In some circumstances an investor is not required to quote, or may choose not to quote, a tax file number (TFN) or Australian business number (ABN).
Details of investors who have claimed an exemption from quotation of a TFN in respect of an investment must be included in the Annual investment income report (AIIR), together with relevant income information.
Investment bodies are not required to withhold amounts for the non-quotation of a TFN/ABN from investments (other than shares in a public company) held by children under 16 years of age, provided that:
- the investment body has records indicating that the investor was under 16 years old on 1 January before the date on which the payment was made, and
- the payment is less than $420 for the financial year (if the payment is not in respect of the whole financial year, the $420 threshold is pro-rated).
Investment bodies are not required to withhold amounts for the non-quotation of a TFN/ABN from interest bearing deposits and accounts with a financial institution provided that the payment is less than $120 for the financial year (if the payment is not in respect of the whole financial year, the $120 threshold is pro-rated).
An entity that is not required to lodge an income tax return and does not have a tax file number (TFN) will be taken to have quoted a TFN in relation to an investment, which is reportable in an AIIR, to the investment body.
To be eligible for the exemption from quoting a TFN, an eligible representative of the entity must supply the investment body with the name and address of the entity and the reason why the entity does not have to lodge an income tax return.
An entity is a body corporate or unincorporated association and includes charitable, social and other non-profit organisations as well as non-profit companies earning small amounts of income.
Non-resident investors who are liable to pay non-resident withholding tax in respect of investment income are taken to have quoted a tax file number in respect of the investment.
Non-residents who become residents of Australia must advise the investment body within a month of becoming a resident. The non-resident exemption ceases to apply from the time the investment body is advised.
Investment bodies are not required to withhold amounts for the non-quotation of a TFN/ABN from investments held by a recipient of certain payments provided the applicable exemption code is quoted. These payments are:
- age pension
- disability support pension
- wife pension
- carer payment
- widow B pension
- parenting payment single
- special benefit
- special needs pension
- age, invalidity or partner service pension from Veterans' Affairs
- Defence Force income support allowance from Veterans' Affairs.
Note. If an investor receives a superannuation pension, they are not exempt unless they also receive one of the above payments.
One of the following codes must be used in place of the TFN:
Code
|
Type
|
Explanation
|
333333333
|
investor under sixteen
|
Where the investor is a child under the age of sixteen and does not quote a TFN the code 333333333 must be used. The date of birth must be supplied.
|
444444441
|
investor is a pensioner
|
Where the investor is a recipient of a Centrelink (age or disability support) or Service (veteran's) pension an exemption from quoting a TFN may be claimed. In this case the code 444444441 must be used.
|
444444442
|
investor is a recipient of other eligible Centrelink pension or benefit
|
(For example, parenting payment and widow allowance). In these cases the code 444444442 must be used. New start allowance and sickness allowance are not eligible benefits for exemption purposes.
|
555555555
|
entity not required to lodge an income tax return
|
The investor entity is exempted from lodging income tax returns - for example, a 'not for profit' organisation.
|
666666666
|
investors in the business of providing consumer or business finance
|
|
777777777
|
Norfolk Island residents
|
|
888888888
|
non-residents
|
Persons who are not residents of Australia.
|
987654321
|
alphabetic characters in quoted TFN
|
Where an investor has quoted a TFN with alpha characters, the code 987654321 must be used in place of the quoted TFN. This code must also be used where the TFN quoted cannot be contained in the TFN field (because it is 10 or more characters in length) and is not an ABN.
|
The Australian Taxation Office (ATO) has cooperative links with other Commonwealth agencies. The incorrect use of TFNs, ABNs and exemption codes is under constant investigation.
Find out about:
If you would like to ask a question about reporting exemption codes in the AIIR, phone us on 1800 072 681 or send an email enquiry to the ATO.
Last Modified: Thursday, 6 December 2012