• Appendix 2: Royalties

    Attention

    Warning:

    This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

    End of attention

    Royalties include consideration of any kind paid or credited for:

    1. the use of, or right to use

    2. the supply of scientific, technical, industrial or commercial knowledge or information

    3. the supply of any assistance that is ancillary and subsidiary to, and is furnished as a means of enabling the application or enjoyment of any property, right, equipment, knowledge or information mentioned in 1a, 1b or 2

    4. the reception of, or the right to receive, visual images or sounds transmitted to the public by satellite, cable, optic fibre or similar technology

    5. the total or partial forbearance in respect of the previously listed activities.

    Show royalties derived by an Australian resident as income in the normal manner.

    Royalties paid by a resident to a non-resident may be subject to withholding tax. The rate for royalties is 30%; however if there is a double tax agreement, the rate may be reduced.

    For more information on the definition of royalty, see Taxation Ruling IT 2660External Link Income tax: definition of royalties.

    Record keeping

    If the trust claims a deduction for royalties paid or credited, keep a record of the name and address and the amounts paid or due to each person. If payment was made to a non-resident, keep details on whether or not tax has been paid or an amount withheld to provide for tax payable by the non-resident.

    Last modified: 30 Oct 2014QC 40282