Taxation Administration Amendment Regulations 2000 (No. 1)

(73 of 2000)

12 May 2000

Made under Taxation Administration Act 1953

1 Name of Regulations

These Regulations are the Taxation Administration Amendment Regulations 2000 (No. 1).

2 Commencement

These Regulations commence as follows:

(a) on gazettal - regulations 1 to 3 and Schedule 1;

(b) on 1 July 2000 - Schedule 2.

3 Amendment of Taxation Administration Regulations

Schedules 1 and 2 amend the Taxation Administration Regulations.

Schedule 1 Amendments commencing on gazettal

[1] Regulation 1

substitute

Part 1 Preliminary

1 Name of Regulations

These Regulations are the Taxation Administration Regulations 1976.

[2] Regulations 2, 2AA and 2A

substitute

2 Definitions

In these Regulations, unless the contrary intention appears:

Act means the Taxation Administration Act 1953.

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

Commissioner includes the Commissioner in the capacity of Registrar of the Australian Business Register.

deposit-taking institution means an institution that is approved under regulation 3.

tax-related liability has the meaning given by section 255-1 of Schedule 1 to the Act.

3 Approval of ADIs

The Commissioner may, by instrument published in the Gazette, approve an authorised deposit-taking institution within the meaning of the Banking Act 1959 as a deposit-taking institution for the purposes of these Regulations.

Note An authorised deposit-taking institution is also known as
an ADI.

4 Prescribed law (Act s 2, definition of taxation law)

For the purposes of paragraph (b) of the definition of taxation law in section 2 of the Act, the Pay-roll Tax Assessment Act 1941 is prescribed.

[3] Subregulation 2B (1)

omit everything before paragraph (a), insert

5 Certificates - failure to comply with requirements of taxation laws

(1) In a prosecution of a person for an offence against section 8C or subsection 8D (1) or (2) of the Act in relation to the refusal or failure of the person to comply with a requirement made under or pursuant to a taxation law, a certificate in writing signed by the Commissioner, a Second Commissioner or a Deputy Commissioner certifying that the person, in the circumstances stated in the certificate, refused or failed, as the case may be:

[4] Regulation 2C

omit everything before paragraph (a), insert

6 Manner of serving orders (Act s 8G)

For the purposes of subsection 8G (2) of the Act, a copy of an order under subsection 8G (1) of the Act is served in the prescribed manner on the person to whom the order is addressed if the copy:

[5] Subregulation 2D (1)

omit everything before paragraph (a), insert

7 Certificates (Act s 8ZG)

(1) A certificate issued under subsection 8ZG (2) of the Act in relation to an order of a court for the payment of an amount to the Commissioner must be in accordance with Form 1 in Schedule 1, and must contain the following particulars:

[6] Regulation 2E

substitute

8 Election to have cases tried in Supreme Court

For the purpose of subsection 8ZJ (5) of the Act, a person prosecuted for a prescribed taxation offence may elect to have the case tried in the Supreme Court of the State or Territory in which the prosecution was instituted by serving on the person who instituted the prosecution, and filing in the court in which the prosecution was instituted, a notice in accordance with Form 2 in Schedule 1.

[7] Regulations 3, 4, 5, 6, 7, 8, 9 and 10

omit

[8] Regulation 11

substitute

9 Giving notice

A notice that is required by the Act or these Regulations to be given to a person by the Commissioner may be given to the person by an officer authorised by the Commissioner for that purpose.

[9] Regulation 12

omit

[10] Regulation 13

renumber as regulation 10

[11] Regulation 14

substitute

Part 2 Expenses and certificates

11 Expenses for certain attendances (Act s 14I and s 353-10 of Schedule 1)

The scale of expenses set out in Schedule 2 is prescribed to be allowed to a person who is required to attend before the Commissioner or an officer authorised by the Commissioner for the purposes of:

omit everything before paragraph (a), insert

15 Service of copies of departure authorisation certificates (Act s 14U)

(1) For the purposes of subsection 14U (3) of the Act, a copy of a departure authorisation certificate is served, as prescribed, on a person if the copy:

