For that purpose, the Commissioner or the officer may administer an oath.

(3) The regulations may prescribe scales of expenses to be allowed to persons required to attend before the Commissioner or the officer.

Subdivision 20-D - Review of decisions

20-80 Reviewable decisions

A person who is dissatisfied with any of the following decisions of the Commissioner may object against the decision in the manner set out in Part IVC.

Part 2-10 - Pay as you go (PAYG) instalments

Division 45 - Instalment payments

Table of Subdivisions

Guide to Division 45

45-A Basic rules

45-B When instalments are due

45-C Working out instalment amounts

45-D Quarterly payers who pay on the basis of GDP-adjusted notional tax

45-E Annual payers

45-F Varying the instalment rate for quarterly instalments

45-G General interest charge payable in certain cases if instalments are too low

45-H Partnership income

45-I Trust income

45-J How Commissioner works out your instalment rate and notional tax

45-K How Commissioner works out your benchmark instalment rate and benchmark tax

45-L How Commissioner works out amount of quarterly instalment on basis of GDP-adjusted notional tax

Guide to Division 45

45-1 What this Division is about

If you have business or investment income, you must pay instalments towards your income tax liability: usually within 21 days after the end of each quarter. If you are not registered for GST purposes, you may be able to choose to pay an annual instalment on 21 October after the end of the income year.

You do not have to pay instalments unless the Commissioner has given you an instalment rate.

The amount of a quarterly instalment is worked out by multiplying your instalment income for the quarter by the rate the Commissioner gave you, or by a rate you choose yourself. If you are an individual who is not registered for GST purposes, you may be able to choose to have the amount of your instalment worked out on the basis of your previous year's income tax liability and notified to you by the Commissioner.

The amount of an annual instalment can be your instalment income for the income year multiplied by the rate the Commissioner gave you; or an amount based on your previous year's income tax liability and notified to you by the Commissioner; or your own estimate of your income tax liability for the income year.

Subdivision 45-A - Basic rules

Table of sections

45-5 Object of this Part

45-10 Application of Part

45-15 Liability for instalments

45-20 Information to be given to the Commissioner

45-25 Penalty for failure to notify Commissioner

45-30 Credit for instalments payable

45-5 Object of this Part

The object of this Part is to ensure the efficient collection of:

(a) income tax; and

(b) Medicare levy; and

(c) amounts of liabilities to the Commonwealth under Chapter 5A of the Higher Education Funding Act 1988.

45-10 Application of Part

This Part applies to individuals, companies, and the entities listed in items 3 and 4, and 6 to 12, of the table in section 9-1 of the Income Tax Assessment Act 1997 (which lists the entities that must pay income tax).

Note: This Part applies to a trustee covered by item 5 in that table only to the extent set out in section 45-300.

45-15 Liability for instalments

(1) The Commissioner may give you an instalment rate from time to time, by giving you written notice of the rate.

(2) You are liable to pay instalments under this Division if the Commissioner has given you an instalment rate.

Note 1: The instalment rate that the Commissioner gives you is worked out under section 45-320.

Note 2: If your assessable income has always consisted wholly of withholding payments (other than non-quotation withholding payments), the Commissioner will not give you an instalment rate.

Note 3: Work out the amount of your instalments under Subdivision 45-C.

Note 4: If the Commissioner withdraws the rate under section 45-90, you are not liable to pay further instalments.

45-20 Information to be given to the Commissioner

(1) If you are liable to pay an instalment for a period (even if it is a nil amount), you must notify the Commissioner of the amount of your *instalment income for the period.

(2) You must notify the Commissioner in the *approved form and on or before the day when the instalment is due (regardless of whether it is paid).

Exceptions

(3) Subsection (1) does not apply to:

(a) a quarterly instalment worked out under section 45-112 (on the basis of GDP-adjusted notional tax); or

(b) an annual instalment, unless it is worked out under paragraph 45-115(1)(a) (based on the Commissioner's rate and your instalment income for the income year).

45-25 Penalty for failure to notify Commissioner

If you fail to notify the Commissioner of an amount as required by section 45-20, or you notify an amount that is less than the correct amount, you are liable to pay the *failure to notify penalty on the amount, or on the shortfall, multiplied by the instalment rate that you are required to use to work out the instalment for the period, for each day in the period that:

(a) started at the beginning of the day by which the amount was due to be paid; and

(b) finishes at the end of the day before you notify the Commissioner of the correct amount, or he or she otherwise becomes aware of it.

45-30 Credit for instalments payable

(1) You are entitled to a credit when the Commissioner:

(a) makes an assessment of the income tax you are liable to pay for an income year; or

(b) determines that you do not have a taxable income for an income year, or that no income tax is payable on it.

(2) The credit is equal to:

• the total of each instalment payable by you for the income year (even if you have not yet paid it);

reduced by:

• the total of each credit that you have claimed under section 45-215 in respect of such an instalment.

Note: You can claim a credit under section 45-215 in certain cases where you choose a rate for working out an instalment.

(3) The making of the assessment or determination, and the resulting credit entitlement, do not affect the liability to pay an instalment.

Note: How the credit is applied is set out in Division 3 of Part IIB.

Subdivision 45-B - When instalments are due

Table of sections

45-50 Liability to pay first instalment

45-55 Subsequent quarterly instalments

45-60 When quarterly instalments are due

45-65 Subsequent annual instalments

45-70 When annual instalments are due

45-72 Electronic payment

45-75 Instalments recoverable in same way as income tax

45-80 General interest charge on late payment

45-85 Commissioner may extend time for payment

45-90 Commissioner may withdraw instalment rate

45-50 Liability to pay first instalment

(1) Your first instalment is payable:

(a) for the *instalment quarter in which the Commissioner first gives you an instalment rate (even if it is not the first instalment quarter in an income year); or

(b) if at the end of that quarter you become an *annual payer under Subdivision 45-E - for the income year in which the Commissioner first gives you an instalment rate;

unless the Commissioner withdraws your instalment rate under section 45-90 during that quarter or income year.

(2) However, if paragraph (1)(b) applies but during a later *instalment quarter in that income year you stop being an *annual payer under section 45-150, your first instalment is payable for that later instalment quarter, unless the Commissioner withdraws your instalment rate under section 45-90 during it.

45-55 Subsequent quarterly instalments

If you are liable to pay an instalment for an *instalment quarter, you are liable to pay an instalment for the next one unless:

(a) at the end of that next instalment quarter you become an *annual payer under Subdivision 45-E; or

(b) during that next quarter the Commissioner withdraws your instalment rate under section 45-90.

45-60 When quarterly instalments are due

(1) If your income year ends on 30 June, the table sets out your instalment quarters and the days on which the instalments for those quarters are due:

(2) If your income year ends on a day other than 30 June:

(a) your first instalment quarter consists of the first 3 months of the income year; and

(b) your second instalment quarter consists of the fourth, fifth and sixth months of the income year; and

(c) your third instalment quarter consists of the seventh, eighth and ninth months of the income year; and

(d) your fourth instalment quarter consists of the tenth, 11th and 12th months of the income year.

(3) If subsection (2) applies, an instalment for an *instalment quarter is due on or before the 21st day of the month after the end of that quarter.

45-65 Subsequent annual instalments

If you are liable to pay an instalment for an income year (the previous year ), you must pay an instalment for the next income year unless:

(a) during the previous year you stopped being an *annual payer because of section 45-150, 45-155 or 45-180; or

(b) during that next income year the Commissioner withdraws your instalment rate under section 45-90.

Note 1: Sections 45-150 and 45-180 cover cases where an annual payer becomes registered for GST, becomes a partner in a partnership that is registered for GST, is a partner in a partnership that becomes registered for GST, becomes a participant in a GST joint venture, or becomes a company group member.

Note 2: Section 45-155 covers cases where an annual payer's notional tax is $8,000 or more, or the entity chooses to pay quarterly.

45-70 When annual instalments are due

(1) This section applies if you are liable to pay an annual instalment for the 2002-03 income year or a later income year.

For an instalment you are liable to pay for 2000-01 or 2001-02,
see section 45-170.

(2) If the income year ends on 30 June, the instalment is due on or before the next 21 October.

(3) If the income year ends on a day other than 30 June, the instalment is due on or before the 21st day of the fourth month after the end of the income year.

45-72 Electronic payment

You must pay an instalment by *electronic payment if you are required to pay by electronic payment the amount of any other liability to the Commissioner that is due on the same day as the instalment.

45-75 Instalments recoverable in same way as income tax

Instalments are to be treated as income tax for the purposes of sections 208, 209, 214, 254, 255, 258 and 259 of the Income Tax Assessment Act 1936.

45-80 General interest charge on late payment

If you fail to pay some or all of an instalment by the time by which the instalment is due to be paid, you are liable to pay the *general interest charge on the unpaid amount for each day in the period that:

(a) started at the beginning of the day by which the instalment was due to be paid; and

(b) finishes at the end of the last day on which, at the end of the day, any of the following remains unpaid:

(i) the instalment;

(ii) general interest chargeon any of the instalment.

45-85 Commissioner may extend time for payment

(1) The Commissioner may, in a particular case, grant such extension of time for payment of an instalment as he or she considers the circumstances warrant.

(2) If the Commissioner grants an extension of time under subsection (1), the instalment is due to be paid on or before the day or days specified by the Commissioner.

45-90 Commissioner may withdraw instalment rate

(1) The Commissioner may:

(a) by giving you written notice, withdraw your instalment rate; or

(b) by notice published in the Gazette, withdraw the instalment rate of a class of entities that includes you.

Note: If the Commissioner does so, you are not liable to pay further instalments (even if you have chosen a rate under section 45-205). See paragraphs 45-55(b) and 45-65(b).

(2) If the Commissioner withdraws your instalment rate and later gives you another one, your first instalment after the withdrawal is payable under section 45-50 as if it were your first instalment, and as if that rate were your first instalment rate.

Subdivision 45-C - Working out instalment amounts

Table of sections

45-110 How to work out amount of quarterly instalment

45-112 Amount of instalment for quarterly payer who pays on basis of GDP-adjusted notional tax

45-115 How to work out amount of annual instalment

45-120 Meaning of instalment income

45-110 How to work out amount of quarterly instalment

(1) Work out the amount of an instalment you are liable to pay for an *instalment quarter as follows:

(Applicable instalment rate * Your instalment income for that quarter)

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

Applicable instalment rate means:

(a) unless paragraph (b) or (c) applies - the most recent instalment rate given to you by the Commissioner under section 45-15 before the end of that quarter; or

(b) if you have chosen an instalment rate for that quarter under section 45-205 - that rate; or

(c) if you have chosen an instalment rate under section 45-205 for an earlier *instalment quarter in that income year (and paragraph (b) does not apply) - that rate.

Note: If you believe the Commissioner's rate is not appropriate for the current income year, you may choose a different instalment rate under Subdivision 45-F.

45-112 Amount of instalment for quarterly payer who pays on basis of GDP-adjusted notional tax

(1) If at the end of an *instalment quarter in an income year you are a *quarterly payer who pays on the basis of GDP-adjusted notional tax, the amount of your instalment for that quarter is the amount notified to you by the Commissioner before the end of that quarter.

Note: The Commissioner works out that amount under Subdivision 45-L.

(2) If the Commissioner notifies you of the amount of the instalment after the end of that quarter, the instalment is due on or before the 21st day after the day on which the notice is given.

45-115 How to work out amount of annual instalment

(1) The amount of an instalment you are liable to pay for the 2002-03 income year or a later income year is whichever of the following you choose:

(a) the amount worked out using the formula:

(Commissioner's instalment rate * Your instalment income for the income year)

(b) your most recent *notional tax notified by the Commissioner before the end of the income year under subsection 45-320(5);

(c) the amount that you estimate will be your *benchmark tax for the income year.

Note 1: You cannot choose a different instalment rate under Subdivision 45-F if you are an annual payer. Instead you can work out the amount of your instalment under paragraph (c).

Note 2: You may be liable to general interest charge under section 45-235 if working out your instalment under paragraph (c) leads you to pay an instalment that is less than 85% of your benchmark tax for the income year (worked out by the Commissioner under section 45-365).

For the amount of an instalment you are liable to pay
for 2000-01 or 2001-02, see section 45-175.

(2) Commissioner's instalment rate for an income year means the most recent instalment rate given to you by the Commissioner before the end of the income year.

(3) If you choose to work out your instalment under paragraph (1)(c), you must notify the Commissioner, in the *approved form, of the amount of the instalment on or before the day when it is due.

45-120 Meaning of instalment income

General rule

(1) Your instalment income for a period includes your *ordinary income *derived during that period, but only to the extent that it is assessable income of the income year that is or includes that period.

Note 1: An amount of statutory income is not instalment income unless it is covered by another provision of this section or by Subdivision 45-H or 45-I.

Note 2: If during that period you are a partner in a partnership, or a beneficiary of a trust, your instalment income also includes some of the partnership's or trust's instalment income for the period. See Subdivision 45-H or 45-I.

Statutory income included for some entities

(2) The instalment income of:

(a) an eligible ADF (as defined in section 267 of the Income Tax Assessment Act 1936); or

(b) an eligible superannuation fund (as defined in that section); or

(c) a pooled superannuation trust (as defined in that section);

for a period also includes the entity's *statutory income, to the extent that:

(d) it is reasonably attributable to that period; and

(e) it is assessable income of the income year that is or includes that period.

Exclusion: amounts in respect of withholding payments

(3) Your instalment income for a period does not include amounts in respect of *withholding payments (except *non-quotation withholding payments) made to you during that period.

Farm management deposits: effect of making and repayment

(4) Your instalment income for a period is reduced (but not below nil) by a *farm management deposit made during that period, but only to the extent that, at the end of that period, you can reasonably expect to be able to deduct the deposit under section 393-10 in Schedule 2G to the Income Tax Assessment Act 1936 for the income year that is or includes that period.

(5) Your instalment income for a period also includes an amount that section 393-15 in Schedule 2G to the Income Tax Assessment Act 1936 includes in your assessable income, for the income year that is or includes that period, because of a repayment during that period of all or some of a *farm management deposit.

Instalment income of entity that is not liable for instalments

(6) An entity can have *instalment income for a period even if the entity is not liable to pay an instalment for that period.

Note: For example, although a partnership does not pay instalments, it is necessary to work out the partnership's instalment income in order to work out instalments payable by the partners. See Subdivision 45-H.

