INCOME TAX RATES ACT 1986

PART II - RATES OF INCOME TAX PAYABLE UPON INCOMES OTHER THAN INCOMES OF COMPANIES, PRESCRIBED UNIT TRUSTS, SUPERANNUATION FUNDS AND CERTAIN OTHER TRUSTS  

Division 3 - Rates of tax  

Subdivision D - Non-resident taxpayers, non-resident beneficiaries and non-resident trust estates  

SECTION 15   RATES OF TAX WHERE DIVISION 6AA OF PART III OF THE ASSESSMENT ACT APPLIES  

15(1)   [Eligible taxable income of non-resident]  

The rates of tax in respect of the taxable income of a non-resident taxpayer:


(a) who is a prescribed person in relation to the year of income for the purposes of Division 6AA of Part III of the Assessment Act; and


(b) who has, for the purposes of that Division, an eligible taxable income;

are as set out in Part II of Schedule 11 .

15(2)   [Shading in]  

Where the eligible taxable income of a non-resident taxpayer for the purposes of Division 6AA of Part III of the Assessment Act:


(a) does not exceed $416 - the amount of tax payable under subsection (1) in respect of that eligible taxable income shall not exceed:


(i) the amount ascertained by applying the second resident personal tax rate to that eligible taxable income; or

(ii) the amount ascertained by deducting from the amount of tax that would be payable by the taxpayer if the rates set out in Part II of Schedule 7 were applied to the taxable income of the taxpayer the amount of tax that would be payable by the taxpayer if those rates were applied to the taxable income of the taxpayer reduced by the amount of that eligible taxable income;
whichever is the greater; or


(b) exceeds $416 but does not exceed the non-resident phase-out limit - the amount of tax payable under subsection (1) in respect of that eligible taxable income shall not exceed:


(i) the amount ascertained by applying the second resident personal tax rate to $416, and then adding 66% of the amount by which that eligible taxable income exceeds $416; or

(ii) the amount ascertained by deducting from the amount of tax that would be payable by the taxpayer if the rates set out in Part II of Schedule 7 were applied to the taxable income of the taxpayer the amount of tax that would be payable by the taxpayer if those rates were applied to the taxable income of the taxpayer reduced by the amount of that eligible taxable income;
whichever is the greater.

15(3)   [Div 6AA income from single trust]  

Where:


(a) a trustee of a trust estate is liable to be assessed and to pay tax under section 98 of the Assessment Act in respect of the share of a non-resident beneficiary of the net income of the trust estate; and


(b) Division 6AA of Part III of the Assessment Act applies to a part of that share;

the rates of tax payable by the trustee in respect of that share of the net income of the trust estate are as set out in Part II of Schedule 12 .

15(4)   [Shading in: subsec (3)]  

Subject to subsection (5), where:


(a) the trustee of a trust estate is liable to be assessed and to pay tax under section 98 of the Assessment Act in respect of the share of a non-resident beneficiary of the net income of the trust estate; and


(b) Division 6AA of Part III of the Assessment Act applies to a part (in this subsection referred to as the eligible part ) of that share;

the amount of tax payable under subsection (3) in respect of the eligible part of that share shall not exceed:


(c) where the eligible part of that share does not exceed $416:


(i) the amount ascertained by applying the second resident personal tax rate to the amount of the eligible part of that share; or

(ii) the amount ascertained by deducting from the amount of tax that would be payable by the trustee if the rates referred to in Part II of Schedule 10 were applied to that share of that net income the amount of tax that would be payable by the trustee if those rates were applied to that share of that net income reduced by the amount of the eligible part of that share;
whichever is the greater; or


(d) where the eligible part of that share exceeds $416 but does not exceed the non-resident phase-out limit:


(i) the amount ascertained by applying the second resident personal tax rate to $416, and then adding 66% of the amount by which the eligible part of that share exceeds $416; or

(ii) the amount ascertained by deducting from the amount of tax that would be payable by the trustee if the rates referred to in Part II of Schedule 10 were applied to that share of that net income the amount of tax that would be payable by the trustee if those rates were applied to that share of that net income reduced by the amount of the eligible part of that share;
whichever is the greater.

15(5)   [Div 6AA income where 2 or more trusts]  

Subsection (4) does not apply in relation to the share of a beneficiary of the net income of a trust estate if Division 6AA of Part III of the Assessment Act applies to a part of a share of the beneficiary of the net income of another trust estate or to parts of the shares of the beneficiary of the net incomes of other trust estates.

15(6)   [Reduction of tax where Div 6AA income not exceeding $810]  

Where:


(a) by reason of the application of subsection (5), subsection (4) does not apply in relation to the share of a beneficiary of the net income of a trust estate in respect of which a trustee is liable to be assessed and to pay tax under section 98 of the Assessment Act; and


(b) the sum of:


(i) the part of that share to which Division 6AA of Part III of the Assessment Act applies; and

(ii) the part of the share of the beneficiary of the net income of the other trust estate or the parts of the shares of the beneficiary of the net incomes of the other trust estates, as the case may be, to which that Division applies;
does not exceed the non-resident phase-out limit;

the tax that, apart from this subsection, would be payable by the trustee in respect of the share referred to in paragraph (a) shall be reduced by such amount (if any) as, in the opinion of the Commissioner, is fair and reasonable.

15(7)   [Commissioner's discretion as to share of net income]  

In forming an opinion for the purposes of subsection (6) in relation to the share of a beneficiary of the net income of a trust estate of a year of income, the Commissioner shall have regard to:


(a) any limitation that would be applicable under subsection (4) on the amount of tax that would be payable by a trustee in accordance with Part II of Schedule 12 in respect of a share of the net income of a trust estate of the year of income of an amount equal to the sum of the shares referred to in paragraph (6)(b) if:


(i) Division 6AA of Part III of the Assessment Act applied to so much of that share as is equal to the sum of the parts of the shares referred to in paragraph (6)(b); and

(ii) that share were a share of a non-resident beneficiary who is not presently entitled to a share of the income of the year of income of any other trust estate;


(b) the amount of any reduction previously granted by the Commissioner under subsection (6) in relation to the share of the beneficiary of the net income of the year of income of any other trust estate; and


(c) such other matters (if any) as the Commissioner thinks fit.

15(8)  


The non-resident phase-out limit is the following amount rounded down to the nearest dollar:
Formula 15(8)




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