Fringe Benefits Tax Assessment Act 1986

PART III - FRINGE BENEFITS

Division 13 - Miscellaneous exempt benefits

SECTION 58PB MEANING OF APPROVED WORKER ENTITLEMENT FUNDS

58PB(1)
A fund is an approved worker entitlement fund if the fund:

(a) is established by or under a law of the Commonwealth, a State or a Territory for the purpose of ensuring that long service leave is paid; and

(b) is operating under that law.

Endorsed funds

58PB(2)

View history reference

A fund is also an approved worker entitlement fund if:

(a) the fund is endorsed as an approved worker entitlement fund under subsection (3); or

(b) the entity that operates the fund is endorsed for the operation of the fund under subsection (3A).

View history note

History

S 58PB(2) substituted by No 41 of 2011, s 3 and Sch 5 item 4, effective 28 June 2011. No 41 of 2011, s 3 and Sch 5 items 13 and 14 contain the following transitional provisions:

13 Transitional provision - approved worker entitlement funds
Scope

(1)
This item applies to a fund that, just before the commencement of this item, was an approved worker entitlement fund under subsection 58PB(2) of the Fringe Benefits Tax Assessment Act 1986 .

Fund taken to have been endorsed

(2)
Treat the fund as having been endorsed, on that commencement, by the Commissioner under subsection 58PB(3) of that Act, as amended by this Part.

(3)
To avoid doubt, subitem (2) does not prevent the Commissioner from revoking that endorsement at a later time under section 426-55 in Schedule 1 to the Taxation Administration Act 1953 .

Fund not required to have ABN for 6 months

(4)
Paragraph 58PB(4)(f) of the Fringe Benefits Tax Assessment Act 1986 , as added by this Part, does not apply to the fund before the end of the period of 6 months starting on the day this item commences.
14 Transitional provision - Australian Business Registrar
14
During the period of 18 months starting on the day this item commences, the Australian Business Registrar:

(a) may enter, but is not required to enter, in the Australian Business Register under subsection 426-65(1) in Schedule 1 to the Taxation Administration Act 1953 a statement that:

(i) an approved worker entitlement fund is endorsed as mentioned in paragraph (ba) of that subsection, as inserted by this Part; or

(ii) an entity is endorsed as mentioned in paragraph (bb) of that subsection, as inserted by this Part; and

(b) may publish on the Australian Taxation Office website, in relation to an approved worker entitlement fund:

(i) the name of the fund; and

(ii) the ABN (within the meaning of the A New Tax System (Australian Business Number) Act 1999 ) of the fund, or of the entity that operates the fund; and

(iii) the date on which the fund was endorsed as mentioned in paragraph (ba) of that subsection, or on which an entity was endorsed for the operation of the fund under paragraph (bb) of that subsection.

S 58PB2(2) formerly read:

58PB(2)
A fund is also an approved worker entitlement fund if:

(a) the fund is prescribed for the purposes of this paragraph; and

(b) a declaration under subsection (3) is not in force in relation to the fund.

58PB(3)

View history reference

The Commissioner must endorse a fund as an approved worker entitlement fund if:

(a) the fund is entitled to be endorsed as an approved worker entitlement fund (see subsection (4)); and

(b) the fund has applied for the endorsement in accordance with Division 426 in Schedule 1 to the Taxation Administration Act 1953 .

View history note

58PB(3A)

View history reference

The Commissioner must endorse an entity for the operation of a fund as an approved worker entitlement fund if:

(a) the entity is entitled to be endorsed for the operation of the fund as an approved worker entitlement fund (see subsection (4A)); and

(b) the entity has applied for the endorsement in accordance with Division 426 in Schedule 1 to the Taxation Administration Act 1953 .