[18] Subregulation 18A (1)

omit everything before paragraph (a), insert

16 Service of notices relating to private rulings

(1) A written notice of a private ruling, or of the withdrawal of a private ruling, may be served on the person who applied for the ruling:

[19] Before regulation 19

insert

Part 4 Payments

[20] Regulation 19

omit everything before paragraph (a), insert

17 Prescribed provisions (Act s 16)

For the purposes of sub-subparagraph 16 (2) (a) (i) (B) of the Act, each of the following provisions is prescribed:

[21] Paragraph 19 (c)

omit

[22] Paragraph 19 (j)

substitute

(i) subregulation 168 (4) of the Income Tax Regulations 1936.

[23] Regulation 20

substitute

18 Payment of tax-related liabilities

(1) A person who pays a tax-related liability must pay the liability in Australian currency.

(2) The person must pay the tax-related liability:

(a) by posting the amount of the liability to an address that is approved by the Commissioner; or

(b) by depositing that amount at a branch of the Reserve Bank of Australia or a deposit-taking institution in accordance with arrangements made by the Commissioner with the Bank or institution for payments at its branches; or

(c) by delivering the amount of the liability to the High Commissioner for the Commonwealth of Australia in the United Kingdom; or

(d) in accordance with other arrangements made by the Commissioner.

(3) The person must pay the amount of the tax-related liability in a single payment unless the Commissioner agrees that the person may make more than 1 payment.

[24] Regulation 21

substitute

19 When receipts are to be given

The Commissioner is not required to give a receipt to a person who pays a tax-related liability unless the person asks for the receipt.

[25] Subregulation 22 (1)

omit everything before

person

insert

20 Information about tax-related liabilities

(1) Subject to subregulation (2), a

[26] Subregulation 22 (1)

omit

debt

insert

tax-related liability

[27] Subregulation 22 (2)

omit everything before paragraph (2) (a), insert

(2) If the person deposits an amount for payment of the tax-related liability at a branch of the Reserve Bank of Australia or a deposit-taking institution, the person must:

[28] Subregulation 23 (1)

Regulation 8

[34] Schedule 1, Form 2

omit

19 .

[35] Schedule 1, Form 3

omit

Subregulation 16 (1)

insert

Subregulation 13 (1)

[36] Schedule 1, Form 3

omit

19 .

[37] Schedule 2, heading

Part 5 Pay As You Go withholding

Division 1 Rounding amounts

22 Rounding before amounts dealt with

(1) This regulation applies to the amount of a payment that is to be dealt with under a provision of this Part.

(2) If the amount is less than $1, it is not to be dealt with.

(3) If the amount is more than $1, the number of cents by which it exceeds a whole dollar is to be disregarded when dealing with the amount.

23 Rounding after amounts worked out

(1) This regulation applies to an amount that:

(a) has been worked out under a provision of this Part; and

(b) includes a number of cents that is less than a whole dollar.

(2) If the amount is less than $1, it is to be disregarded.

(3) If the amount is more than $1, or a multiple of $1, the number of cents by which it exceeds a whole dollar is to be disregarded.

Division 2 General

24 Prescribed tax offsets for withholding schedules (Act s 15-30 of Schedule 1)

For the purposes of paragraph 15-30 (d) of Schedule 1 to the Act, the following tax offsets are prescribed:

(a) a zone rebate mentioned in section 79A of the Income Tax Assessment Act 1936;

(b) a concessional rebate mentioned in section 159J or 159L of that Act;

25 Prescribed matters for withholding schedules (Act s 15-30 of Schedule 1)

For the purposes of paragraph 15-30 (g) of Schedule 1 to the Act, a deductible amount worked out in accordance with section 27H (assessable income to include annuities and superannuation pensions) of the Income Tax Assessment Act 1936 is prescribed.

