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This is a Bill, not an Act. For current law, see the Acts databases.
NEW INTERNATIONAL TAX ARRANGEMENTS (FOREIGN-OWNED BRANCHES AND OTHER MEASURES) BILL 2005
2004-2005
The Parliament of the
Commonwealth of Australia
HOUSE OF REPRESENTATIVES
Presented and read a first time
New International Tax Arrangements
(Foreign-owned Branches and Other
Measures) Bill 2005
No. , 2005
(Treasury)
A Bill for an Act to amend the law relating to
taxation, and for related purposes
i New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill
2005 No. , 2005
Contents
1
Short title.......................................................................................1
2
Commencement .............................................................................1
3
Schedule(s)....................................................................................2
Schedule 1--Dividends received by foreign-owned branches
3
Income Tax Assessment Act 1936
3
Income Tax Assessment Act 1997
4
Schedule 2--Amendments relating to CFCs
7
Income Tax Assessment Act 1936
7
Income Tax Assessment Act 1997
8
Schedule 3--Australian permanent establishments of foreign
financial entities
10
Part 1--Treatment like Australian branches of foreign banks
10
Income Tax Assessment Act 1936
10
Income Tax Assessment Act 1997
11
Part 2--Transfers of losses
13
Income Tax Assessment Act 1997
13
Part 3--Thin capitalisation
15
Income Tax Assessment Act 1997
15
Income Tax (Transitional Provisions) Act 1997
23
Schedule 4--Cross border employee shares or rights
24
Part 1--Amendments
24
Fringe Benefits Tax Assessment Act 1986
24
Income Tax Assessment Act 1936
24
Income Tax Assessment Act 1997
30
Part 2--Application provisions
33
Schedule 5--Technical correction
35
New International Tax Arrangements (Participation Exemption and
Other Measures) Act 2004
35
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 1
A Bill for an Act to amend the law relating to
1
taxation, and for related purposes
2
The Parliament of Australia enacts:
3
1 Short title
4
This Act may be cited as the New International Tax Arrangements
5
(Foreign-owned Branches and Other Measures) Act 2005.
6
2 Commencement
7
(1) Each provision of this Act specified in column 1 of the table
8
commences, or is taken to have commenced, in accordance with
9
column 2 of the table. Any other statement in column 2 has effect
10
according to its terms.
11
12
2 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
Commencement information
Column 1
Column 2
Column 3
Provision(s)
Commencement
Date/Details
1. Sections 1 to 3
and anything in
this Act not
elsewhere covered
by this table
The day on which this Act receives the
Royal Assent.
2. Schedule 1
The day on which this Act receives the
Royal Assent.
3. Schedule 2
The day after this Act receives the Royal
Assent.
4. Schedules 3
and 4
The day on which this Act receives the
Royal Assent.
5. Schedule 5
Immediately after the commencement of
item 140 of Schedule 2 to the New
International Tax Arrangements
(Participation Exemption and Other
Measures) Act 2004.
Note:
This table relates only to the provisions of this Act as originally
1
passed by the Parliament and assented to. It will not be expanded to
2
deal with provisions inserted in this Act after assent.
3
(2) Column 3 of the table contains additional information that is not
4
part of this Act. Information in this column may be added to or
5
edited in any published version of this Act.
6
3 Schedule(s)
7
Each Act that is specified in a Schedule to this Act is amended or
8
repealed as set out in the applicable items in the Schedule
9
concerned, and any other item in a Schedule to this Act has effect
10
according to its terms.
11
Dividends received by foreign-owned branches Schedule 1
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 3
1
Schedule 1--Dividends received by
2
foreign-owned branches
3
4
Income Tax Assessment Act 1936
5
1 After paragraph 44(1)(b)
6
Insert:
7
; and (c) if the shareholder is a non-resident carrying on business in
8
Australia at or through a permanent establishment of the
9
shareholder in Australia, and the company is a resident:
10
(i) dividends (other than non-share dividends) that are paid
11
to the shareholder by the company and are attributable
12
to the permanent establishment, to the extent to which
13
they are paid out of profits derived by the company
14
from sources outside Australia; and
15
(ii) non-share dividends that are paid to the shareholder by
16
the company and are attributable to the permanent
17
establishment, to the extent to which they are derived
18
from sources outside Australia.
19
2 At the end of section 44
20
Add:
21
(7) In this section:
22
permanent establishment of a person:
23
(a) has the same meaning as in a double tax agreement (as
24
defined in Part X) that relates to a foreign country and affects
25
the person; or
26
(b) has the meaning given by subsection 6(1), if there is no such
27
agreement.
28
3 After subsection 102L(21)
29
Insert:
30
(21A) For the purposes of subsection 44(1), a non-unit dividend paid by
31
the trustee of a prescribed trust estate out of corpus of the trust
32
estate is taken, to the extent to which the non-unit dividend is
33
Schedule 1 Dividends received by foreign-owned branches
4 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
attributable to a source outside Australia, to be derived from a
1
source outside Australia.
2
4 After subsection 102T(22)
3
Insert:
4
(22A) For the purposes of subsection 44(1), a non-unit dividend paid by
5
the trustee of a prescribed trust estate out of corpus of the trust
6
estate is taken, to the extent to which the non-unit dividend is
7
attributable to a source outside Australia, to be derived from a
8
source outside Australia.
9
5 Subsection 128B(1)
10
Omit "and (3D),", substitute ", (3D) and (3E),".
11
6 After subsection 128B(3D)
12
Insert:
13
(3E) This section does not apply to income that consists of a dividend
14
that:
15
(a) is paid to a person who is a non-resident carrying on business
16
in Australia at or through a permanent establishment of the
17
person in Australia; and
18
(b) is attributable to the permanent establishment; and
19
(c) is not paid to the person in the person's capacity as trustee.
20
Note:
This subsection not only ensures that this section does not apply to
21
that income to make withholding tax payable on it, but also (as a
22
result) ensures that none of that income is non-assessable non-exempt
23
income under section 128D. Subsection 44(1) makes that income
24
assessable income.
