Foreign income

22 Attributed foreign income

For information on calculating the amounts shown at M, U and X, see the Foreign income return form guide 2013–14.

Where the trust is a member of a consolidated group or MEC group for the whole income year and derived foreign income, the responsibility for preparing the schedule will rest on the head company of the group.

Where a return is required because the trust had a period in the income year when it was not a member of a consolidated group or MEC group (a non-membership period) the trust should complete an International dealings schedule 2014 where it has derived foreign income attributable to the non-membership period.

For information about reporting multiple non-membership periods during the year, see the Consolidation reference manual, sheet C9-5-110.

Did you have overseas branch operations or a direct or indirect interest in a foreign trust, foreign company, controlled foreign entity or transferor trust?

With the repeal of the foreign investment fund rules, foreign trust in this context refers to a controlled foreign trust.

Direct or indirect interests in a controlled foreign company or a controlled foreign trust are taken to have the same meaning as set out in Division 3 of Part X of the ITAA 1936. For the purposes of the controlled foreign company rules, do not trace interests through another Australian entity. For example, if your trust has an interest in an Australian trust, which owns a controlled foreign company, your trust is not regarded as having a direct or indirect interest in the controlled foreign company although your trust must still include any attributable income to which it was presently entitled at item 22 Attributable foreign income.

A trust has an interest in a transferor trust if the trust has ever made, or caused to be made, a transfer of property or services to a non-resident trust. Transfer of property and services is defined in section of 102AAB the ITAA 1936.

Sections 102AAJ and 102AAK of the ITAA 1936 provide guidance on whether there was a transfer, or a deemed transfer, of property or services to a non-resident trust.

If the answer to this question is yes, print X in the Yes box at S and complete and attach an International dealings schedule 2014.

Attach the completed International dealings schedule 2014 to the tax return. Print X in the Yes box at Have you attached any 'other attachment'? at the top of page 1 of the tax return.

If the answer to this question is no, print X in the No box at S.

Listed country

Show at M the amount of gross attributed foreign income from controlled foreign entities and transferor trusts of listed countries. Listed countries are set out in Part 1 of Schedule 10 to the ITR 1936.

Attributed foreign income is the income attributed to the taxpayer from controlled foreign entities, calculated in accordance with Division 7 of Part X of the ITAA 1936, and includes an amount grossed-up under section 392 of the ITAA 1936, as appropriate, to the extent of any foreign taxes paid.

Show at M the amount of income attributed from a transferor trust that is a listed country trust estate, calculated in accordance with Subdivision D of Division 6AAA of the ITAA 1936.

A listed country trust estate is defined in section 102AAE of the ITAA 1936.

Section 404 country

Show at U the amount of attributed foreign income from controlled foreign entities in section 404 countries. Section 404 countries are listed in Part 2 of Schedule 10 to the ITR 1936.

Also show at U the amount of income attributed from a transferor trust if the entire income and profits of the trust are subject to tax in a section 404 country. Do not include the amount if it is shown at M.

Unlisted country

Show at X the amount of attributed foreign income from controlled foreign entities in unlisted countries. Unlisted countries are countries that are not listed in Schedule 10 to the ITR 1936.

Show at X the amount of income attributed from a transferor trust if the amount has not been shown at M or U.