Subdivision 45-D - Quarterly payers who pay on the basis of GDP-adjusted notional tax

Table of sections

45-125 Choosing to pay quarterly instalments on basis of GDP-adjusted notional tax

45-130 Individual stops paying on basis of GDP-adjusted notional tax if he or she chooses to stop, or becomes GST registered

45-135 Individual stops paying on basis of GDP-adjusted notional tax if his or her notional tax is less than $8,000

45-125 Choosing to pay quarterly instalments on basis of GDP-adjusted notional tax

(1) You may choose to pay quarterly instalments on the basis of your *GDP-adjusted notional tax if you are an individual and, at the end of the first *instalment quarter in an income year for which you are liable to pay an instalment, you satisfy the following conditions:

(a) you are neither registered, nor *required to be registered, under Part 2-5 of the *GST Act; and

(b) you are not a partner in a partnership that is registered, or required to be registered, under that Part; and

(c) your most recent *notional tax notified by the Commissioner is $8,000 or more.

Note: This means that you cannot choose to pay quarterly instalments on the basis of your GDP-adjusted notional tax if you are eligible to pay annual instalments.

(2) You must make the choice by notifying the Commissioner, in the *approved form, on or before the day on which that instalment is due.

(3) You are a quarterly payer who pays on the basis of GDP-adjusted notional tax if you satisfy the conditions in subsection (1), and you choose to pay quarterly instalments on the basis of your *GDP-adjusted notional tax. You are taken to have become such a payer just before the end of that *instalment quarter.

Note: You stop being such a payer if section 45-130 or 45-135 applies to you.

45-130 Individual stops paying on basis of GDP-adjusted notional tax if he or she chooses to stop, or becomes GST registered

(1) You stop being a *quarterly payer who pays on the basis of GDP-adjusted notional tax if, during an *instalment quarter in an income year:

(a) you choose to stop being a *quarterly payer who pays on the basis of GDP-adjusted notional tax; or

(b) you become registered, or *required to be registered, under Part 2-5 of the *GST Act; or

(c) you become a partner in a partnership that is registered, or required to be registered, under that Part; or

(d) a partnership in which you are a partner becomes registered, or required to be registered, under that Part.

(2) You must work out the amount of your instalment for that *instalment quarter, and each later instalment quarter, under section 45-110 (on the basis of your instalment income and the applicable instalment rate).

(3) You may again become a *quarterly payer who pays on the basis of GDP-adjusted notional tax if:

(a) you again satisfy the conditions in section 45-125; and

(b) you again choose under that section to pay quarterly instalments on the basis of your *GDP-adjusted notional tax.

Note: You cannot so choose until the next income year.

45-135 Individual stops paying on basis of GDP-adjusted notional tax if his or her notional tax is less than $8,000

(1) If, during an income year the Commissioner notifies you of your *notional tax, and it is less than $8,000, you stop being a *quarterly payer who pays on the basis of GDP-adjusted notional tax at the start of the next income year.

(2) You must work out the amount of your instalment for the first *instalment quarter of that next income year, and each later instalment quarter, under section 45-110 (on the basis of your instalment income and the applicable instalment rate).

(3) You may again become a *quarterly payer who pays on the basis of GDP-adjusted notional tax if:

(a) you again satisfy the conditions in section 45-125; and

(b) you again choose under that section to pay quarterly instalments on the basis of your *GDP-adjusted notional tax.

Note: You can so choose on or before the day on which your first instalment for that next income year is due.

Subdivision 45-E - Annual payers

Table of sections

When you start and stop being an annual payer

45-140 Choosing to pay annual instalments

45-145 Meaning of instalment group

45-150 Entity that becomes GST registered, participant in GST joint venture, or company group member, stops being annual payer

45-155 Entity stops being annual payer if notional tax is $8,000 or more, or entity chooses to pay quarterly

Special rules for 2000-01 and 2001-02

45-170 Due date for annual instalment

45-175 Amount of annual instalment

45-180 Entity that becomes GST registered, participant in GST joint venture, or company group member stops being annual payer

When you start and stop being an annual payer

45-140 Choosing to pay annual instalments

(1) You may choose to pay instalments annually instead of quarterly if, at the end of the first *instalment quarter in an income year for which you would otherwise be liable to pay a quarterly instalment, you satisfy the following conditions:

(a) you are neither registered, nor *required to be registered, under Part 2-5 of the *GST Act; and

(b) you are not a partner in a partnership that is registered, or required to be registered, under that Part; and

(c) your most recent *notional tax notified by the Commissioner is less than $8,000; and

(d) in the case of a company - the company is not a *participant in a *GST joint venture under Division 51 of that Act; and

(e) in the case of a company - the company is not part of an *instalment group.

(2) You must make the choice by notifying the Commissioner, in the *approved form, on or before the day on which that instalment would otherwise be due.

(3) You are an annual payer if you satisfy the conditions in subsection (1), and you choose to pay instalments annually. You are taken to have become an annual payer at the end of that *instalment quarter.

Note: You stop being an annual payer if section 45-150, 45-155 or 45-180 applies to you.

45-145 Meaning of instalment group

(1) An instalment group consists of:

(a) a company:

(i) that has *majority control of at least one other company; but

(ii) of which no other company has *majority control; and

(b) any other company of which the first-mentioned company has *majority control.

(2) A company has majority control of another company if, and only if:

(a) the first company is in a position to cast, or control the casting of, more than 50% of the maximum number of votes that might be cast at a general meeting of the other company; or

(b) the first company has the power to appoint or remove the majority of the directors of the other company; or

(c) the other company is, or a majority of its directors are, accustomed or under an obligation, whether formal or informal, to act according to the directions, instructions or wishes of the first company.

45-150 Entity that becomes GST registered, participant in GST joint venture, or company group member, stops being annual payer

(1) You stop being an *annual payer if, during an *instalment quarter in the 2002-03 income year or a later income year:

(a) you become registered, or *required to be registered, under Part 2-5 of the *GST Act; or

(b) you become a partner in a partnership that is registered, or required to be registered, under that Part; or

(c) a partnership in which you are a partner becomes registered, or required to be registered, under that Part; or

(d) in the case of a company - the company becomes a *participant in a *GST joint venture under Division 51 of that Act; or

(e) in the case of a company - the company becomes part of an *instalment group.

Note: If one of those things happens in 2000-01 or 2001-02, see section 45-180.

(2) You must pay an instalment for that *instalment quarter, and later instalment quarters, in accordance with Subdivision 45-B.

(3) If the *instalment quarter referred to in subsection (1) is not the first one in the income year, you must also pay an annual instalment for that income year. The amount of the annual instalment is reduced (but not below nil) by the amount of each instalment for an instalment quarter in that income year that you must pay under subsection (2).

(4) You may again become an *annual payer if:

(a) you again satisfy the conditions in section 45-140; and

(b) you again choose under that section to pay instalments annually.

45-155 Entity stops being annual payer if notional tax is $8,000 or more, or entity chooses to pay quarterly

(1) You stop being an *annual payer at the end of an income year if, during that income year:

(a) the Commissioner notifies you of your *notional tax, and it is $8,000 or more; or

(b) you choose to pay instalments quarterly instead of annually.

(2) You must pay an instalment for the first *instalment quarter of the next income year, and later instalment quarters, in accordance with Subdivision 45-B.

(3) You must still pay an annual instalment for the income year referred to in subsection (1).

(4) You may again become an *annual payer if:

(a) you again satisfy the conditions in section 45-140; and

(b) you again choose under that section to pay instalments annually.

Special rules for 2000-01 and 2001-02

45-170 Due date for annual instalment

(1) This section applies if you are liable to pay an annual instalment for the 2000-01 or 2001-02 income year.

(2) The instalment is due on or before a day that is notified to you in writing by the Commissioner and is at least 30 days after the Commissioner gives you the notice. If that day is earlier than 31 March in that income year, the instalment is due on or before that 31 March.

(3) However, in the case of an entity that is an instalment taxpayer for that income year (as defined by subsection 221AZK(1) of the Income Tax Assessment Act 1936), the instalment is due on or before the 15th day of the 6th month after the end of that income year.

45-175 Amount of annual instalment

(1) Unless subsection (2) applies, the amount of an annual instalment you are liable to pay for the 2000-01 or 2001-02 income year is whichever of the following you choose:

(a) your most recent *notional tax notified by the Commissioner at least 30 days before the day on which the instalment is due;

(b) the amount that you estimate will be your *benchmark tax for the income year.

Note: You may be liable to general interest charge under section 45-235 if working out your instalment under paragraph (b) leads you to pay an instalment that is less than 85% of your benchmark tax for the income year (worked out by the Commissioner under section 45-365).

(2) If an entity is an instalment taxpayer (as defined by subsection 221AZK(1) of the Income Tax Assessment Act 1936) for the 2000-01 or 2001-02 income year, the amount of an annual instalment that the entity is liable to pay for that income year is worked out under section 45-115, as if that section applied to that income year.

45-180 Entity that becomes GST registered, participant in GST joint venture, or company group member stops being annual payer

(1) You stop being an *annual payer if, during an *instalment quarter in the 2000-01 or 2001-02 income year:

(a) you become registered, or *required to be registered, under Part 2-5 of the *GST Act; or

(b) you become a partner in a partnership that is registered, or required to be registered, under that Part; or

(c) a partnership in which you are a partner becomes registered, or required to be registered, under that Part; or

(d) in the case of a company - the company becomes a *participant in a *GST joint venture under Division 51 of that Act; or

(e) in the case of a company - the company becomes part of an *instalment group.

(2) You must pay an instalment for the first *instalment quarter of the next income year, and later instalment quarters, in accordance with Subdivision 45-B.

(3) You must still pay an annual instalment for the income year referred to in subsection (1).

(4) You may again become an *annual payer if:

(a) you again satisfy the conditions in section 45-140; and

(b) you again choose under that section to pay instalments annually.

Subdivision 45-F - Varying the instalment rate for quarterly instalments

Table of sections

45-200 Application

45-205 Choosing a varied instalment rate

45-210 Notifying Commissioner of varied instalment rate

45-215 Credit on using varied rate in certain cases

45-200 Application

This Subdivision applies if you are a *quarterly payer.

45-205 Choosing a varied instalment rate

(1) You may choose an instalment rate for working out under section 45-110 the amount of your instalment for an *instalment quarter in an income year.

(2) If you do so, you must use that instalment rate to work out the amount of that instalment. (You cannot later choose another instalment rate for working out that amount.)

Note 1: If choosing a rate leads you to pay an instalment that is too low, you may be liable to general interest charge under section 45-230.

Note 2: If you choose a rate under this section, you must use it even if the Commissioner later gives you a new instalment rate.

(3) You must also use that instalment rate to work out the amount of the instalment that you are liable to pay for each later *instalment quarter in that income year, unless you choose another instalment rate under subsection (1) for working out that amount.

Note 1: If you choose a rate under this section, you must use it even if the Commissioner later gives you a new instalment rate.

Note 2: If a rate you have chosen for an instalment quarter is not appropriate for a later instalment quarter in the same income year, you should choose another rate under subsection (1) for the later quarter. If the earlier rate is too low, you may be liable to general interest charge under section 45-230.

(4) However, for working out under section 45-110 the amount of your instalment for an *instalment quarter in a later income year, you must use the most recent instalment rate given to you by the Commissioner before the end of that quarter, unless you again choose another instalment rate under subsection (1).

45-210 Notifying Commissioner of varied instalment rate

If you work out the amount of an instalment using an instalment rate you have chosen under section 45-205, you must specify that rate in the notice about your instalment income that you must give the Commissioner under section 45-20.

45-215 Credit on using varied rate in certain cases

(1) You are entitled to claim a credit if:

(a) the amount of your instalment for an *instalment quarter (the current quarter ) in an incomeyear is to be worked out using an instalment rate you chose under section 45-205; and

(b) either:

(i) that rate is lower than the instalment rate you used to work out the amount of your instalment for the previous instalment quarter (if any) in the same income year; or

(ii) the amount of your instalment for a previous instalment quarter in the same income year was the amount notified to you by the Commissioner under section 45-112 (because you were a quarterly payer on the basis of GDP-adjusted notional tax); and

(c) the amount worked out using the method statement is greater than nil.

Method statement

Step 1. Add up the instalments you are liable to pay for the earlier *instalment quarters in the income year (even if you have not yet paid all of them).

Step 2. Subtract from the step 1 amount each earlier credit that you have claimed under this section in respect of the income year.

Step 3. Multiply the total of your *instalment income for those earlier *instalment quarters by the instalment rate to be used for the current quarter.

Step 4. Subtract the step 3 amount from the step 2 amount.

Step 5. If the result is a positive amount, it is the amount of the credit you can claim.

(2) A claim for a credit must be made in the *approved form on or before the day on which the instalment for the current quarter is due.

Note: How the credit is applied is set out in Division 3 of Part IIB.

(3) The credit entitlement does not affect your liability to pay an instalment.

Subdivision 45-G - General interest charge payable in certain cases if instalments are too low

Table of sections

45-230 Liability to GIC on shortfall in quarterly instalment and on any excess credit under section 45-215

45-235 Liability to GIC on shortfall in annual instalment

45-240 Commissioner may remit general interest charge

45-230 Liability to GIC on shortfall in quarterly instalment and on any excess credit under section 45-215

(1) You are liable to pay the *general interest charge under this section if:

(a) you use an instalment rate (the varied rate ) under section 45-205 to work out the amount of your instalment for an *instalment quarter (the variation quarter ) in an income year; and

(b) the varied rate is less than 85% of your *benchmark instalment rate for that income year that the Commissioner works out under Subdivision 45-K.

(2) You are liable to pay the *general interest charge on the amount worked out as follows:

(Rate discrepancy * Your instalment income for the variation quarter) + Credit adjustment

where:

rate discrepancy means the difference between the varied rate and the lesser of:

(a) the most recent instalment rate given to you by the Commissioner before the end of the variation quarter; and

(b) your *benchmark instalment rate for that income year.

credit adjustment means:

(a) if, as a result of using the varied rate for the variation quarter, you claimed a credit under section 45-215 - the amount worked out as follows:

(Rate discrepancy * Your instalment income for the earlier instalment quarters in that income year)

or the amount of the credit, whichever is less; and

(b) otherwise - nil.