25
(3F) In subsection (3E):
26
permanent establishment of a person:
27
(a) has the same meaning as in a double tax agreement (as
28
defined in Part X) that relates to a foreign country and affects
29
the person; or
30
(b) has the meaning given by subsection 6(1), if there is no such
31
agreement.
32
Income Tax Assessment Act 1997
33
Dividends received by foreign-owned branches Schedule 1
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 5
7 After subsection 67-25(1D)
1
Insert:
2
(1DA) A
*
tax offset is not subject to the refundable tax offset rules if:
3
(a) an entity is entitled to the tax offset under Division 207
4
because a
*
franked distribution is made, or
*
flows indirectly,
5
to the entity; and
6
(b) the entity is a foreign resident and carries on business in
7
Australia at or through a permanent establishment of the
8
entity in Australia, being a permanent establishment within
9
the meaning of:
10
(i) a double tax agreement (as defined in Part X of the
11
Income Tax Assessment Act 1936) that relates to a
12
foreign country and affects the entity; or
13
(ii) subsection 6(1) of that Act, if there is no such
14
agreement; and
15
(c) the distribution is attributable to the permanent
16
establishment.
17
8 Paragraph 115-280(1)(b)
18
Repeal the paragraph, substitute:
19
(b) when the dividend is paid, either you are an Australian
20
resident or you are an individual who is a foreign resident
21
and carries on business in Australia at or through your
22
permanent establishment in Australia, being a permanent
23
establishment within the meaning of:
24
(i) a double tax agreement (as defined in Part X of the
25
Income Tax Assessment Act 1936) that relates to a
26
foreign country and affects the individual; or
27
(ii) subsection 6(1) of that Act, if there is no such
28
agreement; and
29
(ba) if, when the dividend is paid, you are an individual who is a
30
foreign resident and has in Australia such a permanent
31
establishment--the dividend is attributable to the permanent
32
establishment; and
33
9 Section 207-75
34
Before "An entity", insert "(1)".
35
10 At the end of section 207-75
36
Schedule 1 Dividends received by foreign-owned branches
6 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
Add:
1
(2) An entity that receives a
*
distribution also satisfies the residency
2
requirement at the time the distribution is made if the entity at that
3
time:
4
(a) is a company or an individual; and
5
(b) is a foreign resident; and
6
(c) carries on business in Australia at or through a permanent
7
establishment of the entity in Australia, being a permanent
8
establishment within the meaning of:
9
(i) a double tax agreement (as defined in Part X of the
10
Income Tax Assessment Act 1936) that relates to a
11
foreign country and affects the entity; or
12
(ii) subsection 6(1) of that Act, if there is no such
13
agreement;
14
and the distribution is attributable to the permanent establishment.
15
Amendments relating to CFCs Schedule 2
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 7
1
Schedule 2--Amendments relating to CFCs
2
3
Income Tax Assessment Act 1936
4
1 Subparagraph 384(2)(d)(iv)
5
Omit "modified; and", substitute "modified.".
6
2 Paragraph 384(2)(e)
7
Repeal the paragraph.
8
3 Subparagraph 385(2)(d)(v)
9
Omit "modified; and", substitute "modified.".
10
4 Paragraph 385(2)(e)
11
Repeal the paragraph.
12
5 Subsection 406(1)
13
Repeal the subsection, substitute:
14
(1) For the purposes of applying this Act in calculating the attributable
15
income of the eligible CFC, the eligible CFC's commencing day is
16
the later of:
17
(a) the last day of the most recent period during which there was
18
not an attributable taxpayer with an attribution percentage
19
(greater than nil) in relation to the eligible CFC; and
20
(b) 30 June 1990.
21
Example: If a taxpayer became an attributable taxpayer with an attribution
22
percentage (greater than nil) in relation to the eligible CFC at 3 pm on
23
20 October 2004 and there were no other such attributable taxpayers
24
at that time, the commencing day is 20 October 2004.
25
6 Subsections 422(4) and (6)
26
Omit "subparagraph 457(2)(a)(i)", substitute "subparagraph
27
457(2)(a)(ii)".
28
7 Subsection 457(2) (subparagraphs (a)(i) and (ii) of the
29
definition of Adjusted distributable profits)
30
Repeal the subparagraphs, substitute:
31
Schedule 2 Amendments relating to CFCs
8 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
(i) the CFC's income were its adjusted tainted income
1
(excluding any non-portfolio dividends) derived during
2
the period beginning on the first day of the statutory
3
accounting period in which the residence-change time
4
occurred and ending immediately before the time at
5
which the residence-change time occurs; and
6
(ii) the CFC's only other income were an amount that the
7
CFC would have derived had it disposed of all of its
8
tainted assets immediately before the residence-change
9
time for a consideration equal to their market value; and
10
(iii) the CFC's only expenses were expenses related to
11
income covered by subparagraphs (i) and (ii); or
12
8 Subsection 457(2) (subparagraph (b)(i) of the definition of
13
Adjusted distributable profits)
14
After "(excluding any non-portfolio dividends)", insert "derived during
15
the period beginning on the first day of the statutory accounting period
16
in which the residence-change time occurred and ending immediately
17
before the time at which the residence-change time occurs".
18
9 Subsection 457(3)
19
Omit all the words after paragraph (b), substitute:
20
then no amount is to be included in the attributable taxpayer's
21
assessable income under subsection (1) in relation to that change of
22
residence.
23
Income Tax Assessment Act 1997
24
10 Subsections 116-95(3) and (5)
25
Omit "subparagraph 457(2)(a)(i)", substitute "subparagraph
26
457(2)(a)(ii)".
27
11 Application
28
(1)
The amendment made by item 5 applies:
29
(a) for the purposes of section 408A--to statutory accounting
30
periods that begin on or after the day on which this Act
31
receives the Royal Assent; and
32
Amendments relating to CFCs Schedule 2
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 9
(b) in any other case--to CGT events that occur on or after the
1
first 1 July that occurs after the day on which this Act
2
receives the Royal Assent.
3
(2)
The amendments made by items 6, 7, 8 and 10 apply to things
4
happening on or after 1 July 2004.
