• Definitions


    For commercial law purposes, an agent is a person with expressed or implied authority to act for a principal to create or affect legal relations between the principal and third parties. Factors that indicate an agency relationship include:

    • any description of you as an agent having and exercising authority to act for another party in an agreement between you and the other party
    • whether you bear any significant commercial risk
    • whether you act in your own name
    • whether you are paid a commission for your services
    • whether you decide the price of things that you might supply to third parties.

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    GSTR 2000/37External Link Goods and Services Tax: agency relationships and the application of the law

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    Commissioner's instalment rate (CIR)

    The CIR is the rate you use to calculate your PAYG instalments. We will notify you of your rate. For the purpose of voluntary agreements, you use either your CIR or a flat rate of 20% as the rate of withholding.

    Deferred GST scheme

    See Taxable import.


    An entity means an individual, a body corporate, a corporation sole, a body politic, a partnership, an unincorporated association or body of persons, a trust or a superannuation fund. An entity does not include a non-entity joint venture.

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    MT 2006/1External Link The New Tax System: the meaning of entity carrying on an enterprise for the purposes of entitlement to an Australian Business Number (ABN)

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    A hobbyist is one who pursues a spare-time activity or pastime for pleasure or recreation.

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    TR 97/11External Link Income tax: am I carrying on a business of primary production?

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    Indicators of a partnership

    Whether a partnership exists for tax purposes depends on the facts of each case. The following factors assist in deciding whether persons are carrying on business as partners:

    • intention – the mutual assent and intention of the parties
    • conduct
    • joint ownership of business assets
    • registration of business name
    • extent to which parties are involved in the conduct of the business
    • extent of capital contributions
    • entitlements to a share of net profits
    • business records
    • trading in joint names and public recognition of the partnership.

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    A partnership for income tax purposes is an association of persons carrying on business as partners or in receipt of ordinary or statutory income jointly, but does not include a company.

    See Indicators of a partnership.

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    Reasonable expectation of profit or gain

    A reasonable expectation of profit or gain must be more than a possibility, risk or chance.

    Statement by supplier

    A statement by supplier is an ATO form you may use that provides the reason for not quoting an Australian business number (ABN) to an enterprise.

    Taxable import

    GST is payable on goods imported into Australia unless the goods are duty-free under certain customs duty concessions or would have been GST-free or input taxed if they had been supplies. GST is payable on taxable imports regardless of whether you are registered or required to be registered for GST.

    Voluntary agreement

    A voluntary agreement enables businesses to withhold amounts from payments they make to contract workers to help the workers’ pay their income tax. The rate of withholding is either the Commissioner's instalment rate or a flat rate of 20% (see Commissioner's instalment rate).

    To enter into a voluntary agreement, you must be an individual who must have an ABN and the payments must not be subject to any other PAYG withholding. A voluntary agreement excludes these payments from the GST system.

    Withholding payments

    Withholding payments are those contained in any of the following provisions in Schedule 1 to the Taxation Administration Act 1953:

    • payment to an employee
    • payment to a company director
    • payment to an office holder (such as a member of Parliament, the Defence Force or police forces), and
    • payment under a labour hire arrangement, or specified by regulations.

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      Last modified: 24 May 2014QC 18093