(3) You are liable to pay the charge for each day in the period that:

(a) started at the beginning of the day by which the instalment for the variation quarter was due to be paid; and

(b) finishes at the end of the earlier of the following days:

(i) the day on which your assessed tax for the income year is due to be paid;

(ii) the last day on which you pay any of that tax.

(4) The Commissioner must give you written notice of the *general interest charge to which you are liable under subsection (2). You must pay the charge within 14 days after the notice is given to you.

(5) If any of the *general interest charge to which you are liable under subsection (2) remains unpaid at the end of the 14 days referred to in subsection (4), you are also liable to pay the *general interest charge on the unpaid amount for each day in the period that:

(a) starts at the end of those 14 days; and

(b) finishes at the end of the last day on which, at the end of the day, any of the following remains unpaid:

(i) the unpaid amount;

(ii) general interest charge on the unpaid amount.

45-235 Liability to GIC on shortfall in annual instalment

(1) You are liable to pay the *general interest charge under this section if:

(a) you choose to estimate the amount of your instalment (the estimated instalment amount ) for an income year under paragraph 45-115(1)(c) or 45-175(1)(b); and

(b) that amount is less than 85% of your *benchmark tax for the income year (which the Commissioner works out under section 45-365).

(2) If you estimated the amount of the instalment under paragraph 45-175(1)(b), you are liable to pay the *general interest charge on the difference between the estimated instalment amount and the lower of the following amounts:

(a) your most recent *notional tax notified by the Commissioner at least 30 days before the day on which the instalment was due;

(b) your *benchmark tax for the income year.

(3) If you estimated the amount of the instalment under paragraph 45-115(1)(c), you are liable to pay the *general interest charge on the difference between the estimated instalment amount and the lowest of the following amounts:

(a) the amount of your instalment worked out using the most recent instalment rate given to you by the Commissioner before the end of the income year;

(b) your most recent *notional tax notified by the Commissioner before the end of the income year under subsection 45-320(5);

(c) your *benchmark tax for the income year.

(4) You are liable to pay the charge for each day in the period that:

(a) started at the beginning of the day by which the instalment for the income year was due to be paid; and

(b) finishes at the end of the earlier of the following days:

(i) the day on which your assessed tax for the income year is due to be paid;

(ii) the last day on which you pay any of that tax.

(5) The Commissioner must give you written notice of the *general interest charge to which you are liable under subsection (2) or (3). You must pay the charge within 14 days after the notice is given to you.

(6) If any of the *general interest charge to which you are liable under subsection (2) or (3) remains unpaid at the end of the 14 days referred to in subsection (5), you are also liable to pay the *general interest charge on the unpaid amount for each day in the period that:

(a) starts at the end of those 14 days; and

(b) finishes at the end of the last day on which, at the end of the day, any of the following remains unpaid:

(i) the unpaid amount;

(ii) general interest charge on the unpaid amount.

45-240 Commissioner may remit general interest charge

The Commissioner may, if he or she is satisfied that because special circumstances exist it would be fair and reasonable to do so, remit the whole or any part of any *general interest charge payable under subsection 45-230(2) or subsection 45-235(2) or (3).

Subdivision 45-H - Partnership income

45-260 Instalment income for a period in which you are in a partnership

(1) Your instalment income for a period (the current period ) includes an amount for each partnership in which you are a partner at any time during the current period. The amount is worked out using the formula:

(Your assessable income from the partnership for the last income year / Partnership's instalment income for that income year) * Partnership's instalment income for the current period

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

your assessable income from the partnership for the last income year means so much of your individual interest in the partnership's net income for an income year as was included by section 92 of the Income Tax Assessment Act 1936 in your assessable income for the most recent income year:

(a) that ended before the start of the current period; and

(b) for which you have an assessment, or for which the Commissioner has notified you that you do not have a taxable income.

(3) However, if for any reason the component defined in subsection (2) does not exist or is a nil amount, or the partnership had no *instalment income for that income year, your instalment income for the current period includes, for that partnership, an amount that is fair and reasonable having regard to:

(a) the extent of your interest in the partnership during the current period; and

(b) the partnership's *instalment income for the current period; and

(c) any other relevant circumstances.

Subdivision 45-I - Trust income

Table of sections

Instalment income of trust beneficiary

45-280 Instalment income for a period in which you are a beneficiary of a trust

Application of Part to trustees

45-300 Trustees to whom this Part applies

Instalment income of trust beneficiary

45-280 Instalment income for a period in which you are a beneficiary of a trust

(1) Your instalment income for a period (the current period ) includes an amount for each trust of which you are a beneficiary at any time during the current period. The amount is worked out using the formula:

(Your assessable income from the trust for the last income year / Trust's instalment income for that income year) * Trust's instalment income for the current period

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

your assessable income from the trust for the last income year means so much of a share of the net income of the trust for an income year as was included by Division 6 of Part III of the Income Tax Assessment Act 1936 in your assessable income for the most recent income year:

(a) that ended before the start of the current period; and

(b) for which you have an assessment, or for which the Commissioner has notified you that you do not have a taxable income.

(3) However, if for any reason the component defined in subsection (2) does not exist or is a nil amount, or the trust had no *instalment income for that income year, your instalment income for the current period includes, for that trust, an amount that is fair and reasonable having regard to:

(a) the extent of your interest in the trust, and your interest in the income of the trust, during the current period; and

(b) the trust's *instalment income for the current period; and

(c) any other relevant circumstances.

Application of Part to trustees

45-300 Trustees to whom this Part applies

(1) This Part applies to a trustee covered by any of items 6 to 12 in the table in section 9-1 of the Income Tax Assessment Act 1997.

(2) This Part also applies for an income year to the trustee of a trust if for the previous income year the trustee was liable to be assessed, and to pay tax, under section 98 (except subsection 98(3) or (4)) or section 99 or 99A of the Income Tax Assessment Act 1936.

Subdivision 45-J - How Commissioner works out your instalment rate and notional tax

Table of sections

45-320 Working out instalment rate

45-325 Working out your notional tax

45-330 Working out your adjusted taxable income

45-335 Working out your adjusted withholding income

45-340 Adjusted tax on adjusted taxable income or on adjusted withholding income

45-320 Working out instalment rate

(1) An instalment rate that the Commissioner gives you must be the percentage worked out to 2 decimal places (rounding up if the third decimal place is 5 or more) using the formula:

(Your notional tax / Base assessment instalment income) * 100

However, the instalment rate must be a nil rate if either component of the formula is nil.

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

base assessment instalment income means so much of your assessable income, as worked out for the purposes of the *base assessment, as the Commissioner determines is *instalment income for the *base year.

(3) The base assessment is the latest assessment for your most recent income year for which an assessment has been made. However, if the Commissioner is satisfied that there is a later income year for which you do not have a taxable income, the base assessment is the latest return or other information from which an assessment for that income year would have been made.

(4) The base year is the income year to which the *base assessment relates.

(5) When the Commissioner gives you the instalment rate, he or she must also notify you of the amount of your *notional tax, as worked out for the purposes of working out the instalment rate.

(6) The Commissioner may incorporate notice of the instalment rate and the amount of your *notional tax in notice of your assessment.

45-325 Working out your notional tax

Notional tax if you have no withholding income

(1) Your notional tax is your *adjusted tax (worked out under section 45-340) on your *adjusted taxable income (worked out under section 45-330) for the *base year.

Notional tax if you have withholding income

(2) However, your notional tax (as worked out under subsection (1)) is reduced if your assessable income for the *base assessment includes amounts in respect of *withholding payments (except *non-quotation withholding payments).

(3) It is reduced (but not below nil) by your *adjusted tax (worked out under section 45-340) on your *adjusted withholding income (worked out under section 45-335) for the *base year.

Commissioner may take into account effect of the law, as applying to income years after base year

(4) For the purposes of working out your *notional tax, the Commissioner may work out an amount as if provisions of an Act or regulations, as they may reasonably be expected to apply for the purposes of your assessment for a later income year, had applied for the purposes of the *base assessment.

Commissioner may take into account proposed changes to the law so as to reduce instalment rate

(5) For the purposes of working out your *notional tax, the Commissioner may work out an amount as if provisions of an Act or regulations that, in the Commissioner's opinion, are likely to be enacted or made had applied for the purposes of the *base assessment. But the Commissioner may do so only if, as a result, the instalment rate given to you is reduced.

45-330 Working out your adjusted taxable income

(1) Your adjusted taxable income for the *base year is your total assessable income for the *base assessment, reduced by:

(a) any *net capital gain included in that assessable income; and

(b) your deductions for the base year (except *tax losses), as used in making that assessment; and

(c) the amount of any tax loss, to the extent that you can carry it forward to the next income year.

Exception: superannuation entities and net capital gains

(2) Paragraph (1)(a) does not apply in the case of:

(a) an eligible ADF (as defined in section 267 of the Income Tax Assessment Act 1936) for the *base year; or

(b) an eligible superannuation fund (as defined in that section) for that year; or

(c) a pooled superannuation trust (as defined in that section) for that year.

45-335 Working out your adjusted withholding income

Your adjusted withholding income for the *base year is:

• the total of the amounts included in your assessable income for the *base assessment in respect of *withholding payments (except *non-quotation withholding payments);

reduced by:

• your deductions for that year, as used in making that assessment, to the extent that they reasonably relate to those amounts.

45-340 Adjusted tax on adjusted taxa ble income or on adjusted withholding income

Your adjusted tax on your *adjusted taxable income, or on your *adjusted withholding income, for the *base year is worked out as follows:

Method statement

Step 1. The income tax payable on your *adjusted taxable income, or on your *adjusted withholding income, for the *base year is worked out disregarding any *tax offset under:

(a) Subdivision 61-H of the Income Tax Assessment Act 1997 (for a premium under a private health insurance policy); or

(b) section 159N of the Income Tax Assessment Act 1936 (for certain low income individuals); or

(c) section 159T of the Income Tax Assessment Act 1936 (for individuals who make superannuation contributions for a spouse).

Step 2. The Medicare levy payable on your *adjusted taxable income, or on your *adjusted withholding income, for the *base year is worked out disregarding sections 8B, 8C, 8D, 8E, 8F and 8G of the Medicare Levy Act 1986 (which increase Medicare levy in certain cases).

Step 3. The amount (if any) that you would have been liable to pay for the *base year in respect of an accumulated HEC debt under the Higher Education Funding Act 1988 if your taxable income for the base year had been your *adjusted taxable income, or your *adjusted withholding income, for that year is worked out.

Step 4. The results of steps 1, 2 and 3 are added together, and reduced by what would have been your *FTB amount (if any) for the *base year if your taxable income for the base year had been your *adjusted taxable income, or your *adjusted withholding income, for that year. The result is your adjusted tax on your *adjusted taxable income, or on your *adjusted withholding income.

Subdivision 45-K - How Commissioner works out your benchmark instalment rate and benchmark tax

Table of sections

45-355 When Commissioner works out benchmark instalment rate and benchmark tax

45-360 How Commissioner works out benchmark instalment rate

45-365 Working out your benchmark tax

45-370 Working out your adjusted assessed taxable income for the variation year

45-375 Adjusted assessed tax on adjusted assessed taxable income

45-355 When Commissioner works out benchmark instalment rate and benchmark tax

(1) The Commissioner may work out your *benchmark instalment rate for an income year (the variation year ) if, under section 45-205, you choose an instalment rate to work out the amount of your instalment for an *instalment quarter in that year.

(2) The Commissioner may work out your *benchmark tax for an income year (the variation year ) if, under paragraph 45-115(1)(c) or 45-175(1)(b), you estimate the amount of your annual instalment for that year.

45-360 How Commissioner works out benchmark instalment rate

(1) Your benchmark instalment rate for the variation year is the percentage worked out to 2 decimal places (rounding up if the third decimal place is 5 or more) using the formula:

(Your benchmark tax / Variation year instalment income) * 100

However, your benchmark instalment rate is a nil rate if either component of the formula is nil.

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

variation year instalment income means so much of your assessable income for the variation year as the Commissioner determines is *instalment income for that year.

45-365 Working out your benchmark tax

Benchmark tax if you had no withholding income

(1) Your benchmark tax is your *adjusted assessed tax (worked out under section 45-375) on your *adjusted assessed taxable income (worked out under section 45-370) for the variation year.

Benchmark tax if you had withholding income

(2) However, your benchmark tax (as worked out under subsection (1)) is reduced if your assessable income for the variation year includes amounts in respect of *withholding payments.

(3) It is reduced (but not below nil) by the total amount of the credits to which you are entitled for the variation year under section 18-15 (for amounts withheld from withholding payments made to you during the variation year).

45-370 Working out your adjusted assessed taxable income for the variation year

(1) Your adjusted assessed taxable income for the variation year is your taxable income for the year, reduced by any *net capital gain included in your assessable income for the year.

Exception: superannuation entities and net capital gains

(2) In working out the adjusted assessed taxable income , taxable income is not reduced by any *net capital gain in the case of:

(a) an eligible ADF (as defined in section 267 of the Income Tax Assessment Act 1936) for the variation year; or

(b) an eligible superannuation fund (as defined in that section) for the variation year; or

(c) a pooled superannuation trust (as defined in that section) for the variation year.

45-375 Adjusted assessed tax on adjusted assessed taxable income

Your adjusted assessed tax on your *adjusted assessed taxable income for the variation year is worked out as follows:

Method statement

Step 1. The income tax payable on your *adjusted assessed taxable income for the variation year is worked out disregarding any *tax offset under:

(a) Subdivision 61-H of the Income Tax Assessment Act 1997 (for a premium under a private health insurance policy); or

(b) section 159N of the Income Tax Assessment Act 1936 (for certain low income individuals); or

(c) section 159T of the Income Tax Assessment Act 1936 (for individuals who make superannuation contributions for a spouse).

Step 2. The Medicare levy payable on your *adjusted assessed taxable income for the variation year is worked out disregarding sections 8B, 8C, 8D, 8E, 8F and 8G of the Medicare Levy Act 1986 (which increase Medicare levy in certain cases).

Step 3. The amount (if any) that you would have been liable to pay for the variation year in respect of an accumulated HEC debt under the Higher Education Funding Act 1988 if your taxable income for that year had been your *adjusted assessed taxable income for that year is worked out.