5
Schedule 3 Australian permanent establishments of foreign financial entities
Part 1 Treatment like Australian branches of foreign banks
10 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
1
Schedule 3--Australian permanent
2
establishments of foreign financial
3
entities
4
Part 1--Treatment like Australian branches of foreign
5
banks
6
Income Tax Assessment Act 1936
7
1 At the end of subsection 160ZZVA(1)
8
Add:
9
Note:
This Part also:
10
(a)
applies to foreign entities that are financial entities in the same
11
way as it applies to foreign banks; and
12
(b)
applies to permanent establishments in Australia of foreign
13
entities that are financial entities in the same way as it applies to
14
Australian branches of foreign banks.
15
See Division 4.
16
2 At the end of Part IIIB
17
Add:
18
Division 4--Extension of Part to Australian branches of
19
foreign financial entities
20
160ZZZK Treatment like Australian branches of foreign banks
21
Objects
22
(1) The main objects of this section are:
23
(a) to treat foreign entities that are financial entities like foreign
24
banks for the purposes of this Part; and
25
(b) to treat Australian permanent establishments of foreign
26
entities that are financial entities like Australian branches of
27
foreign banks for the purposes of this Part.
28
Australian permanent establishments of foreign financial entities Schedule 3
Treatment like Australian branches of foreign banks Part 1
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 11
Foreign financial entities treated like foreign banks
1
(2) This Part (except this Division) applies to a foreign entity that is a
2
financial entity in the same way as this Part applies to a foreign
3
bank.
4
Australian permanent establishments treated like Australian
5
branches
6
(3) This Part (except this Division) applies to a permanent
7
establishment in Australia of a foreign entity that is a financial
8
entity in the same way as this Part applies to an Australian branch
9
of a foreign bank.
10
Definitions
11
(4) In this section:
12
financial entity has the meaning given by section 995-1 of the
13
Income Tax Assessment Act 1997.
14
foreign entity has the meaning given by section 995-1 of the
15
Income Tax Assessment Act 1997.
16
3 After subsection 262A(1B)
17
Insert:
18
(1BA) Without limiting subsection (1), a foreign entity (as defined in the
19
Income Tax Assessment Act 1997) that is a financial entity (as
20
defined in that Act) must maintain accounting records in respect of,
21
and separately account for, money used in the activities of a
22
permanent establishment in Australia of the entity.
23
4 Application
24
The amendments of the Income Tax Assessment Act 1936 made by this
25
Part apply to years of income starting on or after the commencement of
26
this Part.
27
Income Tax Assessment Act 1997
28
5 Section 12-5 (after the table item headed "foreign
29
exchange")
30
Schedule 3 Australian permanent establishments of foreign financial entities
Part 1 Treatment like Australian branches of foreign banks
12 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
Insert:
1
foreign financial entities' Australian permanent
establishments
generally.......................................................................... Part IIIB
thin capitalisation ............................................................. Subdivision 820-FB
transfer of losses............................................................... Subdivisions 170-A
and 170-B
6 Section 12-5 (table item headed "foreign tax credits")
2
After "foreign bank", insert "or foreign financial entity".
3
Australian permanent establishments of foreign financial entities Schedule 3
Transfers of losses Part 2
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 13
1
Part 2--Transfers of losses
2
Income Tax Assessment Act 1997
3
7 At the end of subsection 170-5(2A)
4
Add:
5
Note:
This Subdivision applies to Australian permanent establishments of
6
foreign entities that are financial entities in the same way as it applies
7
to Australian branches of foreign banks. See section 170-75.
8
8 At the end of Subdivision 170-A
9
Add:
10
Australian permanent establishments of foreign financial
11
entities
12
170-75 Treatment like Australian branches of foreign banks
13
(1) The object of this section is to let
*
tax losses be transferred under
14
this Subdivision to and from
*
Australian permanent establishments
15
of
*
foreign entities that are
*
financial entities in the same way as
16
tax losses can be transferred to and from Australian branches of
17
*
foreign banks.
18
(2) This Subdivision (except this section) applies to an
*
Australian
19
permanent establishment of a
*
foreign entity that is a
*
financial
20
entity in the same way as this Subdivision applies to an Australian
21
branch (as defined in Part IIIB of the Income Tax Assessment Act
22
1936) of a
*
foreign bank.
23
9 At the end of subsection 170-105(2A)
24
Add:
25
Note:
This Subdivision applies to Australian permanent establishments of
26
foreign entities that are financial entities in the same way as it applies
27
to Australian branches of foreign banks. See section 170-174.
28
10 At the end of Subdivision 170-B
29
Add:
30
Schedule 3 Australian permanent establishments of foreign financial entities
Part 2 Transfers of losses
14 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
Australian permanent establishments of foreign financial
1
entities
2
170-174 Treatment like Australian branches of foreign banks
3
(1) The object of this section is to let
*
net capital losses be transferred
4
under this Subdivision to and from
*
Australian permanent
5
establishments of
*
foreign entities that are
*
financial entities in the
6
same way as net capital losses can be transferred to and from
7
Australian branches of
*
foreign banks.
8
(2) This Subdivision (except this section) applies to an
*
Australian
9
permanent establishment of a
*
foreign entity that is a
*
financial
10
entity in the same way as this Subdivision applies to an Australian
11
branch (as defined in Part IIIB of the Income Tax Assessment Act
12
1936) of a
*
foreign bank.
13
11 Application
14
The amendments made by this Part apply in relation to losses for
15
income years starting on or after the commencement of this Part.
16
Australian permanent establishments of foreign financial entities Schedule 3
Thin capitalisation Part 3
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 15
1
Part 3--Thin capitalisation
2
Income Tax Assessment Act 1997
3
12 Section 820-445 (heading)
4
Repeal the heading, substitute:
5
820-445 How this Subdivision interacts with Subdivisions 820-F and
6
820-FA
7
13 Subsection 820-445(4)
8
Repeal the subsection.