26 Prescribed matters for declarations
(Act s 15-50 of Schedule 1)

(1) For the purposes of paragraph 15-50 (1) (b) of Schedule 1 to the Act, the following matters in relation to an individual are prescribed:

(a) whether the individual is entitled to a deductible amount under section 27H of the Income Tax Assessment Act 1936;

(b) whether the individual is entitled to a zone rebate mentioned in section 79A of that Act;

(d) whether the individual is entitled to a rebate mentioned in section 159SM or 159SU of that Act;

(e) if, in any period, the individual is taken under subsection 251U (1) of that Act to have been a prescribed person for the purposes of Part VIIB of that Act in the period - whether the individual is entitled to full or partial relief from Medicare levy;

(f) if paragraph (e) does not apply to the individual - whether the individual is entitled to a variation in the amount of Medicare levy that would otherwise be payable by the individual;

(g) whether the individual wishes to have an additional amount withheld because of an expected liability for the Medicare levy or Medicare levy surcharge;

(h) whether the individual is entitled to the family tax benefit within the meaning of the A New Tax System (Family Assistance) Act 1999.

(2) For the purposes of paragraph 15-50 (3) (b) of Schedule 1 to the Act, the following matters in relation to an individual are prescribed:

(a) whether the individual wishes to reduce the amount withheld to correspond with the first-mentioned amount (the tax-free threshold) set out in column 1 of the table in clause 1 of Part I of Schedule 7 to the Income Tax Rates Act 1986;

(b) whether the individual has an accumulated HEC debt within the meaning of subsection 106H (1) of the Higher Education Funding Act 1988;

27 Certain Defence Force members taken to have given Medicare levy variation declaration

(1) This regulation applies to an individual:

(a) who, on a particular date, is entitled (because of being a member of the Defence Force) to free medical treatment for any incapacity, disease or disabling condition; and

(b) who:

(i) has not given, as a member of the Defence Force, a declaration under subsection 15-50 (1) of Schedule 1 to the Act to the effect that the individual is entitled to full relief from the Medicare levy; and

(ii) has not previously been taken to have given a declaration of that kind under subregulation (2).

(2) On that day, the individual is taken to have given, as a member of the Defence Force, a declaration under subsection 15-50 (1) of Schedule 1 to the Act to the effect that the individual is entitled to relief from 50% of the Medicare levy.

28 When declarations cease to have effect

(1) If an individual who has given a declaration to an entity under subsection 15-50 (1) of Schedule 1 to the Act directs the entity in writing to disregard the declaration, the declaration ceases to have effect.

(2) If an individual who has given a declaration (the earlier declaration ) to an entity under subsection 15-50 (1) of Schedule 1 to the Act about a matter, later gives another declaration about the matter to the entity, the earlier declaration ceases to have effect.

(3) If an individual who has given a declaration to an entity under subsection 15-50 (1) of Schedule 1 to the Act permanently ceases to receive withholding payments covered by Subdivision 12-B, 12-C or 12-D of that Schedule from the entity, the declaration ceases to have effect.

(4) If an individual has given a declaration to an entity under subsection 15-50 (1) or (3) of Schedule 1 to the Act, the declaration ceases to have effect if a TFN declaration made by the individual in relation to the entity ceases to have effect because of subsection 202CA (1B) or (1C) of the Income Tax Assessment
Act 1936.

29 Determination that declarations cease to have effect

(1) The Commissioner may determine in a notice published in the Gazette that:

(a) some or all declarations under subsection 15-50 (1) or (3) of Schedule 1 to the Act cease to have effect at the end of a day stated in the determination; or

(b) a statement made in a declaration mentioned in paragraph (a) ceases to have effect at the end of a day stated in the determination.

(2) If a determination applies to a declaration, or a statement made in a declaration, the declaration or statement ceases to have effect at the end of the day stated for that purpose in the determination.

30 When new declarations to be given

(1) An individual to whom subregulation (2), (3), (4)
or (5) applies must give a new declaration in the approved form to the entity mentioned in that subregulation.

(2) This subregulation applies to an individual if:

(a) the individual gives to an entity a declaration under subsection 15-50 (1) of Schedule 1 to the Act about a matter mentioned in subregulation 26 (1); but

(b) the individual's circumstances change in relation to the matter.

(3) This subregulation applies to an individual who lodges with an entity a claim for the Family Tax Benefit under paragraph 7 (1) (a) of the A New Tax System (Family Assistance) (Administration) Act 1999.

