Tax Laws Amendment (Election Commitments No. 1) Act 2008 (32 of 2008)

Schedule 1   Distributions of managed investment trust income to foreign residents

Part 3   Consequential amendments

Income Tax (Transitional Provisions) Act 1997

23   After Division 830

Insert:

Division 840 - Withholding taxes

Table of Subdivisions

840-M Managed investment trust amounts

Subdivision 840-M - Managed investment trust amounts

Table of sections

840-805 Managed investment trust amounts

840-810 Payment of tax under section 840-805

840-805 Managed investment trust amounts

(1) This section has effect for amounts represented by or reasonably attributable to fund payments made in relation to the first income year starting on or after the first 1 July after the day on which the Tax Laws Amendment (Election Commitments No. 1) Act 2008 receives the Royal Assent by a trust that is a managed investment trust in relation to that year.

(2) If you are a resident of an information exchange country, subsection 840-805(1) of the Income Tax Assessment Act 1997 does not apply to the amounts to the extent that it would otherwise apply to you.

(3) An entity is a resident of an information exchange country if:

(a) the entity is a resident of that country for the purposes of the taxation laws of that country; or

(b) if there are no taxation laws of that country applicable to the entity or the entity’s residency status cannot be determined under those laws:

(i) for an individual - the individual is ordinarily resident in that country; or

(ii) for another entity - the entity is incorporated or formed in that country and is carrying on a business in that country.

(4) Instead, you are liable to pay income tax on the amounts (reduced as mentioned in subsection (5)) at the rate declared by the Parliament.

Note: The tax is imposed by the Income Tax (Managed Investment Trust Transitional) Act 2008.

(5) The amounts are reduced by any loss or outgoing of yours to the extent that:

(a) it is incurred in gaining or producing the amounts; or

(b) it is necessarily incurred in carrying on a business for the purpose of gaining or producing the amounts.

840-810 Payment of tax under section 840-805

(1) Income tax under section 840-805 is due and payable by you at the end of 21 days after:

(a) if subsection 840-805(2) or (3) of the Income Tax Assessment Act 1997 would apply to you apart from section 840-805 of this Act - the end of the month in which the relevant amount is paid, applied or dealt with; or

(b) if subsection 840-805(4) of that Act would so apply to you - the end of the month in which you become presently entitled to the relevant amount.

(2) Subsections 840-810(2) to (5) of the Income Tax Assessment Act 1997 apply to income tax payable under this section.