9
14 Subdivision 820-FB (heading)
10
Repeal the heading, substitute:
11
Subdivision 820-FB--Grouping branches of foreign banks and
12
foreign financial entities with a consolidated group,
13
MEC group or single Australian resident company
14
15 Section 820-595
15
Repeal the section, substitute:
16
820-595 What this Subdivision is about
17
If:
18
(a)
the head company of a consolidated group or MEC
19
group; or
20
(b)
an Australian company that cannot consolidate;
21
is a member of the same wholly-owned group as a foreign bank or
22
foreign financial entity, the company can choose to treat as part of
23
itself the Australian branches of the foreign bank or foreign
24
financial entity, affecting how the rest of this Division applies.
25
Schedule 3 Australian permanent establishments of foreign financial entities
Part 3 Thin capitalisation
16 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
16 Group heading before section 820-597
1
Repeal the heading, substitute:
2
Choice to group with branches of foreign banks and foreign
3
financial entities
4
17 Sections 820-597 and 820-599
5
Repeal the sections, substitute:
6
820-597 Choice by head company of consolidated group or MEC
7
group
8
(1) This section applies if there is a period (the grouping period) for
9
which all these conditions are met:
10
(a) the period was all or part of an income year of the
*
head
11
company of a
*
consolidated group or
*
MEC group;
12
(b) the consolidated group or MEC group existed throughout the
13
period;
14
(c) the head company and an entity (the establishment entity)
15
covered by one of the following subparagraphs are both
16
members of the same
*
wholly-owned group throughout the
17
period:
18
(i) a
*
foreign bank that carried on its banking
*
business in
19
Australia through at least one
*
Australian permanent
20
establishment at each time in the period;
21
(ii) a
*
foreign entity that was a
*
financial entity and had at
22
least one Australian permanent establishment at each
23
time in the period;
24
(d) there is not a longer period in the income year for which the
25
conditions in paragraphs (a), (b) and (c) are met in relation to
26
the head company and the establishment entity.
27
Note:
It does not matter whether the income year ended on the same day for
28
the head company and the establishment entity.
29
(2) The
*
head company may choose to have all of the
*
Australian
30
permanent establishments of the establishment entity treated as part
31
of the head company for the grouping period for the purposes of
32
this Division.
33
Australian permanent establishments of foreign financial entities Schedule 3
Thin capitalisation Part 3
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 17
(3) If the conditions in subsection (1) are met in relation to the
*
head
1
company and more than one other establishment entity, the head
2
company may make a different choice in relation to each of the
3
other establishment entities.
4
820-599 Choice by Australian resident company outside
5
consolidatable group and MEC group
6
(1) This section applies if there is a period (also the grouping period)
7
for which all these conditions are met:
8
(a) the period was all or part of an income year of a company
9
(the single company);
10
(b) throughout the period the single company:
11
(i) was an
*
Australian entity; and
12
(ii) was not a
*
prescribed dual resident; and
13
(iii) was not a
*
member of a
*
consolidatable group; and
14
(iv) was not a member of a
*
consolidated group; and
15
(v) was not a member of a
*
MEC group;
16
(c) the single company and an entity (the establishment entity)
17
covered by one of the following subparagraphs are both
18
members of the same
*
wholly-owned group throughout the
19
period:
20
(i) a
*
foreign bank that carried on its banking
*
business in
21
Australia through at least one
*
Australian permanent
22
establishment at each time in the period;
23
(ii) a
*
foreign entity that was a
*
financial entity and had at
24
least one Australian permanent establishment at each
25
time in the period;
26
(d) there is not a longer period in the income year for which the
27
conditions in paragraphs (a), (b) and (c) are met in relation to
28
the single company and the establishment entity.
29
Note:
It does not matter whether the income year ended on the same day for
30
the single company and the establishment entity.
31
(2) The single company may choose to have all of the
*
Australian
32
permanent establishments of the establishment entity treated as part
33
of the single company for the grouping period for the purposes of
34
this Division.
35
Schedule 3 Australian permanent establishments of foreign financial entities
Part 3 Thin capitalisation
18 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
(3) If the conditions in subsection (1) are met in relation to the single
1
company and more than one other establishment entity, the single
2
company may make a different choice in relation to each of the
3
other establishment entities.
4
18 Subsection 820-603(1)
5
Omit "
*
foreign bank", substitute "establishment entity".
6
19 Subsection 820-603(2)
7
Repeal the subsection, substitute:
8
(2) The rest of this section applies:
9
(a) to each
*
Australian permanent establishment that:
10
(i) was an Australian permanent establishment of the
11
establishment entity; and
12
(ii) if the establishment entity was a
*
foreign bank--was an
13
Australian permanent establishment through which the
14
entity carried on banking
*
business in Australia at any
15
time in the grouping period; and
16
(b) in relation to each time (the test time) that was in the
17
grouping period and was when the Australian permanent
18
establishment:
19
(i) was an Australian permanent establishment of the
20
establishment entity; and
21
(ii) if the establishment entity was a foreign bank--was an
22
Australian permanent establishment through which the
23
entity carried on banking business in Australia.
24
20 Paragraphs 820-603(3)(b), (4)(a) and (5)(b)
25
Omit "
*
foreign bank", substitute "establishment entity".
26
21 Subparagraph 820-603(5)(c)(i)
27
Omit "foreign bank", substitute "establishment entity".
28
22 Section 820-605 (heading)
29
Repeal the heading, substitute:
30
Australian permanent establishments of foreign financial entities Schedule 3
Thin capitalisation Part 3
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 19
820-605 Effect on establishment entity if certain debt deductions
1
disallowed
2
23 Paragraph 820-605(a)
3
Omit "the
*
foreign bank", substitute "the establishment entity".
4
24 Section 820-605
5
Omit "the foreign bank,", substitute "the establishment entity,".
6
25 Section 820-605 (notes 1 and 2)
7
Omit "foreign bank" (wherever occurring), substitute "establishment
8
entity".
9
26 Section 820-607
10
Omit "the
*
foreign bank", substitute "the establishment entity".