(4) This subregulation applies to an individual if:

(a) the individual gives to an entity a declaration under subsection 15-50 (3) of Schedule 1 to the Act about a matter mentioned in subregulation 26 (2); but

(b) the individual's circumstances change in relation to the matter.

(5) This subregulation applies to an individual who:

(a) gives a TFN declaration to an entity expressing a wish to reduce the amount withheld to correspond with the first-mentioned amount (the tax-free threshold) set out in column 1 of the table in clause 1 of Part I of Schedule 7 to the Income Tax Rates Act 1986; and

(b) becomes a foreign resident.

(6) If the individual fails to comply with subregulation (1), he or she is liable to pay a civil penalty of 5 penalty units.

Note 1 See section 4AA of the Crimes Act 1914 for the current value of a penalty unit.

Note 2 Division 298 of the Act contains machinery provisions relating to civil penalties.

31 Issue of payment summaries

(1) If a payment summary that is required by section 16-155, 16-160 or 16-165 of Schedule 1 to the Act to be given by an entity was posted to the recipient and returned to the entity without having been delivered, the entity must send the summary to the Commissioner by the later of:

(a) the first 31 October after the end of the financial year in which the payments covered by the summary were made; and

(b) the end of 7 days after the day on which the summary was returned.

(2) An entity that fails to comply with subregulation (1) is liable to pay a civil penalty of 5 penalty units.

Note 1 See section 4AA of the Crimes Act 1914 for the current value of a penalty unit.

Note 2 Division 298 of the Act contains machinery provisions relating to civil penalties.

32 How certain documents to be signed

(1) A document mentioned in a provision of Part 2-5 of Schedule 1 to the Act that is required to be signed by an entity must be signed:

(a) if the entity is an individual - by the individual; and

(b) if the entity is a trustee - by the trustee; and

(i) by the senior active trustee resident in Australia; or

(ii) if there is no active trustee resident in Australia, by the agent in Australia of the board of trustees; and

(d) if the entity is a company - by the public officer of the company; and

(e) if entity is the Commonwealth or a State or Territory, an agency within the meaning of the Public Service Act 1999, or a Commonwealth, State or Territory authority - by an officer appointed or authorised for the purpose.

(2) However, if it is not practicable for an individual, trustee, agent or officer to sign personally each document of a particular kind:

(a) he or she may authorise another individual to sign documents of that kind; and

(b) the authority must be in the approved form and state:

(i) the name of the authorised individual; and

(ii) the capacity in which that individual signs a document; and

(iii) a specimen signature of the individual.

(3) An individual, trustee, agent or officer who authorises another individual must, as soon as practicable, give a copy of the authority to the Commissioner.

33 Cessation of authorisation to sign certain documents

(1) The Commissioner or a Deputy Commissioner may, by written notice given to the individual, trustee, agent or officer who authorised a person under subregulation 32 (2), disapprove of the authorisation.

(2) On receipt of a notice by the individual, trustee, agent or officer who authorised a person, the person ceases to be authorised to sign a document mentioned in a provision of Part 2-5 of Schedule 1 to the Act that is required to be signed by an entity.

(3) If a person who was authorised under subregulation 32 (2) ceases (otherwise than under subregulation (2)) to be authorised, the individual, trustee, agent or officer who authorised the person must, within 14 days after the cessation, notify the Commissioner accordingly in the approved form.

(4) Application may be made under the Administrative Appeals Tribunal Act 1975 to the Administrative Appeals Tribunal for review of a decision under subregulation (1).

Note A person who makes a reviewable decision must take such steps as are reasonable in the circumstances to give to any person whose interests are affected by the decision notice, in writing or otherwise, of the making of the decision and of the right of the person to have the decision reviewed: see Administrative Appeals Tribunal Act 1975, s 27A.

Division 3 Payments in respect of which ABNs or TFNs not quoted and Part VA investment payments

34 Part VA investment payments

(1) The amount to be withheld under section 12-140 or 12-145 of Schedule 1 to the Act from a payment of income in respect of a Part VA investment is an amount equal to 48.5% of the amount of the payment.