Step 4. The results of steps 1, 2 and 3 are added together, and reduced by what would have been your *FTB amount (if any) for the variation year if your taxable income for that year had been your *adjusted assessed taxable income for that year. The result is your adjusted assessed tax on your *adjusted assessed taxable income for the variation year.

Subdivision 45-L - How Commissioner works out amount of quarterly instalment on basis of GDP-adjusted notional tax

Table of sections

45-400 Working out amount of instalment

45-405 Working out your GDP-adjusted notional tax

45-400 Working out amount of instalment

The Commissioner must work out in accordance with the table an amount that he or she notifies to you under section 45-112 as the amount of your instalment for an *instalment quarter in an income year (the current year ).

45-405 Working out your GDP-adjusted notional tax

(1) Your GDP-adjusted notional tax is worked out in the same way as your *notional tax would be worked out under Subdivision 45-J for the purposes of working out an instalment rate if that instalment rate were to be given to you at the same time as notice of the amount of the instalment referred to in section 45-400.

(2) However, in applying Subdivision 45-J for the purposes of subsection (1):

(a) your *adjusted taxable income for the *base year; and

(b) your *adjusted withholding income (if any) for the *base year;

are each increased in accordance with the formula:

Original amount * (1 + GDP adjustment)

(3) For the purposes of the formula in subsection (2):

original amount means the amount that, apart from subsection (2), would be your *adjusted taxable income for the *base year, or your *adjusted withholding income for the *base year, as appropriate.

GDP adjustment means the percentage (rounded to the nearest whole number, rounding down a number ending in .5) worked out using the formula:

[100 * (Sum of GDP amounts - current year / Sum of GDP amounts - previous year)] - 100

or 0% if the percentage worked out using the formula is negative.

(4) For the purposes of the formula in subsection (3):

sum of GDP amounts (current year) means the sum of the *GDP amounts, for the *quarters in the last calendaryear (the later calendar year ) ending at least 3 months before the start of the current year, specified in the document referred to in subsection (6).

sum of GDP amounts (previous year) means the sum of the *GDP amounts, for the *quarters in the calendar year (the earlier calendar year ) before the later calendar year, specified in the document referred to in subsection (6).

(5) The GDP amount for a *quarter is the amount published by the Australian Statistician as the original gross domestic product at current prices for that quarter.

(6) The GDP adjustment must be worked out on the basis of the first document that:

(a) is published by the Australian Statistician after the end of the later calendar year; and

(b) sets out the *GDP amounts for all the *quarters in both the later calendar year and the earlier calendar year.

(7) To avoid doubt, subsections 45-325(4) and (5) also have effect for the purposes of working out your *GDP-adjusted notional tax.

3   Application of Part 2-5 in Schedule 1 to the 12

(1) Division 12 (except section 12-190) in Schedule 1 to theTaxation Administration Act 1953 applies to a payment made on or after 1 July 2000.

(1A) Section 12-190 in Schedule 1 to the Taxation Administration Act 1953 applies to a payment made on or after 1 July 2000, but only if some or all of the supply is made on or after that day. (When a supply is made is determined for the purposes of this subitem in the same way as for the purposes of the A New Tax System (Goods and Services Tax Transition) Act 1999.)

(2) Section 12-215, 12-250 or 12-285 in Schedule 1 to the Taxation Administration Act 1953 applies to an amount received on or after 1 July 2000.

(3) Section 12-260 in Schedule 1 to the Taxation Administration Act 1953 applies to interest (within the meaning of Division 11A of Part III of the Income Tax Assessment Act 1936) if the transaction in relation to which the interest is payable is entered into on or after 1 July 2000, unless paragraph 221YL(2E)(a) of the Income Tax Assessment Act 1936 has been complied with in relation to the interest before the transaction is entered into.

(3A) A certificate in force under subsection 221YHZB(4) of the Income Tax Assessment Act 1936 at the end of 30 June 2000 has effect after that day (with such modifications, if any, as the circumstances require) as if the Commissioner had given it under section 12-335 in Schedule 1 to the Taxation Administration Act 1953.

(4) Division 14 in Schedule 1 to the Taxation Administration Act 1953 applies to a non-cash benefit provided on or after 1 July 2000.

(5) Subdivision 16-C in Schedule 1 to the Taxation Administration Act 1953 applies to the financial year starting on 1 July 2000 and to later financial years.

4   Application of Part 2-10 in Schedule 1 to the 12

(1) Part 2-10 in Schedule 1 to the Taxation Administration Act 1953 applies to the 2000-2001 income year and later income years.

(2) However, the Commissioner may give an entity an instalment rate before the start of the 2000-2001 income year. In that case, section 45-50 in that Schedule applies as if the rate had been given on the first day of that income year.

Part 2   Consequential amendment of Acts

Income Tax Assessment Act 1997

5   After section 26-20

Insert:

26-25 Interest or royalty

(1) You cannot deduct under this Act a payment of interest (within the meaning of Division 11A of Part III of the Income Tax Assessment Act 1936) or a *royalty if:

(a) you are required to withhold an amount from the interest or royalty under Division 12 in Schedule 1 to the Taxation Administration Act 1953; and

(b) either:

(i) you fail to withhold the amount; or

(ii) after withholding the amount, you fail to comply with section 16-70 in that Schedule in relation to that amount.

(2) You cannot deduct under this Act a payment of interest (within the meaning of Division 11A of Part III of the Income Tax Assessment Act 1936), or a *royalty, that is in the form of a *non-cash benefit if:

(a) you are required to pay to the Commissioner an amount under section 14-5 or 14-10 in Schedule 1 to the Taxation Administration Act 1953 for that payment; and

(b) you fail to do so.

(3) If:

(a) apart from subsection (1) or (2), you can deduct a payment of interest (within the meaning of Division 11A of Part III of the Income Tax Assessment Act 1936) or a *royalty, for an income year; and

(b) the *withholding tax payable for the interest or the royalty is paid;

you can deduct the interest or royalty for that income year.

6   Section 28-185

Repeal the section, substitute:

28-185 Application of Subdivision 28-J to recipients and payers of certain withholding payments

Application to recipients

(1) If an individual receives, or is entitled to receive, *withholding payments covered by subsection (3), this Subdivision applies to him or her:

(a) in the same way as it applies to an employee; and

(b) as if an entity (a notional employer ) that makes (or is liable to make) such payments to him or her were his or her employer; and

(c) as if any other individual who receives, or is entitled to receive, such payments from a notional employer were also an employee of the notional employer.

Application to payers

(2) This Division applies to an entity that makes, or isliable to make, *withholding payments covered by subsection (3):

(a) in the same way as it applies to an employer; and

(b) as if an individual to whom the entity makes (or is liable to make) such payments were the entity's employee.

Withholding payments covered

(3) This subsection covers a *withholding payment covered by any of the provisions in Schedule 1 to the Taxation Administration Act 1953 listed in the table.

7   Parts 4-5 and 4-10

Repeal the Parts.

8   Section 900-12

Repeal the section, substitute:

900-12 Application to recipients and payers of certain withholding payments

Application to recipients

(1) If an individual receives, or is entitled to receive, *withholding payments covered by subsection (3), this Division applies to him or her:

(a) in the same way as it applies to an employee; and

(b) as if an entity that makes (or is liable to make) such payments to him or her were his or her employer; and

(c) as if the withholding payments covered by subsection (3) that he or she receives (or is entitled to receive) were salary or wages.

Application to payers

(2) This Division applies to an entity that makes, or is liable to make, *withholding payments covered by subsection (3):

(a) in the same way as it applies to an employer; and

(b) as if an individual to whom the entity makes (or is liable to make) such payments were the entity's employee.

Withholding payments covered

(3) This subsection covers a *withholding payment covered by any of the provisions in Schedule 1 to the Taxation Administration Act 1953 listed in the table.

Income Tax Assessment Act 1936

9   Subsection 6(1AA)

Omit all the words after "(the 1997 Act )", substitute ", or for the purposes of Schedule 1 to the Taxation Administration Act 1953, except as provided in the 1997 Act or in that Schedule".

10   Subsection 6(1) (at the end of the definition of this Act )

Add:

; and (c) Schedule 1 to the Taxation Administration Act 1953.

11   Paragraph 220AF(1)(c)

After "1994", insert "and before 1 July 2000".

12   Subsection 220AJ(1)

After "financial year", insert "ending on or before 30 June 2000".

13   Paragraph 220AQ(1)(b)

After "first person", insert "on or before 30 June 2000".

14   Paragraph 220AQ(2)(c)

After "form", insert ", and on or before 30 June 2000".

15   At the end of section 221AKA

Add:

(3) This Division does not apply to a taxpayer for the 2000-01 income year or a later income year.

Note: For the 2000-01 income year a taxpayer may be liable to pay PAYG instalments: see Division 45 in Schedule 1 to the Taxation Administration Act 1953.

16   Before section 221AZJ

Insert in Subdivision B of Division 1C of Part VI:

221AZJA Application of this Division

A taxpayer is not liable to pay instalments under this Division for the 2000-01 income year or a later income year.

Note: For the 2000-01 income year a taxpayer may be liable to pay PAYG instalments: see Division 45 in Schedule 1 to the Taxation Administration Act 1953.

17   Subsection 221AZK(2)

After "subsection (3A)", insert "of this section and to sections 221AZJA, 221AZKB, 221AZKC and 221AZKE".

18   After section 221AZKA

Insert:

221AZKB For 1999-2000, some medium and small taxpayers need not pay instalment due in month 18

(1) For the 1999-2000 year of income, a medium taxpayer is not liable to pay the instalment that would otherwise be due on the 1st day of month 18.

(2) For the 1999-2000 year of income, a small taxpayer is not liable to pay the instalment that would otherwise be due on the 15th day of month 18.

Note: This subsection does not cover a small taxpayer whose assessed tax for the 1999-2000 is more than $300,000. See subsection 221AZK(3A).

To qualify, taxpayer must be quarterly instalment payer

(3) However, subsection (1) or (2) applies only if the taxpayer is liable to pay an instalment for the first instalment quarter of the 2000-01 year of income under Division 45 in Schedule 1 to the Taxation Administration Act 1953 (even if the amount of that instalment is nil).

Note: This means that an entity that becomes an annual payer at the end of that instalment quarter under Subdivision 45-E in Schedule 1 to the Taxation Administration Act 1953 does not qualify.

Effect on amount of final instalment

(4) In working out the amount of the final instalment of a small or medium taxpayer for the 1999-2000 year of income, disregard a previous instalment that the taxpayer is not liable to pay because of this section.

221AZKC Deferring payment of the final instalment for 1999-2000

(1) Depending on the amount of its assessed tax for the 1999-2000 year of income, an instalment taxpayer may defer payment of all or some of its final instalment for that year.

(2) However, subsection (1) applies only if the taxpayer is liable to pay a quarterly instalment for the first instalment quarter of the 2000-01 year of income under Division 45 in Schedule 1 to the Taxation Administration Act 1953 (even if the amount of that instalment is nil).

Note: This means that an entity that becomes an annual payer at the end of that instalment quarter under Subdivision 45-E in Schedule 1 to the Taxation Administration Act 1953 does not qualify.

How much can be deferred, and for how long?

(3) The table shows:

(a) how much of the final instalment can be deferred (the deferred amount ); and

(b) the number of equal quarterly payments by which the taxpayer must pay off the deferred amount.

However, the deferred amount cannot be more than the whole of the instalment (reduced by any credits or offsets specified in paragraph 221AZP(1)(b)).

Note: The amount of each quarterly payment is the deferred amount divided by the number of payments.

(4) If only some of the final instalment can be deferred, the rest is still due on the day on which the whole of the instalment would otherwise be due. Section 221AZMAA (which applies the general interest charge to unpaid amounts) applies as if the rest of the final instalment were the whole of the final instalment.

When the quarterly payments are due

(5) The first of the quarterly payments is due:

(a) if (disregarding anything the Commissioner does under section 206) the final instalment would otherwise be due on the 1st day of month 18 for the 1999-2000 year of income - on the 21st day of month 19 for that year; and

(b) if (disregarding anything the Commissioner does under section 206) the final instalment would otherwise be due on the 1st or 15th day of month 21 for the 1999-2000 year of income - on the 21st day of month 22 for that year.

Note: The due date for the first quarterly payment is the same as for the taxpayer's next quarterly instalment for the 2000-01 year of income under Division 45 in Schedule 1 to the Taxation Administration Act 1953. If the taxpayer's year of income ends on 30 June 2000, the due date will be 21 January or 21 April 2001.

(6) Each of the remaining quarterly payments is due 3 months after the day on which the previous quarterly payment is due (or would be due apart from anything the Commissioner does under section 206).

(7) A quarterly payment is due on a particular day even if no quarterly instalment of the taxpayer is due on that day under Division 45 in Schedule 1 to the Taxation Administration Act 1953.

Note: If some or all of a quarterly payment is not paid on time, the taxpayer is liable to pay the general interest charge on the unpaid amount: see section 221AZMAA.

(8) Quarterly payments are to be treated as tax for the purposes of sections 206, 208, 209, 214, 254, 255, 258 and 259.

221AZKE Modified application of sections 221AZKB and 221AZKC to entity adopting a substituted accounting period

Sections 221AZKB and 221AZKC apply to an entity with modifications that the Commissioner determines in writing if the Commissioner has granted the entity leave under section 18 to adopt an accounting period ending on a day other than 30 June and, as a result:

(a) the entity's 1999-2000 year of income will end on a day of a calendar year that does not correspond to the last day of the entity's 1998-99 year of income; or

(b) the entity's 2000-01 year of income will end on a day of a calendar year that does not correspond to the last day of the entity's 1999-2000 year of income.

19   Subsection 221AZMAA(1)

After "instalment" (second occurring), insert "or quarterly payment".

20   Subsection 221AZMAA(1)

After "the instalment" (wherever occurring), insert "or quarterly payment".

21   Subsection 221AZMAA(1)

After "221AZK", insert "or 221AZKC".

22   Subsection 221C(1A)

After "salary or wages" (first occurring), insert "before 1 July 2000".

23   Section 221K

After "at any time", insert "before 1 July 2000".

24   Subsection 221S(2)

After "times", insert "before 1 July 2000".

25   After subsection 221S(2)

Insert:

(2A) An arrangement under subsection (1), or an authorisation under subsection (2), does not apply to a payment of salary or wages made after 30 June 2000.