11
27 Section 820-609
12
Repeal the section, substitute:
13
820-609 Effect on classification of head company or single company
14
(1) The
*
head company or single company is an outward investing
15
entity (ADI) for a period (the trial period) that is all or part of the
16
grouping period if:
17
(a) apart from this Subdivision, the head company or single
18
company would be an
*
outward investing entity (ADI) for the
19
trial period; or
20
(b) apart from this Subdivision, the head company or single
21
company would be:
22
(i) an
*
outward investing entity (non-ADI) and an
*
outward
23
investor (financial) for the trial period; or
24
(ii) an
*
outward investing entity (non-ADI) and an
*
outward
25
investor (general) for the trial period;
26
and at least one of the
*
Australian permanent establishments
27
is a
*
permanent establishment through which a
*
foreign bank
28
carries on banking
*
business in Australia.
29
(2) The
*
head company is also an outward investing entity (ADI) for
30
the trial period if, apart from this Subdivision:
31
Schedule 3 Australian permanent establishments of foreign financial entities
Part 3 Thin capitalisation
20 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
(a) the head company would satisfy subsection 820-585(2) for
1
the trial period (triggering the exemption in section 820-585);
2
or
3
(b) section 820-587 would apply Subdivision 820-D to the head
4
company as if it were an
*
outward investing entity (ADI) for
5
the trial period.
6
(3) The single company is also an outward investing entity (ADI) for
7
the trial period if it is both a
*
foreign controlled Australian
8
company and an
*
ADI for that period.
9
(4) The
*
head company or single company is an inward investing
10
entity (ADI) for the trial period if:
11
(a) apart from this Subdivision, it would be an
*
inward
12
investment vehicle (general) or an
*
inward investment
13
vehicle (financial), and not an
*
outward investor (general) or
14
an
*
outward investor (financial), for the trial period; and
15
(b) at least one of the
*
Australian permanent establishments is a
16
*
permanent establishment through which a
*
foreign bank
17
carries on banking
*
business in Australia.
18
(5) The
*
head company or single company is an outward investing
19
entity (non-ADI) and an outward investor (financial) for the trial
20
period if, apart from this Subdivision, it would be an
*
outward
21
investing entity (non-ADI) and:
22
(a) an
*
outward investor (financial); or
23
(b) an
*
outward investor (general);
24
for that period, and:
25
(c) at least one of the
*
Australian permanent establishments is a
26
*
permanent establishment of a
*
foreign entity that is a
27
*
financial entity; and
28
(d) none of the Australian permanent establishments is a
29
permanent establishment through which a
*
foreign bank
30
carries on banking
*
business in Australia.
31
(6) The
*
head company or single company is an inward investing
32
entity (non-ADI) and an inward investment vehicle (financial) for
33
the trial period if, apart from this Subdivision, it would be an
34
*
inward investing entity (non-ADI) and:
35
(a) an
*
inward investment vehicle (financial); or
36
(b) an
*
inward investment vehicle (general);
37
Australian permanent establishments of foreign financial entities Schedule 3
Thin capitalisation Part 3
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 21
for that period and not an
*
outward investor (general) or an
1
*
outward investor (financial) for that period and:
2
(c) at least one of the
*
Australian permanent establishments is a
3
*
permanent establishment of a
*
foreign entity that is a
4
*
financial entity; and
5
(d) none of the Australian permanent establishments is a
6
permanent establishment through which a
*
foreign bank
7
carries on banking
*
business in Australia.
8
(7) This section has effect despite any other provision of this Division,
9
except Subdivision 820-EA.
10
Note:
If the head company or single company is an outward investor
11
(financial) or inward investment vehicle (financial) under this section
12
and satisfies subsection 820-430(5), it may choose under
13
Subdivision 820-EA to be treated as an outward investing entity
14
(ADI). Section 820-603 affects whether the company satisfies that
15
subsection, by treating as part of the company each relevant foreign
16
financial entity's Australian permanent establishment.
17
28 Section 820-613 (heading)
18
Repeal the heading, substitute:
19
820-613 How Subdivision 820-D applies
20
29 Subsection 820-613(1) (note)
21
Repeal the note, substitute:
22
Note:
Subdivision 820-D applies to the head company or single company if
23
it is classified as an outward investing entity (ADI) because of
24
section 820-609, either alone or in conjunction with a choice made by
25
the company under section 820-430.
26
30 Subsections 820-613(3) and (4)
27
Repeal the subsections, substitute:
28
(3) The amount worked out under this subsection as at a particular day
29
is the total of the amounts worked out under the following
30
paragraphs for each of the establishment entity's
*
Australian
31
permanent establishments that section 820-603 treats as part of the
32
*
head company or single company on that day:
33
(a) so much of the establishment entity's
*
ADI equity capital, at
34
the end of the day, as:
35
Schedule 3 Australian permanent establishments of foreign financial entities
Part 3 Thin capitalisation
22 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
(i) is attributable to that Australian permanent
1
establishment; and
2
(ii) has not been allocated to the
*
OB activities of the entity;
3
(b) the amounts that, as at the end of that day:
4
(i) are made available by the establishment entity to the
5
Australian permanent establishment as loans to it; and
6
(ii) do not give rise to any
*
debt deductions of the entity for
7
the income year or any other income year.
8
Note:
The amounts are to be worked out, so far as practicable, on the basis
9
of the information that would be contained in a set of consolidated
10
accounts. See section 820-611.
11
Risk-weighted assets
12
(4) For each of the establishment entity's
*
Australian permanent
13
establishments that is covered by the choice, the
*
risk-weighted
14
assets of the
*
head company or single company include that part of
15
the entity's risk-weighted assets that:
16
(a) is attributable to that Australian permanent establishment;
17
and
18
(b) is not attributable to the entity's
*
OB activities.
19
31 Section 820-615 (heading)
20
Repeal the heading, substitute:
21
820-615 How Subdivision 820-E applies
22
32 Subsection 820-615(1) (note)
23
Repeal the note, substitute:
24
Note:
Subdivision 820-E applies to the head company or single company if
25
it is classified as an inward investing entity (ADI) because of
26
section 820-609.
