Exemptions under other Australian legislation do not affect tax requirements.
Visiting ships may be subject to, or specifically exempt from, the requirements of a range of Australian legislation.
However, an exemption granted under a particular body of Australian legislation only applies to that body of legislation, not to Australian tax legislation.
Example: Non-tax exemptions
'Alacarte Ltd', a company based in the United Kingdom, owns and operates an ocean cruise liner, the 'Savoy at Sea'.
A current tax treaty exists between Australia and the UK.
Under this tax treaty, Alacarte Ltd is exempt from paying Australian tax on fares received for the carriage of passengers who embark in Australia and disembark in another country.
The ‘Savoy at Sea’ visits Australia frequently, during cruises to the Asia-Pacific region, with fare-paying Australian passengers embarking in Melbourne and Sydney.
However, some passengers embark in Melbourne and disembark in Sydney without travelling overseas.
Under the same tax treaty, Alacarte Ltd is still subject to Australian tax for any fares received for the carriage of passengers who embark in Melbourne and then disembark in Sydney without travelling overseas.
The voyage between Melbourne and Sydney is coastal trade and any payment received is deemed to be assessable. As a result, 5% of this amount must be returned as taxable income.
As a cruise liner, operating between Melbourne and Sydney, the ship is exempt from the coastal trade requirements of the Navigation Act 1912. This means that the ‘Savoy at Sea’ does not need a permit to trade between these Australian ports.
However, this coastal trade exemption, under the Navigation Act 1912, applies only to the need to obtain a permit. It does not provide Alacarte Ltd with an exemption from the provisions of section 129 of the Income Tax Assessment Act 1936 and it must therefore lodge an Overseas ships – voyage return form.End of example