-resident fund

"288B. (1) If a superannuation fund that is a resident superannuation fund in relation to the year of income (the 'current year of income') was a non-resident superannuation fund in relation to the immediately preceding year of income, the fund's assessable income of the current year of income includes the fund's net previous income in respect of previous years of income.

"(2) The fund's net previous income in respect of previous years of income is taken to be the amount worked out using the

formula:

Asset values less Members contributions where:

'Asset values' means the sum of the market values of the fund's assets immediately before the start of the current year of income;

'Members contributions' means the amount in the fund immediately before the start of the current year of income that represented the total contributions made by current members of the fund.".

29   Application

The amendments made by this Division apply in relation to a fund for the 1995-96 year of income of the fund and for each later year of income.

Division 5   Withholding tax exemptions for certain interest, dividend and royalty income of overseas superannuation funds

30   Object

The object of this Division is to abolish withholding tax exemptions for certain interest, dividend and royalty income of overseas superannuation funds.

31   Section 128A

Add at the end:

"(10) For the purposes of this Division, the trustee of a provident, benefit, superannuation or retirement fund is a non-resident at a particular time if, and only if, the fund is a non-resident superannuation fund at that time.

"(11) If, apart from this subsection, there is, in relation to a fund, no person who is a trustee of the fund for the purposes of this Division, the person, or each of the persons, who manages the fund is taken, for the purposes of this Division, to be the trustee, or a trustee, as the case requires, of the fund.".

32   Paragraph 128B(3)(f)

Omit the paragraph.

33   Section 221YK

Add at the end:

"(4) For the purposes of this Division the trustee of a provident, benefit, superannuation or retirement fund is a non-resident at a particular time if, and only if, the fund is a non-resident superannuation fund at that time.

"(5) If, apart from this subsection, there is, in relation to a fund, no person who is a trustee of the fund for the purposes of this Division, the person, or each of the persons, who manages the fund is taken, for the purposes of this Division, to be the trustee, or a trustee, as the case requires, of the fund.".

34   Application

The amendments made by this Division apply in relation to income derived by a fund after whichever is the later of the commencement of this Division or the beginning of the 1994-95 year of income of the fund.

Division 6   Deductions to employers etc. for certain contributions made to non-complying superannuation funds

35   Object

The object of this Division is to deny deductions to employers etc. for certain contributions made to non-complying superannuation funds.

36   Paragraph 67AAA(1)(b)

Insert "or 82AAE" after "section 82AAC".

37   Subsection 73B(1) (definition of 'contributions to superannuation funds')

Insert "or 82AAE" after "section 82AAC".

38   Paragraph 82AAC(1)(b)

Omit "eligible", substitute "complying".

39   After section 82AAC

Insert:

Deduction for contribution to non-complying superannuation fund that taxpayer reasonably believes to be a complying superannuation fund

"82AAD. (1) If:

(a) a taxpayer pays an amount as a contribution to a non-complying superannuation fund (as defined by subsection 267(1)) for the purpose of making provision for superannuation benefits for an eligible employee; and

(b) when the contribution is made the taxpayer has reasonable grounds for believing that the superannuation fund is a complying superannuation fund;

the amount is taken, for the purposes of section 82AAC, to be paid to a complying superannuation fund.

"(2) Subject to subsection (3), a taxpayer who makes a contribution to a superannuation fund is taken, for the purposes of subsection (1), to have reasonable grounds for believing that the fund is a complying superannuation fund if, at or before the time when the contribution is made, the taxpayer has obtained a written statement, provided by or on behalf of the trustee of the fund, that the fund:

(a) is a resident regulated superannuation fund within the meaning of the Superannuation Industry (Supervision) Act 1993; and

(b) is not subject to a direction under section 63 of that Act.

"(3) A taxpayer who makes a contribution to a superannuation fund is taken, for the purposes of subsection (1), not to have reasonable grounds for believing that the fund is a complying superannuation fund if, when the contribution is made:

(a) the taxpayer:

(i) is the trustee or the manager of the fund; or

(ii) is an associate (within the meaning of subsection 26AAB(14)) of the trustee or the manager of the fund; and

(b) the taxpayer has reasonable grounds for believing that the fund is not a resident regulated superannuation fund within the meaning of the Superannuation Industry (Supervision) Act 1993 or is operating while in breach of that Act or regulations under that Act.

"(4) Section 39 of the Superannuation Industry (Supervision) Act 1993 applies for the purposes of subsection (3) of this section in a corresponding way to the way in which it applies for the purposes of Division 2 of Part 5 of that Act.

Deduction for contribution to non-complying superannuation fund

"82AAE. A deduction is allowable under this Subdivision in respect of an amount paid by a taxpayer as a contribution to a non-complying superannuation fund (as defined by subsection 267(1)) for the purpose of making provision for superannuation benefits for an eligible employee other than such an employee who is an exempt visitor to Australia for the purposes of section 517 in relation to the year of income in which the amount is paid.".

40   Subsection 82AAR(1)

Insert "superannuation" before "fund".

41   Application

The amendments made by this Division apply in relation to contributions made to a fund in the 1994-95 year of income of the fund or in a later year of income.

Division 7   Definition of taxable contributions

42   Object

The object of this Division is to make amendments relating to the definition of "taxable contributions".

43   Subsection 267(1)

Omit the definitions of "Commission's superannuation principles", "eligible superannuation contributions", "industrial tribunal", "superannuation agreement", "superannuation agreement contribution" and "tax-exempt entity".

44   Paragraph 274(1)(a)

Omit the paragraph, substitute:

"(a) if the eligible entity is a resident superannuation fund in relation to the year of income in which the contributions are made:

(i) contributions made for the purpose of making provision for superannuation benefits for another person, other than contributions made by a person that is, when the contributions are made, a trustee of:

(A) an exempt life assurance fund (within the meaning of Division 6C of Part III); or

(B) a complying superannuation fund, a complying ADF or a PST;

(ii) a specified roll-over amount;

(aa) if the eligible entity is a non-resident superannuation fund in relation to the year of income in which the contributions are made - contributions made for the purpose of making provision for superannuation benefits for another person (other than a person who is an exempt visitor to Australia for the purposes of section 517 in relation to the year of income to which the contributions relate) to the extent that the contributions relate to a period in which the other person is or was:

(i) a resident of Australia; or

(ii) a non-resident who derives assessable income that consists of or includes salary or wages (within the meaning of Division 2 of Part VI);".

45   Paragraph 274(1)(b)

After "complying superannuation fund", insert "in relation to the year of income in which the contributions are paid".

46   Subsection 274(7)

Omit "subparagraph (1)(a)(i), (ii) or (iii)", substitute "subparagraph (1)(a)(i)".

47   Paragraph 275B(2)(b)

Omit "274(1)(a)(i), (ii) or (iii)", substitute "274(1)(a)(i)".

48   Application

The amendments made by this Division apply in relation to amounts paid to an eligible entity during the 1994-95 year of income of the entity or during a later year of income.

Division 8   Deductions for taxable contributions to certain entities

49   Object

The object of this Division is to allow deductions to ADFs, superannuation funds and PSTs for taxable contributions that are fringe benefits.

50   After section 277

Insert in Division 2 of Part IX:

Deduction for taxable contributions that are fringe benefits

"277A. A deduction is allowable from the assessable income of an eligible entity of a year of income of an amount equal to the total of any taxable contributions included in that assessable income that are fringe benefits (within the meaning of the Fringe Benefits Tax Assessment Act 1986).".

51   Application

The amendment made by this Division applies to assessments in respect of income of the 1994-95 year of income and each later year of income.

Division 9   Cost of collecting non-taxable contributions by non-resident superannuation funds

52   Object

The object of this Division is to deny a deduction to a non-resident superannuation fund for the cost of collecting non-taxable contributions.

53   Section 277

Repeal the section, substitute:

Contributions treated as assessable in determining deductions for ADFs and resident superannuation funds

"277. In determining the deductions allowable from the assessable income of an eligible entity that is:

(a) an eligible ADF; or

(b) a resident superannuation fund in relation to the year of income concerned;

any amount that is paid to the entity as mentioned in subsection 274(1), or is a contribution to which subsection 82AAT(1) applies, is taken to be assessable income of the entity (whether or not it is a taxable contribution).".

54   Application

The amendment made by this Division applies to assessments in respect of income of the 1994-95 year of income and each later year of income.

Division 10   Lump sum payments made in consequence of the termination of overseas projects or overseas employment

55   Object

The object of this Division is to provide for a tax exemption for certain lump sum payments made in consequence of the termination of an overseas project or overseas employment.

56   Paragraph 23AF(17)(a)

Add at the end "or".

57   After paragraph 23AF(17)(a)

Insert:

"(aa) the income is a payment, consideration or amount that:

(i) is included in assessable income under Subdivision AA of Division 2; or

(ii) is excluded from the definition of 'eligible termination payment' in subsection 27A(1) because of paragraph (ja), (k), (ka), (m), (ma), (n) or (p) of that definition; or".

58   Subsection 23AF(17A) (definition of 'notional gross tax')

Insert after paragraph (a):

"(aa) if the exempt amount is an exempt resident foreign termination payment (within the meaning of Subdivision AA of Division 2) - the exempt amount (excluding any part of that amount that represented contributions made by the taxpayer) were assessable income of the taxpayer; and".

59   After subsection 23AF(17B)

Insert:

"(17C) Subsection (17A) applies to a taxpayer in respect of income of a year of income as if any exempt resident foreign termination payment (within the meaning of Subdivision AA of Division 2) that related to the termination of qualifying service (within the meaning of that Division) that was made in respect of the taxpayer during that year of income were income of the taxpayer of that year of income that is exempt from tax under this section.".

60   Subsection 23AG(3) (definition of 'notional gross tax')

Insert after paragraph (a):

"(aa) if the exempt amount is an exempt resident foreign termination payment (within the meaning of Subdivision AA of Division 2) - the exempt amount (excluding any part of that amount that represented contributions made by the taxpayer) were assessable income of the taxpayer; and".