27
33 Subsection 820-615(4)
28
Repeal the subsection, substitute:
29
Risk-weighted assets
30
(4) For each of the establishment entity's
*
Australian permanent
31
establishments covered by the choice, the
*
risk-weighted assets of
32
Australian permanent establishments of foreign financial entities Schedule 3
Thin capitalisation Part 3
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 23
the
*
head company or single company include that part of the
1
entity's risk-weighted assets that:
2
(a) is attributable to that Australian permanent establishment;
3
and
4
(b) is not attributable to the entity's
*
OB activities.
5
34 Subsection 995-1(1) (definition of inward investing entity
6
(non-ADI))
7
Omit "and 820-583", substitute ", 820-583 and 820-609".
8
35 Subsection 995-1(1) (definition of inward investment
9
vehicle (financial))
10
Omit "and 820-583", substitute ", 820-583 and 820-609".
11
36 Subsection 995-1(1) (definition of outward investing entity
12
(non-ADI))
13
Omit "and 820-583", substitute ", 820-583 and 820-609".
14
37 Subsection 995-1(1) (definition of outward investor
15
(financial))
16
Omit "and 820-583", substitute ", 820-583 and 820-609".
17
Income Tax (Transitional Provisions) Act 1997
18
38 Paragraph 701D-10(5)(c)
19
Omit "820-599(2)(c)(iii)", substitute "820-599(1)(b)(iii)".
20
39 Application
21
The amendments made by this Part apply in relation to assessments for
22
income years starting on or after the commencement of this Part.
23
Schedule 4 Cross border employee shares or rights
Part 1 Amendments
24 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
1
Schedule 4--Cross border employee shares
2
or rights
3
Part 1--Amendments
4
Fringe Benefits Tax Assessment Act 1986
5
1 Subsection 136(1) (paragraph (hb) of the definition of fringe
6
benefit)
7
Repeal the paragraph, substitute:
8
(hb) a benefit constituted by the acquisition by a trust of money or
9
other property where the sole activities of the trust are
10
obtaining shares, or rights to acquire shares, in a company, or
11
a holding company (within the meaning of the Corporations
12
Act 2001) of the first-mentioned company, and providing
13
those shares or rights:
14
(i) to employees, or associates of employees, of the
15
first-mentioned company; or
16
(ii) to persons who are engaged in foreign service (within
17
the meaning of section 139GBA of the Income Tax
18
Assessment Act 1936) for the first-mentioned company,
19
or associates of those persons; or
20
Income Tax Assessment Act 1936
21
2 Subsection 23AF(18) (paragraph (a) of the definition of
22
eligible foreign remuneration)
23
After "allowances", insert ", or of amounts included in a person's
24
assessable income under Division 13A,".
25
3 Subsection 23AF(18) (paragraph (b) of the definition of
26
eligible foreign remuneration)
27
After "income", insert ", or amounts included in a person's assessable
28
income under Division 13A,".
29
4 Subsection 23AG(7) (definition of foreign earnings)
30
After "allowances", insert ", or of amounts included in a person's
31
assessable income under Division 13A,".
32
Cross border employee shares or rights Schedule 4
Amendments Part 1
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 25
5 After subsection 139B(1)
1
Insert:
2
(1A) However, for any period during which the taxpayer is a
3
non-resident, the discount is not included under subsection (1) in
4
the assessable income of the taxpayer to the extent that the
5
discount is given in respect of, or for or in relation directly or
6
indirectly to, the taxpayer's engagement in foreign service that
7
relates to the acquisition of the share or right.
8
Note:
Foreign service is defined in section 139GBA.
9
6 Subsection 139B(2)
10
Omit "subsection (3)", substitute "subsection (2A) or (3)".
11
7 After subsection 139B(2)
12
Insert:
13
(2A) Unless subsection (3) applies, if the taxpayer:
14
(a) acquired the share or right while the taxpayer was not an
15
employee; and
16
(b) subsequently became an employee while holding the share or
17
right;
18
the discount is included in the taxpayer's assessable income in the
19
year of income in which, after the acquisition, the taxpayer first
20
becomes an employee in respect of employment or services that
21
affect the acquisition or holding of the share or right.
22
Note:
Subsection 139GA(2) limits the meaning of employee in this
23
subsection, so that engagement in foreign service is not of itself
24
sufficient.
25
8 Subsection 139B(3)
26
Omit "for the year of income in which the share or right is acquired",
27
substitute "covering the share or right".
28
9 Subsection 139CC(2)
29
Omit "subsection 139B(2)", substitute "subsection 139B(2) or (2A)".
30
Note:
The heading to subsection 139CC(2) is altered by inserting "or (2A)" after "subsection
31
139B(2)".
32
10 Paragraphs 139CD(1)(a) and (b)
33
Schedule 4 Cross border employee shares or rights
Part 1 Amendments
26 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
Repeal the paragraphs, substitute:
1
(a) a share in a company is a qualifying share if:
2
(i) the 6 conditions below are satisfied; and
3
(ii) in the case of a share that a taxpayer has acquired while
4
engaged in foreign service--section 139CDA applies to
5
the share; and
6
(b) a right to acquire a share in a company is a qualifying right
7
if:
8
(i) the first, second, third, fifth and sixth of the 6 conditions
9
below are satisfied; and
10
(ii) in the case of a right that a taxpayer has acquired while
11
engaged in foreign service--section 139CDA applies to
12
the right.
13
11 Subsection 139CD(1) (note)
14
Omit "Note", substitute "Note 1".
15
12 At the end of subsection 139CD(1)
16
Add:
17
Note 2:
Foreign service is defined in section 139GBA.
18
13 After section 139CD
19
Insert:
20
139CDA Additional requirement for shares or rights acquired while
21
engaged in foreign service
22
This section applies to a share in a company, or a right to acquire a
23
share in a company, if the taxpayer in question first becomes an
24
employee, in respect of employment or services that affect the
25
acquisition or holding of the share or right, before the cessation
26
time for the share or right.
27
Note:
Subsection 139GA(2) limits the meaning of employee in this section,
28
so that engagement in foreign service is not of itself sufficient.
