Tax and Superannuation Laws Amendment (2016 Measures No. 1) Act 2016 (52 of 2016)

Schedule 3   Farm management deposits

Part 1   Main amendments

Taxation Administration Act 1953

14   At the end of Division 288 in Schedule 1

Add:

288-115 Prohibited offsets of liabilities using interest etc. accrued on farm management deposits

(1) The person who made or is making a *farm management deposit is liable to an administrative penalty if:

(a) the fact that the person made or is making the deposit is the reason why, or one of the reasons why, an amount of interest payable to the *FMD provider in respect of loans or other debts falls short of what it would otherwise be; and

(b) the shortfall:

(i) contravenes a requirement, contained in the agreement mentioned in paragraph 393-20(1)(b) of the Income Tax Assessment Act 1997 in relation to the deposit, as set out in item 8 of the table in section 393-35 of that Act; or

(ii) would contravene such a requirement if it were contained in that agreement.

(2) The amount of the penalty is 200% of so much of the shortfall as contravenes that requirement, or would contravene such a requirement.