61   After subsection 23AG(4)

Insert:

"(5) Subsection (3) applies to a taxpayer in respect of income of a year of income as if any exempt resident foreign termination payment (within the meaning of Subdivision AA of Division 2) that related to the termination of employment that was made in respect of the taxpayer during that year of income were income of the taxpayer of that year of income that is exempt from tax under this section.".

62   Subsection 23AG(7) (definition of 'foreign earnings')

Add at the end:

"but does not include any payment, consideration or amount that:

(a) is included in assessable income under Subdivision AA of Division 2; or

(b) is excluded from the definition of 'eligible termination payment' in subsection 27A(1) because of paragraph (ja), (k), (ka), (m), (ma), (n) or (p) of that definition;".

63   Subsection 27A(1) (definition of 'eligible termination payment')

Insert after paragraph (k):

"(ka) an exempt resident foreign termination payment or an exempt non-resident foreign termination payment;".

64   Subsection 27A(1)

Insert:

"'approved project' has the same meaning as in section 23AF;

'eligible foreign remuneration' has the same meaning as in section 23AF;

'exempt resident foreign termination payment', in relation to a taxpayer, means a payment made in respect of the taxpayer:

(a) that:

(i) is made otherwise than from a superannuation fund (as defined by subsection 6(1)), in consequence of the termination of the taxpayer's employment or the termination of the qualifying service in relation to a project (whether or not the qualifying service was terminated in consequence of the termination of the project); and

(ii) would, apart from paragraphs (ka) and (ma) of the definition of 'eligible termination payment', be an eligible termination payment; or

(b) that:

(i) is made from an eligible non-resident non-complying superannuation fund within 6 months after the termination of the employment or qualifying service mentioned in subparagraph (a)(i); and

(ii) had the fund been a superannuation fund, would, apart from paragraphs (ka) and (ma) of the definition of 'eligible termination payment', be an eligible termination payment;

where:

(c) if the payment related to the termination of employment:

(i) the employment was service in a foreign country as the holder of an office or in the capacity of an employee; and

(ii) the taxpayer was a resident of Australia throughout the period of the employment; and

(iii) the taxpayer's foreign earnings from the employment (other than the payment) are exempt from tax under section 23AG; and

(iv) the payment related solely to the period of the employment; and

(v) the payment is not exempt from taxation under the law of the foreign country; or

(d) if the payment related to the termination of qualifying service:

(i) the project was an approved project; and

(ii) the taxpayer was a resident of Australia throughout the period of the qualifying service; and

(iii) eligible foreign remuneration (other than the payment) derived by the taxpayer that was attributable to the qualifying service is exempt from tax under section 23AF; and

(iv) the payment related solely to the period of the qualifying service; and

(v) the payment is not exempt from taxation under the law of the country from sources in which the eligible foreign remuneration in relation to the qualifying service was derived;

'exempt non-resident foreign termination payment', in relation to a taxpayer, means:

(a) a payment made in respect of the taxpayer to which the following subparagraphs apply:

(i) the payment is made otherwise than from a superannuation fund (as defined by subsection 6(1)) in consequence of the termination of the taxpayer's employment;

(ii) the payment would, apart from paragraphs (ka) and (ma) of the definition of 'eligible termination payment', be an eligible termination payment;

(iii) the employment was service in a foreign country as a holder of an office or in the capacity of an employee;

(iv) the payment related solely to a period of the employment during which the taxpayer was not a resident of Australia; or

(b) a payment made in respect of the taxpayer to which the following subparagraphs apply:

(i) the payment is made from an eligible non-resident non-complying superannuation fund within 6 months after the taxpayer became a resident of Australia;

(ii) had the fund been a superannuation fund, the payment would, apart from paragraphs (ka) and (ma) of the definition of 'eligible termination payment' in subsection 27A(1), have been an eligible termination payment;

(iii) the period to which the payment relates does not include any period other than a period in which the taxpayer was a non-resident or a period between the time when the taxpayer became a resident and the time when the taxpayer received the payment;

(iv) the benefit does not exceed the amount that was properly payable out of the fund to the taxpayer at the time when the payment was made;

'foreign earnings' has the same meaning as in section 23AG;

'qualifying service' has the same meaning as in section 23AF;".

65   Subsection 27A(3)

Omit "definition of 'eligible termination payment"', substitute "definitions of 'eligible termination payment', 'exempt resident foreign termination payment' and 'exempt non-resident foreign termination payment"'.

66   After section 27CC

Insert:

Exemption from tax-exempt resident foreign termination payment

"27CD. If an exempt resident foreign termination payment or an exempt non-resident foreign termination payment is made in relation to a taxpayer, the taxpayer's assessable income does not include that payment.".

67   Application

The amendments made by this Division apply in relation to payments made on or after 1 July 1994.

Division 11   Lump sum payments made from resident non-complying superannuation funds

68   Object

The object of this Division is to provide for a tax exemption for certain lump sum payments made from resident non-complying superannuation funds.

69   Subsection 27A(1)

Insert:

"'eligible resident non-complying superannuation fund', at a particular time (the 'relevant time'), means a fund:

(a) that:

(i) is a continuously non-complying superannuation fund (as defined by subsection 267(1)) at the relevant time; or

(ii) is a non-complying superannuation fund at the relevant time and ceased, or last ceased, to be a complying superannuation fund on or after 1 July 1995; and

(b) that:

(i) is a resident superannuation fund at the relevant time, or was a resident superannuation fund at any previous time in the year of income in which the relevant time occurred, and has always been a resident superannuation fund in relation to the years of income preceding that year of income; or

(ii) is a resident superannuation fund at the relevant time, or was a resident superannuation fund at any previous time in the year of income in which the relevant time occurred, and ceased, or last ceased, to be a non-resident superannuation fund in relation to a previous year of income on or after 1 July 1995;".

70   Subsection 27A(1) (definition of 'eligible termination payment')

Insert after paragraph (m):

"(ma) a payment from a fund that is an eligible resident non-complying superannuation fund, or an eligible non-resident non-complying superannuation fund, when the payment is made;".

71   Before section 27D

Insert:

Exemption from tax-payment from eligible resident non-complying superannuation fund

"27CE. (1) If:

(a) a lump sum payment (including a payment made as a result of the commutation of a superannuation pension or of an annuity) is made from a fund that is an eligible resident non-complying superannuation fund in respect of a taxpayer when the payment is made; and

(b) had the fund been a superannuation fund, the payment would, apart from paragraph (ma) of the definition of 'eligible termination payment' in subsection 27A(1), have been an eligible termination payment;

the taxpayer's assessable income does not include that payment.

"(2) Subsection 27A(3) applies for the purposes of this section in a corresponding way to the way in which it applies for the purposes of the definition of 'eligible termination payment' in subsection 27A(1).".

72   Application

The amendments made by this Division apply in relation to payments made on or after 1 July 1994.

Division 12   Lump sum payments from certain non-resident superannuation funds

73   Object

The object of this Division is to include in assessable income lump sum payments made from certain non-resident superannuation funds and to allow credits for foreign tax paid on, and to exempt from tax contributions included in, such lump sum payments.

74   Subsection 6AB(1)

(a) Insert "(including eligible termination payments as defined in subsection 27A(1))" before "derived".

(b) Insert: "27CAA," before "102AAZD".

75   Subsection 27A(1)

Insert:

"'eligible non-resident non-complying superannuation fund' means a non-resident superannuation fund that:

(a) is a continuously non-complying superannuation fund (as defined in subsection 267(1)); or

(b) is a non-complying superannuation fund that ceased, or last ceased, to be a complying superannuation fund on or after 1 July 1995;".

76   After section 27C

Insert:

Assessable income to include component of lump sum payment from an eligible non-resident non-complying superannuation fund

"27CAA. (1) If:

(a) a payment (the 'relevant payment') of a lump sum (including a payment made as a result of the commutation of a superannuation pension or of an annuity but not including an 'exempt resident foreign termination payment' or an 'exempt non-resident foreign termination payment') is made from a fund that is an eligible non-resident non-complying superannuation fund in relation to a taxpayer when the relevant payment is made; and

(b) had the fund been a superannuation fund, the relevant payment would, apart from paragraph (ma) of the definition of 'eligible termination payment' in subsection 27A(1), have been an eligible termination payment; and

(c) the amount (the 'gross amount') that was properly payable on the day on which the relevant payment was made before any deduction was made from that amount exceeds the amount worked out using the formula:

Accumulated entitlement plus Additional contributions;

then the taxpayer's assessable income of the year of income in which the relevant payment is made includes the amount of the excess.

"(2) For the purposes of the formula in subsection (1):

'Accumulated entitlement' means the amount properly payable to the taxpayer out of the fund on the day immediately before the relevant day;

'Additional contributions' means so much (if any) of the gross amount as represented contributions paid by the taxpayer, or an employer of the taxpayer, on or after the relevant day;

'relevant day' means the day on which the taxpayer became a member of the fund or the first day during the period to which the relevant payment relates on which the taxpayer became a resident of Australia, whichever is the later.

"(3) Subsection 27A(3) applies for the purposes of this section in a corresponding way to the way in which it applies for the purposes of the definition of "eligible termination payment" in subsection 27A(1).".

77   After subsection 160AF(5)

Insert:

"(6) If:

(a) a payment is made from a superannuation fund in respect of a taxpayer; and

(b) an amount (the 'assessable component') is included in the taxpayer's assessable income under section 27CAA in respect of the payment; and

(c) the taxpayer has paid foreign tax in respect of the assessable component for which the taxpayer was personally liable;

then, for the purposes of subsection (1), the amount of that foreign tax is taken to be the amount worked out using the formula:

(Actual foreign tax * Assessable component) / Gross amount of payment

where:

'Actual foreign tax' means the amount of the foreign tax actually paid by the taxpayer in respect of the payment referred to in paragraph (a);

'Assessable component' means the assessable component;

'Gross amount of payment' means the amount of the payment referred to in paragraph (a) that was due to be made before any deduction was made from that amount.".