26   At the end of subsection 221YB(2)

Add "(except the 2000-01 year of income and later income years)".

27   At the end of subsection 221YB(2)

Add:

Note: For the 2000-01 income year you may be liable to pay PAYG instalments: see Division 45 in Schedule 1 to the Taxation Administration Act 1953.

28   At the end of subsection 221YBA(1)

Add "(except the 2000-01 year of income and later income years)".

29   At the end of subsection 221YBA(1)

Add:

Note: For the 2000-01 income year you may be liable to pay PAYG instalments: see Division 45 in Schedule 1 to the Taxation Administration Act 1953.

30   Before section 221YHA

Insert:

221YHAAH Division does not apply to payments made after 30 June 2000

This Division does not apply to a prescribed payment made after 30 June 2000.

31   Paragraph 221YHDD(1)(a)

Before "a person", insert "before 1 July 2000,".

32   After subsection 221YHDD(4)

Insert:

(4A) If:

(a) this section applies; and

(b) the project or part is not completed by the end of 30 June 2000;

the householder must, within 6 weeks after that day:

(c) in accordance with subsection (5), complete and sign, in respect of the project, the part of a householder payment summary form relating to the householder; and

(d) make a copy of the form; and

(e) send the form to the Commissioner.

(The completed form does not need to cover prescribed payments made after 30 June 2000.)

33   After subsection 221YHDD(6)

Insert:

(6A) Subject to subsection (7), the householder must keep the copy that paragraph (4A)(d) requires to be made for 6 months after it is made.

34   Subsection 221YHDD(8)

After "(6)", insert ", (6A)".

35   Subsection 221YHZB(1)

After "non-resident" (second occurring), insert "before 1 July 2000".

36   After subsection 221YHZC(1)

Insert:

(1AAAA) Subsection (1A) does not apply to a payment made after 30 June 2000.

Note: Instead, the investment body must withhold an amount under section 12-140 or 12-145 in Schedule 1 to the Taxation Administration Act 1953.

37   Subsection 221YHZD(1B)

After "202DA", insert "and before 1 July 2000".

38   Subsection 221YHZD(1B)

Omit "until", substitute "unless".

39   Paragraph 221YHZQ(1)(b)

Repeal the paragraph, substitute:

(b) if the investment body had paid the deemed payment amount to the investor in money, and section 12-150 in Schedule 1 to the Taxation Administration Act 1953 had not been enacted, section 12-140 in that Schedule would have required the investment body to withhold an amount (the notional deduction ) from the payment; and

40   Before subsection 221YL(1)

Insert:

(1A) This section (except subsections (2D), (2DA) and (2E)) does not apply to a dividend, interest or a royalty paid after 30 June 2000.

Note: Instead, see Subdivision 12-F in Schedule 1 to the Taxation Administration Act 1953.

41   After subsection 221YL(2D)

Insert:

(2DA) However, subsection (2E) does not apply in relation to the interest if the transaction in relation to which it is payable is entered into on or after 1 July 2000, unless the lender complied with paragraph (2E)(a) in relation to the interest before the transaction is entered into.

Note: Instead, the lender must notify the borrower under section 12-260 in Schedule 1 to the Taxation Administration Act 1953.

42   Subsection 221YP(1)

Omit "until", substitute "before 1 July 2000 unless".

43   Subsection 221YP(2)

Omit "until", substitute "before 1 July 2000 unless".

44   Subsection 221YP(3A)

Omit "until", substitute "before 1 July 2000 unless".

45   Subsection 221ZB(1)

After "shall not", insert "before 1 July 2000".

46   Before section 221ZM

Insert in Division 6 of Part VI:

221ZMA Division does not apply to withdrawals made after 30 June 2000

This Division does not apply to a withdrawal from a film account made after 30 June 2000.

47   Subsection 221ZXB(1)

After "if", insert ", before 1 July 2000,".

48   After subsection 262A(2)

Insert:

(2A) If an entity is required to withhold an amount under Division 12 in Schedule 1 to the Taxation Administration Act 1953, or to pay an amount to the Commissioner under Division 14 of that Schedule, the entity must keep records that record and explain all transactions and other acts engaged in by the entity that are relevant for the purposes of that Schedule.

49   After subsection 262A(4)

Insert:

(4AAA) Subsection (4) does not apply to any record required to be kept by a provision in Schedule 1 to the Taxation Administration Act 1953.

49A   Application

The amendment of the Income Tax Assessment Act 1936 made by item 39 of this Schedule applies to an income year that ends after 30 June 2000.

A New Tax System (Goods and Services Tax) Act 1999

50   Paragraph 9-20(2)(a)

Repeal the paragraph, substitute:

(a) by a person as an employee or in connection with earning *withholding payments covered by subsection (4) (unless the activity or series is done in supplying services as the holder of an office that the person has accepted in the course of or in connection with an activity or series of activities of a kind mentioned in subsection (1)); or

Note: Acts done as mentioned in paragraph (a) will still form part of the activities of the enterprise to which the person provides work or services.

51   Paragraph 9-20(2)(d)

Repeal the paragraph, substitute:

(d) as a member of a local governing body established by or under a *State law or *Territory law (except a local governing body to which subsection 12-45(3) in Schedule 1 to the Taxation Administration Act 1953 applies).

52   At the end of section 9-20

Add:

(4) This subsection covers a *withholding payment covered by any of the provisions in Schedule 1 to the Taxation Administration Act 1953 listed in the table.

53   Section 9-39 (at the end of the table)

Add:

54 Section 37-1 (after table item 33)

Insert:

55   Paragraph 111-5(1)(a)

Omit ", other *PAYE earner".

56   Paragraph 111-5(1)(a)

Omit ", PAYE earner".

57   Subsection 111-5(1)

Omit ", PAYE earner" (last occurring).

58   At the end of subsection 111-5(1)

Add:

Note: This section also applies if you reimburse the recipient of certain withholding payments: see section 111-20.

59   Paragraph 111-5(3)(a)

Omit ", *PAYE earner".

60   Paragraph 111-5(3)(b)

Omit ", PAYE earner".

61   Paragraph 111-10(2)(a)

Omit ", *PAYE earner".

62   Paragraph 111-10(2)(a)

Omit ", PAYE earner".

63   After section 111-15

Insert:

111-20 Application of Division to recipients of certain withholding payments

(1) If you make, or are liable to make, *withholding payments covered by subsection (2), this Division applies to you as if:

(a) an individual to whom you make (or are liable to make) such payments were your employee; and

(b) his or her activities in connection with earning such payments were activities as your employee.

(2) This subsection covers a *withholding payment covered by any of the provisions in Schedule 1 to the Taxation Administration Act 1953 listed in the table.

64   At the end of Part 4-2

Add:

Division 113 - PAYG voluntary agreements

113-1 What this Division is about

A supply is not a taxable supply if:

(a) an amount must be withheld from payment for the supply because of section 12-55 in Schedule 1 to the Taxation Administration Act 1953 (about voluntary agreements to withhold); and

(b) the acquisition of the thing supplied would be a creditable acquisition if the supply were a taxable supply.

113-5 Supply of work or services not a taxable supply

(1) A supply that you make is not a *taxable supply to the extent that you make it under an arrangement (within the meaning of the Income Tax Assessment Act 1997) if:

(a) the arrangement the performance of which, in whole or in part, involves the performance of work or services (whether or not by you); and

(b) an agreement is in force that:

(i) complies with section 12-55 in Schedule 1 to the Taxation Administration Act 1953 (about voluntary agreements to withhold); and

(ii) states that the section covers payments under the arrangement, or payments under a series of arrangements that includes the arrangement; and

(c) you, and the entity acquiring what you supply under the arrangement, are parties to that agreement; and

(d) you have an *ABN that is in force and is quoted in the agreement; and

(e) the acquisition, by that entity, of what you supply under the arrangement would be a *creditable acquisition (and not *partly creditable) if the supply were a *taxable supply.

(2) This section has effect despite section 9-5 (about what is a taxable supply.)

65   Section 195-1

Insert:

non-cash benefit has the meaning given by subsection 995-1(1) of the Income Tax Assessment Act 1997.

66   Section 195-1 (definition of PAYE earner )

Repeal the definition.

67   Section 195-1 (note at the end of the definition of taxable supply )

Omit "and 90-5", substitute ", 90-5 and 113-1".

68   Section 195-1

Insert:

withholding payment has the meaning given by subsection 995-1(1) of the Income Tax Assessment Act 1997.

69   Section 195-1

Insert:

withholding payment covered by a particular provision in Schedule 1 to the Taxation Administration Act 1953 has the meaning given by subsection 995-1(1) of the Income Tax Assessment Act 1997.

A New Tax System (Goods and Services Tax Administration) Act 1999

70   Item 7 of Schedule 1

Omit "At the end of the Act", substitute "After Part V".

71   Item 7 of Schedule 1

Omit "Add:", substitute "Insert:".

A New Tax System (Australian Business Number) Act 1999

72   Paragraph 38(2)(a)

Repeal the paragraph, substitute:

(a) by a person as an employee or in connection with earning *withholding payments covered by subsection (3) (unless the activity or series is done in supplying services as the holder of an office that the person has accepted in the course of or in connection with an activity or series of activities of a kind mentioned in subsection (1)); or

Note: Acts done as mentioned in paragraph (a) will still form part of the activities of the enterprise to which the person provides work or services.

73   Paragraph 38(2)(d)

Repeal the paragraph, substitute:

(d) as a member of a local governing body established by or under a *State law or *Territory law (except a local governing body to which subsection 12-45(3) in Schedule 1 to the Taxation Administration Act 1953 applies).

74   At the end of section 38

Add:

(3) This subsection covers a *withholding payment covered by any of the provisions in Schedule 1 to the Taxation Administration Act 1953 listed in the table.

75   Section 41

Insert:

non-cash benefit has the meaning given by subsection 995-1(1) of the Income Tax Assessment Act 1997.

76   Section 41 (definition of PAYE earner )

Repeal the definition.

77   Section 41

Insert:

withholding payment has the meaning given by subsection 995-1(1) of the Income Tax Assessment Act 1997.

78   Section 41

Insert:

withholding payment covered by a particular provision in Schedule 1 to the Taxation Administration Act 1953 has the meaning given by subsection 995-1(1) of the Income Tax Assessment Act 1997.

Fringe Benefits Tax Assessment Act 1986

79   Subsection 136(1) (definition of current employee )

Repeal the definition, substitute:

current employee means a person who receives, or is entitled to receive, salary or wages.

80   Subsection 136(1) (definition of current employer )

Repeal the definition, substitute:

current employer means a person (including a government body) who pays, or is liable to pay, salary or wages, and includes:

(a) in the case of a partnership - each partner; and

(b) in the case of any other unincorporated association or body of persons - its manager or other principal officer.

81   Subsection 136(1) (definition of salary or wages )

Repeal the definition, substitute:

salary or wages means a payment from which an amount must be withheld (even if the amount is not withheld) under a provision in Schedule 1 to the Taxation Administration Act 1953 listed in the table, to the extent that the payment is assessable income.

Note: Section 137 extends the meaning of salary or wages for some purposes.

82   Subsection 137(1)

Omit "section 221A of the Income Tax Assessment Act 1936", substitute "a definition in subsection 136(1)".

83   Subsection 137(2)

Repeal the subsection.

84   Application

The amendments of the Fringe Benefits Tax Assessment Act 1986 made by this Part apply to a payment made, or a benefit provided, on or after 1 July 2000.

Taxation Administration Act 1953

85   Subsection 8AAB(5) (after table item 17)

Insert:

86   Subsection 8AAJ(1)

Repeal the subsection, substitute:

(1) There are certain provisions of Acts that make persons liable to pay the failure to notify penalty. Subsections (4) and (5) list the provisions.

87   Subsection 8AAJ(4)

Omit "Sections 91Z and 95A of the Sales Tax Assessment Act 1992 also deal with liability to the penalty.".

88   At the end of section 8AAJ

Add:

(5) The following table is an index of the provisions of Acts other than the Income Tax Assessment Act 1936 that deal with liability to the penalty.

Schedule 2   Running balance accounts, general interest charge and related matters

Part 1   Running balance accounts

Division 1   Amendment of Part IIB of the Taxation Administration Act 1953

1   Section 8AAZA (definition of deficit)

Repeal the definition.

2   Section 8AAZA

Insert:

excess non-RBA credit means a credit that arises under section 8AAZLA or 8AAZLB.

3   Section 8AAZA (definition of RBA class)

Repeal the definition.

4   Section 8AAZA (definition of RBA deficit)

Repeal the definition.

5   Section 8AAZA (definition of RBA deficit debt)

Repeal the definition, substitute:

RBA deficit debt , in relation to an RBA of an entity, means a balance in favour of the Commissioner, based on:

(a) primary tax debts that have been allocated to the RBA and that are currently payable; and

(b) payments made in respect of current or anticipated primary tax debts of the entity, and credits to which the entity is entitled under a taxation law, that have been allocated to the RBA.

6   Section 8AAZA

Insert:

RBA surplus , in relation to an RBA of an entity, means a balance in favour of the entity, based on:

(a) primary tax debts that have been allocated to the RBA; and

(b) payments made in respect of current or anticipated primary tax debts of the entity, and credits to which the entity is entitled under a taxation law, that have been allocated to the RBA.

7   Section 8AAZA (definition of special priority credit )

Repeal the definition.

8   Subsection 8AAZC(1)

Repeal the subsection, substitute:

(1) The Commissioner may establish one or more systems of accounts for primary tax debts.

Note: This section does not prevent the Commissioner from establishing other accounts that are not RBAs.

9   Subsection 8AAZC(4)

Omit "Within an RBA class,".

10   After subsection 8AAZC(4)

Insert:

(4A) Without limiting subsection (4), separate RBAs may be established for different types of primary tax debts.

11   Subsection 8AAZD(1)

Repeal the subsection, substitute:

(1) The Commissioner may allocate a primary tax debt to an RBA that has been established for that type of tax debt.

Note: General interest charge on an RBA deficit debt is not allocated to the RBA: it accrues automatically under section 8AAZF.

Separate RBAs for one entity

(1A) If 2 or more RBAs for an entity have been established for that kind of tax debt, the Commissioner may allocate the debt to any one of those RBAs, or between any 2 or more of those RBAs, in the manner the Commissioner determines.

