Explanatory Memorandum
(Circulated by authority of the Minister for Industry, the Honourable Ian MacFarlane MP)Schedule 1 - Amendments
Bankruptcy Act 1966
Item 1 amends subsection 82(3AB) to ensure that a TSL debt or accumulated TSL debt is not provable in bankruptcy. This amendment ensures that the treatment of a TSL debt or accumulated TSL debt under bankruptcy proceedings is consistent with HELP debts incurred under the Higher Education Support Act 2003.
Income Tax Assessment Act 1936
Item 2 amends subsection 82A(2) to ensure that a payment made in respect of, or in the reduction or discharge of any indebtedness to the Commonwealth under the Trade Support Loans Act 2014 is not included within the definition of expenses of self-education.
Item 3 amends section 202, which outlines the objects for the establishment of the Tax File Number system, to allow for the administration of the Trade Support Loans Act 2014 with regard to the provision of trade support loans and the recovery of these debts by inserting to facilitate the administration of the Trade Support Loans Act 2014.
Item 4 amends subsection 202F(1) to provide that a decision of the Commissioner to give a notice under subsections 68(1) and 70(1) of the Trade Support Loans Act 2014 may be reviewed by the Administrative Appeals Tribunal.
Income Tax Assessment Act 1997
Item 5 amends section 12-5 to include trade support loans in the list of provisions about specific types of deductions.
Item 6 amends section 26-20 to ensure that a payment made in the reduction of a debt to the Commonwealth under Chapter 3 of the Trade Support Loans Act is not a payment that can be deducted under the Income Tax Assessment Act 1997. This amendment will ensure that there is a consistent treatment between HELP debts and the trade support loan.
Items 7 inserts a definition for accumulated TSL debt into the Income Tax Assessment Act 1997.
Taxation Administration Act 1953
Item 8 inserts a new definition for compulsory TSL repayment amount into the Taxation Administration Act 1953.
Item 9 makes a technical amendment to the heading of section 8AAZLD to allow for new paragraph 8AAZLD(b).
Item 10 inserts new paragraph 8AAZLD(ad). Section 8AAZLD sets the priority order in which credits arising under the PAYG provisions (Schedule 1 to the Taxation Administration Act 1953) must be applied to certain debts and compulsory repayment amounts. In regards to the priority order under section 8AAZLD, new paragraph 8AAZLD(b) provides that any such credit is to be applied to a compulsory TSL repayment amount after it has first been applied against any compulsory repayment amount of the entity, but before it is applied against any FS assessment debt of the entity.
Item 11 makes a technical amendment to include a paragraph 202(hac) of the Income Tax Assessment Act 1936 in paragraph 8WA(1AA)(b).
Item 12 makes a technical amendment to include a paragraph 202(hac) of the Income Tax Assessment Act 1936 in paragraph 8WB(1A)(a) and 8WB(1A)(b).
Item 13 inserts a reference to trade support loan into the outline of Parts 2-5 and 2-10 in section 6-1 in Schedule 1.
Item 14 inserts new paragraph 11-1(cd) in Schedule 1 to insert a reference to trade support loan as a new matter to be considered by the Commissioner when making withholding schedules for any financial year commencing on or after 1 July 2014.
Item 15 makes a technical amendment to subsection15-25(1) to allow for new paragraph 11-1(cd) in Schedule 1.
Item 16 inserts new paragraph 15-30(cd) to insert a reference to trade support loan as a new matter to be considered by the Commissioner when making withholding schedules for any financial year commencing on or after 1 July 2014.
Item 17 amends paragraph 15-50(1)b) to insert a reference to paragraph 11-1(cd) for the purposes of making a declaration about prescribed matters under section 15-50.
Item 18 inserts a reference to liabilities to the Commonwealth in relation to trade support loan (under Chapter 3 of the Trade Support Loans Act 2014) as a new object (of Part 2-10) into section 45-5 of Schedule 1 to the Taxation Administration Act 1953.
Item 19 inserts a new step 3AC in respect of an accumulated TSL debt into the method statement in section 45-340 to be included in calculating adjusted tax on adjusted taxable income or on adjusted withholding income.
Items 20 and 22 make technical amendments to step 4 of the method statements in sections 45-340 and 45-375 to allow for new step 3AC.
Item 21 inserts a new step in respect of an accumulated TSL debt into the method statement in section 45-375 to be included in calculating adjusted assessed tax on your adjusted assessed taxable income.
Item 23 inserts new item 36D into the table in subsection 250-10(2) in Schedule 1 to include compulsory TSL repayments amount under the Trade Support Loans Act 2014 in the index of tax-related liability under other tax related Acts.
Item 24 inserts a new table item 5AA in subsection 355-65(2) where the record is made for or the disclosure is to the Industry Secretary, and the record or disclosure is for the purpose of administering the Trade Support Loans Act 2014.
Taxation (Interest on Overpayments and Early Payments) Act 1983
Item 25 inserts a new definition for compulsory TSL repayment amount into subsection 3(1) of the Taxation (Interest on Overpayments and Early Payments) Act 1983.
Items 26 and 27 insert a reference to trade support loans into the meaning of relevant tax under subsection 3C(1) and section 3C respectively.
Item 28 and 29 amend subsections 8A(1) and 8A(2) to ensure compulsory TSL repayment amounts are payments for which interest is payable by the Commissioner to the person on the payment, calculated in respect of the period applicable under section 8B at the rate specified in section 8C.
Items 30 and 31 amend paragraphs 8E(1)(d) and 8E(2)(d) to ensure that interest can be paid when crediting amounts in excess of any compulsory TSL repayment amounts.
Item 32 makes technical amendments to subparagraph 12A(1)(a)(iv) to allow for new subsection 12A(1A).
Item 33 inserts new subsection 12A(1A) to include compulsory TSL repayment amount for the purposes of interest payable by the Commissioner under section 12A.
Item 34 repeals and substitutes subsection 12A(2). Section 12A relates to interest payable by the Commissioner in relation to amounts that have been paid to the Commissioner.
Item 35 - Transitional provision - claims for trade support loan made within 1 month of commencement
Item 35 is a transitional provision. This provision applies to a person making a claim for trade support loan during the month prior to the commencement of the Act. In determining whether the person has been undertaking a qualifying apprenticeship for the whole of a TSL instalment period, regard may be had to the month prior to commencement of the Act to determine if the person was undertaking a qualifying apprenticeship.