78   After paragraph 160AF(7)(b)

Insert:

"(ba) an amount included in assessable income under section 27CAA;".

79   Subsection 274(10)

At the end of the subsection add:

"(c) a transfer of an amount from an eligible non-resident non-complying superannuation fund to a resident superannuation fund other than so much of the amount as was properly payable out of the first-mentioned fund to a member of that fund on the day on which the transfer took place.".

80   Application

The amendments made by this Division apply to assessments in respect of income of the 1994-95 year of income and each later year of income.

Division 13   To make certain amendments to Subdivision AA of Division 2 of Part III in consequence of the amendments made by Divisions 11 and 12

81   Objects

The objects of this Division are:

(a) to exclude eligible resident non-complying superannuation funds and eligible non-resident non-complying superannuation funds from the operation of Subdivision AA of Division 2 of Part III; and

(b) to ensure that payments from a non-resident superannuation fund that is not an eligible non-resident non-complying superannuation fund are treated as eligible termination payments made from an untaxed source.

82   Subsection 27A(1) (definition of 'superannuation fund')

(a) Omit subparagraph (ia) of paragraph (a), substitute:

"(ia) a fund that is or has been a non-resident superannuation fund in relation to any year of income;".

(b) Add at the end (but not as part of paragraph (b) of the definition) "but does not include an eligible resident non-complying superannuation fund or an eligible non-resident non-complying superannuation fund".

83   Subsection 27A(1) (definition of 'taxed superannuation fund')

Add at the end:

"and (c) is a resident superannuation fund in relation to the year of income in which the ETP was made;".

84   After subsection 27A(12B)

Insert:

"(12BA) Despite subsection (12), a payment from a non-resident superannuation fund is not a qualifying eligible termination payment.".

85   Application

The amendments made by this Division apply to assessments in respect of income of the 1994-95 year of income and each later year of income.

Division 14   Pension or annuity paid from non-complying superannuation fund

86   Object

The object of this Division is to include in assessable income pensions and annuities paid from certain non-complying superannuation funds.

87   Subsection 27H(1)

Omit "The assessable income", substitute "Subject to subsection (1A), the assessable income".

88   After subsection 27H(1)

Insert:

"(1A) An annuity paid from a fund that is an eligible resident non-complying superannuation fund when the payment is made is exempt from income tax.".

89   Subsection 27H(4) (definition of 'annuity')

Omit the definition, substitute:

"'annuity' includes:

(a) a superannuation pension; and

(b) a pension or annuity paid from a fund that is an eligible non-resident non-complying superannuation fund when the payment is made;

but does not include an annuity that is a qualifying security for the purposes of Division 16E;".

90   Application

The amendments made by this Division apply to assessments in respect of income of the 1994-95 year of income and each later year of income.

Division 15   Roll-over annuities bought from life assurance companies

91   Object

The object of this Division is to require roll-over annuities bought from life assurance companies to be in the form of Australian policies.

92   Subparagraph 27A(12)(c)(ii)

Omit "death of the taxpayer.", substitute "death of the taxpayer; and".

93   Paragraph 27A(12)(c)

Add at the end:

"(iii) if the annuity is purchased from a life assurance company - is an Australian policy (as defined by subsection 110(1)).".

94   Application

The amendments made by this Division apply in relation to amounts paid to a life assurance company on or after 1 July 1994.

Division 16   Amounts paid by Part IX entities that are subject to tax under Part XI

95   Object

The object of this Division is to exempt from tax amounts paid by Part IX entities that are subject to tax under Part XI.

96   Subparagraph 23AK(1)(a)(i)

Omit "or (g)", substitute ", (g) or (h)".

97   Subsection 23AK(1)

Add at the end:

"(i) if the payment is of a kind referred to in paragraph 603(1)(h) - the payment is exempt from tax to the extent of the debit.".

98   Subsection 603(1)

Add at the end:

"(h) an amount that is included in assessable income under Subdivision AA of Division 2 of Part III.".

99   Application

The amendments made by this Division apply, or are taken to have applied, in relation to amounts paid on or after 1 January 1993.

Division 17   Assessments

100   Amendment of assessments

Section 170 of the Income Tax Assessment Act 1936 does not prevent the amendment of an assessment made before the commencement of this Part for the purpose of giving effect to this Part.

Part 3   INCOME TAX ACT 1986

101   Object

The object of this Part is to make amendments relating to non-complying superannuation funds that were previously complying superannuation funds, and to resident superannuation funds that were previously non-resident superannuation funds.

102   Section 5

Add at the end:

"(5) This Act does not impose tax upon the taxable income of a non-complying superannuation fund within the meaning of Part IX of the Assessment Act, to the extent that the taxable income is attributable to the inclusion of an amount in the fund's assessable income under section 288A of that Act.

"(6) This Act does not impose tax upon the taxable income of a resident superannuation fund, to the extent that the taxable income is attributable to the inclusion of an amount in the fund's assessable income under section 288B of that Act.".

Part 4   SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993

Division 1   Amendments relating to the residency of superannuation funds and approved deposit funds

103   Objects

The objects of this Division are:

(a) to restrict "complying superannuation fund" status to resident superannuation funds; and

(b) to restrict "complying approved deposit fund" status to resident approved deposit funds.

104   Section 10

Insert:

"'resident approved deposit fund' has the meaning given by section 20A;

'resident regulated superannuation fund' means a regulated superannuation fund that is a resident superannuation fund within the meaning of subsection 6E(1) of the Income Tax Assessment Act 1936;".

105   After section 20

Insert:

Resident approved deposit funds

"20A. (1) For the purposes of this Act, an approved deposit fund is a resident approved deposit fund at a particular time if, and only if:

(a) either:

(i) the fund was established in Australia; or

(ii) at that time, any asset of the fund is situated in Australia; and

(b) at that time, the central management and control of the fund is in Australia; and

(c) at that time, the percentage worked out using the following formula is not less than 50%:

(Accumulated entitlements of resident members / Total assets of fund) * 100

where:

'Accumulated entitlements of resident members' means the sum of so much of the value of the assets of the fund at that time as is attributable to:

(i) deposits made to the fund before that time by or in respect of members of the fund who are residents at that time; and

(ii) income or accretions arising from those deposits;

'Total assets of fund' means the value of the assets of the fund at that time.

Definitions

"(2) In this section:

'Australia' has the same meaning as in the Income Tax Assessment Act 1936;

'member' includes depositor;

'resident' has the same meaning as in the Income Tax Assessment Act 1936.".

106   Paragraph 42(1)(a)

Before "regulated superannuation fund" insert "resident".

107   Paragraph 43(a)

Omit "an approved deposit fund", substitute "a resident approved deposit fund".

108   Application

The amendments made by this Division apply in relation to the 1994-95 year of income and each later year of income.

Division 2   Amendments relating to contraventions that are taken into account in determining 'complying superannuation fund' status

109   Object

The object of this Division is to limit the circumstances in which contraventions are taken into account in determining "complying superannuation fund" status.

110   Paragraph 42(1)(b)

Omit the paragraph, substitute:

"(b) either of the following conditions is satisfied:

(i) the trustee did not contravene this Act or the regulations in relation to the entity in respect of the year of income;

(ii) both:

(A) the trustee contravened this Act or the regulations in relation to the entity in respect of the year of income on one or more occasions; and

(B) the entity did not fail the culpability test set out in subsection (1A) in relation to any of those contraventions.".

111   After subsection 42(1)

Insert:

"(1A) For the purposes of subparagraph (1)(b)(ii), an entity fails the culpability test in relation to a particular contravention of this Act or the regulations if:

(a) both:

(i) all of the members of the entity were in any way directly or indirectly knowingly concerned in, or party to, the contravention; and

(ii) the Commissioner, after considering:

(A) the taxation consequences that would arise if the entity were to be treated as a non-complying superannuation fund for the purposes of Part IX of the Income Tax Assessment Act 1936 in relation to the year of income concerned; and

(B) the seriousness of the contravention; and

(C) all other relevant circumstances;

thinks that a notice should be given stating that the entity is not a complying superannuation fund in relation to the year of income concerned; or

(b) all of the following conditions are satisfied:

(i) one or more members of the entity were in any way directly or indirectly knowingly concerned in, or party to, the contravention;

(ii) one or more members of the entity (the 'innocent members') were not in any way directly or indirectly knowingly concerned in, or party to, the contravention;

(iii) none of the innocent members would suffer any substantial financial detriment if the entity were to be treated as a non-complying superannuation fund for the purposes of Part IX of the Income Tax Assessment Act 1936 in relation to the year of income concerned;

(iv) the Commissioner, after considering:

(A) the taxation consequences that would arise if the entity were to be treated as a non-complying superannuation fund for the purposes of Part IX of the Income Tax Assessment Act 1936 in relation to the year of income concerned; and

(B) the seriousness of the contravention; and

(C) all other relevant circumstances;

thinks that a notice should be given stating that the entity is not a complying superannuation fund in relation to the year of income concerned.

"(1B) For the purposes of subsection (1A), if there is a question whether a person was in any way directly or indirectly knowingly concerned in, or party to, a particular contravention, that question may be decided on the balance of probabilities.".

112   Application

The amendments made by this Division apply in relation to the 1994-95 year of income and each later year of income.

Division 3   Amendments relating to the equal representation rules

113   Object

The object of this Division is to abolish the rule that allows contraventions of the "equal representation" provisions of Part 9 of the Superannuation Industry (Supervision) Act 1993 to be taken into account in determining "complying superannuation fund" status.

114   Subsection 39(1)

Omit "(other than Part 9)".

115   Subsection 42(2)

Omit the subsection.