(2) Subregulation (3) applies if

(a) the payment from which that amount is to be withheld is a dividend that has been franked in accordance with section 160AQF of the Income Tax Assessment Act 1936; and

(b) the franking percentage is less than 100%.

(3) The amount to be withheld from the payment is the amount worked out using the formula:

(Amount of payment – franked amount) 0.485

(4) In this regulation:

franked amount and franking percentage have the meanings given by section 160APA of the Income Tax Assessment Act 1936.

Part VA investment has the meaning given in subsection 995-1 (1) of the Income Tax Assessment Act 1997.

35 Part VA investment payments below certain thresholds (Act s 12-140 and 12-145 of Schedule 1)

(1) An amount is not required to be withheld from a payment mentioned in regulation 34 if:

(a) the payment is not a payment in relation to an investment mentioned in item 6 (shares in a public company) in the table in subsection 202D (1) of the Income Tax Assessment Act 1936; and

(b) the payment is to be made to an investor:

(i) who had not turned 16 on the 1 January before the date on which the payment was made; and

(ii) about whose age the investment body is aware; and

(i) in the case of a payment in respect of the whole of a financial year - $420; and

(ii) in any other case - an amount worked out using the formula:

(P * $420) / 365

where:

P is the number of days in the period in the financial year in respect of which the amount is payable.

(2) If a payment mentioned in regulation 34:

(a) is not of the kind described in subregulation (1); and

(b) is in respect of an investment of a kind mentioned in item 1 or 2 in the table in subsection 202D (1) of the Income Tax Assessment Act 1936; and

(i) in the case of a payment in respect of the whole of a financial year - $120; and

(ii) in any other case - the amount worked out using the formula:

(P * $120) / 365

where:

P is the number of days in the period in the financial year in respect of which the amount is payable;

an amount is not required to be withheld from the payment.

36 ETPs for which TFNs not quoted

(1) In this regulation:

eligible termination payment (or ETP ) has the meaning given by subsection 27A (1) of the Income Tax Assessment Act 1936.

post-June 83 component , in relation to an ETP, means the amount that would be the post-June 83 component of the ETP for the purposes of paragraph (e) of subsection 27AA (1) of the Income Tax Assessment Act 1936 if:

(a) paragraph (ca) of that subsection were omitted; and

(b) the expression '– EC ' (wherever occurring) were omitted from paragraph (d) of that subsection.

pre-July 83 component , in relation to an ETP, means the amount that would be the pre-July 83 component of the ETP for the purposes of paragraph 27AA (1) (d) of the Income Tax Assessment Act 1936 if the expression '– EC ' (wherever occurring) were omitted from that paragraph.

prescribed non-resident , for a period in a year of income, means a person who:

(a) at all times in the period, is a non-resident; and

(b) at any time in the year of income, is not a person to whom a pension, allowance or benefit in respect of which he or she is liable to be assessed and to pay income tax in Australia is, or was, payable under:

(i) the Veterans' Entitlements Act 1986; or

(ii) subsection 4 (6) of the Veterans' Entitlements (Transitional Provisions and Consequential Amendments) Act 1986; or

(iii) a provision, except Part 2.11, 2.12, 2.14 or 2.15, of the Social Security Act 1991.

retained amount of the post-June 83 component and retained amount of the pre-July 83 component have the same meanings as in subsection 27AC (2) of the Income Tax Assessment Act 1936.

(2) If an individual has not made a TFN declaration that is in effect under Division 3 of Part VA of theIncome Tax Assessment Act 1936 to an entity making an ETP to the individual, the amount to be withheld from the ETP under section 12-85 of Schedule 1 to the Act is:

(a) if the individual is a prescribed non-resident - the amount worked out by multiplying the number of whole dollars in the sum of the retained amount of the pre-July 83 component, and the retained amount of the post-June 83 component, of the ETP by 0.47; and

(b) if the individual is not a prescribed non-resident - the amount worked out by multiplying the number of whole dollars in the sum of the retained amount of the pre-July 83 component, and the retained amount of the post-June 83 component, of the ETP by 0.485.