29
14 Paragraph 139D(1)(c)
30
Repeal the paragraph, substitute:
31
(c) apart from this section, an amount:
32
Cross border employee shares or rights Schedule 4
Amendments Part 1
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 27
(i) would be included in respect of the acquisition in the
1
assessable income of the taxpayer of a year of income
2
under this Division; or
3
(ii) would have been so included if the taxpayer had been a
4
resident at the time of the acquisition.
5
15 Subsection 139D(2)
6
Omit "If", substitute "Subject to subsection (3), if".
7
16 At the end of section 139D
8
Add:
9
(3) If:
10
(a) this section applies; and
11
(b) the taxpayer acquired the share or right while the associate
12
was not an employee; and
13
(c) the associate subsequently became an employee while the
14
taxpayer was holding the share or right;
15
the amount is included in the associate's assessable income in the
16
year of income in which, after the acquisition, the associate first
17
becomes an employee in respect of employment or services that
18
affect the acquisition or holding of the share or right.
19
Note:
Subsection 139GA(2) limits the meaning of employee in this
20
subsection, so that engagement in foreign service is not of itself
21
sufficient.
22
17 At the end of Subdivision D of Division 13A of Part III
23
Add:
24
139DG Amendment of assessments to account for reductions of
25
amounts included in assessable income
26
(1) If:
27
(a) an amount has been included in a taxpayer's assessable
28
income of a particular year of income; and
29
(b) that amount is reduced or increased because of a change in
30
the extent (if any) of the application of section 23AF or
31
23AG or subsection 139B(1A) in relation to the amount
32
during a subsequent year of income;
33
Schedule 4 Cross border employee shares or rights
Part 1 Amendments
28 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
section 170 does not prevent the amendment of an assessment, for
1
the purpose of giving effect to the reduction or increase, at any
2
time during the period of 4 years starting immediately after the
3
income year during which the period of employment or service
4
relating to the acquisition of the share or right in question ends.
5
(2) In paragraph (1)(b):
6
(a) the reference to an amount being reduced includes a
7
reference to the amount being reduced to a nil amount; and
8
(b) the reference to an amount being increased includes a
9
reference to the amount being increased from a nil amount.
10
18 Subsection 139E(2)
11
Omit "The election", substitute "An election under subsection (1)".
12
19 At the end of section 139E
13
Add:
14
(3) If:
15
(a) a taxpayer becomes an employee during a year of income
16
(the employment year); and
17
(b) before the employment year, the taxpayer had acquired a
18
qualifying share or qualifying right, being an acquisition that
19
occurred:
20
(i) while the taxpayer was not an employee; and
21
(ii) after the year of income (if any) in which the taxpayer
22
last became an employee;
23
the taxpayer may make an election under this section that
24
subsection 139B(2A) applies for each of the years of income
25
before the employment year and after the year referred to in
26
paragraph (b). The election covers each qualifying share or
27
qualifying right acquired in any of those years by the taxpayer.
28
Note:
Subsection 139GA(2) limits the meaning of employee in this
29
subsection, so that engagement in foreign service is not of itself
30
sufficient.
31
(4) An election under subsection (3) must be in writing in a form
32
approved by the Commissioner and be made before the taxpayer
33
lodges his or her return of income for the employment year, or
34
within such further time as the Commissioner allows.
35
Cross border employee shares or rights Schedule 4
Amendments Part 1
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 29
20 Section 139GA
1
Repeal the section, substitute:
2
139GA Meaning of employee and employer
3
(1) The expression employee:
4
(a) has the same meaning as in section 221A; and
5
(b) includes a person who is engaged in foreign service.
6
(2) However:
7
(a) subsection (1) does not apply in relation to section 139GBA;
8
and
9
(b) paragraph (1)(b) does not apply in relation to subsection
10
139B(2A), section 139CDA or subsection 139D(3), 139E(3)
11
or 139GB(1).
12
(3) The expression employer:
13
(a) has the same meaning as in section 221A; and
14
(b) includes a person who engages another person in foreign
15
service.
16
21 After subsection 139GB(1)
17
Insert:
18
Note:
Subsection 139GA(2) limits the meaning of employee in this
19
subsection, so that engagement in foreign service is not of itself
20
sufficient.
21
22 After section 139GB
22
Insert:
23
139GBA Meaning of foreign service
24
Foreign service is service in a foreign country as the holder of an
25
office or in the capacity of an employee.
26
23 Section 139GH (after table item dealing with Financial
27
assistance)
28
Insert:
29
Foreign service
139GBA
Schedule 4 Cross border employee shares or rights
Part 1 Amendments
30 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
24 Subsection 160AEA(1) (at the end of the definition of
1
passive income)
2
Add:
3
; or (q) an amount included in the taxpayer's assessable income
4
under Division 13A.
5
25 Before subsection 530A(1)
6
Insert:
7
(1A) If:
8
(a) a taxpayer acquired a qualifying share or right under an
9
employee share scheme and has not made an election under
10
section 139E covering the share or right; and
11
(b) for the whole of a notional accounting period of a FIF the
12
following conditions are satisfied:
13
(i) the taxpayer holds the share or right;
14
(ii) the share or right is an interest in the FIF;
15
(iii) the cessation time for the share or right has not
16
occurred;
17
the foreign investment fund income of the taxpayer, to the extent
18
that it relates to the share or right, for the notional accounting
19
period is zero.
20
26 Paragraph 530A(1)(a)
21
Omit "for the year of income in which the share or right is acquired",
22
substitute "covering the share or right".
23
27 Paragraph 530A(1)(b)
24
Omit "the whole or".
25
Income Tax Assessment Act 1997
26
28 Subsection 104-160(5) (heading)
27
Repeal the heading, substitute:
28
Exceptions
29
29 At the end of section 104-160 (before note 1)
30
Add:
31
Cross border employee shares or rights Schedule 4
Amendments Part 1
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 31
(6) A
*
capital gain or
*
capital loss you make is disregarded if:
1
(a) the asset is a
*
qualifying share or
*
qualifying right; and
2
(b) the asset is not covered by an election under section 139E of
3
the Income Tax Assessment Act 1936; and
4
(c) the
*
cessation time for the share or right has not occurred.