116   Section 87

Omit "not being a complying superannuation fund for the purposes of Part IX of the Income Tax Assessment Act (see Part 5 of this Act)", substitute "being directed under section 63 not to accept any contributions made to the fund by an employer-sponsor (see subsection 63(6))".

117   Application

The amendments made by this Division apply in relation to the 1994-95 year of income and each later year of income.

Part 5   SUPERANNUATION GUARANTEE (ADMINISTRATION) ACT 1992

118   Object

The object of this Part is to make some minor amendments consequential on amendments to the Superannuation Industry (Supervision) Act 1993.

119   Subparagraph 24(1)(a)(i)

Before "regulated", insert "resident".

120   Subsection 24(4)

Before "regulated" (wherever occurring), insert "resident".

121   Subsection 25(1)

Before "the time", insert "or before".

122   Paragraph 25(1)(a)

Before "regulated", insert "resident".

123   Paragraph 25(2)(b)

Before "regulated", insert "resident".

124   Paragraph 65(2)(a)

Before "regulated", insert "resident".

125   Application

1. The amendments made by items 119 and 120 apply to a scheme in relation to so much of a contribution period as occurs after the beginning of the scheme's 1994-95 year of income.

2. The amendments made by items 121 and 122 apply to contributions made to a superannuation fund at or after the beginning of the fund's 1994-95 year of income.

3. The amendments made by items 123 and 124 apply to a payment to a superannuation fund at or after the beginning of the fund's 1994-95 year of income.

Schedule 4   AMENDMENTS RELATING TO RESEARCH AND DEVELOPMENT ACTIVITIES

Part 1   INDUSTRY RESEARCH AND DEVELOPMENT ACT 1986

1   Objects

The objects of this Part are:

(a) to empower the Industry Research and Development Board to formulate guidelines, and give certificates, for the purpose of enabling certain companies engaging in overseas research and development activities to obtain taxation concessions; and

(b) to reduce the expenditure threshold for those concessions in respect of companies registering jointly.

2   Subsection 39E(1)

Insert "Australian" before "research".

3   After section 39EA

Insert:

Guidelines concerning overseas research and development activities

"39EB. (1) The Board must, as soon as practicable (and, in any event, within 90 days) after the commencement of this section, formulate written guidelines setting out the criteria to be met by eligible companies wishing to obtain a provisional certificate under section 39ED in relation to overseas research and development activities proposed to be carried on by them as part of projects of research and development activities.

"(2) The Board must cause the guidelines to be:

(a) published in the Gazette; and

(b) made available on request, without charge, to any eligible company.

"(3) The criteria to be set out in the guidelines must include the following criteria:

(a) it must be shown that the proposed overseas research and development activities cannot be carried out in Australia or the external Territories;

(b) it must be shown that the results of the overseas research and development activities will be exploited by the eligible company concerned for the benefit of the Australian economy;

(c) it must be shown that the expenditure:

(i) that is proposed to be incurred by the eligible company in respect of the overseas research and development activities; and

(ii) in respect of which the company proposes to claim a deduction under section 73B of the Income Tax Assessment Act 1936;

will not exceed 10% of the total expenditure that the company has incurred or proposes to incur on the project of research and development activities.

"(4) An instrument formulating guidelines under subsection (1) is a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901.

Applications for provisional certificates

"39EC. (1) An eligible company that proposes to incur expenditure in carrying on overseas research and development activities in respect of which it proposes to claim a deduction under section 73B of the Income Tax Assessment Act 1936 may apply to the Board for a provisional certificate in respect of the activities.

"(2) The application must:

(a) be in writing; and

(b) describe the project to which the proposed activities relate; and

(c) describe the proposed activities; and

(d) state the respective amounts of expenditure proposed to be incurred by the company on the project that relate to:

(i) Australian research and development activities; and

(ii) overseas research and development activities; and

(iii) if the company proposes to claim a deduction under section 73B of the Income Tax Assessment Act 1936 in respect of part only of the expenditure on overseas research and development activities - the amount of that part of the expenditure; and

(e) be accompanied by any other information that the Board reasonably requires.

Board's decision on application for provisional certificate

"39ED. (1) After considering an application under section 39EC, the Board must decide to:

(a) grant the application; or

(b) refuse the application.

"(2) If the Board has not made a decision under subsection (1) before whichever time (the 'eligible time') is the later of the following times:

(a) the end of the period (the 'original 90-day period') of 90 days after the day on which the application was received by the Board;

(b) if the Board, by written notice given to the applicant within the original 90-day period, requests the applicant to give further information about the application - the end of the period of 90 days after the Board receives the further information;

then, at the eligible time, the Board is taken to have made a decision under subsection (1) to refuse the application.

"(3) If the Board makes a decision under subsection (1) before the eligible time, the Board must give written notice of the decision to the applicant.

"(4) A notice under subsection (3) relating to a refusal must set out the reasons for the refusal.

"(5) The Board must not grant the application unless the Board is satisfied that the applicant meets the criteria set out in the guidelines formulated under section 39EB.

"(6) If the Board grants the application, it must give to the applicant a provisional certificate in respect of the activities to which the application relates.

Matters to be contained in provisional certificate

"39EE. (1) A provisional certificate given to an eligible company under section 39ED must:

(a) describe the overseas research and development activities to which the certificate relates; and

(b) contain a description of the project of research and development activities to which those overseas research and development activities relate; and

(c) state the amount of proposed expenditure on overseas research and development activities in respect of which the company proposes to claim a deduction under section 73B of the Income Tax Assessment Act 1936; and

(d) contain any other matters that the Board considers relevant.

"(2) After a provisional certificate is given to a company under section 39ED, the company may apply in writing to the Board for the certificate to be amended so as to vary either or both of the following:

(a) the description of the overseas research and development activities;

(b) the amount of the proposed expenditure on overseas research and development activities in respect of which the company proposes to claim a deduction under section 73B of the Income Tax Assessment Act 1936.

"(3) If:

(a) such an application is made; and

(b) the provisional certificate is produced to the Board; and

(c) the Board is satisfied that it is appropriate to amend the certificate having regard to the criteria set out in the guidelines formulated under subsection 39EB(1);

the Board may amend the certificate accordingly and return the amended certificate to the company.".

4   Section 39F

Insert "Australian" before "research" (wherever occurring).

5   After section 39L

Insert:

Certificate as to overseas research and development activities

"39LAA. (1) The Board may, and must if requested in writing by the Commissioner to do so, give to the Commissioner a certificate stating whether particular activities that have been or are being carried on by or on behalf of an eligible company in respect of a project are the overseas research and development activities described in the provisional certificate given to the company.

"(2) If the Board gives a certificate under subsection (1), the Board must give to the company concerned:

(a) a copy of the certificate; and

(b) if the Board decided that particular activities were not the overseas research and development activities described in the provisional certificate - a statement of the reasons for its decision.".

6   Paragraph 39P(3)(c)

Omit "$1,000,000", substitute "$500,000".

7   Subsection 39S(1)

(a) After "under", insert "section 39ED, subsection 39EE(3),".

(b) Insert ", 39LAA" after "39L".

8   Application

The amendment made by item 6 applies to the joint registration of companies on or after 1 July 1994 in respect of a proposed project or proposed projects comprising or including research and development activities starting on or after that date.

Part 2   INCOME TAX ASSESSMENT ACT 1936

9   Object

The object of this Part is to broaden the research and development taxation concession by reducing the expenditure threshold and extending the concession to activities conducted outside Australia and the external Territories.

10   Subsection 73B(1) (definition of 'aggregate research and development amount')

Add at the end (but not as part of paragraph (d)) "but does not include expenditure on overseas research and development activities that is not certified expenditure".

11   Subsection 73B(1) (definition of 'deduction acceleration factor')

Omit the definition.

12   Subsection 73B(1)

Insert:

"'Australian research and development activities' means research and development activities that are carried on in Australia or in an external Territory;

'certified expenditure' means expenditure that was incurred by an eligible company on overseas research and development activities in respect of which the Board gave a provisional certificate under section 39ED of the Industry Research and Development Act 1986 before the expenditure was incurred;

'overseas research and development activities' means research and development activities that are carried on outside Australia and the external Territories;".

13   Subsection 73B(1) (definition of 'research and development activities')

Omit the definition, substitute:

"'research and development activities' means:

(a) systematic, investigative or experimental activities that involve innovation or technical risk and are carried on for the purpose of:

(i) acquiring new knowledge (whether or not that knowledge will have a specific practical application); or

(ii) creating new or improved materials, products, devices, processes or services; or

(b) other activities that are carried on for a purpose directly related to the carrying on of activities of the kind referred to in paragraph (a);".

14   Subsection 73B(14)

Omit "the deduction acceleration factor in relation to the company in relation to the year of income", substitute "1.5".

15   Paragraph 73B(15)(a)

Omit "the deduction acceleration factor in relation to the company in relation to the year of income", substitute "1.5".

16   After subsection 73B(17)

Insert:

"(17A) An amount is not allowable as a deduction under subsection (12), (13), (14), (15) or (17) from a company's assessable income of a year of income in respect of expenditure on overseas research and development activities unless the expenditure is certified expenditure.".

17   Subparagraph 73B(23)(e)(i)

Omit "the deduction acceleration factor in relation to the company in relation to the year of income", substitute "1.5".

18   Paragraph 73B(24)(e)

Omit "the deduction acceleration factor in relation to the company in relation to the year of income", substitute "1.5".

19   After subsection 73B(34)

Insert:

"(34A) If the Board gives to the Commissioner a certificate stating whether particular activities that have been or are being carried on by or on behalf of an eligible company in respect of a project are the overseas research and development activities described in the provisional certificate given by the Board to the company under section 39ED of the Industry Research and Development Act 1986, the certificate is binding on the Commissioner for the purpose of making an assessment of the company's taxable income of any year of income in which any research and development activities included in the project were carried on.".

20   Subsection 73C(9)

Omit the subsection, substitute:

"(9) If clawback applies to expenditure (other than contracted expenditure) incurred on or after 21 November 1987, subsection 73B(14) and paragraph 73B(15)(a) have effect as if 'multiplied by 1.5' were omitted from that subsection and that paragraph.".