Note: Separate RBAs may be established for different businesses or undertakings conducted by the same entity, for different parts of the same business or undertaking or for different periods: see subsection 8AAZC(5).

Note: The following heading to subsection 8AAZD(2) is inserted "Definition".

12   Section 8AAZE

Repeal the section.

13   Subsection 8AAZF(1)

Omit "a deficit on an RBA", substitute "an RBA deficit debt".

Note: The heading to section 8AAZF is altered by adding at the end " debt ".

14   Subsection 8AAZF(1)

Omit "that deficit", substitute "that RBA deficit debt".

15   Subsection 8AAZF(2)

Repeal the subsection, substitute:

(2) The balance of the RBA is altered in the Commissioner's favour by the amount of the general interest charge payable.

16   Subsection 8AAZH(1)

After "deficit", insert "debt".

Note: The heading to section 8AAZH is altered by adding at the end " debt ".

17   Subsection 8AAZH(2) (example)

Omit "deficit on the RBA", substitute "RBA deficit debt".

18   Paragraph 8AAZJ(1)(a)

After "deficit", insert "debt".

19   Paragraph 8AAZJ(1)(b)

Omit "was allocated to the RBA", substitute "is payable on the RBA deficit debt".

20   Paragraph 8AAZJ(1)(d)

After "deficit", insert "debt".

21   Section 8AAZK

Repeal the section.

22   Division 3 of Part IIB

Repeal the Division, substitute:

Division 3 - Treatment of payments, credits and RBA surpluses

8AAZL Amounts covered by this Division

(1) This Division sets out how the Commissioner must treat the following kinds of amount:

(a) a payment the Commissioner receives in respect of a current or anticipated tax debt or tax debts of an entity;

(b) a credit (including an excess non-RBA credit) that an entity is entitled to under a taxation law;

(c) an RBA surplus of an entity.

(2) The Commissioner must treat each such amount using the method set out in section 8AAZLA or 8AAZLB (but not both).

Note: In either case, section 8AAZLC has some additional rules that apply to RBA surpluses and to certain excess non-RBA credits.

8AAZLA Method 1 - allocating the amount first to an RBA

(1) The Commissioner may, in the manner he or she determines, allocate the amount to an RBA of the entity.

(2) The Commissioner must then also apply the amount against the following kinds of debts (if there are any):

(a) tax debts that have been allocated to that RBA;

(b) general interest charge on such tax debts.

(3) To the extent that the amount is not applied under subsection (2), it gives rise to an excess non-RBA credit in favour of the entity that:

(a) is equal to the part of the amount that is not applied; and

(b) relates to the RBA to which the amount was allocated.

8AAZLB Method 2 - applying the amount first against a non-RBA tax debt

(1) The Commissioner may, in the manner he or she determines, apply the amount against a non-RBA tax debt of the entity.

(2) If the non-RBA tax debt is:

(a) a tax debt that has been allocated to an RBA; or

(b) general interest charge on such a tax debt;

the Commissioner must then also allocate the amount to that RBA.

(3) To the extent that the amount is not applied under subsection (1), it gives rise to an excess non-RBA credit in favour of the entity that is equal to the part of the amount that is not applied.

(4) The excess non-RBA credit relates to the RBA (if any) that the Commissioner determines and the balance of that RBA is adjusted in the entity's favour by the amount of that credit.

Separate RBAs for one entity

(5) If the non-RBA tax debt mentioned in subsection (1) has been allocated to 2 or more RBAs, the Commissioner must allocate the amount applied between those RBAs in the proportions in which the tax debt was allocated.

Note: Separate RBAs may be established for different businesses or undertakings conducted by the same entity, for different parts of the same business or undertaking or for different periods: see subsection 8AAZC(5).

8AAZLC RBA surplus and related credits must remain equivalent if one or the other is applied

RBA surpluses

(1) If an RBA surplus is allocated or applied under this Division, the Commissioner must reduce by the same amount excess non-RBA credits that relate to the RBA.

Excess non-RBA credits

(2) If, under this Division, an excess non-RBA credit that relates to an RBA (the related RBA ) is:

(a) allocated to an RBA; or

(b) applied against a non-RBA tax debt;

the related RBA is adjusted in the Commissioner's favour by the same amount.

8AAZLD Special priority credits: HEC and FS assessment debts

If, under this Division, the Commissioner is to apply a credit that arises under Schedule 1 to this Act (the PAYG system), the Commissioner must apply it, whether under section 8AAZLA or 8AAZLB:

(a) first, against any HEC assessment debt of the entity; and

(b) then against any FS assessment debt of the entity;

before applying it against other non-RBA tax debts of the entity.

8AAZLE Instructions to Commissioner not binding

In doing anything under this Division, the Commissioner is not required to take account of any instructions of any entity.

Division 3A - Refunds of RBA surpluses and credits

8AAZLF Commissioner must refund RBA surpluses and credits

(1) The Commissioner must refund to an entity so much of:

(a) an RBA surplus of the entity; or

(b) a credit (including an excess non-RBA credit) in the entity's favour;

as the Commissioner does not allocate or apply under Division 3.

Voluntary payments only to be refunded on request

(2) However, the Commissioner is not required to refund an RBA surplus or excess non-RBA credit that arises because a payment is made in respect of an anticipated tax debt of an entity unless the entity later requests, in the approved manner, that the Commissioner do so.

(3) On receiving such a request, the Commissioner must refund so much of the amount as the Commissioner does not allocate or apply under Division 3.

Effect of refunding RBA surplus

(4) If the Commissioner refunds an RBA surplus under this section, the Commissioner must reduce by the same amount excess non-RBA credits that relate to the RBA.

Effect of refunding credit that relates to an RBA

(5) If, under this section, the Commissioner refunds an excess non-RBA credit that relates to an RBA, the RBA is adjusted in the Commissioner's favour by the same amount.

8AAZLG Retaining refunds until information or notification given

(1) The Commissioner may retain an amount that he or she otherwise would have to refund to an entity under section 8AAZLF, if the entity has not given the Commissioner a notification:

(a) that affects or may affect the amount that the Commissioner refunds to the entity; and

(b) that the entity is required to give the Commissioner under any of the following provisions:

(2) The Commissioner may retain the amount until the entity has given the Commissioner that notification.

8AAZLH How refunds are made

(1) This section applies to refunds payable to an entity of RBA surpluses, or excess non-RBA credits that relate to an RBA, if primary tax debts arising under any of the provisions set out in paragraph 8AAZLG(1)(b) have been allocated to that RBA.

(2) The Commissioner must pay those refunds to the credit of a financial institution account nominated by the entity.

(3) However, the Commissioner may direct that any such refunds be paid to the entity in a different way.

(4) If an entity has not nominated a financial institution account for the purposes of this section and the Commissioner has not directed that any such refunds be paid in a different way, the Commissioner is not obliged to refund any amount to the entity until the entity does so.

Division 2   Consequential amendments

Multiple amendments

23   Multiple amendments

The specified provisions of the Acts listed in this Division are amended by omitting "section 8AAZL" and substituting "Division 3 of Part IIB".

Income Tax Assessment Act 1936

24   Subsection 160AN(3)

25   Subsection 160AN(4)

26   Paragraph 160APYBB(b)

27   Subsection 163B(10) (definition of income tax crediting amount )

28   Subsection 220AZC(6)

29   Subsection 221YHG(5)

30   Subsection 221YHZL(6)

31   Subsection 221YT(3)

32   Subsection 221ZG(3)

Sales Tax Assessment Act 1992

33   Section 56

Taxation (Interest on Overpayments and Early Payments) Act 1983

34   Subsection 3(1) (paragraph (a) of the definition of income tax crediting amount )

Division 3 - Application and transitional

35   Application

(1) The amendments made by this Part, so far as they relate to the establishment, operation and effect of RBAs, apply to all tax debts owing on or after 1 July 2000, regardless of when the debts arose.

(2) The amendments made by this Part, so far as they relate to the treatment of payments and credits by the Commissioner, apply to the treatment of payments or credits by the Commissioner on or after 1 July 2000, regardless of when the payments were made or when the credits arose.

36   Transitional - existing RBAs

Although item 8 repeals and substitutes subsection 8AAZC(1) of the Taxation Administration Act 1953, an RBA system established under the old version of that subsection continues in existence after the commencement of that item as if it had been established under the new version of that subsection.

Part 2   General interest charge

Crimes (Taxation Offences) Act 1980

37   Subsection 3(1) (paragraph (b) of the definition of income tax )

Omit "section 207, 221AG, 221AY, 221AZE or", substitute "section 163AA, section 170AA, subsection 204(3), subsection 221AZMAA(1), subsection 221AZP(1), subsection 221YD(3), section".

38   Subsection 3(1) (paragraph (d) of the definition of income tax )

Omit "221EAA(1), section 220AAE, 220AAM or 220AAR or subsection 220AAV(3)", substitute "221EAA(1) or section 220AAE, 220AAM or 220AAR".

39   Subsection 3(1) (paragraph (g) of the definition of income tax )

Omit "220AS(2)", substitute "220AS(1)".

Income Tax Assessment Act 1936

40   At the end of section 102UO

Add:

(3) Any unpaid ultimate beneficiary non-disclosure tax may be sued for and recovered in a court of competent jurisdiction by the Commissioner suing in his or her official name.

41   Sections 102UP and 102UQ

Repeal the sections, substitute:

102UP Late payment of ultimate beneficiary non-disclosure tax

If any of the ultimate beneficiary non-disclosure tax which a person is liable to pay remains unpaid 60 days after the day by which it is due to be paid, the person is liable to pay the general interest charge on the unpaid amount for each day in the period that:

(a) started at the beginning of the 60th day after the day by which the ultimate beneficiary non-disclosure tax was due to be paid; and

(b) finishes at the end of the last day on which, at the end of the day, any of the following remains unpaid:

(i) the ultimate beneficiary non-disclosure tax;

(ii) general interest charge on any of the ultimate beneficiary non-disclosure tax.

Note: The general interest charge is worked out under Division 1 of Part IIA of the Taxation Administration Act 1953.

42   Subsections 163B(5) and (6)

Repeal the subsections.

43   Subsection 163B(8)

Omit "170, 172, 174", substitute "204".

46   Section 220AAF

Omit "the general interest charge", substitute "a penalty".

47   Section 220AAF (note)

Repeal the note.

48   Section 220AAW

Repeal the section, substitute:

220AAW Large remitters - non-electronic payment

(1) A large remitter that pays an amount other than by electronic transfer is liable to a penalty of the greater of:

(a) $500; or

(b) assuming that the general interest charge applied to the amount that was paid other than by electronic transfer - an amount equal to the general interest charge that would be payable for each day in a period of 7 days starting at the beginning of the day on which the payment became due.

Note: The general interest charge is worked out under Division 1 of Part IIA of the Taxation Administration Act 1953.

(2) However, the Commissioner may remit some or all of the penalty.

(3) The penalty becomes due for payment on the day the payment was made.

(4) If any of the penalty remains unpaid after the time by which it is due to be paid, the large remitter is liable to pay the general interest charge on the unpaid penalty amount for each day in the period that:

(a) started at the beginning of the day by which the penalty amount was due to be paid; and

(b) finishes at the end of the last day on which, at the end of the day, any of the following remains unpaid:

(i) the penalty amount;

(ii) general interest charge on any of the penalty amount.

(5) This section does not apply to an exempt Australian government agency (as defined in subsection 995-1(1) of the Income Tax Assessment Act 1997).

49   Paragraph 220AAZF(g)

Omit "220AAX(5)", substitute "220AAW(2)".

50   At the end of section 221AZM

Add "The credit arises when the Commissioner makes an assessment of the income tax payable by the taxpayer or determines that no income tax is payable."

51   At the end of section 221N

Add:

(3) A person who is dissatisfied with a decision of the Commissioner under subsection (1) in relation to the person may object against it in the manner set out in Part IVC of the Taxation Administration Act 1953.

52   At the end of section 221YDB

Add:

(3) If any of the additional tax payable under this section remains unpaid after the last day for which it is payable, the taxpayer is liable to pay the general interest charge on the unpaid additional tax for each day in the period that:

(a) started at the beginning of the next day; and

(b) finishes at the end of the last day on which, at the end of the day, any of the following remains unpaid:

(i) the additional tax;

(ii) general interest charge on any of the additional tax.

Note: The general interest charge is worked out under Division 1 of Part IIA of the Taxation Administration Act 1953.

53   Before subsection 221YHZD(1)

Insert:

(1AAA) A person who deducts, or purports to deduct, under subsection 221YHZC(1), an amount from a payment to a non-resident must pay the amount to the Commissioner within 14 days after the end of the month in which the person makes the payment to the non-resident.

54   Paragraph 221YHZD(1) (penalty)

After "Penalty", insert "for a contravention of this subsection".

55   Subsection 221YHZD(2)

Omit "subsection (1)", substitute "subsection (1AAA)".

56   Subsection 254(2)

Omit "a provision of this Act", substitute "section 163AA, section 170AA, subsection 204(3), subsection 221AZMAA(1), subsection 221AZP(1), subsection 221YD(3) or section 221YDB".

57   Subsection 255(4)

Omit "a provision of this Act", substitute "section 163AA, section 170AA, subsection 204(3), subsection 221AZMAA(1), subsection 221AZP(1), subsection 221YD(3) or section 221YDB".

58   Subsection 258(2)

Omit "a provision of this Act", substitute "section 163AA, section 170AA, subsection 204(3), subsection 221AZMAA(1), subsection 221AZP(1), subsection 221YD(3) or section 221YDB".

59   Subsection 259(2)

Omit "a provision of this Act", substitute "section 163AA, section 170AA, subsection 204(3), subsection 221AZMAA(1), subsection 221AZP(1), subsection 221YD(3) or section 221YDB".

60   Subsection 265(12)

Omit "a provision of this Act", substitute "section 163AA, section 170AA, subsection 204(3), subsection 221AZMAA(1), subsection 221AZP(1), subsection 221YD(3) or section 221YDB".

61   Section 271-80 of Schedule 2F

Repeal the section, substitute:

271-80 Late payment of family trust distribution tax

If any of the family trust distribution tax which a person is liable to pay remains unpaid 60 days after the day by which it is due to be paid, the person is liable to pay the general interest charge on the unpaid amount for each day in the period that:

(a) started at the beginning of the 60th day after the day by which the family trust distribution tax was due to be paid; and

(b) finishes at the end of the last day on which, at the end of the day, any of the following remains unpaid:

(i) the family trust distribution tax;

(ii) general interest charge on any of the family trust distribution tax.

