INCOME TAX ASSESSMENT ACT 1997

CHAPTER 2 - LIABILITY RULES OF GENERAL APPLICATION  

PART 2-42 - PERSONAL SERVICES INCOME  

Division 87 - Personal services businesses  

Subdivision 87-A - General  

SECTION 87-25   The employment test for a personal services business  

87-25(1)  
An individual meets the employment test in an income year if:


(a) the individual engages one or more entities (other than *associates of the individual that are not individuals) to perform work; and


(b) that entity performs, or those entities together perform, at least 20% (by *market value) of the individual's principal work for that year.

87-25(2)  
A *personal services entity meets the employment test in an income year if:


(a) the entity engages one or more other entities to perform work, other than:


(i) individuals whose *personal services income is included in the entity's *ordinary income or *statutory income; or

(ii) *associates of the entity that are not individuals; and


(b) that other entity performs, or those other entities together perform, at least 20% (by *market value) of the entity's principal work for that year.

87-25(2A)  


If the *personal services entity is a partnership, work that a partner performs is taken, for the purposes of subsection (2), to be work that the personal services entity engages another entity to perform.

87-25(3)  
An individual or a *personal services entity also meets the employment test in an income year if, for at least half the income year, the individual or entity has one or more apprentices.


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