21   Subsection 124ZF(1) (definition of 'research and development activities')

Omit subparagraph (a)(ii), substitute:

"(ii) would be research and development activities for the purposes of that section if subsection (2A) of that section were amended so that references in that subsection to an eligible company included references to a person other than an eligible company; and".

22   Application

The amendments made by this Part apply to deductions claimed for the 1994-95 year of income, or any later year of income, in respect of expenditure related to research and development activities.

23   Amendment of assessments

Section 170 of the Income Tax Assessment Act 1936 does not prevent the amendment of an assessment made before the commencement of this Part for the purpose of giving effect to this Part.

Schedule 5   AMENDMENTS RELATING TO THE PAYMENT OF INTEREST ON OVERPAYMENTS AND EARLY PAYMENTS

Part 1   OBJECT

1   Object

The object of this Schedule is:

(a) to extend the cases where interest is payable on overpayments under the Taxation (Interest on Overpayments) Act 1983; and

(b) to provide that interest is payable under that Act on certain early payments; and

(c) to change the basis for setting the rate of interest payable under that Act and under other Acts that adopt that rate for their purposes.

Part 2   TAXATION (INTEREST ON OVERPAYMENTS) ACT 1983

2   Title

After "overpayments" insert "and early payments".

3   Section 1

After "Overpayments" insert "and Early Payments".

4   Subsection 3(1) (paragraph (ca) of the definition of 'decision to which this Act applies')

Omit all the words after "taxpayer to tax".

5   Subsection 3(1) (definition of 'income tax')

Omit "Income Tax Assessment Act 1936" (wherever occurring), substitute "Tax Act".

6   Subsection 3(1) (definition of 'provisional tax')

Omit "Income Tax Assessment Act 1936", substitute "Tax Act".

7   Subsection 3(1) (paragraphs (a), (b), (ba), (bb), (bc), (c) and (caa) of the definition of 'relevant tax')

Omit "Income Tax Assessment Act 1936" (wherever occurring), substitute "Tax Act".

8   Subsection 3(1) (definition of 'year of income')

Omit "Income Tax Assessment Act 1936", substitute "Tax Act".

9   Subsection 3(1)

Insert:

"'double tax agreement' means an agreement within the meaning of the Income Tax (International Agreements) Act 1953;

'final instalment day' means:

(a) in relation to a year of income of a relevant entity - the day by which the final payment of tax in respect of income of the year of income:

(i) is required to be made under section 221AZD of the Tax Act (as affected by sections 221AN and 221AU of that Act); or

(ii) would be required to be made under that section (as so affected) if the requirements of paragraph (b) of that section were met; and

(b) in relation to a year of income of an instalment taxpayer - the day by which the final instalment for the year of income is liable to be paid under section 221AZK;

'income tax crediting amount', in relation to income tax payable by a person for a year of income, means any amount that is required or permitted to be credited or applied against the income tax under:

(a) section 159GDA, 160AQK, 220AZC, 221AZF, 221AZM, 221H, 221K, 221YE, 221YHG, 221YHZL, 221YT, 221ZG or 221ZT of the Tax Act; or

(b) section 160AN of the Tax Act, provided that, only in the case where the applying of the amount is to provide correlative relief in respect of the taxing of an amount under a law of a foreign country, the following requirements are met:

(i) the law of the foreign country requires the payment of late payment interest in respect of the amount taxed; and

(ii) the late payment interest was paid by the time the applying of the amount took place;

'FS assessment debt' has the meaning given by subsection 3(1) of the Student Assistance Act 1973;

'HEC assessment debt' has the meaning given by subsection 34(1) of the Higher Education Funding Act 1988;

'instalment taxpayer' means an instalment taxpayer within the meaning of section 221AZH of the Tax Act;

'late payment interest', in respect of an amount, means interest payable solely to compensate for the time value of the amount;

'provide correlative relief' has the meaning given by section 3A;

'relevant entity' means a relevant entity within the meaning of section 221AK of the Tax Act;

'Tax Act' means the Income Tax Assessment Act 1936.".

10   After section 3

Insert in Part I:

Provision of correlative relief

"3A. (1) For the purposes of this Act, a decision to which this Act applies is made, or the applying of an income tax crediting amount takes place, to 'provide correlative relief' in respect of the taxing of an amount under a law of a foreign country if:

(a) there is a double tax agreement between Australia and the foreign country; and

(b) a provision of the double tax agreement has been prescribed, or the manner of operation of a provision of the double tax agreement has been prescribed, for the purposes of this paragraph; and

(c) the decision is made, or the applying of the income tax crediting amount takes place, in giving effect, or in circumstances that would enable effect to be given, to the provision mentioned in paragraph (b), or to that provision in its operation in the prescribed manner, as a result of the taxing of the amount under the law of the foreign country.

"(2) For the purposes of this Act, a decision to which this Act applies is also made, or the applying of an income tax crediting amount also takes place, to 'provide correlative relief' in respect of the taxing of an amount under a law of a foreign country (the 'primary foreign country') if:

(a) there is no double tax agreement between Australia and the primary foreign country; and

(b) a provision of a double tax agreement between Australia and a foreign country other than the primary foreign country has been prescribed, or the manner of operation of a provision of such an agreement has been prescribed, for the purposes of this paragraph; and

(c) the decision is made, or the applying of the income tax crediting amount takes place, in circumstances that would enable effect to be given to the provision mentioned in paragraph (b), or to that provision in its operation in the prescribed manner, as a result of the taxing of the amount under the law of the primary foreign country, if the double tax agreement had instead been entered into between Australia and the primary foreign country.".

11   After Part II

Insert:

"PART IIA - INTEREST ON EARLY PAYMENTS

Entitlement to interest

"8A. (1) If:

(a) a person makes a payment of, or on account of:

(i) income tax; or

(ii) HEC assessment debt; or

(iii) FS assessment debt; or

(iv) additional tax under Part VII of the Tax Act; or

(v) interest under section 102AAM of the Tax Act; or

(vi) provisional tax; or

(vii) an instalment of provisional tax within the meaning of section 221YA of the Tax Act; or

(viii) an amount mentioned in subsection 221AP(1) of the Tax Act; or

(ix) an amount mentioned in paragraph 221AZD(b) of the Tax Act; or

(x) an instalment under subsection 221AZK(2) of the Tax Act; and

(b) the payment is made more than 14 days before:

(i) if subparagraph (ii) does not apply - the day (the 'appropriate due day') on which the tax, debt, interest, amount or instalment concerned becomes due and payable; or

(ii) if the person is a relevant entity or an instalment taxpayer and the payment is of, or on account of, income tax - the final instalment day (also the 'appropriate due day') in respect of the year of income in respect of which the income tax is payable;

interest is payable by the Commissioner to the person on the payment, calculated in respect of the period applicable under section 8B at the rate specified in section 8C.

"(2) A reference in paragraph (1)(a) to a person making a payment of, or on account of:

(a) income tax; or

(b) HEC assessment debt; or

(c) FS assessment debt;

does not include a reference to the making of a deduction or payment under Part VI (other than Division 1) of the Tax Act or section 20B of the Loan (Income Equalisation Deposits) Act 1976.

"(3) A reference in paragraph (1)(a) to a person making a payment of, or on account of, any thing listed in any of the subparagraphs of that paragraph does not include a reference to the person being deemed or taken, by the Tax Act or any other Act, to have paid the thing because of the crediting or applying of any relevant tax, income tax crediting amount or other payment.

Interest period

"8B. (1) Subject to subsection (2), interest under section 8A is payable to a person for the period:

(a) if the person is neither a relevant entity nor an instalment taxpayer - from the beginning of the later of the following days:

(i) the day on which the payment is made;

(ii) the day on which the notice notifying the tax, debt, interest or instalment concerned is issued; and

(b) if the person is a relevant entity or an instalment taxpayer - from the beginning of the day on which the payment is made;

until the end of the appropriate due day.

"(2) If the payment is to any extent refunded before the appropriate due day, interest is not payable on the payment to that extent in respect of any period after the day on which the refund takes place.

Rate of interest

"8C. Interest under section 8A is payable at such annual rate or rates as are provided for by section 214A of the Tax Act, less 4 percentage points.

No double entitlement to interest

"8D. If:

(a) interest is payable under this Part on a payment in respect of a period; and

(b) interest is also payable under Part IIIA on the whole or part of the payment in respect of the whole or part of the period;

then interest is not payable under this Part on the whole or part of the payment in respect of the whole or part of the period.".

"PART IIB - INTEREST ON OVERPAYMENTS RESULTING FROM ASSESSMENTS

Entitlement to interest - ordinary taxpayers

"8E. (1) If:

(a) a person who is neither a relevant entity nor an instalment taxpayer furnishes a return of income for a year of income; and

(b) an assessment is made of the income tax payable by the person for the year of income; and

(c) the notice of assessment notifies that the Commissioner has credited, applied or refunded (which crediting, applying or refunding is the 'notice crediting') one or more income tax crediting amounts in relation to the income tax payable by the person for the year of income; and

(d) the sum of the income tax crediting amounts in paragraph (c) exceeds the sum of the following amounts:

(i) income tax payable under the assessment (after allowing any rebate or deduction under subsection 100(2) of the Tax Act and before allowing any crediting, applying or other payment);

(ii) additional tax for the year of income payable by the person under Part VII of the Tax Act immediately before the notice crediting;

(iii) an HEC assessment debt that is notified in the notice of assessment;

(iv) an FS assessment debt that is notified in the notice of assessment;

(v) interest for the year of income payable by the person under section 102AAM of the Tax Act immediately before the notice crediting; and

(e) the notice crediting occurs more than 30 days or more after the day on which the person furnishes the return of income;

interest is payable by the Commissioner to the person on the excess mentioned in paragraph (d), calculated in respect of the period applicable under section 8F at the rate specified in section 8I.

