Taxation Administration Act 1953
Note: See section 3AA .Chapter 2 - Collection, recovery and administration of income tax
Note: A Commissioner ' s Remedial Power modification is relevant to this part of the tax law.
Taxation Administration (Remedial Power - Seasonal Labour Mobility Program) Determination 2020 (F2020L01474) modifies the operation of s 840-905(b)(ii) of the Income Tax Assessment Act 1997 (ITAA 1997) and s 12-319A(b)(ii) of Sch 1 to the Taxation Administration Act 1953 (TAA 1953) to include foreign resident employees of Approved Employers under the Seasonal Labour Mobility Program ( " employees under the Program " ) who previously held a Temporary Work (International Relations) Visa (subclass 403) and have extended their stay in Australia using a different temporary visa (including a bridging visa) granted under the Migration Act 1958 .
The operation of the relevant provisions is modified as follows:
The modification applies to salary, wages, commissions, bonuses or allowances paid on and after 24 March 2020. The modification ensures that employees under the Program continue to be taxed by application of a final withholding tax rate of 15%. It also ensures that this income is otherwise treated as non-assessable non-exempt income. As is currently the case for those holding a Temporary Work (International Relations) Visa (subclass 403), these employees under the Program will not have to lodge an income tax return unless they earn other Australian sourced income.
An entity must treat a modification as not applying to it or any other entity if the modification would produce a less favourable result for it. The Commissioner is empowered by s 370-5 of Sch 1 to TAA 1953 to make modifications, by legislative instrument, to ensure the law is administered to achieve its intended purpose or object.
An entity that *carries on an *enterprise must withhold an amount from a payment that it makes to an individual in the course or furtherance of the enterprise if:
(a) the enterprise is a *business of arranging for persons to perform work or services directly for clients of the entity, or the enterprise includes a business of that kind that is not merely incidental to the main activities of the enterprise; and
(b) the payment is made under an *arrangement the performance of which, in whole or in part, involves the performance of work or services by the individual directly for a client of the entity, or directly for a client of another entity.
For exceptions, see section 12-1 .EXAMPLES
Staffprovider Ltd keeps a database of skilled persons who are willing for their services to be provided to third parties. Staffprovider arranges with Corporate Pty Ltd to provide to it the services of a computer programmer in return for payment. Staffprovider arranges with Jane for her to do computer programming for Corporate. Staffprovider must withhold amounts under this section from payments it makes to Jane under the arrangement with her.
Ian is a solicitor who regularly briefs barristers to represent his clients. Briefing barristers is merely incidental to Ian ' s main activities as a solicitor, so he does not have to withhold amounts under this section from payments he makes to barristers.
An entity that carries on an *enterprise must withhold an amount from a payment that it makes to an individual in the course or furtherance of the enterprise if the payment is, in whole or in part, for work or services and is of a kind prescribed by the regulations.
For exceptions, see section 12-1 .