Note: The general interest charge is worked out under Division 1 of Part IIA of the Taxation Administration Act 1953.

62   Section 271-85 of Schedule 2F

Omit ", and any unpaid additional tax payable under section 271-80,".

Income Tax Assessment Act 1997

63   Paragraph 20-25(2A)(a)

Omit "general interest charge", substitute "*general interest charge".

64   Paragraph 25-5(1)(c)

Omit "general interest charge", substitute "*general interest charge".

65   At the end of section 25-5

Add:

No double deduction for general interest charge on a running balance account

(7) If you deduct *general interest charge that applies to an RBA deficit debt, you can't also deduct the corresponding general interest charge on tax debts that have been allocated to the RBA.

Note: RBAs (running balance accounts) are dealt with in Part IIB of the Taxation Administration Act 1953.

Sales Tax Assessment Act 1992

66   Section 56

Omit "Taxation Administration Act 1955", substitute "Taxation Administration Act 1953".

67   Subsection 95A(1)

After "fails to notify", insert "the amount of tax payable on".

Note: The heading to section 95A is altered by omitting " of " and substituting " amount of tax payable on ".

68   Subsection 95A(1)

Omit "the assessable dealing", substitute "the tax payable".

69   Subsection 95A(2)

Omit "an amount of", substitute "the amount of tax payable on".

70   Subsection 95A(2)

Omit "the assessable dealing", substitute "the tax payable".

71   At the end of subsection 99(1)

Add "(other than failure to notify penalty under section 95A)".

72   Subsection 99(3)

After "this Part", insert "(other than section 95A)".

73   Section 100

After "this Part", insert "(other than failure to notify penalty under section 95A)".

74   At the end of section 100

Add:

Note: The Commissioner may remit failure to notify penalty under section 8AAM of the Taxation Administration Act 1953.

Taxation Administration Act 1953

75   Subsection 8AAB(4) (before table item 1)

Insert:

76   Subsection 8AAB(4) (at the end of the table)

Add:

77   Subsection 8AAF(2)

Repeal the subsection.

78   After section 8AAG

Insert:

8AAGA Rounding of the charge

If the amount of the charge payable for any period is not a multiple of 5 cents, the Commissioner may round it down to the nearest multiple of 5 cents.

79   Subsection 8AAP(4) (table item 3, entry headed 'Topic')

Omit "PPS payment summary", substitute "PPS payment reconciliation statement form".

80   Subsection 8AAQ(2)

Omit "reconciliation statement", substitute "statement, report or form".

81   Paragraph 8AAZD(2)(b)

Omit "debt; or", substitute "debt.".

82   Paragraph 8AAZD(2)(c)

Repeal the paragraph.

Taxation (Interest on Overpayments and Early Payments) Act 1983

83   Subsection 3(1) (paragraphs (baa), (ba) and (bb) of the definition of relevant tax )

Repeal the paragraphs, substitute:

(baa) an amount payable to the Commissioner under subsection 220AS(1) of the Tax Act;

(ba) an amount payable to the Commissioner under subsection 221EAA(1) of the Tax Act;

(bb) an amount payable to the Commissioner under subsection 221YHH(1) of the Tax Act;

84   Subsection 3(1) (paragraph (caa) of the definition of relevant tax )

Repeal the paragraph.

85   Subparagraph 12A(1)(a)(i)

After "under", insert "section 163AA, section 170AA,".

86   Subparagraph 12A(1)(a)(i)

Omit "subsection 221AZP(1)", substitute "subsection 204(3), subsection 221AZMAA(1), subsection 221AZP(1), subsection 221YD(3)".

Taxation Laws Amendment Act (No. 3) 1999

87   Items 84 and 85 of Schedule 1

Repeal the items.

Note: These items contained misdescribed amendments. The correct amendments are in items 44 and 45 of this Schedule.

88   Items 355, 356 and 357 of Schedule 1

Repeal the items.

Note: These items contained misdescribed amendments. The correct amendment is in item 83 of this Schedule.

89   Subitems 398(3), (4) and (5) of Schedule 1

Repeal the subitems.

90   Subitem 399(2) of Schedule 1

Omit "where", substitute "to the extent that".

91   Subitem 399(2) of Schedule 1

Omit "starts", substitute "occurs".

92   Application of amendments

The amendments made by this Part apply in relation to amounts that are due to be paid on or after 1 July 1999.

93   Transitional - pre-1 July 1999 debts

(1) This item applies to an amount (including an amount of penalty or interest) that a person owes to the Commonwealth directly under a taxation law (including a law that has been repealed or amended) and that became payable at any time before 1 July 1999, if all or some of the amount (the unpaid debt ) remains unpaid at the beginning of 1 July 1999.

(2) The person is liable, and is taken to have been liable, to pay general interest charge on the unpaid debt for each day in the period that:

(a) started at the beginning of the day by which the amount was due to be paid; and

(b) finishes at the end of the last day on which, at the end of the day, any of the following remains unpaid:

(i) the unpaid debt;

(ii) general interest charge on any of the unpaid debt.

(3) The general interest charge is worked out under Division 1 of Part IIA of the Taxation Administration Act 1953.

(4) For the purposes of this item, the general interest charge rate for a day before 1 July 1999 is taken to have been 12.72% divided by the number of days in the calendar year that the day was in.

(5) If this item results in a person being liable, or being taken to have been liable, to pay both general interest charge and some other penalty or interest in respect of the same debt, the Commissioner must remit either that general interest charge or that other penalty or interest (the Commissioner chooses which).

Part 3   Fringe benefits tax

Fringe Benefits Tax Assessment Act 1986

94   Subparagraphs 9(2)(c)(i) and (ii)

Repeal the subparagraphs, substitute:

(i) if the annualised number of whole kilometres the car travelled during the year of tax was more than 40,000 - 0.07; or

(ii) if the annualised number of whole kilometres the car travelled during the year of tax was not less than 25,000 and not more than 40,000 - 0.11; or

(iii) if the annualised number of whole kilometres the car travelled during the year of tax was not less than 15,000 and not more than 24,999 - 0.20; or

(iv) in any other case - 0.26;

95   Subsection 11(1) (definition of D )

Repeal the definition, substitute:

D is the number of days in the year of tax.

96   Subsection 11(2) (definition of D )

Repeal the definition, substitute:

D is the number of days in the year of tax.

97   Section 12

Repeal the section, substitute:

12 Depreciated value

(1) In this Subdivision, the depreciated value of a car at a particular time (the relevant time ) is the amount worked out using the formula:

(A - B)

where:

A is:

(a) if the car was owned by the person at the start of 1 July 1986 - the depreciated value worked out under subsection (2); or

(b) in any other case - the cost price of the car to the person.

B is the total amount of depreciation (if any) that would have been taken to have been incurred by the person in respect of the car for the period after the start of 1 July 1986 and before the relevant time when the person owned the car, if the depreciation taken to have been incurred for that period were calculated in accordance with subsection 11(1).

(2) The depreciated value of a car owned by a person at the start of 1 July 1986 is the cost price of the car to that person, reduced by the total amount of depreciation that would have been taken to have been incurred by the person in respect of the car for the period before that time when it was owned by the person if:

(a) the depreciation taken to have been incurred for that period were calculated in accordance with subsection 11(1); and

(b) each year starting on 1 July were a year of tax.

98   Paragraph 19(1)(b)

Omit all the words from and including "both", substitute "a once-only deduction (in this subsection called the gross deduction ), other than a foreign income deduction, would, or would if not for section 82A, and Subdivisions F, GA and G of Division 3 of Part III, of the Income Tax Assessment Act 1936, and Divisions 28 and 900 of the Income Tax Assessment Act 1997, have been allowable to the recipient under either of those Acts in respect of the gross interest".

99   Subparagraph 19(1)(ba)(ii)

Omit all the words from and including "allowable", substitute "allowable as a once-only deduction other than a foreign income deduction to the recipient under the Income Tax Assessment Act 1936 or the Income Tax Assessment Act 1997 in respect of that interest if that interest had been incurred and paid by the recipient on the last day of the loan period".

100   Subparagraph 19(1)(ca)(i)

Repeal the subparagraph.

101   Subparagraph 19(1)(ca)(ii)

Omit "in the case of the second standard year of tax or a subsequent year of tax - ".

102   Paragraph 19(1)(d)

Omit all the words and subparagraphs after "apply" to and including "recipient gives", substitute "and the loan fringe benefit is a car loan benefit in respect of a car held by the recipient during a period (in this subsection also called the holding period ) in the year of tax, the recipient gives".

103   Paragraphs 19(2)(a) and (b)

Repeal the paragraphs, substitute:

(a) purchase a particular car; or

(b) pay a Division 28 car expense;

104   Paragraph 24(1)(b)

Omit all the words and subparagraphs from and including "both", substitute "a once-only deduction (in this subsection called the gross deduction ), other than a foreign income deduction, would, or would if not for section 82A, and Subdivisions F, GA and G of Division 3 of Part III, of the Income Tax Assessment Act 1936, and Divisions 28 and 900 of the Income Tax Assessment Act 1997, have been allowable to the recipient under either of those Acts in respect of the gross expenditure".

105   Subparagraph 24(1)(ba)(ii)

Omit all the words and sub-subparagraphs from and including "allowable" to and including "recipient under", substitute "allowable as a once-only deduction other than a foreign income deduction to the recipient under".

106   Paragraph 26(1)(c) (definition of C )

Repeal the definition, substitute:

C is the number of days in the year of tax;

107   Paragraph 26(2)(a) (definition of B )

Repeal the definition, substitute:

B is the number of days in the current year of tax; and

108   Paragraph 26(3)(a)

Repeal the paragraph.

109   Paragraph 29(1)(a) (definition of DYT )

Repeal the definition, substitute:

DYT is the number of days in the current year of tax;

110   Subsection 29(3A)

Repeal the subsection, substitute:

(3A) For the purposes of this section:

(a) the single quarters statutory amount in relation to a year of tax is the amount calculated:

(i) by multiplying the indexation factor for that year of tax by the single quarters statutory amount in relation to the immediately preceding year of tax; or

(ii) if the amount ascertained that way is not an amount of whole dollars - by rounding the amount to the nearest dollar (rounding 50 cents upwards); and

(b) the standard statutory amount in relation to a year of tax is the amount calculated:

(i) by multiplying the indexation factor for that year of tax by the standard statutory amount in relation to the immediately preceding year of tax; or

(ii) if the amount ascertained that way is not an amount of whole dollars - by rounding the amount to the nearest dollar (rounding 50 cents upwards).

111   Paragraph 44(1)(b)

Omit all the words and subparagraphs from and including "both", substitute "a once-only deduction (in this subsection called the gross deduction ), other than a foreign income deduction, would, or would if not for section 82A, and Subdivisions F, GA and G of Division 3 of Part III, of the Income Tax Assessment Act 1936, and Divisions 28 and 900 of the Income Tax Assessment Act 1997, have been allowable to the recipient under either of those Acts in respect of the gross expenditure".

112   Subparagraph 44(1)(ba)(ii)

Omit all the words and subparagraphs from and including "allowable", substitute "allowable as a once-only deduction other than a foreign income deduction to the recipient under either of those Acts in respect of that consideration if that consideration had been incurred and paid by the recipient at the provision time".

113   Paragraph 47(6)(aa)

Omit "in the case of a standard year of tax - ".

114   Paragraph 52(1)(b)

Omit all the words and subparagraphs from and including "both", substitute "a once-only deduction (in this subsection called the gross deduction ), other than a foreign income deduction, would, or would if not for section 82A, and Subdivisions F, GA and G of Division 3 of Part III, of the Income Tax Assessment Act 1936, and Divisions 28 and 900 of the Income Tax Assessment Act 1997, have been allowable to the recipient under either of those Acts in respect of the gross expenditure".

115   Subparagraph 52(1)(ba)(ii)

Omit all the words and sub-subparagraphs from and including "allowable", substitute "allowable as a once-only deduction other than a foreign income deduction to the recipient under either of those Acts in respect of so much of that consideration as was taken into account for the purposes of section 48, 49, 50 or 51 of the Income Tax Assessment Act 1936, or section 4-15 or 8-1 of the Income Tax Assessment Act 1997, if that consideration had been incurred and paid by the recipient at the comparison time".

116   Subparagraph 61C(3)(b)(i)

Repeal the subparagraph.

117   Paragraphs 62(1)(a) and (b)

Repeal the paragraphs, substitute:

(a) if the taxable value or the sum of the taxable values does not exceed $500 - an amount equal to the taxable value or the sum of the taxable values; or

(b) in any other case - $500.

118   Section 68

Omit "28 days after the end of the year", substitute "21 May in the next year of tax".

119   Subsection 90(1)

Omit "the twenty-eighth day after the end of the", substitute "21 May in the next".

120   Section 102

Omit all the words and paragraphs after "pay", substitute ", in accordance with this Division, 4 instalments of tax in respect of each year of tax.".

121   Sections 103, 104 and 105

Repeal the sections, substitute:

103 When instalment of tax payable

Subject to this Division, the 4 instalments of tax payable in respect of a year of tax are due and payable as follows:

104 Notice of the amount of an instalment

An employer must notify the Commissioner, in the approved form, of the amount of an instalment on or before the day on which the instalment is due and payable.

105 Entitlement to instalment credit

(1) If:

(a) an employer is or was liable to pay an instalment of tax in respect of a year of tax; and

(b) the Commissioner makes an assessment of the tax payable, or determines that no tax is payable, by the employer in respect of that year of tax;

the employer is entitled to a credit equal to the amount of the instalment when the assessment or determination is made.

Note: How the credit is applied is set out in Division 3 of Part IIB of the Taxation Administration Act 1953.

(2) The making of the assessment or determination, and the resulting credit entitlement, do not affect the liability to pay the instalment.

122   Subdivision B of Division 2 of Part VII

Repeal the Subdivision.

123   Subdivision C of Division 2 of Part VII (heading)

Repeal the heading, substitute:

Subdivision C - Working out the amount of instalments

124   Section 109 (definition of employer's estimate )

Omit "standard".

