Tax Laws Amendment (Repeal of Inoperative Provisions) Act 2006 (101 of 2006)

Schedule 2   Consequential amendments relating to Schedule 1 repeals etc.

Part 1   Amendments: general

Income Tax Assessment Act 1936

345   After section 128NB

Insert:

128NBA Credits in respect of amounts assessed under Division 16E of Part III

When section applies

(1) This section applies if:

(a) the amount of any withholding tax that has become payable by a taxpayer on a payment of interest under, or in relation to the transfer of, a qualifying security has been paid; and

(b) there is a net Division 16E amount (see subsection (5)) in relation to the taxpayer in relation to:

(i) if the payment of interest is a payment in relation to the transfer of the qualifying security - the security; or

(ii) if the payment of interest is such a payment by virtue of the application of section 128AC in relation to an attributable agreement payment within the meaning of that section - the attributable agreement payment; or

(iii) in any other case - the payment of interest; and

(c) the amount of the withholding tax payable on the interest exceeds the amount that would have been payable on the interest if the interest were reduced by the net Division 16E amount.

Entitlement to apply for credit

(2) The taxpayer may apply to the Commissioner for a credit of an amount equal to the excess.

Requirements for application

(3) The application must be in the approved form.

Entitlement to credit

(4) If the Commissioner is satisfied as to the matters mentioned in paragraphs (1)(a), (b) and (c), the applicant is entitled to a credit of an amount equal to the excess.

Net Division 16E amount

(5) For the purposes of this section, if:

(a) the sum of all amounts (if any) included in the assessable income of the taxpayer of any years of income in relation to the qualifying security, attributable agreement payment or payment of interest under section 159GQ;

exceeds:

(b) the sum of all amounts (if any) allowable as deductions from the assessable income of the taxpayer of any years of income in relation to the security or the payment, as the case may be, under that section;

there is a net Division 16E amount equal to the excess.