37 Certain payments for which TFNs not quoted

(1) This regulation applies to a payment if:

(a) a provision of Subdivision 12-B (except section 12-55), 12-C or 12-D of Schedule 1 to the Act requires an amount to be withheld from the payment; and

(b) the recipient of the payment does not provide the payer with a TFN declaration that has effect under Division 3 of Part VA of the Income Tax Assessment Act 1936.

(2) The amount to be withheld from the payment is an amount equal to 48.5% of the amount of the payment.

38 Certain payments for which ABNs not quoted

(1) This regulation applies to a payment to which subsection 12-190 (1) of Schedule 1 to the Act applies.

(2) The amount to be withheld from the payment is an amount equal to 48.5% of the amount of the payment.

Division 4 Dividend, interest, royalty and mining payments

39 Interpretation

(1) In this Division:

dividend includes part of a dividend.

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

interest means any amount that is, or is deemed to consist of, interest for the purposes of Division 11A of Part III of the Income Tax Assessment Act 1936.

(2) Subject to subregulation (4), for the purposes of this Division, the following are prescribed countries:

(a) the Kingdom of the Netherlands;

(b) another country, except Australia, the government of which is a party to a convention or agreement a copy of which is set out in a Schedule to the Income Tax (International Agreements) Act 1953, being a convention or agreement:

(i) the provisions of which, so far as they affect Australian tax, have the force of law in accordance with that Act; and

(ii) that contains a provision limiting the amount of Australian tax payable in respect of a dividend.

(3) In paragraph (2) (a):

Kingdom of the Netherlands has the same meaning as the Netherlands as defined in Article 3 of the Netherlands agreement referred to in the Income Tax (International Agreements) Act 1953.

(4) If, under the Income Tax (International Agreements) Act 1953, an agreement within the meaning of that Act has the force of law in relation to a withholding payment:

(a) on income derived by a non-resident on or after a particular day; or

(b) in respect of dividends derived on or after a particular day;

a country, except Australia, that is a party to the agreement is a prescribed country for the purposes of this Division from that day.

40 Dividend payments

(1) The amount to be withheld from a dividend to which section 12-210 of Schedule 1 to the Act applies is:

(a) if an address mentioned in paragraph 12-210 (a), or a place mentioned paragraph 12-210 (b), of Schedule 1 to the Act is not in a prescribed country - an amount equal to 30% of the amount of the dividend; and

(b) if that address or place is in a prescribed country - an amount calculated at the rate provided for in the double tax agreement with that country.

(2) The amount to be withheld from a dividend to which section 12-215 of Schedule 1 to the Act applies is:

(a) if a foreign resident mentioned in paragraph 12-215 (b) of Schedule 1 to the Act is not a resident of a prescribed country - an amount equal to 30% of the amount of the dividend; and

(b) if that foreign resident is a resident of a prescribed country - an amount calculated at the rate provided for in the double tax agreement with that country.

(3) However, paragraphs (1) (b) and (2) (b) do not apply in relation to a dividend that is:

(a) paid to a resident of the United States of America; and

(b) included in a class of dividends that is exempt from tax under the law of that country.

41 Interest payments

The amount to be withheld under section 12-245, 12-250 or 12-255 of Schedule 1 to the Act from interest is an amount equal to 10% of the amount of the interest.

42 Royalty payments

The amount to be withheld under section 12-280 or 12-285 of Schedule 1 to the Act from a royalty is:

(a) if the person to whom the royalty is paid, or a foreign resident mentioned in paragraph 12-285 (b) of Schedule 1 to the Act, is a resident of a country with which Australia does not have a double tax agreement - 30% of the amount of the royalty; and

(b) if the person to whom the royalty is paid, or a foreign resident mentioned in paragraph 12-285 (b) of that Schedule, is a resident of a country with which Australia has a double tax agreement - the amount calculated at the rate provided for in the agreement; and

43 Mining payments

The amount to be withheld under subsection 12-320 (1) of Schedule 1 to the Act from a mining payment is an amount equal to 4% of the amount of the payment.