"(2) If:

(a) a person who is neither a relevant entity nor an instalment taxpayer furnishes a return of income for a year of income; and

(b) an assessment is made of the income tax payable by the person for the year of income; and

(c) after the notice of assessment is issued to the person, the Commissioner credits, applies or refunds (which crediting, applying or refunding is a 'post-notice crediting') one or more income tax crediting amounts in relation to the income tax payable by the person for the year of income; and

(d) the sum of the income tax crediting amounts in paragraph (c) exceeds the sum of the following amounts:

(i) income tax payable for the year of income by the person immediately before the post-notice crediting;

Note: This is the amount payable under the assessment for the year of income as reduced by any rebate, deduction under subsection 100(2) of the Tax Act, crediting, applying or other payment made before the post-notice crediting.

(ii) additional tax for the year of income payable by the person under Part VII of the Tax Act immediately before the post-notice crediting;

(iii) an HEC assessment debt, worked out by reference to the person's taxable income of the year of income, payable by the person immediately before the post-notice crediting;

(iv) an FS assessment debt, worked out by reference to the person's taxable income of the year of income, payable by the person immediately before the post-notice crediting;

(v) interest for the year of income payable by the person under section 102AAM of the Tax Act immediately before the post-notice crediting;

interest is payable by the Commissioner to the person on the excess mentioned in paragraph (d), calculated in respect of the period applicable under section 8F at the rate specified in section 8I.

Interest period-ordinary taxpayers

"8F. (1) If subsection 8E(1) applies, the interest is payable on the excess mentioned in paragraph 8E(1)(d) for the period from the beginning of the 30th day after the day on which the person furnishes the return of income until the end of the day on which the notice of assessment is issued.

"(2) If subsection 8E(2) applies and subsection (3) of this section does not apply, the interest is payable on the excess mentioned in paragraph 8E(2)(d) for the period from the beginning of the day on which the notice of assessment is issued until the end of the day on which the post-notice crediting occurs.

"(3) If:

(a) subsection 8E(2) applies; and

(b) one or more payments have been made (including any taken to have been made because of the crediting or applying of any amount) of any amounts mentioned in subparagraphs 8E(1)(d)(i) to (v) (including those amounts as increased or decreased for any reason) after the notice of assessment is issued and before the post-notice crediting;

the interest is payable:

(c) on so much of the excess as is attributable to a particular payment mentioned in paragraph (b) - for the period from the beginning of the day on which the payment was made until the end of the day on which the post-notice crediting occurs; and

(d) on so much of the excess as is not attributable to payments mentioned in paragraph (b) - for the period from the beginning of the day on which the notice of assessment is issued until the end of the day on which the post-notice crediting occurs.

"(4) For the purposes of subsection (3), but subject to subsection (5), the excess is attributable toa particular payment to the extent that it would be set off against that payment if it were set off in succession against each of the payments in the reverse of the order in which they were made.

"(5) For the purposes of subsection (4), any payment is to be disregarded to the extent that:

(a) it consists of an amount on which interest is payable under section 9; or

(b) it has been taken into account in any previous application of subsection (4) of this section in relation to a post-notice crediting occurring before the current post-notice crediting.

Entitlement to interest-relevant entities and instalment taxpayers

"8G. (1) If:

(a) a person who is a relevant entity or an instalment taxpayer furnishes a return of income for a year of income; and

(b) after the person furnishes the return, the Commissioner credits, applies or refunds (which crediting, applying or refunding is the 'first crediting') one or more income tax crediting amounts in relation to the income tax payable by the person for the year of income; and

(c) the Commissioner has not previously credited, applied or refunded any income tax crediting amount in relation to the income tax payable by the person for the year of income; and

(d) the sum of the income tax crediting amounts in paragraph (b) exceeds the sum of the following amounts:

(i) income tax payable by the person for the year of income (after allowing any rebate or deduction under subsection 100(2) of the Tax Act and before any crediting, applying or other payment);

(ii) additional tax for the year of income payable by the person under Part VII of the Tax Act immediately before the first crediting;

(iii) interest for the year of income payable by the person under section 102AAM of the Tax Act immediately before the first crediting; and

(e) if the person furnishes the return of income for the year of income 30 days or more before the final instalment day in relation to the year of income - the first crediting occurs 30 days or more after the day on which the person furnishes the return; and

(f) if the person furnishes the return of income for the year of income after the 30th day before the final instalment day in relation to the year of income - the first crediting occurs on or after the final instalment day;

interest is payable by the Commissioner to the person on the excess mentioned in paragraph (d), calculated in respect of the period applicable under section 8H at the rate specified in section 8I.

"(2) If:

(a) a person who is a relevant entity or an instalment taxpayer furnishes a return of income for a year of income; and

(b) after the first crediting, the Commissioner credits, applies or refunds (which crediting, applying or refunding is a 'later crediting') one or more income tax crediting amounts in relation to the income tax payable by the person for the year of income; and

(c) the sum of the income tax crediting amounts in paragraph (b) exceeds the sum of the following amounts:

(i) income tax payable for the year of income by the person immediately before the later crediting;

Note: This is the income tax payable for the year of income as reduced by any rebate, deduction under subsection 100(2) of the Tax Act, crediting, applying or other payment made before the later crediting.

(ii) additional tax for the year of income payable by the person under Part VII of the Tax Act immediately before the later crediting;

(iii) interest for the year of income payable by the person under section 102AAM of the Tax Act immediately before the later crediting; and

interest is payable by the Commissioner to the person on the excess mentioned in paragraph (c), calculated in respect of the period applicable under section 8H at the rate specified in section 8I.

Interest period - relevant entities and instalment taxpayers

"8H. (1) If subsection 8G(1) applies, the interest is payable on the excess mentioned in paragraph 8G(1)(d) for the period from the beginning of the earlier of the following days:

(a) the 30th day after the day on which the person furnishes the return of income for the year of income;

(b) the final instalment day in relation to the year of income;

until the end of the day on which the first crediting occurs.

"(2) If subsection 8G(2) applies and subsection (3) of this section does not apply, the interest is payable on the excess mentioned in paragraph 8G(2)(c) for the period from the beginning of the final instalment day until the end of the day on which the later crediting occurs.

"(3) If:

(a) subsection 8G(2) applies; and

(b) one or more payments have been made (including any taken to have been made because of the crediting or applying of any amount) of any amounts mentioned in subparagraphs 8G(1)(d)(i) to (iii) after the first crediting and before the later crediting;

the interest is payable:

(c) on so much of the excess as is attributable to a particular payment mentioned in paragraph (b) - for the period from the beginning of the day on which the payment was made until the end of the day on which the later crediting occurs; and

(d) on so much of the excess as is not attributable to payments mentioned in paragraph (b) - for the period from the beginning of the final instalment day until the end of the day on which the later crediting occurs.

"(4) For the purposes of subsection (3), but subject to subsection (5), the excess is attributable to a particular payment to the extent that it would be set off against that payment if it were set off in succession against each of the payments in the reverse of the order in which they were made.

"(5) For the purposes of subsection (4), any payment is to be disregarded to the extent that:

(a) it consists of an amount on which interest is payable under section 9; or

(b) it has been taken into account in any previous application of subsection (4) of this section in relation to a later crediting occurring before the current later crediting.

Rate of interest

"8I. Interest under this Part is payable at such annual rate or rates as are provided for by section 214A of the Tax Act, less 4 percentage points.

Limit on interest where correlative relief in respect of foreign tax

"8J. (1) If:

(a) apart from this section, interest is payable on an excess resulting from the crediting, applying or refunding of one or more income tax crediting amounts; and

(b) at least one (the 'correlative relief amount') of the income tax crediting amounts was applied to provide correlative relief in respect of the taxing of an amount under a law of a foreign country; and

(c) the interest on the excess, to the extent that it is attributable to the correlative relief amount, exceeds by an amount (the 'reduction amount') the lesser of:

(i) theamount of the late payment interest mentioned in subparagraph (b)(i) of the definition of 'income tax crediting amount' in subsection 3(1), expressed in Australian currency at the exchange rate applicable at the time when the taxing of the amount under the law of the foreign country takes place;

(ii) the correlative relief amount;

then the interest payable is reduced by the reduction amount.

"(2) For the purposes of paragraph (1)(c), so much of the interest payable on the excess mentioned in paragraph (1)(a) as is worked out using the following formula is taken to be attributable to the correlative relief amount:

(Correlative relief amount / Sum of correlative relief amount and any other income tax crediting amounts) * Excess

Interpretation

"8K. (1) If the Commissioner is satisfied that no tax is payable by a person for a year of income, the Commissioner is taken for the purposes of this Part to have made an assessment that a nil amount of income tax is payable by the person for the year of income.

"(2) If the Commissioner issues a notice to a person that no tax is payable by the person for a year of income, the Commissioner is taken for the purposes of this Part to have issued a notice of assessment to the person that a nil amount of income tax is payable by the person for the year of income.

"(3) If the crediting, applying or refunding of an income tax crediting amount takes place at different times, the whole of the income tax crediting amount is taken for the purposes of this Part to have been credited, applied or refunded at the earlier or earliest of those times.

"(4) Subsections 221AZF(2) and 221AZM(3) of the Tax Act are to be disregarded for the purposes of this Part.".

12   Heading to Part III

Omit the heading, substitute:

"PART III - INTEREST ON OVERPAYMENTS RESULTING FROM DECISIONS TO WHICH THIS ACT APPLIES".

13   After subsection 9(1)

Insert:

"(1A) If:

(a) apart from this subsection, subsection (1) would apply to an overpayment; and

(b) the decision to which this Act applies mentioned in that subsection was made wholly or partly to provide correlative relief in respect of the taxing of an amount under a law of a foreign country; and

(c) either:

(i) the law of the foreign country did not require the payment of late payment interest in respect of the amount; or

(ii) the law of the foreign country did require the payment of late payment interest but the payment had not been made by the time the decision to which this Act applies was made;

subsection (1) does not apply to the overpayment to the extent to which it is attributable to the provision of the correlative relief.".

