• Exemptions from the FIF measures

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

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    If you have an interest in a FIF or a FLP which is wholly or partly exempt from FIF taxation for a notional accounting period ending in your income year, you must keep records showing why the exemption applied. These records should include details of any acts, transactions, calculations and other circumstances relevant to the application of the exemption. [section 620]

    You must keep records for each interest in a FIF or a FLP for which you are claiming an exemption.

    See Chapter 3: Exemptions for the conditions that relate to particular exemptions.

    Additional records that you must keep for some of the exemptions are listed below.

    Active business exemption

    Stock exchange listing method

    If you are claiming an exemption from the FIF measures under the active business exemption using the stock exchange listing method, keep records relating to:

    • the name of the approved stock exchange in which the class of interests to which your FIF interest belongs was listed
    • the class of the company designated by
      • the approved stock exchange, or
      • the approved international sectoral classification system
       
    • the activities that the company is engaged in.

    Balance sheet method

    If you are claiming an active business exemption from the FIF measures using the balance sheet method, keep records of the gross value of all of the company's assets shown in the balance sheet and to what extent the assets are held at the balance date for use in eligible activities.

    Where the foreign holding company is the direct or indirect owner of 50% or more of the paid-up share capital of another company - subsidiary - the holding company may use the gross value of the subsidiary's assets for the balance sheet method. Keep records of the subsidiary's assets as shown in its balance sheet and of the extent to which the assets are held at the balance date for use in eligible activities. For more information, read Appendix 2: Business activities that are not eligible activities.

    Employer-sponsored foreign superannuation fund exemption

    If you are claiming an employer-sponsored foreign superannuation fund exemption, keep details such as the name and location of the foreign superannuation fund and whether you are an employee or past employee, a director or an associate.

    Exclusion of a FIF that is a CFC, CFT or a transferor trust

    If you have an interest in a FIF, which is also a CFC or CFT to which Part X of the ITAA 1936 applies, Part X requires you to keep records for the CFC measures.

    Other specific exemptions

    Although some industries such as banking, insurance and real estate are listed as ineligible activities for the purposes of the active business exemption, there are specific exemptions for certain publicly listed and widely held investments in these industries. [Divisions 4 to 7] There is also an exemption for complying superannuation entities, certain assets of life insurance companies and certain fixed trusts. [Division 11A]

    There are also specific exemptions for interests in FIFs that are trading stock and interests in FIFs that are multi-industry foreign companies, Lloyd's, or resident in the United States. Another exemption may apply to your interests in FIFs, which would otherwise be caught and taxed under the measures, where the total value of your interest in those FIFs is 10% or less of the total value of all your FIF interests. [Divisions 8, 12 to 15]

    If you are claiming an exemption under one or more of these provisions, keep records showing how the FIF interest satisfied the conditions of the particular exemption. Read Chapter 3: Exemptions for the conditions that relate to the particular exemption.

    Small investor exemption

    Direct interests in FIFs and FLPs

    For the small investor exemption, keep a record of how you worked out your aggregate interests and those of your associates in foreign companies, foreign trusts and foreign life policies. The aggregate must show that the amount of those interests is A$50,000 or less at the end of the notional accounting period.

    Direct interests in resident public unit trusts

    Keep a record of how you and your associates worked out your aggregate interests in any FIFs, FLPs and resident public unit trusts. The aggregate must show that the amount of those interests is A$50,000 or less at the end of the notional accounting period.

    Exemption for temporary residents

    If you qualify as a temporary resident and get an exemption from the FIF measures, you must keep passport visa information and details of your date of arrival in Australia.

    Last modified: 04 Feb 2010QC 21777