Taxation Ruling
IT 2140W - Notice of Withdrawal
Tax instalment deductions from earnings of field representatives engaged by banks to service credit card merchants
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Please note that the PDF version is the authorised version of this withdrawal notice.
FOI status:
may be releasedNotice of Withdrawal
Taxation Ruling IT 2140 is withdrawn with effect from today.
1. Taxation Ruling IT 2140 issued on 6 March 1985. The Ruling deals specifically with whether a bank is required to deduct tax instalments from the earnings of field representatives engaged by it to service credit card merchants. It discusses whether the substance of the relationship between the bank and the field representatives is one of 'master and servant'. Division 2 of Part VI of the Income Tax Assessment Act 1936 provided the legislative framework for what is commonly referred to as the Pay As You Earn (PAYE) system. The Division imposed an obligation on an employer to deduct instalments of tax from payments of salary or wages to employees.
2. The PAYE collection system was replaced with effect from 1 July 2000. From that date the obligation of a paying entity to withhold an amount from a relevant payment to an employee is provided in section 12-35 of Schedule 1 to the Taxation Administration Act 1953 (TAA).
3. Taxation Ruling TR 2005/16, which issued on 31 August 2005, is the current ruling that provides guidance on whether an individual is paid as an employee for the purposes of section 12-35 of Schedule 1 to the TAA. Taxation Ruling TR 2005/16 supersedes Taxation Ruling TR 2000/14. To the extent that our views in IT 2140 still apply, they have been incorporated into Taxation Ruling TR 2005/16.
Commissioner of Taxation
16 August 2006