14   Paragraph 9(5)(a)

Omit "Income Tax Assessment Act 1936", substitute "Tax Act".

15   Subsection 9(7)

Omit "Income Tax Assessment Act 1936", substitute "Tax Act".

16   Paragraph 10(1)(a)

Before "in respect of" insert "if paragraph (aa) does not apply -".

17   After paragraph 10(1)(a)

Insert:

"(aa) if the person is a relevant entity or an instalment taxpayer and the relevant tax is a relevant tax of a kind referred to in paragraph (a) of the definition of 'relevant tax' in subsection 3(1) - in respect of the period that commenced on the final instalment day in relation to the year of income for which the relevant tax was payable and ended on the day on which the amount of the relevant tax or the part of the amount of the relevant tax, as the case may be, was so refunded or applied; and".

18   Paragraph 10(1)(b)

Omit the paragraph, substitute:

"(b) at such annual rate or rates as are provided for by section 214A of the Tax Act, less 4 percentage points.".

19   Subsections 10(2), (3) and (4)

Omit the subsections.

20   Sections 11 and 11A

Repeal the sections, substitute:

Limit on overpayment of interest where correlative relief in respect of foreign tax

"11. If:

(a) apart from this section, interest is payable in respect of the whole or part (which whole or part is the 'overpayment') of an amount of relevant tax; and

(b) the decision to which this Act applies mentioned in subsection 9(1) was made wholly or partly to provide correlative relief in respect of the taxing of an amount under a law of a foreign country; and

(c) as a result, the whole or part (which whole or part is the 'correlative relief amount') of the overpayment is attributable to the provision of the correlative relief; and (d) the interest on the overpayment, to the extent that it is attributable to the correlative relief amount, exceeds the lesser of:

(i) the amount of the late payment interest paid in respect of the amount taxed under the law of the foreign country, expressed in Australian currency at the exchange rate applicable at the time when the taxing of the amount under the law of the foreign country takes place;

Note: Such interest must have been paid or subsection 9(1A) would prevent the correlative relief amount from attracting interest under this Part.

(ii) the correlative relief amount;

the interest otherwise payable on the overpayment is reduced by the amount of the excess in paragraph (d).".

21   Subparagraph 12(1)(a)(i)

Omit "Income Tax Assessment Act 1936", substitute "Tax Act".

22   After Part III

Insert:

"PART IIIA - INTEREST ON OVERPAYMENTS RESULTING FROM CERTAIN REMISSIONS, REFUNDS AND CREDITS

Entitlement to interest

"12A. (1) If:

(a) the Commissioner, as a result of a request by a person:

(i) remits, under subsection 207(1A), 207A(4), 221AY(5), 221AZE(5), 221AZP(4) or 221YDB(4) of the Tax Act, the whole or part of an amount that has been paid to the Commissioner; or

(ii) refunds the whole or part of an amount under subsection 221AQ(3), 221AR(6), 221AU(4), 221AV(4), 221AW(5), 221AX(14), 221AZL(2) or 221AZQ(1) of the Tax Act; or

(iii) refunds or credits the whole or part of an amount under subsection 221YBA(6), 221YCA(2) or 221YG(2) of the Tax Act; or

(iv) refunds the whole or part of a payment made by the person on account of:

(A) income tax; or

(B) HEC assessment debt; or

(C) FS assessment debt; or

(D) additional tax under Part VII of the Tax Act; or

(E) interest under section 102AAM of the Tax Act; or

(F) provisional tax; or

(G) an instalment of provisional tax within the meaning of section 221YA of the Tax Act; or

(H) an amount mentioned in subsection 221AP(1) of the Tax Act; or

(I) an amount mentioned in paragraph 221AZD(b) of the Tax Act; or

(J) an instalment under subsection 221AZK(2) of the Tax Act; and

(b) the remission, refund or crediting takes place more than 30 days after the day on which the request is made;

interest is payable by the Commissioner to the person on the amount remitted, refunded or credited, calculated in respect of the period applicable under section 12B at the rate specified in section 12C.

"(2) A reference in subparagraph (1)(a)(iv) to a person making a payment on account of:

(a) income tax; or

(b) HEC assessment debt; or

(c) FS assessment debt;

does not include a reference to the making of a deduction or payment under Part VI of the Tax Act or section 20B of the Loan (Income Equalisation Deposits) Act 1976.

Period of interest

"12B. The interest is payable for the period from the beginning of the 30th day after the day on which the request was made until the end of the day on which the remission, refund or crediting takes place.

Rate of interest

"12C. Interest under this Part is payable at such annual rate or rates as are provided for by section 214A of the Tax Act, less 4 percentage points.

"PART IIIB - ADJUSTMENT OF INTEREST

Interest to be in multiples of 1 cent

"12D. If an amount of interest calculated under this Act is not a multiple of 1 cent, the amount of interest is to be:

(a) if the amount of interest is a multiple of 0.5 cent - increased by 0.5 cent; or

(b) in any other case - increased or decreased, as the case requires, to the nearest multiple of 1 cent.

Small amounts of interest not to be paid

"12E. If, apart from this section, an amount of interest:

(a) would be payable to a person under this Act; and

(b) is less than 50 cents;

the amount is not payable to the person.

Adjustment where amount to be paid by, or refunded to, person does not exceed 49 cents

"12F. If:

(a) an amount of interest payable to a person under this Act is applied in discharge of a liability of the person to the Commonwealth; and

(b) the amount (if any) remaining to be paid (the 'net amount') by the person in relation to that liability is less than 50 cents;

the net amount is not payable by the person.".

23   Section 13

Omit "this Act", substitute "Part IIB, Part III or Part IIIA".

24   Section 13

Add at the end:

"(2) The Commissioner may apply an amount of interest payable under Part IIA (other than an amount to which subsection (3) applies) to a person who is neither a relevant entity nor an instalment taxpayer in payment of the following, in order:

(a) income tax payable by the person for the year of income following the eligible year of income;

(b) HEC assessment debt worked out by reference to the person's taxable income of the year of income following the eligible year of income;

(c) FS assessment debt worked out by reference to the person's taxable income of the year of income following the eligible year of income;

(d) additional tax under Part VII of the Tax Act payable by the person for the year of income following the eligible year of income;

(e) interest under section 102AAM of the Tax Act payable by the person for the year of income following the eligible year of income;

(f) any other liability of the person to the Commonwealth.

"(3) The Commissioner may apply an amount of interest, payable under Part IIA to a person in respect of a payment of or on account of provisional tax mentioned in subparagraph 8A(1)(a)(vi) or an instalment of provisional tax mentioned in subparagraph 8A(1)(a)(vii), in payment of the following, in

order:

(a) income tax payable by the person for the eligible year of income;

(b) HEC assessment debt worked out by reference to the person's taxable income of the year of income;

(c) FS assessment debt worked out by reference to the person's taxable income of the year of income;

(d) additional tax under Part VII of the Tax Act payable by the person for the year of income;

(e) interest under section 102AAM of the Tax Act payable by the person for the year of income;

(f) any other liability of the person to the Commonwealth.

"(4) The Commissioner may apply an amount of interest payable under Part IIA to a person who is a relevant entity or an instalment taxpayer in payment of the following, in order:

(a) income tax payable by the person for the eligible year of income;

(b) additional tax under Part VII of the Tax Act payable by the person for the eligible year of income;

(c) interest under section 102AAM of the Tax Act payable by the person for the eligible year of income;

(d) any other liability of the person to the Commonwealth.

"(5) In this section:

'eligible year of income', in relation to interest payable under Part IIA, means the year of income in respect of which the tax, debt, interest, amount or instalment mentioned in the applicable subparagraph of paragraph 8A(1)(a) is payable.".

Part 3   OTHER ACTS

Division 1   Income Tax Assessment Act 1936

25   Paragraph 26(jb)

After "Overpayments" insert "and Early Payments".

26   Section 102AAB (definition of 'basic statutory interest rate')

Omit the definition, substitute:

"'basic statutory interest rate', in relation to a year of income, means such annual rate or rates of interest as are provided for by section 214A, less 4 percentage points, for the year of income or for periods included in the year of income, as the case may be;".

27   Paragraph 102AAM(5)(b)

Omit the paragraph, substitute:

"(b) at such annual rate or rates as are provided for by section 214A, less 4 percentage points.".

28   Subsection 214A(2)

Omit the subsection, substitute:

"(2) The annual rate at which interest is calculated or computed under:

(a) section 102AAB, 102AAM, 170AA, 207A, 555 or 592 of this Act; or

(b) section 93 of the Fringe Benefits Tax Assessment Act 1986; or

(c) section 65 of the Petroleum Resource Rent Tax Assessment Act 1987; or

(d) section 75 of the Training Guarantee (Administration) Act 1990; or

(e) section 8C, 8I, 10 or 12C of the Taxation (Interest on Overpayments and Early Payments) Act 1983;

for any period of, or within, a month is the rate of interest for that month.".

29   Subsection 555(2) (definition of 'basic statutory interest rate')

Omit the definition, substitute:

"'basic statutory interest rate', in relation to a year of income, means such annual rate or rates of interest as are provided for by section 214A, less 4 percentage points, for the year of income or for periods included in the year of income, as the case may be;".

30   Subsection 592(2) (definition of 'basic statutory interest rate')

Omit the definition, substitute:

"'basic statutory interest rate', in relation to a year of income, means such annual rate or rates as are provided for by section 214A, less 4 percentage points, for the year of income or for periods included in the year of income, as the case may be;".

Division 2   Fringe Benefits Tax Assessment Act 1986

31   Subsection 93(2)

Omit the words after "reference to such", substitute "annual rate or rates as are provided for by section 214A of the Income Tax Assessment Act 1936, less 4 percentage points.".