View history note

58PB(4)

View history reference

A fund is entitled to be endorsed as an approved worker entitlement fund if:

(a) the management of the fund (including the management of the investments of the fund) is carried out at arm ' s length from the contributors to the fund and their associates; and

(b) under the fund ' s constituting documents:

(i) no more than 5% of the total assets of the fund are to be invested in an entity controlled by a contributor or an associate of a contributor; and

(ii) the assets of the fund are not to be used to provide or facilitate any form of financial assistance, including a loan, to a contributor, a person in respect of whom contributions are made or an associate of a contributor or an associate of a person in respect of whom contributions are made; and

(c) under the fund ' s constituting documents, payments from contributions to the fund are to be made only for the following purposes:

(i) to pay worker entitlements to persons in respect of whom contributions are made, or to death benefits dependants (within the meaning of the Income Tax Assessment Act 1997 ) or legal personal representatives (within the meaning of that Act) of those persons;

(ii) to make investments to generate income from the assets of the fund;

(iii) to reimburse contributors who have paid entitlements directly to persons in respect of whom contributions are made;

(iv) to return contributions to contributors;

(v) to pay, for the benefit of a person in respect of whom contributions are made, an employment termination payment (within the meaning of the Income Tax Assessment Act 1997 ) into a complying superannuation fund (within the meaning of section 45 of the Superannuation Industry (Supervision) Act 1993 ), a complying approved deposit fund (within the meaning of section 47 of the Superannuation Industry (Supervision) Act 1993 ) or a retirement savings account (within the meaning of the Retirement Savings Accounts Act 1997 );

(vi) to transfer contributions to another approved worker entitlement fund;

(vii) to pay the reasonable administrative expenses of the fund;

(viii) to pay amounts to a contributor ' s external administrator that would otherwise be payable as mentioned in subparagraph (iii) or (iv) to the contributor;

(ix) to pay interest on, or to repay, money lent to the fund; and

View history reference

(d) under the fund ' s constituting documents, payments from the income of the fund are to be made only for the following purposes:

(i) a purpose mentioned in subparagraphs (c)(ii) to (ix);

(ii) to make payments to contributors to the fund;

(iii) to make payments to other persons where the payment is specified in subsection (5); and

(e) under the fund ' s constituting documents:

(i) an account must be kept for each person in respect of whom contributions to the fund are made; and

(ii) the account must be kept in a manner that enables entitlements in respect of the person to be calculated; and

(f) the fund, or the entity that operates the fund, has an ABN.

View history reference

View history note

58PB(4A)

View history reference

An entity is entitled to be endorsed for the operation of a fund as an approved worker entitlement fund if the fund is entitled to be endorsed as an approved worker entitlement fund.

View history note

58PB(5)
A payment made by a fund to a person in the following circumstances is specified for the purposes of subparagraph (4)(d)(iii):

(a) a contribution has been made to the fund in respect of the person; and

(b) the contribution would be an exempt benefit under section 58PA if the fund were an approved worker entitlement fund; and

(c) either:

(i) the payment is of a worker entitlement the contribution for which would be an exempt benefit under section 58PA if the fund were an approved worker entitlement fund; or

(ii) the payment is of some kind other than a worker entitlement.

View history note

Disclaimer and notice of copyright applicable to materials provided by CCH Australia Limited

CCH Australia Limited ("CCH") believes that all information which it has provided in this site is accurate and reliable, but gives no warranty of accuracy or reliability of such information to the reader or any third party. The information provided by CCH is not legal or professional advice. To the extent permitted by law, no responsibility for damages or loss arising in any way out of or in connection with or incidental to any errors or omissions in any information provided is accepted by CCH or by persons involved in the preparation and provision of the information, whether arising from negligence or otherwise, from the use of or results obtained from information supplied by CCH.

The information provided by CCH includes history notes and other value-added features which are subject to CCH copyright. No CCH material may be copied, reproduced, republished, uploaded, posted, transmitted, or distributed in any way, except that you may download one copy for your personal use only, provided you keep intact all copyright and other proprietary notices. In particular, the reproduction of any part of the information for sale or incorporation in any product intended for sale is prohibited without CCH's prior consent.