TAXATION ADMINISTRATION ACT 1953

SCHEDULE 1 - COLLECTION AND RECOVERY OF INCOME TAX AND OTHER LIABILITIES  

Note: See section 3AA .

Chapter 2 - Collection, recovery and administration of income tax  

PART 2-5 - PAY AS YOU GO (PAYG) WITHHOLDING  

Division 14 - Benefits, gains and taxable supplies for which amounts must be paid to the Commissioner  

Subdivision 14-A - Non-cash benefits  

SECTION 14-5   PROVIDER OF NON-CASH BENEFIT MUST PAY AMOUNT TO THE COMMISSIONER IF PAYMENT WOULD BE SUBJECT TO WITHHOLDING  

14-5(1)  
An entity (the payer ) must pay an amount to the Commissioner before providing a *non-cash benefit to another entity (the recipient ) if Division 12 would require the payer to withhold an amount (the notionally withheld amount ) if, instead of providing the benefit to the recipient, the payer made a payment to the recipient in money equal to the *market value of the benefit when the benefit is provided.

14-5(2)  
The amount to be paid to the Commissioner is equal to the notionally withheld amount.

Example:

Nick is a building contractor who has entered into a voluntary agreement with Mike for the purposes of section 12-55 . Nick proposes to give Mike his old utility van (whose market value is $1,000) as payment for work Mike has done for him over a fortnight.

If Nick were instead to pay Mike $1,000, Nick would have had to withhold $203 under Division 12 (in accordance with withholding rates current at the time).

This section requires Nick to pay $203 to the Commissioner before giving the van to Mike.

14-5(3)  


This section does not apply to providing:


(a) a *fringe benefit; or


(b) a benefit that is an exempt benefit under the Fringe Benefits Tax Assessment Act 1986 ; or


(c) a benefit that would be an exempt benefit under that Act if paragraphs (d) and (e) of the definition of employer in subsection 136(1) of that Act were omitted; or


(d) a benefit constituted by the acquisition of an *ESS interest *under an employee share scheme to which Subdivision 83A-B or 83A-C of the Income Tax Assessment Act 1997 applies.


(e) (Repealed by No 133 of 2009)




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