32   Subsection 93(3)

Omit the subsection.

Division 3   Superannuation Guarantee (Administration) Act 1992

33   Subsection 31(1)

Omit "regulations made for the purposes of paragraph 10(1)(b) of the Taxation (Interest on Overpayments) Act 1983", substitute "the regulations for the purposes of this subsection".

34   Subsection 31(2)

Omit the subsection.

35   Subsection 49(2)

Omit "regulations made for the purposes of paragraph 10(1)(b) of the Taxation (Interest on Overpayments) Act 1983", substitute "the regulations for the purposes of this subsection".

36   Subsection 49(3)

Omit the subsection.

Division 4   Training Guarantee (Administration) Act 1990

37   Subsection 75(2)

Omit the words after "reference to", substitute "such annual rate or rates as are provided for by section 214A of the Income Tax Assessment Act 1936, less 4 percentage points".

38   Subsection 75(3)

Omit the subsection.

Division 5   Australian Capital Territory Taxation (Administration) Act 1969

39   Paragraph 5A(1)(e)

After "Overpayments" insert "and Early Payments".

Division 6   Freedom of Information Act 1982

40   Schedule 3

Omit "Taxation (Interest on Overpayments) Act 1983", substitute "Taxation (Interest on Overpayments and Early Payments) Act 1983".

Division 7   Pay-roll Tax (Territories) Assessment Act 1971

41   Paragraph 5A(1)(e)

After "Overpayments" insert "and Early Payments".

Division 8   Petroleum Resource Rent Tax Assessment Act 1987

42   Paragraph 65(4)(b)

Omit the paragraph, substitute:

"(b) at such annual rate or rates as are provided for by section 214A of the Income Tax Assessment Act 1936, less 4 percentage points.".

43   Subsection 65(7)

Omit the subsection.

Division 9   Swimming Pools Tax Refund Act 1992

44   Subsection 5(4)

After "Overpayments" insert "and Early Payments".

45   Subsection 6(3)

After "Overpayments" insert "and Early Payments".

Part 4   APPLICATION AND TRANSITIONAL

46   Application

(1) The amendment made by item 4 applies to any decision made on or after 1 July 1994 in relation to an assessment in respect of income of the 1993-94 year of income or any later year of income.

(2) The first regulation made for the purposes of paragraph 3A(1)(b) or (2)(b) of the amended Act (see item 10) has effect in relation to the making of any decision, or the applying of any income tax crediting amount, as mentioned in subsection 3A(1) or (2) of that Act where:

(a) the decision is made on or after 1 July 1994 and relates to an assessment in respect of income of any year of income; or

(b) the applying of the income tax crediting amount takes place on or after 1 July 1994 and relates to income tax payable for the 1993-94 year of income or any later year of income.

(3) Part IIA of the amended Act (see item 11) applies to any payment of, or on account of, a tax, a debt, interest, an amount or an instalment mentioned in paragraph 8A(1)(a) of that Act payable in respect of the 1993-94 year of income or any later year of income, where the payment is made on or after 1 July 1994.

(4) Part IIB of the amended Act (see item 11) applies to the crediting, applying or refunding of any income tax crediting amount where:

(a) the income tax crediting amount relates to income tax payable for the 1993-94 year of income or any later year of income; and

(b) the crediting, applying or refunding takes place on or after 1 July 1994. However, if interest would be payable under that Part in respect of any period before 1 July 1994, the interest is not payable in respect of that period.

(5) Subsection 9(1A) (see item 13) and section 11 (see item 20) of the amended Act apply to any decision made on or after 1 July 1994 in relation to an assessment in respect of income of any year of income.

Note: Because of subitem (1), the amendment broadening the definition of "decision to which this Act applies" made by item 4 only applies from the 1993-94 year of income. Subsection 9(1A) and section 11 of the amended Act will therefore apply not only to those decisions, but also to decisions covered by the narrower definition of the term for years of income before

1993-94.

(6) The amendments made by items 16 and 17 apply to interest that becomes payable on or after 1 July 1994 in respect of relevant tax that relates to the 1993-94 year of income or any later year of income.

(7) The amendment made by item 18 applies to interest in respect of periods beginning on or after 1 July 1994, or in respect of periods to the extent that they continue after 30 June 1994.

(8) Part IIIA of the amended Act (see item 22) applies to the remission, refund or crediting of an amount paid in relation to a tax, a debt, interest, an amount or an instalment payable for the 1993-94 year of income or for any later year of income, where the remission, refund or crediting takes place on or after 1 July 1994. However, if interest would be payable under that Part in respect of any period before 1 July 1994, the interest is not payable in respect of that period.

(9) Part IIIB (see item 22) and section 13 (see item 24) of the amended Act apply to interest that becomes payable on or after 1 July 1994.

(10) The amendments made by items 26 to 32, 37, 38 and 42 to 45 apply to interest payable in respect of periods beginning on or after 1 July 1994, or in respect of periods to the extent that they continue after 30 June 1994.

(11) The amendments made by items 33 and 34 apply to the calculation of the nominal interest component under the Superannuation Guarantee (Administration) Act 1992 in relation to an employer for any year (whether commencing before or after the commencement of this Schedule) in respect of any period that commences, or in respect of any period to the extent that it continues, after the commencement of this Schedule.

(12) The amendments made by items 35 and 36 apply to the calculation of additional superannuation guarantee charge under the Superannuation Guarantee (Administration) Act 1992 in respect of any period that commences, or in respect of any period to the extent that it continues, after the commencement of this Schedule.

(13) In this item:

"amended Act" means the Taxation (Interest on Overpayments) Act 1983 as amended by this Schedule.

47   Transitional - Superannuation Guarantee (Administration) Act 1992

(1) For the purposes of:

(a) calculating under subsection 31(1) of the Superannuation Guarantee (Administration) Act 1992 the nominal interest component in relation to an employer for any year commencing before the commencement of this Schedule; or

(b) calculating under subsection 49(2) of that Act additional superannuation charge;

in respect of:

(c) the period that:

(i) commences on 1 July 1994; and

(ii) ends immediately before the commencement of the first or only regulations made for the purposes of that subsection; or

(d) any other period to the extent that it consists of or includes the period in paragraph (c);

the rate applicable under that subsection in respect of that period, or that period to that extent, is, and is taken always to have been, in spite of anything in that Act, 10% per annum.

(2) Subitem (1) does not have the effect of making a person liable to:

(a) a penalty under Part 7 of the Superannuation Guarantee (Administration) Act 1992; or

(b) a penalty for an offence under any other Act; for any act or omission happening before the 28th day after the day on which this Schedule commences.

(3) Subitem (2) does not relieve a person from liability to a penalty of a kind mentioned in that subsection to the extent to which the liability would have existed if this item had not been enacted.

Schedule 6   AMENDMENTS OF THE DEVELOPMENT ALLOWANCE AUTHORITY ACT 1992

1   Object

The object of this Schedule is to change, or introduce, signature requirements in respect of applications and reports to the Development Allowance Authority.

2   Subsection 28(3)

Omit the subsection.

3   After subsection 28(6)

Insert:

"(6A) The application and accompanying report must be signed by the applicant if the applicant is a natural person. If the applicant is not a natural person, they must be signed on behalf of the applicant by whichever of the following natural persons is applicable:

(a) if the applicant is an incorporated body that has a board of directors (however described) - the chairperson (however described) of the board;

(b) in any other case - the natural person designated by the form as the signatory.".

4   After subsection 37(5)

Insert:

"(5A) The application and accompanying report must be signed by the applicant if the applicant is a natural person. If the applicant is not a natural person, they must be signed on behalf of the applicant by whichever of the following natural persons is applicable:

(a) if the applicant is an incorporated body that has a board of directors (however described) - the chairperson (however described) of the board;

(b) in any other case - the natural person designated by the form as the signatory.".

5   Section 43

Add at the end:

"(6) The application and accompanying report must be signed by the applicant if the applicant is a natural person. If the applicant is not a natural person, they must be signed on behalf of the applicant by whichever of the following natural persons is applicable:

(a) if the applicant is an incorporated body that has a board of directors (however described) - the chairperson (however described) of the board;

(b) in any other case - the natural person designated by the form as the signatory.".

6   Section 50

Add at the end:

"(5) The application and accompanying report must be signed by the applicant if the applicant is a natural person. If the applicant is not a natural person, they must be signed on behalf of the applicant by whichever of the following natural persons is applicable:

(a) if the applicant is an incorporated body that has a board of directors (however described) - the chairperson (however described) of the board;

(b) in any other case - the natural person designated by the form as the signatory.".

7   After subsection 60(5)

Insert:

"(5A) The application and accompanying report must be signed by the applicant if the applicant is a natural person. If the applicant is not a natural person, they must be signed on behalf of the applicant by whichever of the following natural persons is applicable:

(a) if the applicant is an incorporated body that has a board of directors (however described) - the chairperson (however described) of the board;

(b) in any other case - the natural person designated by the form as the signatory.".

8   Section 70

Add at the end:

"(6) The application and accompanying report must be signed by the applicant if the applicant is a natural person. If the applicant is not a natural person, they must be signed on behalf of the applicant by whichever of the following natural persons is applicable:

(a) if the applicant is an incorporated body that has a board of directors (however described) - the chairperson (however described) of the board;

(b) in any other case - the natural person designated by the form as the signatory.".

9   Application

The amendments made by this Schedule apply to applications, and reports accompanying applications, where the applications are made after the commencement of this Schedule.

NOTES ABOUT SECTION HEADINGS

1. On the commencement of Part 3 of Schedule 1 of this Act, the heading to section 160ARXC of the Income Tax Assessment Act 1936 is altered by adding at the end "or different refunds".

2. On the commencement of Part 4 of Schedule 1 of this Act, the heading to section 82AAQ of the Income Tax Assessment Act 1936 is altered by omitting "to taxpayer to be included in his assessable income" and substituting "to be included in recipient's assessable income".