125   Section 109 (definition of estimated tax )

Omit "standard".

126   Section 109 (definition of GIC period )

Repeal the definition, substitute:

GIC period , in relation to an instalment in relation to a year of tax, means:

(a) for a first instalment - the period starting at the beginning of 21 July, and finishing at the end of 20 October, in the year of tax; or

(b) for a second instalment - the period starting at the beginning of 21 October, and finishing at the end of 20 January, in the year of tax; or

(c) for a third instalment - the period starting at the beginning of 21 January in the year of tax and finishing at the end of 20 April in the next year of tax; or

(d) for a fourth instalment - the period starting at the beginning of 21 April, and finishing at the end of 20 May, in the next year of tax.

127   Section 109 (definition of relevant fraction )

Repeal the definition, substitute:

relevant fraction , in relation to an instalment, means:

(a) 0.25 for a first instalment; or

(b) 0.50 for a second instalment; or

(c) 0.75 for a third instalment; or

(d) 1.00 for a fourth instalment.

128   Subsection 110(1)

Repeal the subsection, substitute:

(1) Subject to this section, the notional tax amount of an employer in respect of a year of tax is the amount of the tax that was assessed in respect of the employer in respect of the immediately preceding year of tax.

129   Paragraph 110(2)(a)

Omit "standard".

130   Subsection 110(5)

Omit "standard year of tax, being an instalment that becomes due and payable on the twenty-eighth", substitute "year of tax, being an instalment that becomes due and payable on the 21st".

131   Subsection 111(1)

Omit "standard".

132   Subsection 111(1)

Omit "twenty-eighth", substitute "21st".

133   Subsection 111(2)

Omit "standard".

134   Subsection 112(1)

Omit "standard".

135   Subsection 112(1)(b)

Omit "statement in writing", substitute "written statement, in the approved form,".

136   Subsection 136(1)

Insert:

approved form has the meaning given by subsection 995-1(1) of the Income Tax Assessment Act 1997.

137   Subsection 136(1) (definition of standard year of tax )

Repeal the definition.

138   Subsection 136(1) (definition of transitional year of tax )

Repeal the definition.

139   Subsection 136(1) (definition of year of tax )

Repeal the definition, substitute:

year of tax means the year starting on 1 April 1987, and each later year starting on 1 April.

140   Application of amendments

The amendments made by this Part apply in relation to the year of tax starting on 1 April 2000 and all later years of tax.

Schedule 3  

1   Subsection 995-1(1)

Insert:

ABN has the meaning given by the A New Tax System (Australian Business Number) Act 1999.

2   Subsection 995-1(1)

Insert:

adjusted assessed tax has the meaning given by section 45-375 in Schedule 1 to the Taxation Administration Act 1953.

3   Subsection 995-1(1)

Insert:

adjusted assessed taxable income has the meaning given by section 45-370 in Schedule 1 to the Taxation Administration Act 1953.

4   Subsection 995-1(1)

Insert:

adjusted taxable income has the meaning given by section 45-330 in Schedule 1 to the Taxation Administration Act 1953.

5   Subsection 995-1(1)

Insert:

adjusted withholding income has the meaning given by section 45-335 in Schedule 1 to the Taxation Administration Act 1953.

6   Subsection 995-1(1)

Insert:

amount required to be withheld by an entity from a *withholding payment means:

(a) the amount that the entity must withhold from the payment under Division 12 in Schedule 1 to the Taxation Administration Act 1953; or

(b) the amount that Division 14 in that Schedule requires the entity to pay to the Commissioner in respect of the *non-cash benefit of which the withholding payment consists;

or that amount as varied by the Commissioner under section 16-15 in the Schedule.

7   Subsection 995-1(1)

Insert:

amount withheld by an entity from a *withholding payment means:

(a) an amount that the entity withheld from the payment under Division 12 in Schedule 1 to the Taxation Administration Act 1953; or

(b) an amount that the entity paid to the Commissioner under Division 14 in that Schedule in respect of the *non-cash benefit of which the withholding payment consists.

8   Subsection 995-1(1)

Insert:

annual payer means an entity that has become an annual payer under section 45-140 in Schedule 1 to the Taxation Administration Act 1953, and has not since ceased to be an annual payer under section 45-150, 45-155 or 45-180 in that Schedule.

9   Subsection 995-1(1)

Insert:

approved form : a notice, application or other document is in the approved form if, and only if:

(a) it is in the form approved in writing by the Commissioner in relation to that kind of notice, application or other document; and

(b) it is signed by a person or persons as the form requires; and

(c) it contains the information that the form requires, and any further information or statement as the Commissioner requires; and

(d) for a notice, application or document that is required to be lodged with the Commissioner - it is lodged at the place and in the manner that the Commissioner requires.

The Commissioner may combine in the same approved form more than one notice, application or other document.

10   Subsection 995-1(1)

Insert:

Australian Business Register means the Australian Business Register established and maintained under the A New Tax System (Australian Business Number) Act 1999.

11   Subsection 995-1(1)

Insert:

Australian Business Registrar means the Registrar of the *Australian Business Register.

12   Subsection 995-1(1)

Insert:

Australian legislature means:

(a) the Parliament of the Commonwealth of Australia; or

(b) the Parliament of a State; or

(c) the Legislative Assembly for the Australian Capital Territory; or

(d) the Legislative Assembly of the Northern Territory of Australia.

13   Subsection 995-1(1)

Insert:

base assessment has the meaning given by section 45-320 in Schedule 1 to the Taxation Administration Act 1953.

14   Subsection 995-1(1)

Insert:

base year has the meaning given by section 45-320 in Schedule 1 to the Taxation Administration Act 1953.

15   Subsection 995-1(1)

Insert:

benchmark instalment rate has the meaning given by section 45-360 in Schedule 1 to the Taxation Administration Act 1953.

16   Subsection 995-1(1)

Insert:

benchmark tax has the meaning given by section 45-365 in Schedule 1 to the Taxation Administration Act 1953.

17   Subsection 995-1(1)

Insert:

carried on in Australia , in relation to an *enterprise, has the meaning given by subsection 9-25(6) of the *GST Act.

18   Subsection 995-1(1)

Insert:

carrying on an *enterprise includes doing anything in the course of the commencement or termination of the enterprise.

19   Subsection 995-1(1)

Insert:

electronic payment means a payment by way of electronic transmission, in an electronic format approved by the Commissioner.

20   Subsection 995-1(1)

Insert:

electronic signature of a person means a unique identification of the person in electronic form that is approved by the Commissioner for the purposes of the definition of electronic signature in section 6 of the Income Tax Assessment Act 1936.

21   Subsection 995-1(1)

Insert:

enterprise has the meaning given by section 9-20 of the *GST Act.

22   Subsection 995-1(1)

Insert:

failure to notify penalty means the penalty worked out under Division 2 of Part IIA of the Taxation Administration Act 1953.

23   Subsection 995-1(1)

Insert:

farm management deposit has the same meaning as in Schedule 2G to the Income Tax Assessment Act 1936.

24   Subsection 995-1(1)

Insert:

foreign resident means a person who is not a resident of Australia for the purposes of the Income Tax Assessment Act 1936.

Note: Foreign resident is not asterisked in this Act.

25   Subsection 995-1(1)

Insert:

FTB amount for an income year means an amount of family tax benefit (within the meaning of the A New Tax System (Family Assistance) (Administration) Act 1999) to which an individual is entitled in respect of the income year.

26   Subsection 995-1(1)

Insert:

GDP-adjusted notional tax has the meaning given by section 45-405 in Schedule 1 to the Taxation Administration Act 1953.

27   Subsection 995-1(1)

Insert:

GDP amount for a *quarter has the meaning given by section 45-405 in Schedule 1 to the Taxation Administration Act 1953.

28   Subsection 995-1(1)

Insert:

GST Act means the A New Tax System (Goods and Services Tax) Act 1999.

29   Subsection 995-1(1)

Insert:

GST joint venture has the meaning given by section 51-5 of the *GST Act.

30   Subsection 995-1(1)

Insert:

instalment group has the meaning given by section 45-145 in Schedule 1 to the Taxation Administration Act 1953.

31   Subsection 995-1(1)

Insert:

instalment income has the meaning given by sections 45-120, 45-260 and 45-280 in Schedule 1 to the Taxation Administration Act 1953.

32   Subsection 995-1(1)

Insert:

instalment quarter has the meaning given by section 45- 60 in Schedule 1 to the Taxation Administration Act 1953.

33   Subsection 995-1(1)

Insert:

investment body for a *Part VA investment has the meaning given by section 202D of the Income Tax Assessment Act 1936.

34   Subsection 995-1(1)

Insert:

investor for a *Part VA investment has the meaning given by section 202D of the Income Tax Assessment Act 1936.

35   Subsection 995-1(1)

Insert:

invoice means a document notifying an obligation to make a payment.

36   Subsection 995-1(1)

Insert:

labour hire notional withheld amount has the meaning given by section 16-125 in Schedule 1 to the Taxation Administration Act 1953.

37   Subsection 995-1(1)

Insert:

large withholder has the meaning given by sections 16-95 and 16-125 in Schedule 1 to the Taxation Administration Act 1953.

38   Subsection 995-1(1)

Insert:

market value of a *non-cash benefit: in working out the market value of a *non-cash benefit, disregard anything that would prevent or restrict conversion of the benefit to money.

39   Subsection 995-1(1)

Insert:

medium withholder has the meaning given by section 16-100 and 16-135 in Schedule 1 to the Taxation Administration Act 1953.

40   Subsection 995-1(1)

Insert:

mining withholding tax means income tax payable under section 128V of the Income Tax Assessment Act 1936.

41   Subsection 995-1(1)

Insert:

natural resource has the meaning given by section 6 of the Income Tax Assessment Act 1936.

42   Subsection 995-1(1)

Insert:

non-cash benefit is property or services in any form except money. If a non-cash benefit is dealt with on behalf of an entity, or is provided or dealt with as an entity directs, the benefit is taken to be provided to the entity.

43   Subsection 995-1(1)

Insert:

non-quotation withholding payment means a *withholding payment covered by Subdivision 12-E in Schedule 1 to the Taxation Administration Act 1953.

Note: Subdivision 12-E and Division 14 in that Schedule deal with collecting amounts on account of income tax payable by recipients of certain payments or non-cash benefits who have not quoted their tax file number or ABN, as appropriate.

44   Subsection 995-1(1)

Insert:

notional tax has the meaning given by section 45-325 in Schedule 1 to the Taxation Administration Act 1953.

45   Subsection 995-1(1)

Insert:

Part VA investment means an investment of a kind mentioned in section 202D of the Income Tax Assessment Act 1936.

46   Subsection 995-1(1)

Insert:

participant , in relation to a *GST joint venture, has the meaning given by section 51-5 or paragraph 51-70(1)(a) of the *GST Act.

47   Subsection 995-1(1)

Insert:

PAYG instalment means an instalment payable under Division 45 in Schedule 1 to the Taxation Administration Act 1953.

48   Subsection 995-1(1)

Insert:

payment summary has the meaning given by section 16-170 in Schedule 1 to the Taxation Administration Act 1953.

49   Subsection 995-1(1)

Insert:

quarter means a period of 3 months ending on 31 March, 30 June, 30 September or 31 December.

50   Subsection 995-1(1)

Insert:

quarterly payer means an entity that is liable to pay *PAYG instalments and is not an *annual payer.

51   Subsection 995-1(1)

Insert:

quarterly payer who pays on the basis of GDP-adjusted notional tax means an individual who has become such a payer under section 45-125 in Schedule 1 to the Taxation Administration Act 1953, and has not since ceased to be one under section 45-130 or 45-135 in that Schedule.

52   Subsection 995-1(1)

Insert:

quote an entity's *ABN means quote in a form and manner approved by the Commissioner.

53   Subsection 995-1(1)

Insert:

quoted : an entity has quoted its *tax file number in connection with a *Part VA investment if the entity is taken, for the purposes of Part VA of the Income Tax Assessment Act 1936, to have quoted its tax file number in connection with the investment.

54   Subsection 995-1(1)

Insert:

reportable fringe benefits amount for an income year in respect of an employee's employment by an employer has the same meaning as in the Fringe Benefits Tax Assessment Act 1986 (as it applies of its own force or because of the Fringe Benefits Tax (Application to the Commonwealth) Act 1986).

55   Subsection 995-1(1)

Insert:

required to be registered has the meaning given by the *GST Act.

56   Subsection 995-1(1)

Insert:

small withholder has the meaning given by section 16-105.

57   Subsection 995-1(1)

Insert:

supply has the meaning given by section 9-10 of the *GST Act.

58   Subsection 995-1(1)

Insert:

tax file number means a tax file number as defined in section 202A of the Income Tax Assessment Act 1936.

59   Subsection 995-1(1)

Insert:

withholder means a *large withholder, a *medium withholder or a *small withholder.

60   Subsection 995-1(1)

Insert:

withholding payment means:

(a) a payment from which an amount must be withheld under Division 12 in Schedule 1 to the Taxation Administration Act 1953 (even if the amount is not withheld); or

(b) a *non-cash benefit in respect of which Division 14 in that Schedule requires an amount to be paid to the Commissioner.

(A withholding payment that consists of a non-cash benefit is made when the benefit is provided. The amount of the withholding payment is taken to be the *market value of the benefit at that time.)

Note: Divisions 12 and 14 in Schedule 1 to the Taxation Administration Act 1953 deal with collecting amounts on account of income tax payable by the recipient of the payment or non-cash benefit.

61   Subsection 995-1(1)

Insert:

withholding payment covered by a particular provision in Schedule 1 to the Taxation Administration Act 1953 means a *withholding payment consisting of:

(a) a payment from which an amount must be withheld under that provision (even if the amount is not withheld); or

(b) a *non-cash benefit provided by an entity if that provision would have required the entity to withhold an amount if, instead of providing the benefit, the entity had paid the *market value of the benefit; or

(c) a non-cash benefit provided to an entity if that provision would have required the entity to withhold an amount if the benefit had been a payment of an amount equal to the market value of the benefit.

62   Subsection 995-1(1)

Insert:

withholding tax means income tax payable under section 128B of the Income Tax Assessment Act 1936.

63   Subsection 995-1(1) (after paragraph (b) of the definition of this Act )

Insert:

and (c) Schedule 1 to the Taxation Administration Act 1953;