5
30 At the end of section 130-80 (after the note)
6
Add:
7
(4) This section does not apply to a
*
share or right if:
8
(a) you become an Australian resident; and
9
(b) you owned, or held a beneficial interest in, the share or right
10
just before you became an Australian resident; and
11
(c) the share or right does not have the
*
necessary connection
12
with Australia; and
13
(d) either:
14
(i) the share or right is not a
*
qualifying share or a
15
*
qualifying right; or
16
(ii) you have made an election under section 139E of the
17
Income Tax Assessment Act 1936 covering the share or
18
right.
19
Note:
Section 136-40 deals with shares or rights that do not have the
20
necessary connection with Australia.
21
31 Paragraph 130-83(1)(b)
22
Omit "to include an amount in your assessable income for the income
23
year in which you
*
acquired the share or right", substitute "covering the
24
share or right".
25
32 Subsection 130-83(2)
26
Omit "or E5", substitute ", E5 or I1".
27
33 At the end of section 130-83
28
Add:
29
(4) Subsection (3) does not apply to a
*
share or right if:
30
(a) you become an Australian resident; and
31
(b) you owned, or held a beneficial interest in, the share or right
32
just before you became an Australian resident; and
33
Schedule 4 Cross border employee shares or rights
Part 1 Amendments
32 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
(c) the share or right does not have the
*
necessary connection
1
with Australia; and
2
(d) the cessation time for the share or right had occurred before
3
you became an Australian resident.
4
Note:
Section 136-40 deals with shares or rights that do not have the
5
necessary connection with Australia.
6
34 At the end of section 130-85 (after the note)
7
Add:
8
(4) This section does not apply to a
*
share or right if:
9
(a) you become an Australian resident; and
10
(b) you owned, or held a beneficial interest in, the share or right
11
just before you became an Australian resident; and
12
(c) the share or right does not have the
*
necessary connection
13
with Australia.
14
Note:
Section 136-40 deals with shares or rights that do not have the
15
necessary connection with Australia.
16
35 At the end of subsection 130-90(1A)
17
Add:
18
; or (c) an individual who is engaged in foreign service (within the
19
meaning of section 139GBA of the Income Tax Assessment
20
Act 1936), or an
*
associate or affiliate company of such an
21
individual.
22
36 At the end of section 136-40
23
Add:
24
(4) This section does not apply to a
*
share or right if:
25
(a) it is a
*
qualifying share or a
*
qualifying right; and
26
(b) you have not made an election under section 139E of the
27
Income Tax Assessment Act 1936 covering the share or right;
28
and
29
(c) the
*
cessation time for the share or right has not occurred.
30
Cross border employee shares or rights Schedule 4
Application provisions Part 2
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 33
1
Part 2--Application provisions
2
37 Application--amendment of the Fringe Benefits Tax
3
Assessment Act 1986
4
The amendment made by item 1 of this Schedule applies in respect of
5
the FBT year in which this Act receives the Royal Assent and in respect
6
of all later FBT years.
7
38 Application--amendments of the Income Tax Assessment
8
Act 1936
9
(1)
The amendments made by items 2 to 24 of this Schedule apply in
10
relation to shares or rights that a person acquires, or has acquired, under
11
an employee share scheme only in accordance with subitem (2) or (3).
12
(2)
The amendments apply, on and from the time of the acquisition, if the
13
person acquired the shares or rights on or after the day on which this
14
Act received the Royal Assent.
15
(3)
If:
16
(a) immediately before that day, the person was not an employee
17
in respect of employment that affects the acquisition or
18
holding of the share or right; and
19
(b) the person becomes an employee in respect of that
20
employment on or after that day; and
21
(c) at the time of becoming an employee in respect of that
22
employment, the person holds shares or rights that the person
23
acquired under an employee share scheme; and
24
(d) this subitem has not previously applied in relation to the
25
person;
26
the amendments apply, on and from the time when the person becomes
27
an employee in respect of that employment, to any shares or rights the
28
person holds that the person acquired under an employee share scheme
29
(whether or not the shares or rights were acquired before, on or after
30
that day).
31
(4)
Subitem (3) does not limit the operation of subitem (2).
32
(5)
Expressions used in this item have the same meaning as they have for
33
the purposes of Division 13A of Part III of the Income Tax Assessment
34
Schedule 4 Cross border employee shares or rights
Part 2 Application provisions
34 New International Tax Arrangements (Foreign-owned Branches and Other Measures)
Bill 2005 No. , 2005
Act 1936. However, paragraph 139GA(1)(b) of that Act does not apply
1
in relation to subitem (3).
2
39 Application--amendments of section 530A of the Income
3
Tax Assessment Act 1936
4
The amendments made by items 25 to 27 of this Schedule apply to
5
assessments for the first year of income ending on or after the day on
6
which this Act receives the Royal Assent and later years of income.
7
40 Application--amendments of the Income Tax Assessment
8
Act 1997
9
The amendments made by items 28 to 34 and item 36 of this Schedule
10
apply in relation to CGT events happening on or after the day on which
11
this Act receives the Royal Assent.
12
41 Application--amendment of section 130-90 of the Income
13
Tax Assessment Act 1997
14
The amendment made by item 35 of this Schedule applies in relation to
15
shares or rights to which a beneficiary becomes absolutely entitled on or
16
after the day on which this Act receives the Royal Assent.
17
Technical correction Schedule 5
New International Tax Arrangements (Foreign-owned Branches and Other Measures) Bill 2005
No. , 2005 35
1
Schedule 5--Technical correction
2
3
New International Tax Arrangements (Participation
4
Exemption and Other Measures) Act 2004
5
1 Subitem 140(2) of Schedule 2
6
Repeal the subitem, substitute:
7
(2)
Subject to subitem (2A), the amendments made by Parts 2 and 3 of this
8
Schedule apply to things happening after 30 June 2004.
9
(2A)
The amendments made by items 7, 58 and 59 of this Schedule apply to
10
statutory accounting periods starting on or after 1 July 2004.
11